World Trade Organization: A World Government?

September 04, 1994|By LYLE DENNISTON

WASHINGTON — Washington. -- Unhappily for President Clinton, American history from the days when he was a child is repeating itself -- almost exactly. A fight waged with real bitterness in the late 1940s and early 1950s is warming up again in Congress, exposing anew the deep fear that grips some Americans anytime they contemplate being ruled by a world government run by foreigners.

This time, the fight focuses on the proposed World Trade Organization (WTO), a would-be super government agency that is supposed to be able to settle global trade disputes more efficiently. It was designed to replace a weaker free-trade mechanism that was to be temporary when set up in 1947 but that has lasted close to a half-century.

As the WTO conflict intensifies on Capitol Hill, it threatens to erase Mr. Clinton's last chance this year for a spectacular victory on his legislative agenda.

He and his aides had hoped that a new global trade treaty -- the opaquely named "Uruguay Round" treaty -- would whisk through Congress this fall, lifting the president's spirits (and his poll numbers) just as last year's enactment of the North American Free Trade Agreement did.

The fate of the whole Uruguay Round of world trade reforms hangs, in significant part, on the Clinton administration's ability to sell the World Trade Organization to an increasingly skeptical Congress.

The name Uruguay Round comes from the South American country where the seven-year negotiations that produced a vast new free-trade pact began. It was signed last December but awaits formal approval by the United States and the other 116 signers before it can take effect next July. An effort to speed up the ratification process seems to be faltering.

Sweeping global reforms in trade dealings to be made by the pact are estimated to add $100 billion to $200 billion a year to U.S. economic output and income, once those reforms take full effect -- projection that has won the Uruguay Round many admirers, especially among business firms and business associations.

But the proposed creation of the WTO -- an idea that emerged late in the negotiations and was spurred by major U.S. trading partners who have grown resentful of what they consider excessive "unilateral" trade decision-making by America -- has come to dominate the debate on the treaty's fate.

WTO, if it comes into being, would be an unusually powerful compact of 117 nations organized on the one-nation, one-vote idea.

Its very form is the nub of the complaint against it: If the United States joins -- and there won't be a WTO otherwise -- it would lack veto power or weighted votes in the global organization. This country has never before been willing to go without those self-protective backstops.

Dispute-settling panels of the WTO apparently could demand the relaxation of U.S. laws or official regulations that were found to impede other nations' trading with the United States. Some WTO critics contend that the treaty would give Congress and state legislatures the unattractive choice of relaxing or repealing U.S. laws or inviting retaliation from other nations.

The proposed creation of a WTO with just that sort of no-veto decision-making power apparently was an essential condition for acceptance of the vast trade-freeing reforms included in the treaty.

Earlier this year, it did not appear that the WTO was going to be a significant problem for the Clinton administration in getting the treaty through Congress, and the prospect of a major political victory for the president this fall loomed.

That outlook, of course, has unsettled some of the president's most ardent adversaries. The conservative Coalitions for America has chastised key Republicans for embracing the new treaty and especially its provision for the WTO. It would be "a stupid mistake," said the Coalitions in July, if GOP leaders assist Mr. Clinton on the treaty "and give him momentum going into November."

The Coalitions added to their complaint what the organization's leaders clearly thought was the clincher: "Grass-roots America is deeply suspicious of this step toward one world government. You will deeply regret any part in making this a reality."

The Senate's most conservative member, Republican Jesse Helms of North Carolina, has railed against WTO: "I confess to unalterable opposition to world government -- always have and always will. . . . I think it would be fair to describe the new World Trade Organization as a United Nations for world trade, combined with a world court."

Other conservative critics have coined the phrase "trade uber alles" to describe what they consider WTO's real goal: Trade promotion will trump any contrary law of any nation or any U.S. state, including laws designed to protect public safety and the environment.

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