March 24, 2003
Faith in global integration as inevitable and beneficial is eroding. The sentiment was never unanimous of course, but the fight over Iraq has estranged the United States from many of its traditional European partners. Fear of terrorism has led to increased doubts about opening borders to free movement of people and goods. Bedrock institutions of multilateralism -- the United Nations, NATO, the European Union -- are in various states of disrepair.
All the more reason, you would think, for the United States, Europe and Japan to press forward with the trade liberalization that has been proven to increase prosperity -- and upon which the developing world so desperately depends. But in that field, too, progress is stalled and doubts are growing. Bilateral trade negotiations have had some success, but there's a danger that disputes over security will creep into the broader, multilateral negotiations, and that the World Trade Organization will become one more multilateral casualty.
True, the origins of the WTO stalemate have little to do with the broader political fracas. A reduction in agricultural subsidies and price supports, perhaps the most important goal of the current trade negotiating round, has long been stopped in its tracks by Europe's inability to reform its own agricultural subsidy regime. As a result, it now looks as if crucial negotiating deadlines, set for the end of this month, will not be met. Without a doubt, the primary victims of Europe's intransigence are the world's poorest countries, whose economies would benefit far more from freer markets for their commodities than they would from new injections of aid money. Indeed, until trade barriers are lifted, any conversation about "helping the developing world" will always have a farcical ring.
Meanwhile, the U.S. position on loosening patent rules on drugs for very poor developing countries is also in need of reexamination. It is unacceptable that millions of victims of AIDS, tuberculosis and other epidemics cannot afford the drugs that could cure them because the American drug industry keeps the prices too high. Talks on this issue collapsed last December, and although U.S. negotiators have agreed not to pursue poor countries that manufacture generic versions of critical drugs, the onus is still on the United States to make sure the drugs are genuinely and easily available where they need to be.
There are other, smaller ways to show more goodwill on trade issues too. Congress could, for example, finally pass rules removing tax exemptions for American exporters, thereby putting the United States in line with WTO rules. But freer trade in agriculture and wider access to generic drugs are of the greatest importance, to the economies of the developing world and to the international perception of the United States. Failure to make progress in these two areas will send the wrong message about this administration's priorities to the millions of people who can still only dream of taking part in the global economy that America helped create, and that American rhetoric continues to promote.
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