The Battle In Seattle
Antiglobalization forces are threatening to turn the WTO's
meeting on free trade into a free-for-all
By MARGOT HORNBLOWER/SEATTLE
November 22, 1999
Web posted at: 1:25 p.m. EST (1825 GMT)
Trade negotiations? Oh, please--wake us when it's over. Tariffs.
Subsidies. Antidumping measures. Multilateral investment
agreements. The eyes glaze over. Even free trade's First
Cheerleader, Bill Clinton, confesses that most people think the
World Trade Organization is "some rich guys' club where people
get in, talk in funny language and make a bunch of rules that
help the people that already have and stick it to the people that
So why is it that tens of thousands of demonstrators from around
the globe will make chilly, rainy Seattle a hot town next
week--the scene of marches, teach-ins, street theater and uncivil
disobedience? This vintage '60s protest fest is prompted,
incongruously, by the first American gathering of the WTO, a
sober, 135-nation group that sets the rules for international
commerce. Thousands of trade ministers, politicians and their
staffs will hunker down by Puget Sound to launch a new multiyear
round of wrangling over how to promote exports--and, as much as
possible, avoid one another's imports.
The Geneva-based WTO is both traffic cop and top court of the
global economy. And as shown by China's bid for admission last
week, the organization seems about to extend its gospel of
no-pain, no-gain capitalism across the planet. The WTO's 36,000
pages of regulations reach into far-flung crannies of human
existence. Can Malaysian fishermen export their shrimp to the
U.S. even if their nets lack escape hatches for endangered
turtles? Yes. Can Massachusetts refuse to buy products from
companies that do business in Myanmar? No. Do American
corporations get an illegal export subsidy by setting up legal
offshore tax shelters? Yes. Can the French block our hormone-fed
beef? No. Rule breakers are punished--in France's case by a hike
in the tariffs on Roquefort cheese, among other goodies.
In the abstract, free trade is feel-good fellowship. Trash the
tariffs and, globally, consumers profit from lower prices.
Political enemies turn into economic friends--who trades together
plays together. In the half-century since the WTO's predecessor,
the General Agreement on Tariffs and Trade, was founded with 23
members, worldwide trade has expanded some 15-fold, to $6.5
trillion. As the world's largest exporter and importer, the U.S.
owes nearly a third of its economic growth in the past decade to
trade. "Cooperation is not a choice," says Mike Moore, the
onetime meatpacker and New Zealand Prime Minister who heads the
WTO. "It is indispensable to survival."
But as global economic integration, led by multinational
companies, gathers momentum, a popular backlash is building.
Protesters aren't against trade, but they want
corporation-friendly rules to include social concerns--the
environment, labor rights, Third World poverty. And they want it
now. More than 775 nongovernment organizations have registered
with the WTO, bringing some 2,100 observers. "The WTO is an
octopus with an arm into every little crevice of democracy," says
Lori Wallach, director of Public Citizen's Global Trade Watch
lobby. "It trumps domestic laws and international treaties and
imposes one-size-fits-all rules."
If the Seattle host committee, chaired by Microsoft CEO Bill
Gates and Boeing CEO Philip Condit, fears that protests can
overshadow the event, trade diplomats are even more concerned
that the negotiations themselves could implode. As of late last
week, the agenda had yet to be set, despite marathon discussions
in Geneva. That will put even more pressure on the delegates in
Seattle, working within shouting distance of protesters. Says
Canadian Trade Minister Pierre Pettigrew: "I'm preoccupied by the
zoo Seattle might be turned into."
There are too many conflicting goals and alliances to count.
Developing countries grouse that they are opening their markets
but with little benefit. They want more time to comply with rules
on financial services and intellectual property, the latter
jealously guarded by U.S. multinationals. Third World ministers
also argue that richer countries have an obligation to import
more, particularly in the wake of the Asian crisis of 1997, which
devastated countries from Thailand to Peru.
The Europeans will be mounting an all-out defense of their
agricultural markets, currently protected by the European Union's
devilishly complicated, reform-resistant $44 billion in farm
supports. And they will fight to maintain their moratorium on the
import of genetically modified crops in the face of U.S. and
Canadian opposition (see page 49). European Union trade
commissioner Pascal Lamy is also standing up for what he calls
"specific traits of European civilization--the insistence on
high-quality foodstuffs, cultural identity in a world without
barriers and a reluctance to see some activities reduced to a
commercial footing." In other words, protection against too many
Disney movies, Pizza Huts and American bankers.
The U.S. agenda has something to annoy everyone. Particularly
irksome to Asians is American insistence on reducing tariffs on
e-commerce, biotechnology and financial services--industries in
which the U.S. clearly leads--and at the same time enforcing
anti-dumping legislation on steel imports. Says Chau Tak-hay,
Hong Kong's Secretary for Trade and Industry: "The U.S. is
single-mindedly pursuing its own narrow agenda while showing
little interest in others' needs."
Lined up against all sides is a guerrilla network of activists
that has been empowered by the very same forces that drive
economic globalization: technology, the Internet and lowered
barriers--hence costs--to international travel. Groups such as
Kenya's Consumers' Information Network, Ecuador's Accion
Ecologica and Trinidad and Tobago's Caribbean Association for
Feminist Research and Action are linked through scores of
websites, list servers and discussion groups to U.S., European
and Asian counterparts. Last week five aids activists chained
themselves to the balcony of U.S. Trade Representative Charlene
Barshefsky's office, protesting WTO patent rules that have made
AIDS medicine expensive for poor countries.
In the U.S., the "Mobilization Against Globalization" is stoked
by labor unions, who have angrily watched jobs migrate to Mexico
and other low-wage countries, spurred by falling tariffs for
foreign-made goods. Bowing partly to such concerns, Congress has
twice refused to give President Clinton expedited
trade-negotiating authority, thus defeating efforts to expand the
North American Free Trade Agreement.
Their argument couched in moral terms, the unions are allied with
U.S. environmental, human-rights and consumer activists in an
effort to make social policy through trade. On Nov. 30, the first
day of WTO deliberations, the AFL-CIO plans a rally in Seattle
led by 900 Boeing machinists, whose employer is one of the
world's top exporters. Union delegations representing everyone
from teachers to teamsters are flocking in from 25 states and 143
nations. Dockworkers plan to shut down the port. Even the
Wobblies are roused. The Puget Sound chapter of Industrial
Workers of the World is orchestrating a student walkout. "In the
early '80s, we gave up wages and benefits to be more globally
competitive," says David Reid, 42, who nonetheless lost his job
as a crane driver at Kaiser Aluminum. He has taken a course in
civil disobedience to prepare for the protest. "It clicked," he
says. "I am not a victim if I can organize."
The antiglobalist message resonates across a broad swath of
ideology, from the isolationist Buchananite right to a
kaleidoscope of left-wing groups. "The WTO has brought about a
harmonic convergence," said John Sellers, director of the Ruckus
Society, as he trained a group of Berkeley students for civil
disobedience last month. Forest activists, who have polished
their skills blocking the logging of redwoods, will target U.S.
efforts to slash worldwide tariffs on paper and pulp products.
At the very least, it could be good theater. Earlier this month,
U.S. Labor Secretary Alexis Herman, in Seattle to drum up support
for free trade, was picketed by steelworkers, antinuclear
activists, Free Burma advocates--and Anne Kirkham, 26, of the
Bicycle Alliance of Washington. "I'm a bicycle activist, but it's
all one big thing--globalism, urban sprawl, pollution," she
explained. "It's about corporate greed."
Police have little to fear from the 240 Humane Society activists,
dressed in turtle costumes, set to protest the WTO's
shrimp-export decision. Nor are they worried about the human
chain of hand-holding clergy and parishioners who will surround
the delegates' reception Monday to plead for Third World debt
relief. But scores of "radical jeerleaders" are practicing their
choreographed cheers in church basements: "Smash the state/ Let's
liberate!" Four Molotov cocktails were lobbed into an empty Gap
store in downtown Seattle this month, Gap being a focus of
antisweatshop protests. No wonder the city has budgeted $6
million for police overtime and is stockpiling tear gas. "If
there are rowdy guests, we plan to treat them that way," says
Seattle Mayor Paul Schell.
While the protesters take to the streets, corporate lobbyists
will be taking to the halls. The Idaho Barley Commission has
registered, as have the German Bar Association and the Automotive
Component Manufacturers Association of India. Many are baffled by
the uproar. "As somebody who protested against Vietnam, I'm not
sure what everyone is so cranked up about," says Procter & Gamble
lobbyist Scott Miller, chairman of the U.S. Alliance for Trade
Expansion. "We've had eight years of amazing prosperity." U.S.
business is more concerned about opening up what some call the
European trade cartel than it is about the Administration's
overtures to citizen groups. "Environment and labor standards
won't be tied to trade even if the U.S. stands on its head and
spits wooden nickels," says Thomas Donohue, president of the U.S.
Chamber of Commerce. "The Chamber won't let it happen, and the
rest of the world won't let it happen."
He's right. Although the U.S. wields a big stick, the WTO
operates by consensus. The largest bloc, made up of 77 developing
countries, stands virtually united against efforts by wealthier
countries to influence environmental and labor laws in developing
countries. As for human rights: "There's an Asian consensus that
human rights should not be linked to trade," says economist M.G.
Quibria of the Asian Development Bank in Manila. In the view of
developing countries, trade-pact clauses involving labor and the
environment amount to backdoor protectionism.
That makes it awkward for many U.S. protesters, who say they are
out to help the Third World, not just clean up the planet, end
child labor and promote human rights. Venezuela and Brazil
successfully challenged as discriminatory a U.S. law that set
stringent environmental regulations for refineries that make
gasoline for export. Four Asian countries--Malaysia, India,
Pakistan and Thailand--were the challengers to the U.S. effort to
ban shrimp caught in nets without turtle escape hatches. "If you
want to put turtles ahead of Indian poverty, go ahead!" said
Columbia University economist Jagdish Bhagwati in a debate. "But
why not go out and buy these $15 nets at Wal-Mart and give them
to the fishermen?"
For years, the cold war afforded political cover for free trade.
Who could oppose economic freedom as it cleared a pathway for
democracy? But as the threat of communism receded, the public
began to focus on market globalization as the root of many evils.
Is big better? Is small still beautiful? The underlying principle
of the global economy is that each country should manufacture and
freely export the goods it can make at a comparative
advantage--read cheaply--over other countries. If this means paying
slave wages and leveling the rainforest, so be it.
Despite the economic upturn, this ethic of survival of the
fittest has spawned widespread anxiety in rich countries and poor
countries alike. In Washington State 3 out of 4 jobs may be
linked to exports--in theory creating a pro-trade constituency--but
from software coders to apple pickers, there is a sense that
their jobs could migrate tomorrow. "Many people see only
layoffs," laments Commerce Secretary William Daley, who has been
dogged by protesters. "They don't see the payoffs of this
Many, like Daley, would argue that peace and prosperity can
flourish only if trade barriers are torn down. U.N.
Secretary-General Kofi Annan acknowledged in a speech that "the
trading system is one of the great success stories of the past
half-century." At the same time, he added, with a quarter of the
globe's population mired in poverty, multinational companies risk
a wave of protectionism unless they commit to "global corporate
citizenship" in the form of concessions to labor, human rights
and environmental health.
Such is the challenge of the WTO, the newest and arguably most
powerful global institution on the block. If the protests in
Seattle do not degenerate into anarchic violence, and if the
negotiators can somehow put aside their cantankerous
brinkmanship, a new dialogue is likely to be opened on--naive as
it may sound--how to make the world a better place. --With
reporting by Hannah Beech/Hong Kong, Steven Frank/Toronto and
James L. Graff/Brussels
THE ROLE OF THE WTO
Membership: 135 countries
History: Successor to the General Agreement on Tariffs and Trade
formed in 1947. Once limited to goods, the WTO's purview has been
extended to include intellectual property and trade in services.
The organization's task is to administer and enforce the trade
agreements made by member nations, ensuring freer flow of goods
and services. Its rulings are law among members.
TALKING TRADE: NEGOTIATING A WORLD FULL OF CONFLICTS
THE PLAYERS: Europe and Japan vs. the U.S. and the Third World
THE ISSUE: European and Japanese farmers are swaddled in
subsidies. The U.S. and the Third World want access to those
markets. Europe and Japan say the U.S. also aids farmers; they
oppose the U.S.'s genetically modified food.
THE LIKELY OUTCOME: Look for subsidies to subside but
healthy-food fears to grow.
THE PLAYERS: The U.S. and the European Union vs. the Third World
THE ISSUE: Low-cost Third World labor, which threatens jobs here.
The U.S. proposes a WTO study group on labor issues. Some
European Union countries are supportive. Developing nations don't
want outside interference in their labor markets.
THE LIKELY OUTCOME: Don't expect much progress here.
THE PLAYERS: The U.S. and E.U. vs. the Third World
THE ISSUE: The U.S. and E.U. want to enforce environmental
pacts--such as a treaty restricting endangered-species
trade--without WTO challenge. But the U.S. seeks to slash wood
tariffs, thus increasing deforestation. Third World opposes
THE LIKELY OUTCOME: Progress may come on less controversial
issues, such as fishing subsidies.
THE PLAYERS: The U.S. vs. everyone else
THE ISSUE: The U.S. wants to slash barriers to several key
industries, including health care, banking, education, insurance
and e-commerce. But a huge battle looms.
THE LIKELY OUTCOME: WTO members have already agreed to negotiate
over services. The U.S. will drive hard to get some concessions
from the global trade community.
THE PLAYERS: U.S. vs. Japan and the Third World
THE ISSUE: U.S. laws block countries from "dumping" subsidized
products--steel, semiconductors, textiles--on the American market.
Third World nations say the laws are protectionist and U.S.
should import more.
THE LIKELY OUTCOME: With an election year coming and so many jobs
at stake, the U.S. will not give ground.
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Cover Date: November 29, 1999