Globalization/Anti-globalization: what are the arguments?

Okay, if you really want to understand the intelligent critiques of globalization as currently practiced, go to http://www.prospect.org/issue_pages/globalization/

Read Kuttner’s introduction for about the most concise summary one can get of the basic issue. Then, read Amartya Sen and Joseph Stiglitz, both Nobel prize winners in economics, to understand some of the issues in more detail.

To quote from Kuttner’s piece:

The WTO was created during the Uruguayan round of GATT (global agreement on trade and tariffs)

In “Democracy for the Few” by Michael Parenti a common Sociology textbook Parenti says, "The WTO has the autority to prevent, overrule, or dilute any laws of any nation deemed to burden the investment and market prerogatives of transnational corporations. It sets up three-member panels composed of ‘trade specialists’ who act as judges over economic issues, placing themselves above the national sovereignty and popular control of any nation, thereby insuring the supremacy of international finance capital, a process called ‘globalization’, and treated as an inevitable natural development beneficial to all. "

The chapter continues on…“Elected by non one and drawn from the corporate world, these panelists meet in secret and can have investment stakes in the very issues they adjudicate, being limited by no conflict-of-interest provisions. Their function is to allow the transnational companies to do whatever they like without any restraints or regulations place on them by any country. Not one of GATT’s five hundred pages of rules and restrictions are directed against private business; all are against governments. Signatory governments must lower tariffs, end farm subsidies, treat foreign compaines as domestic ones, honor all corporate patent claims, and obey the rulings of a permanent elite beauracracy, the WTO. … The WTO overturned a portion of the U.S. Clean Air Act banning certain additives to gasoline because it interfereed with imports from foreign refineries.” (pg 172)

SORRY for the really long quote but everyone has been arguing from a wholly capitalist perspective and i thought another viewpoint should be aired. The reason so many people have protested is not that they are dirty hippies or stereotype people wnat to give to activists. They are protesting because no one seems to care that our country and 119 others have signed an agreement that allows multinational corporations to protest against the laws of sovereign nations if they interfere with their ability to make even higher profits. The example of the U.S. Clean air act is only one of many other examples dealing with developed industrial nations having laws for the good of their country being changed because of the WTO. I did not even get into the parts about how damaging the WTO and even more so the IMF are for poor third world countries. Globalization is as was said earlier by Martin E that globalization is the peacful alternative to imperialization. This is true, but doesnt’ taht really mean that what we’re callling globalization is just a spin on imperialism? isnt’ it a more complicated way for the rich countries and more importantly the rich corporations to gain higher profits. Much of the debate has centered on economics, but you cannot ignore the impact on people.

Which, of course, is false. The WTO does not have the power to “overrule” any nation’s laws. Evidently Mr. Parenti is either dishonest or stupid.

The WTO is the referee of a TREATY. Countries enter into it voluntarily and they can leave it voluntarily. It is no different from the UN, NATO, NAFTA, the EU, or any other international treaty. The WTO has no “authority” to “overrule” a nation’s law for any reason. That’s baloney.

Well, any three idiots can “place themselves” above “National sovereignty.” It isn’t going to change anyone’s laws.

What kind of “textbook” is this?

Well, of course…

IT’S
A
TREATY
BETWEEN
GOVERNMENTS!!!

GATT and the WTO are a treaty between sovereign nations’ governments. An international treaty is SUPPOSED to moderate the behaviour of governments! That’s what it’s for. The entire point behind an international treaty is that Country A and Country B agree they will do X and Y, but not Z.

Treaties are contracts between governments. A contract dictates what the signing parties will do. The reason the WTO has no rules about private companies is that private companies don’t have any standing in the WTO. Companies don’t raise and lower tariffs - governments do.

There’s no mention of private companies in the UN charter. There’s no mention of private companies in the Geneva Conventions. No mention of them in the Universal Declaration of Human Rights. None in the International Law of the Sea. Why would there be?

Name one Western nation without farm subsidies.

Gosh, really? So if I set up a corporation and patent the automobile they have to honor that?

Simplicity is not your friend.

One that is rife with factual inaccuracies.

Look, the WTO is a treaty. Nothing more. The WTO has NO soveriegn power. It does not have the power to overturn national laws, never has, and never will. The USA or any other nation could leave the WTO tomorrow if they got pissed off at it. The WTO did not “overturn” any part of the Clean Air Act.

** cut to scene of tearfull Sally Struthers**

“for the love of God, IMF, PLEASE quit qiving these poor third world countries MONEY…”

Alas, I don’t have the time to take full participation in this debate (I do recommend that newcomers to the Boards look up some of the archived debates on this subject–I can remember at least 4 of them in my time).

Rick, there are lots of other posts I could and would take issue with had I the time. But yours is the most proximate. I don’t know the Parenti book so I’m not going to discuss it on the basis of one quotation. (I would, though, like to point out that zeva’s characterization of the “wholly capitalist perspective” is misleading since the debates over what would constitute a fair, democratic and humane form of globablization, are not taking place between those who are pro-capitalist and those who are anti-capitalist. Most participants in the debate recognize the legitimacy of capitalism in some form, and the debate is to do with the role of citizens and local governments in reining in corporate power, and to do with how much the power of multinational corporations has been backed up by the force of Western governments such as that of the US, without the informed consent of Western citizens).

It would be best if those who wish to defend the globalization status quo would debate directly with the articles posted by jshore, which were written by economists with deep knowledge of the issues at hand: they are not “rife with factual inaccuracies.”

On the matter of institutions vs. treaties:

First, the IMF, I would like to point out is not, like GATT, a treaty. It and the World Bank, rather than the WTO itself, are the real institutional players. Here is Joseph Stiglitz, Nobel prize winning economist and former chief economist of the World Bank writing in his latest book, Globalization and its Discontents:

“The IMF is a PUBLIC institution, established [after WWII] with money provided by taxpayers around the world. This is important to remember b/c it does not report directly to either the citizens who finance it or those whose lives it affects. Rather, it reports to the ministries of finance and the central banks of the governments of the world” (12). He goes on to explain that it’s principally the US that has effective veto power. (Hence, Rick, your assertion that the USA could leave the WTO tomorrow if it got pissed off at it is rather besides the point; the USA effectively controls the WTO and therefore has no incentive to leave it.)

“Over the years since its inception,” the IMF has changed from the belief that “markets often worked badly,” to its current view in which it “champions market supremacy with ideological fervor.” The IMF was founded on a philosophy of Keynsian expansionism and now insists on contractionist policies and unprotected markets (the punitive effects of which Western governments would never submit to imposing on themselves).

“*t is clear that the IMF has failed in its mission. …[M]any of the policies that the IMF pushed, in particular, premature capital market liberalization, have contributed to global instability.” IMF policies have not only failed to stabilize crises that have ensued, but in many cases have made things worse, esp. for the poor. (15)

The WTO is not a treaty, Rick, it is, as its name implies, an international organization. Though you are right in saying that unlike either the IMF or the World Bank, the WTO doesn’t set rules itself, “rather, it provides a forum in which trade negotiations go on and it ensures that its agreement are lived up to” (16).

Now if you think that an organization that operates to ensure that agreements negotiated between powerful and weak countries doesn’t exert a coercive effect of some kind then you have a very narrow view of what coercion is.

To read your post one would think that “treaties” are completely neutral in their effects simply because more than one party has signed them. Was the Treaty of Versailles a neutral document in which Germany, after its crushing WWI defeat, willingly conceded to conditions that would make it a second-rate power? Unless you’re willing to reply “Yes” to that question you should drop the rather disingenuous posture that the systematic negotiation and enforcement of treaties is “nothing” at all, and not a concern for citizens, whether in the West or in the developing world.

I cannot possibly summarize the whole of 250 page book in a single Straight Dope post. What I can say is that anyone on either side of the debate who hasn’t familiarized himself/herself with Stiglitz’s arguments (and its ilk) is simply shooting from the hip.

I’d also like to add that Paul Krugman, hitherto a strong defender of the globalization status quo (at least as it was approached under Clinton’s reign) has begun to rethink his position. Why? Because there are powerful empirical as well as as philosophical arguments out there and some of the world’s most informed minds are making them.

This isn’t a sandbox argument, it is truly a Great Debate, possibly the greatest debate of our era. I wish I had a dollar for every Straight Dope post I’ve read that dismissed the debate because Poster X spoke to Protestor Y and found that Y was stupid s/he didn’t know anything about the economy, etc. How pleasant it must be to take on strawmen rather than Nobel prize winners! Please, everyone, let’s do better than that. In this debate insulting one’s opponent simply won’t cut it. Forget Protester Y, not-terribly-smart-Poster D, or anecdote X. Read Stiglitz et.al. and if you still feel you’ve got an authoritative critique, let’s hear it. I’m all ears.

Alas, I don’t have the time to take full participation in this debate (I do recommend that newcomers to the Boards look up some of the archived debates on this subject–I can remember at least 4 of them in my time).

Rick, there are lots of other posts I could and would take issue with had I the time. But yours is the most proximate. I don’t know the Parenti book so I’m not going to discuss it on the basis of one quotation. (I would, though, like to point out that zeva’s characterization of the “wholly capitalist perspective” is misleading since the debates over what would constitute a fair, democratic and humane form of globablization, are not taking place between those who are pro-capitalist and those who are anti-capitalist. Most participants in the debate recognize the legitimacy of capitalism in some form, and the debate is to do with the role of citizens and local governments in reining in corporate power, and to do with how much the power of multinational corporations has been backed up by the force of Western governments such as that of the US, without the informed consent of Western citizens).

It would be best if those who wish to defend the globalization status quo would debate directly with the articles posted by jshore, which were written by economists with deep knowledge of the issues at hand: they are not “rife with factual inaccuracies.”

On the matter of institutions vs. treaties:

First, the IMF, I would like to point out is not, like GATT, a treaty. It and the World Bank, rather than the WTO itself, are the real institutional players. Here is Joseph Stiglitz, Nobel prize winning economist and former chief economist of the World Bank writing in his latest book, Globalization and its Discontents:

“The IMF is a PUBLIC institution, established [after WWII] with money provided by taxpayers around the world. This is important to remember b/c it does not report directly to either the citizens who finance it or those whose lives it affects. Rather, it reports to the ministries of finance and the central banks of the governments of the world” (12). He goes on to explain that it’s principally the US that has effective veto power. (Hence, Rick, your assertion that the USA could leave the WTO tomorrow if it got pissed off at it is rather besides the point; the USA effectively controls the WTO and therefore has no incentive to leave it.)

“Over the years since its inception,” the IMF has changed from the belief that “markets often worked badly,” to its current view in which it “champions market supremacy with ideological fervor.” The IMF was founded on a philosophy of Keynsian expansionism and now insists on contractionist policies and unprotected markets (the punitive effects of which Western governments would never submit to imposing on themselves).

“*t is clear that the IMF has failed in its mission. …[M]any of the policies that the IMF pushed, in particular, premature capital market liberalization, have contributed to global instability.” IMF policies have not only failed to stabilize crises that have ensued, but in many cases have made things worse, esp. for the poor. (15)

The WTO is not a treaty, Rick, it is, as its name implies, an international organization. Though you are right in saying that unlike either the IMF or the World Bank, the WTO doesn’t set rules itself, “rather, it provides a forum in which trade negotiations go on and it ensures that its agreement are lived up to” (16).

Now if you think that an organization that operates to ensure that agreements negotiated between powerful and weak countries doesn’t exert a coercive effect of some kind then you have a very narrow view of what coercion is.

To read your post one would think that “treaties” are completely neutral in their effects simply because more than one party has signed them. Was the Treaty of Versailles a neutral document in which Germany, after its crushing WWI defeat, willingly conceded to conditions that would make it a second-rate power? Unless you’re willing to reply “Yes” to that question you should drop the rather disingenuous posture that the systematic negotiation and enforcement of treaties is “nothing” at all, and not a concern for citizens, whether in the West or in the developing world.

I cannot possibly summarize the whole of 250 page book in a single Straight Dope post. What I can say is that anyone on either side of the debate who hasn’t familiarized himself/herself with Stiglitz’s arguments (and its ilk) is simply shooting from the hip.

I’d also like to add that Paul Krugman, hitherto a strong defender of the globalization status quo (at least as it was approached under Clinton’s reign) has begun to rethink his position. Why? Because there are powerful empirical as well as as philosophical arguments out there and some of the world’s most informed minds are making them.

This isn’t a sandbox argument, it is truly a Great Debate, possibly the greatest debate of our era. I wish I had a dollar for every Straight Dope post I’ve read that dismissed the debate because Poster X spoke to Protestor Y and found that Y was stupid s/he didn’t know anything about the economy, etc. How pleasant it must be to take on strawmen rather than Nobel prize winners! Please, everyone, let’s do better than that. In this debate insulting one’s opponent simply won’t cut it. Forget Protester Y, not-terribly-smart-Poster D, or anecdote X. Read Stiglitz et.al. and if you still feel you’ve got an authoritative critique, let’s hear it. I’m all ears.

zeva4,
Do you have any idea how the WTO enforces its edicts? Do you know what awesome stick it wields that makes all governments bow before it?

Oh, and by the way, one guess who it is that can initiate a WTO complaint. (Hint: It isn’t corporations.)

“Democracy for the Few” is a tired, Marxist rant against the evils of capitalism. No doubt what passes for a well-informed anti-globalism protester has read at least parts of it. Too bad they don’t read Amartya Sen instead.

The IMF and the WTO are two different things. They are set up differently. They have two different functions. Just because the US has effective control over the IMF doesn’t mean the same thing applies to the WTO. In fact, it does not. The US has the most control over the IMF because votes are rationed out proportionally to the amount of money you contribute compared to everyone else. This does not occur in the WTO. The US does NOT effectively control the WTO, and it has no incentive to leave the WTO because the US has generally more liberal trading laws than other members, and so tends to be a net beneficiary.

And if that publicly financed/undemocratic crap about the IMF is supposed to be some sort of shot against it, well, that’s just ridiculous. The UN is a PUBLICLY financed operation. My tax money finances it (well, it would if the US would pay its dues). Yet, last time I checked, the UN does not report directly to me. Same with the CEC. Or NATO. Or any other number of IGOs. And the same with the IMF. Get over it.

Despite your factual lapses, Mandelstam, you are correct that the policies the IMF have tried to institute as a condition of their loans have not usually led to greater development. That’s why the IMF is changing the conditions now. One thing is clear, however, is that if the country needs IMF loans to shore up its currency/economy, then it obviously wasn’t doing something right and some sort of change is needed, probably forcibly as a condition of the loan.

Mandelstam
There certainly is a debate to be had about how to best manage the world economy. However, I’d take a bet that 999 out of 1000 anti-globalization protesters think that Stiglitz is a kind of chewing gum.

As strident as he is in his recent book, Globalization and its Discontents, Stiglitz is hardly in favor of shutting down the world economy.

Just because it’s hilarious, here’s a link to a riposte from the IMF. A sample quote,

**

http://www.imf.org/external/np/vc/2002/070202.htm

Neurotik, with all due respect I don’t believe there are any factual lapses in my post as my point was precisely to distinguish between the IMF and the WTO.

Hence, I wrote:

" The WTO is not a treaty…[but] an international organization. …nlike either the IMF or the World Bank, the WTO doesn’t set rules itself, “rather, it provides a forum in which trade negotiations go on and it ensures that its agreement are lived up to” (16)."

You are right though that I made a logical leap between quoting Stiglitz on the matter of US effective control of the IMF, and imputing the same kind of US effective control over the WTO. I should have made clear that elsewhere in Stiglitz’s book there is evidence for effective US control over the latter. It may well be possible to argue that due to the different structure that effective US control over the WTO is not as strong as over the IMF. It would be perhaps be more accurate to say that the US in conjunction with Europe exerts effective control over the WTO. That said, my parenthetical point was that it’s besides the point to argue that the US could, if it were “pissed off” by the WTO, leave it. No one is suggesting otherwise. That’s what I really meant to say.

I’m not sure what the purport of your last statement is, Neurotik. Yeah, obviously impoverished countries need change of some kind, as well as loans. But that doesn’t mean that they need the unhelpful and unfair terms dictated to them by the IMF in recent years. I agree that the IMF is beginning to change: world opinion is beginning to change. (Krugman’s change in opinion is just one example). But that suggests to me that that people who’ve been criticizing what was the status quo are beginning to prevail: the Sens and the Stiglitzes and, in their own way, the protesters, are having an effect. All the more reason to take the debate seriously and to understand its nuances (and I’m not suggesting you haven’t). And, yes, understanding its nuances also means recognizing when changes for the better begin to be made. Stiglitz certainly acknowledges changes for the better, and also maps out some suggestions at the end of his book.

**
Which would be great, but that wasn’t the subject of my post. I’m unclear as to what it is you object to that I wrote. Incidentally, jshore’s links do in part answer the OP. Not much else to say there.

Are you talking about the WTO, the IMF, or both? I can’t reply until you clarify which you’re discussing. You seem confused between the two. If you think the U.S. has control over the WTO you’re rather sadly mistaken, but for now we’ll run with that idea because it sets up a fascinating contradiction, as we’ll see in a moment.

And so the IMF is set up with taxpayer money. So what? Aren’t all international organizations set up with tax dollars?

Yes, I know the WTO is an organization. It has employees, offices, and sends out letters on WTO letterhead. It has a Web site and a trademarked logo. So too with the UN, NATO (North Atlantic Treaty Organization), UNICEF, etc. However, these organizations exist, and are granted power by, treaties between nations. The WTO is nothing on its own; it wields influence by virtue of the trade treaty it exists to enforce.

You and I could set up the Global Trade Organization tomorrow and issue edicts all day. You be President, I’ll be the veep. It would accomplish nothing, because like the WTO, we don’t carry sovereign power. But if 120 countries suddenly signed a treaty laying out groundrules for trade and handing refereeing duties to you and I, the GTO would suddenly become an influential organization. It’s the treaty, Mandlestam, it ain’t the cubicles.

The point I was addressing is simple; the WTO does not have the power to “overrule” sovereign nations’ laws. If a member of the WTO doesn’t like its rulings, they can ignore them, or leave the WTO, or try to get the rules changed or whatever it pleases. There would be consequences, to be sure; you’d get tariffed all to hell, if you don’t mind me using “tariff” as a verb. That’s the nature of international relations; you agree to cooperate or you don’t and take what comes either way. The existence of the WTO doesn’t change that.

Many nations are not members of the WTO, so it does seem that membership is voluntary.

Gosh, thanks, M, but I did know that powerful and weak countries tend to sign unequal treaties. Go back and read what I was replying to, please. I was arguing the WTO did not and could not overrule a sovereign law of The United States of America, which is not a weak country - in fact, you have asserted that the USA “effectively controls” the WTO. Would you mind explaining, then, how I’m wrong in stating the WTO cannot “overrule” U.S. law? Or are you retreating on your claim the USA controls the WTO?

(Nor is this a new claim, by the way. I have seen and heard many people claim the WTO is a supra-sovereign power.)

It unquestionably is, but please do not insult my intelligence by presenting me with a silly false dilemma between “WTO is super-powerful” and “WTO is a neutral treaty (or enforcer of a treaty)” and expecting me to choose one or the other.

Furthermore, would you mind not just making stuff up off the top of your head and claiming I wrote it? I did not write “the systematic negotiation and enforcement of treaties is nothing at all” nor did I claim it was “not a concern for citizens” anywhere in the world. Where the heck did that come from?

We have here a claim (not yours, the earlier one) that the WTO can overrule domestic law. That’s ridiculous. You can argue, with a fair amount of logic, that the WTO is very powerful, especially over small nations. You cannot say the WTO exerts lawmaking power over a nation’s own laws. It is an absolute, inarguable falsehood.

Furthermore, it was claimed the WTO can and has overruled AMERICAN domestic law - which would seem to directly contradict your claim that the U.S. is disproportionately powerful in this regard. Thanks for backing me up.

The signing and enforcement of treaties should certainly be a matter of public debate, but public debate in not well served by alarmist baloney like “the WTO can overrule US law.”

Actually, I’ve read Stiglitz. He makes some really interesting points, and some really dumb ones, like anyone else.

The fact remains that “the WTO can overrule US law” is not a valid criticism, it’s a lie. “NAFTA stopped Canada from bringing in plain cigarette packages” is not a valid criticism, it’s a lie. “Al Gore is a stupid robot and he smokes crack” is not a valid criticism, it’s a lie, whether or not you’ve read Rush Limbaugh’s books. If I observe, and point out, that something is a lie, I am not simultaneously obligated to debate points that have not even been raised because you want to swoop in and attribute bizarre strawman arguments to me. How is saying “the WTO does not overrule U.S. law” equivalent to “the WTO is of no concern to the citizenry”?

If you want to debate the issue, raise some debateable points. There’s a lot to discuss in how the world’s poor and weak nations are treated. But don’t tell us to “go read this book and this article from The Nation and get back to me with a thesis.” That’s patronizing, and it’s BS argumentation, and it’s the third or fourth time you’ve tried it on this subject; “I think you are wrong. Now go read Smith/Wesson/Brown and get back to me with a rebuttal against them.” Go read them yourself, professor, and get back to us. If Stiglitz wants me to argue with him he can post here. Or choose something in Stiglitz and raise it as a debate.

I was attacking several false statements. They’re false. There’s nothing else to say on that vein. If you want a difference debate, start it.

First, I see no authority to affirm all of Earth’s governments unalienable right to receive a loan without detrimental stipulation set by the lender. Second, as “the people” fund it, “the people” of a nation can decide the IMF is acting contrary to the goals and or interests of that people and withdraw.

Besides, not only is there no right to a loan, nobody forces a government to take money from the IMF.

A percentage of the world’s population are dissatisfied with the way the IMF is administered, and of late the IMF has been changing somewhat.

Sounds like a system that’s not perfect, but accountable and getting better. I like it.

Of coarse, since I haven’t won a Nobel Prize in economics, I must be (by definition) wrong.

** RickJay**:
“Are you talking about the WTO, the IMF, or both? I can’t reply until you clarify which you’re discussing. You seem confused between the two.”

:confused:

I just went back and read my last two posts and I think the distinction is crystal clear. Let me give you a hint as you re-read them. When I say W-T-O I am talking about the WTO and only the WTO. When I say I-M-F, I am talking about the IMF and only the IMF.

:wink:

“If you think the U.S. has control over the WTO you’re rather sadly mistaken…”

I do think so. Or, to be more precise, as I said in my second post: I think that the US and Europe together effectively dominate the WTO.

“And so the IMF is set up with taxpayer money. So what? Aren’t all international organizations set up with tax dollars?”

No. Some are set up by private money: either corporate or individual. The UN is an example of an international organization set up with taxpayer money. That’s why I like the fact that its deliberations are open to the public and a free press.

“The WTO is nothing on its own; it wields influence by virtue of the trade treaty it exists to enforce.”

Precisely. That’s almost exactly what I said after the letters W-T-0 in my first post.

Now here’s Stiglitz on the subject (and again I want to emphasize that Stiglitz writes much less about the WTO than he does about the IMF and World Bank–the main objects of his critique).

“At the WTO, the negotations that lead up to agreements are all done behind closed doors, making it difficult–until it is too late–to see the influence of corporate and other special interests. The deliberations of the WTO panels that rule on whether there has been a violaton of the WTO agreements occur in secret. …By bringing the deliberations more out into the open, public scrutiny would either make the panels more sensitive to public conerns [such as the envirionment] or force a reform in the adjudication process.” (227-8).

“…It’s the treaty, Mandlestam, it ain’t the cubicles.”

I don’t disagree. Nor did I disagree with your attempt to straighten out what looked to be misleading in the excerpt posted by zeva. The author should have made clear how the WTO functions. (Perhaps the author does elsewhere in the book; I don’t know and I don’t really care since I prefer Stiglitz).

"If a member of the WTO doesn’t like its rulings, they can ignore them, or leave the WTO, or try to get the rules changed or whatever it pleases. There would be consequences, to be sure; you’d get tariffed all to hell, if you don’t mind me using “tariff” as a verb. That’s the nature of international relations; you agree to cooperate or you don’t and take what comes either way. The existence of the WTO doesn’t change that. "

But this assumes that countries struggling to develop can manage without taking part in international trade and getting a seat at the table; attempting a kind of autarky perhaps. They can’t. In theory participation is voluntary. In practice it isn’t.

Globalization is here to stay: we are all “one world” as the saying goes. Those of us who are criticizing the status quo want to see more accountable deliberative and enforcement bodies. They want to enable concerned citizens to take part in the process leading up to treaty-signing. That’s what democracy should mean. To say that those who don’t like the unaccountable institutions that thus far have developed–institutions that are all about serving corporate interests–can opt out of globalization is a Hobson’s choice.

“Gosh, thanks, M, but I did know that powerful and weak countries tend to sign unequal treaties.”

I don’t doubt it. And that really is the point. In a situation where there are vast inequalities of power, there needs to be full public accountability. Simple, no?

“Would you mind explaining, then, how I’m wrong in stating the WTO cannot “overrule” U.S. law? Or are you retreating on your claim the USA controls the WTO?”

I never said that you were wrong about not overruling US law. That said, I repeat that I believe (based on Stiglitz and other sources) that the US and Europe excercise effective control over what goes in and through the WTO. What I mean by “effective” is something like the difference between de juro and defacto. Hope that helps.

“I have seen and heard many people claim the WTO is a supra-sovereign power.”

It is my understanding, as you well know, that NAFTA can, via Chapter 11, hold secretive tribunals that end up penalizing countries for trade violations the tune of millions of dollars for doing what is legal within their own borders. That said, I would not define that as “supra-sovereign power,” a term that really makes no sense. (I would not even call the EC a “supra-sovereign” power.)

The main protesters’ claim, as I understand it, is at the level of the citizen. Trade delegations are sent by poorer countries, sometimes under-qualified to even understand the terms of these agreements. They negotiate in secret and with vast inequalities of power. Citizens bear the brunt of whatever decisions are made. Western citizens must also bear the brunt: in terms of their environmental and humanitarian concerns. That’s not a good system in my view.

In a democracy the citizenry is supposed to be sovereign. Insofar as trade agreements and their enforcement aren’t accountable to the public, citizens’ sovereignty is reduced. That strikes me as a valid if lofty argument. (Personally, I wouldn’t make the argument since I think there are a lot of ways in which citizens are disempowered here in the US that have nothing to do with the WTO.)

"I did not write “the systematic negotiation and enforcement of treaties is nothing at all” nor did I claim it was “not a concern for citizens” anywhere in the world. Where the heck did that come from? "

I know you didn’t write it. I wrote it. It seemed to me and still seems to me, for the most part, that because membership is in the WTO is voluntary it doesn’t, as you see it, pose a problem for citizens. I’m glad to hear I was (and am) mistaken but I’d like to hear more about what you think the concern for citizens should be.

“The signing and enforcement of treaties should certainly be a matter of public debate, but public debate in not well served by alarmist baloney like “the WTO can overrule US law.””

I agree. I never thought otherwise, actually. So let’s see some debate.

"Actually, I’ve read Stiglitz. He makes some really interesting points, and some really dumb ones, like anyone else. "

Ah–here’s the debate! Or should have been… So what are the really dumb points that Stiglitz makes “like anyone else”?

“The fact remains that “the WTO can overrule US law” is not a valid criticism, it’s a lie.”

Yeah Rick. Gotcha the first four times. Sorry if I got your back up. Thing is, I don’t care about arguing with you about why you said I said she said they said. We’ve both got better things to do.

What are these “really dumb points” made by Joseph Stiglitz? I’ve got the book next to me and I’d like to hear all about it. That’s what I meant when I first chimed in. It’s what I think the OP wants to know too.

“But don’t tell us to “go read this book and this article from The Nation and get back to me with a thesis.” That’s patronizing, and it’s BS argumentation, and it’s the third or fourth time you’ve tried it on this subject; “I think you are wrong. Now go read Smith/Wesson/Brown and get back to me with a rebuttal against them.” Go read them yourself, professor, and get back to us. If Stiglitz wants me to argue with him he can post here. Or choose something in Stiglitz and raise it as a debate.”

I thought the whole point of the Straight Dope was that we posted links. I fail to see how that’s patronizing. It’s how one makes a debate more than an exercise in rhetorical skills and off-the-cuff knowledge. Naturally, people don’t always have the time; I often don’t have the time. But it’s funny how often people are willing to write a long post slamming some manifestly incompetent poster, rather than cut to the quick and really debate. (I’m sure I’ve done it too, so don’t take this personally).

I asked that people at least look at jshore’s links if they were interested in earnest debate. I took the time to directly quote form Stiglitz’s book. I have read the book in question (and most of jshore’s links on a previous occasion). Is there something you’ve posted that you’d like me to respond to that I haven’t read?

(I should add that I may have to duck out of this debate something fast; but I’ll try very hard not to leave you hanging as, despite it all, it’s always a pleasure Rick, and you know I don’t think you’re a guy with something to say.)

This is being transferred from the Pit thread at my own initiative in the hopes of short-cicuiting the empty blather about public and misreadings of Sen and other economists.

I posted, in response to this from Gobear

To which Gobear responded:

Now, let me expand, but only briefly.

As I see it, from what I consider an insider’s view, a major flaw in what has become know as the Washington Consensus is a somewhat naïve proposition that “if you build it, they will come.” Contained in that underlying proposition are two points, a certain naïve market fundamentalism that many of our own board’s market fundies – in my view often folks with a naïve and uninformed view of market operations to begin with – share that there are no significant informational barriers. The more or less perfectly efficient market hypothesis.

I’m not sure, however, how to address this. Certainly naively depending on capital flows to come, even when good steps are taken abstracts away from serious informational ineffeiciencies. Investors, corporations outside of the few truly global firms (and I mean those that do not just operate in the developed world) just do not have a well-developed appreciation of risk and reward in the developing world. The very fact that “contagion” in financial crises has hit unrelated markets, in my view, illustrates the poor

To the specifics of investing. I disagree with gobear’s estimation, but China Guy I think is better placed to comment on the issues specific to Asia, which I do not really know that well. In fact, he might have some comments to expand on my own. I’d like to go on, but I have far too much work in front of me, so let me hopefully inspire a new direction rather than same old tired nattering(*).

(*: e.g. this foolishness about the US controlling WTO. The current case building up in re Cotton which the US looks to get fucked right good on of course will be ignored by the terminally clueless.)

**
This is certainly true, as far as it goes. A sound economic infrastructure is a necessary, but not sufficient, condition for development. Yakistan might have the most enlightened and market-friendly fiscal policy on the planet, but if it’s got no natural resources, no ports, etc. etc., the world isn’t going to beat a path to its door.

In many cases, however, the IMF is dealing with a slightly different situation. While, “Build it, and they will come.” may be slightly iffy, you can always count on, “Tear it down, and they will run like hell.”

The IMF is often (though not always) dealing with countries that appear to have had their economic and social policies set by the Marx brothers (Groucho, Harpo, Chico and Karl) on crack. After these countries have nosedived their economies into the ground at full afterburner, they come to the IMF and ask them to put the pieces back together. Is it any surprise that the IMF asks them to change some of the policies that got the country into trouble in the first place? I agree that adhering to IMF conditions doesn’t guarantee growth and prosperity. However, refusing to address the problems that caused your economy to collapse pretty much ensures that you won’t have growth and prosperity.

There are certainly different ways to go about it. Sometimes, perhaps, the IMF may take too hard of a line. This is, however, a matter of nuance. But come on, at its most basic level, much of what the IMF insists on is obvious to someone who can balance their checkbook.

As for the WTO, I’ve got to agree with Collounsbury. Countries aren’t “punished” for not joining the WTO, they are rewarded for joining. The WTO actually represents a significant loss of control for the United States since before GATT, trade deals were bilateral. Malawi wouldn’t have much leverage in a bilateral trade deal with the U.S… Now, however, Malawi has the option of dragging the U.S. in front of the WTO if it feels that the U.S. isn’t living up to its treaty commitments.

In fact, in one of the very first disputes heard by the WTO, Venezuela and Brazil filed a complaint against the U.S. and won.

Rick Jay,

Since you have such a bee in your bonnet about the claim that sovereignty is restricted, I hope you are consistent and get just as exercised when the Bush Administration apparently uses the same language to defend our decision not to be a party of various treaties. [See item 4 on this link http://www.aps.org/WN/WN02/wn070502.html
for the list of treaties.]

I understand your distinction in a hypertechnical sense. But, I think the point is that being party to a treaty or part of the WTO does in fact involve a trade-off of sovereignty in a sense as long as one remains a party to it. This is not necessarily a bad thing in all cases. (I think that the Comprehensive Test Ban Treaty is a good thing even if it restricts our sovereignty in being able to test nuclear weapons.) Anyway, it more a matter of terminology than anything else. You might not love the terminology, and find it a bit misleading, but I think it is a stretch to call it a lie.

I also think it is too simplistic to talk purely about which countries win and lose under the WTO etc. Part of the issue might be how the poorer countries fare relative to the richer countries. However, the 800 pound gorilla that we are not talking about is how large corporations fare relative to everyone else. I.e., there are a lot of interested parties, including corporations, poor people in Third World countries, working class folks in richer countries, etc., etc. One of the big questions is how the decisions that are made affect each of these “stakeholders” (to throw in a little corporate-speak). One concern with the current process is that the corporate stakeholders are making out like bandits at the expense of some of the other interested parties.

Of particular concern, for example, is this whole Chapter 11 in NAFTA which seems like it can be used, for example, by companies to complain that environmental regulations are trade restrictions … Yes, I know, that as we have discussed in a previous thread, and found that the interpretation of this area in the NAFTA resolution process remains unsettled: it is not clear how companies that try to take this line of logic will fare in that process. (Which is why that Canadian company that sued California over the gas additive seems to have amended its suit to emphasize different arguments.) But that does not mean there is no reason for concern. And, it is important for those who care about the way that is resolved to raise a stink about the whole thing since the proceedings are not constructed to give the general public any real input.

But for many countries, the reasons the economy collapsed is because of the loans that they received from other banks. This money is often used to buy weapons or line the pockets of those in power. Then when the country runs out of money again, the IMF comes in to ‘help.’ However the money the IMF loans is not to help the economy, but to pay off the banks that gave the bad loans in the first place. I ask again, who benefits from the money that the IMF lends? I think the IMF has recognized this problem to some extent, for example in Chad, where they have tried to force the Chadian government to use the money received from oil on social spending, rather than military hardware. Unfortunately, this has not been without problems , but at least there is some sign of progress.

As far as NAFTA is concerned, there have now been several cases where a corporation has used Chapter 11 to sue a government over an environmental law. One example being Crompton Corp suing because Canada banned lindane for canola crops, despite it being banned for use on Canola crops in the U.S.

In another case, the Canadian government was sued for banning the toxic gasoline additive MMT. See this site

Chris

Collounsbury, I don’t disagree with most of your post. I don’t however think it’s “clueless” to point out that powerful nations, including especially the US, exert effective control over the WTO because of the pre-existing inequalities of power that go into trade negotiations in the first place. In fact, it astonishes me that anyone who sees himself as a seasoned man of the world of realpolitik would seek to deny this obvious claim.

Truth Seeker puts it well, I think. To trade you’ve got to play; to play you’ve got to embroil yourself in all kinds of complicated agreements. That’s sometimes going to result in powerful countries getting caught up in a troublesome snare or two. I have no problem acknowledging that and still making the claim that the the system as it is–unaccountable, secretive, and anti-democratic–favors the already powerful (which is to say MNCs and the powerful governments in the US and Europe that support their interests).

I do find it odd though that Rick, for example, is eager to show that the US must follow trade agreements to which it’s agreed in order to argue against its “effective” power; yet unwilling (it seems) to concede that trade agreements impose on the citizens of nations that agree to them under such unaccountable conditions. Which is it? Do trade agreements bind sovereign nations and their citizens or not? Obviously the answer is that they do. Which is why powerful countries aren’t eager to open up negotations to world opinion: b/c then it would become obvious how their “effective” control is exerted in ways that, on balance, serve narrow interests.

None of which is to say that the US as a government, or European governments, have any ill will towards the developing world. I’m sure that they’d just love to see the developing world develop which would be good for global stability and good for US citizens who need to be able to produce things that the developing world can buy. Yet the manner in which these agreements are negotiated is certain to favor short-term and narrow interests as against this broadly conceived goal.

To me this seems like an extremely obvious problem. Would anyone want to see the UN, the EC, or the US Congress deliberate in secret?

Parenthetical: greetings jshore. I look forward to reading your latest link this evening.

Most young leftist activists and protestors know that they are against something, and are looking for a cause, if I may use such a cliche. What these youth are can be viewed as future Socialists and Communists; they see the bars of society that constitute their prison, and so have become discontent. However, such young leftists have not yet developed the experience to view the root of their discontent, their jailers.

Some, gifted with inherited social connections and destined to travel the upper strata of society, may keep their lefitist attitudes as age improves their wealth and freedom, and fall into the the peer group of neo-liberals. Most, however, will one day join the working class and be ground down into mindless slave-laborers who can no longer see past the extent of their own suffering of endless hours of work, loan payments and terror of being layed off. Some of these working class, for whatever reason, will see what supports the cage of their suffering – Capatalism – and will, at this point, become aware of the great class strugle that is central to Communism. Exploited against the exploiters. Creators of wealth versus the takers of wealth. Such working class, in an instant, discard racial and sexual differences as the most petty and inconsequential things imaginable. Their salvation of their class is the elimination of class.

Of course, to be a Communist one does not need to have every work of Marx, Engels, Trotsky and Lennin. It boils down to being aware of the class strugle.

Now, how about a Marxist view of globalization? The Marxist will probably view this as a progressive force overall. A mandidtory condition for a successful world Revolution is the existance of a strong proletariat, and the presnece of super-wealth. If Capatalism can help to expand the economic power across more of the world’s population, and thus expand the world’s proletariat – as exploited as they are – all the better to hasten the inevitable world Revolution. Yes, as Marx pointed out, Capatalism is a progressive force that paves the way for a succesful proletariat Revolution by gathering the economic forces of the masses.

"The bourgeoisie, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all, even the most barbarian, nations into civilisation. The cheap prices of its commodities are the heavy artillery with which it batters down all Chinese walls. It compels all nations, on pain of extinction, to adopt the bourgeois mode of production; it compels them to introduce what it calls civilisation into their midst, i.e., to become bourgeois themselves. In one word, it creates a world after its own image."
– Marx and Engles, Communist Manifesto

Yeesh, GUTB, what Marx and Engels wrote in the Manifesto made a lot of predictive sense in the 1840s. It no longer does. Personally, I still value a lot of Marx’s philosophy, and I think his critique of capitalism holds up in many ways. But his Hegelian teleology, in which the class struggle leads to communism through some inevitable dialectical unfolding, is as unhistorical as can be; and to invoke it in 2002, without any consideration of what people’s concerns are in the wake of WWII, decolonization, and the Cold War, just doesn’t make sense.

Social democracy is, IMO, absolutely crucial. But “communism,” conceived of as something outside of that framework, is something that one would have to define at this stage of the game in terms of what one believes is politically possible and desirable. I don’t ask you not to do that; but I do ask you not to do that here since this is not the place for a debate on communism (and there have been some good one’s here in the past).

(I gotta wonder if GUTB isn’t someone’s sockpuppet :wink: ).