Plan B: A Global Trade Bunt
May 05, 2011
Back when I was a full-time farmer, I would trade in my used John Deere tractor for a new one every four or five years. I would bargain with my dealer. Sometimes I made out well. Other times he drove a hard bargain--and I had to take what I could get.
The trade diplomats behind the Doha round of world trade talks have bargained for nearly a decade--and now, at long last, they find themselves in the uncomfortable position of having to take what they can get.
They’re calling it “Plan B.” That’s just another way of admitting what a lot of us have said for a while now: Doha, at least in the sense that it was originally conceived, is dead. The 153 members of the World Trade Organization simply won’t come together on an ambitious agreement any time soon.
Fundamentally, there’s a lack of political will--and when there’s no will, there’s no way.
The vacuum in leadership has made it impossible to achieve consensus on issues of substance. It’s difficult, of course, to get 153 people to agree on anything--and getting 153 countries to agree on complicated matters such as agricultural tariffs and subsidies is even tougher. A lot of interests are at stake and they feel threatened by change.
But it starts with leadership--and Doha has lacked a champion.
Another factor may be skewed expectations. Most rounds of trade talks are named after a person or a place, such as the “Kennedy round” (for John F. Kennedy, Jr.) and the “Uruguay Round” (after the country that hosted that round’s first ministerial meeting). The Doha round follows in this tradition--it’s named after the capital of Qatar, the site of opening negotiations in 2001.
Yet its full name is the “Doha Development Round” or the “Doha Development Agenda,” and there’s always been the assumption that these talks would focus on developing countries. This was probably a mistake because it led many developing countries to believe that they wouldn’t have to make meaningful concessions--some of them seemed to think this would be a charity round in which they would receive much and give next to nothing.
That’s not how trade diplomacy works.
The bottom line is that Plan B is a salvage operation that abandons the lofty aspirations of ten years ago and seizes upon what it can get right now. It means that agriculture may be off the table, along with import taxes on manufactured products such as cars and machinery. Instead, the WTO will seek agreement on a small-bore agenda that includes creating a more unified set of customs standards and limiting subsidies for the fishing industry.
It’s hard to get excited about this plan, but at this point there isn’t an obvious alternative--except, perhaps, for another ten years of pointless chatter in Geneva and elsewhere.
In baseball, sometimes it makes sense for a batter to bunt the ball and let the infielders throw him out. If he can advance a runner, it can be a worthwhile sacrifice. Well, the Doha debaters stopped swinging for the fences a long while ago. A strikeout is a definite possibility. Perhaps the time has come simply to put the ball in play and pocket a small gain.
Greater progress can come later. Mitt Romney, a likely U.S. presidential candidate, recently suggested one possible form it might take: He proposed the advent of an alternative to the WTO, an organization that would hold its members to a “higher standard” on matters such as intellectual property rights.
That’s a bold idea, but probably even more difficult to realize than what the Doha round first sought to achieve. At least he’s talking about international trade. His comments hint at a desire to step up to the plate and lead.
In the meantime, those already charged with the responsibility to lead will have to make the best of a bad situation--and Plan B sounds a lot better than no plan at all.