Why do people hate the WTO

SkepticOne

Originally posted by bonkey
However, many developing nations can't afford the level of subsidy they would need to compete with the western nations, and so they instead are asknig that the subsidies in the west get reduced/eliminated.

I'm getting a bit tired of this term "The West". Japan subsidising its rice farmers has precicely the same effect on developing nations yet it is not in "The West". The term is out-dated imo.

colinsky

Subsidies INCREASE unfairness and inequity. For every farmer or producer who benefits from a subsidy, there is one in another country who suffers. Subsiding your own producers is the EXACTLY the same as putting a tariff on everyone else.

This IS what the WTO supports. Free trade is the absence of nationalized intervention. Nationalized intervention favours the citizens of one country over another. Again, that's not fair. Only free trade is fair.

Opposition to the WTO and free trade boils down to selfish opportunism or nationalist xenophobia.

edit: missing word

SkepticOne

Originally posted by bonkey
They can't compete nationally because the WTO etc. insist on letting foreign (subsidised) suppliers in who can undercut the locals becuse of the subsidisation, and they obviously can't compete internationally for the same reason.

What do you mean by foreign? Foreign to whom? Was the SK farmer who killed himself one of these foreigners?

Turnip

I'd like to see Tony Blair break the farmers the same way Mrs.Thatcher broke the miners. Send in 10,000 riot cops to sort out the countryside alliance swine. It's not very likely though. It's even less likely to happen here.

Turnip

America set to torpedo trade talks

Nick Mathiason and John Madeley in Cancun
Sunday September 14, 2003
The Observer

Fears are growing that the United States could effectively walk away from crucial trade talks in the Mexican resort of Cancun aimed at solving the deepening economic and social crisis afflicting billions of the world's poorest people.

As the World Trade Organisation negotiations entered their final hours, business leaders feared that efforts to strike a ground-breaking deal on trade distortions harming the developing world were in the balance.

The Observer

What happens if the US walks off? Bye bye WTO? is this what protesters want? I don't see that the collapse of the WTO helps anyone. Least of all the poor.

shotamoose

World trade talks collapse, says BBC

The world trade talks in Mexico have collapsed without agreement on the final day of discussions, delegates have said.

Kenyan delegate George Odour Ongwen said the talks were over and that the chairman, Mexican Foreign Minister Luis Ernesto Derbez, was calling delegates to announce the collapse.

After four days of talks rich and poor nations remained deeply divided on agricultural subsidies and rules on how countries should treat foreign investors.

A failure would probably postpone the implementation, planned for the end of next year, of a trade liberalisation pact the WTO adopted in 2001.

That last sentence is untrue. The collapse of the talks mean that there's nothing to implement. In fact, one of the major items on the agenda was implementation of what was agreed ten years ago in the 'Uruguay Round'. The failure of rich countries to live up to their responsibilities in this area and in agriculture, while simultaneously trying to exapand the agenda of the WTO into areas of their own advantage, seems to be behind the failure of this year's talks. That and the fact that developing countries have actually started standing up to them.

Where does the WTO go from here? I honestly don't know. This could be the beginning of its end.

bonkey

Originally posted by SkepticOne
What do you mean by foreign? Foreign to whom? Was the SK farmer who killed himself one of these foreigners?

Developing nations cannot afford to pay the same subsidies that developed nations do. As a result, they - the developing nations - are forced to allow food imported into their nation (from the subsidised, developed nations).

The "foreign" therefore would be "foreign to the developing nation". The SK farmer killed himself over subsidies being paid to farmers in foreign (to him) developed nations, which was putting him in an impossible position. He wanted more subsidies for SK farmers, so that they would be able to compete in the SK market against the foreign (to the SK) sales, although I'm sure that he would haev settled for subsidies ebing removed from the other nations.

Personally, I'm delighted to see the disarray this stand has left the WTO in. Its about time the developed nations realised that they can't just ride rough-shod over the rest of the world in the name of profit. All they're being asked to do is to play fair.

jc

SkepticOne

Originally posted by bonkey
The "foreign" therefore would be "foreign to the developing nation". The SK farmer killed himself over subsidies being paid to farmers in foreign (to him) developed nations, which was putting him in an impossible position. He wanted more subsidies for SK farmers, so that they would be able to compete in the SK market against the foreign (to the SK) sales, although I'm sure that he would haev settled for subsidies ebing removed from the other nations.

South Korea is a rich industrial nation in the midst of poor rice producing nations. It is not the richest country in the world, but its GDP per capita is comparable to the poorer (current) EU countries. Its GDP per capita is 10 time that of neighbouring rice producing countries.

It maintains heavy subsidies and tarifs on rice because if it did not, it's farmers would be wiped out by imports from neighbouring countries.

Government farm handouts continue to account for 40 percent of OECD farm income just as in the mid1980s. In such heavily protected agricultures as South Korea, Switzerland and Norway, government payments make up two-thirds of farm income.

[source]

Yes if rich countries reduced subsidies then this would help, unfortunately for South Korea, this would also mean them reducing subsidies and tarifs.

Luis Fernando Furlan, minister of industry and development of Brazil, said his country has 20 million farmers — more than the EU and the United States combined — but they cannot compete internationally because of the massive subsidies paid to farmers in rich nations.

"It's incredible to us," he said. "How can a small number of people be so powerful as to get almost 50 percent of the budget of the European Union and to get the amount of subsidies they get in Switzerland, the United States, Japan and (South) Korea?

"What's happening is that the developing world is getting poorer and poorer because of overproduction and depressed international prices. Developed countries need to sell their products at the world prices without subsidies."

[source]. Luckily, the rich countries (including South Korea) are forming a united front to oppose reductions in subsidies.

To strengthen their position, importers Japan, the European Union (EU), South Korea and Switzerland agreed to reinforce their joint front and press for revisions to the proposed farm targets.

The accord was reached as Japanese Agriculture, Forestry and Fisheries Minister Tadamori Oshima met bilaterally with the EU team of Trade Commissioner Pascal Lamy and farm commissioner Franz Fischler, South Korean farm minister Kim Dong Tae and Swiss economic department head Joseph Paul Marie Deiss.

The four parties all reiterated they cannot accept the targets proposed by agriculture negotiations chairman Stuart Harbinson, Japanese officials said.

http://www.worldtradereview.com/webpage.asp?wID=314][source][/url]

Personaly, I'm against rich nations subsidising agriculture and maintianing tarifs against poorer countries. However, this view would be opposed by many of the protesters.

Outside the venue, more than 2,000 demonstrators from Japanese, North American, European and Asian farm groups chanted slogans against sharp tariff cuts. Japanese farm lobbyists also upped the pressure on Tokyo not to budge.

What then is to be concluded from the SK farmers suicide. I believe it is that the reforms wanted by the poorer countries will not be without massive social consequences among farmers in rich countries and this will have to be dealt with.

Éomer of Rohan

Did anyone notice the third world countries walk out of the WTO talks in Mexico with the words "We are not being listened to" ? I think this, without entering into the socialism vs capitalism debate but rather from a liberal capitalist point of view, answers the question that this thread asked.

SkepticOne

Originally posted by Éomer of Rohan
Did anyone notice the third world countries walk out of the WTO talks in Mexico with the words "We are not being listened to" ? I think this, without entering into the socialism vs capitalism debate but rather from a liberal capitalist point of view, answers the question that this thread asked.

No it doesn't. Who was not listening?

As far as I can tell, rich countries within the WTO successfully stood firm on the issue of agricultural protectionism within their own countries while wanting the poor countries to open up their own markets. Poor countries were unwilling to open up their own markets without the removal of protectionism in rich countries. I know I'm simplifying but it does appear that there was two groups diametrically opposed to each other.

Without entering into the socialism vs capitalism debate, what is your solution?

Éomer of Rohan

There isn't an answer; people say that there is no loser in laissez faire economics, that everyone can get rich; I think that this is wrong and what has given rise to this notion is the transferring of poverty from large parts of Western working classes to the lower classes of the developing (or not) world.

SkepticOne

Originally posted by Éomer of Rohan
There isn't an answer; people say that there is no loser in laissez faire economics, that everyone can get rich; I think that this is wrong and what has given rise to this notion is the transferring of poverty from large parts of Western working classes to the lower classes of the developing (or not) world.

What are the alternatives to laissez faire economics and can there be agreement between rich and poor countries on how it should be administered?

shotamoose

Originally posted by SkepticOne
Without entering into the socialism vs capitalism debate, what is your solution?

The best path to a solution would be for rich countries to match their actions to their rhetoric and actually put development (and thus an enlightened rather than a narrow self-interest) at the heart of trade.

This would basically involve them recognising the need for pro-poor reforms across the spectrum of policies - debt, aid, finance, etc - and not just trade. And where trade is involved, giving developing countries the assistence and policy space they need.

Éomer of Rohan

Quoted from Skeptic One
What are the alternatives to laissez faire economics and can there be agreement between rich and poor countries on how it should be administered?

The WTO is about lowering trade barriers to create a vast free market - yes, excellent goal, except for one thing; the USA and the EU (and soon China if the economic decentralisation continues) function as black holes into which all profit is drawn and more to the point, Europe and the US still use protectionism and they cannot have sanctions laid against them as there is no coalition of resource rich, industry poor nations who could economically survive such a measure - or more accurately the counter sanctions which would follow - though Europe and the USA do occasionally lay sanctions against each other and can get away with it since neither, in the grand scheme of things, supplies each other with resources they could not get from elsewhere.

Therefore, since all nations are not equal trading partners and since we have vast trading blocs which can control trade, free trade as we know it is a misnomer and impracticable - and the free trade which is happening at the minute is an excuse for erosion of social democracy and the cessation of government subsidisation of public services and industry, which, eventually would lead to a self contained elite running the country with a vast amount of money to spend and little on which to spend it except weapons or space or some such idea.

Of course, we have seen that protectionism does not work either - in the 50's and 60's and 70's we saw the failures of protectionism with large amounts of unemployment and growth a fraction of what it is today.

So to answer the questions, there is no alternative within capitalist principles and no, poor and rich nations will never agree since the poor nations are going to be the losers and the rich nations are so rich they don't have to agree to be the losers, they can bully the poor nations.

shotamoose

Originally posted by Éomer of Rohan
Of course, we have seen that protectionism does not work either - in the 50's and 60's and 70's we saw the failures of protectionism with large amounts of unemployment and growth a fraction of what it is today.

Didn't developing countries experience higher growth in the 50s-70s than in 1980-2000?

Éomer of Rohan

Quoted from shotamoose
didn't developing countries experience higher growth in the 50s-70s than in 1980-2000?

I am not sure that they did but IF they did then I'd be happy to acknowledge that since it further exposes the US/eurocentrisms of world economics.

Capt'n Midnight

not having read all the other posts but the bottom third of the people in Ireland have 6% of the wealth...
(ie. they have less than a fifth the Average wealth)
The world's richest 500 people have as much wealth as the
poorest 2,000,000,000

Now there is a saying about a high tide lifting all boats - but unless the WTO's activities result in poorer people getting richer at a faster rate than the rich - the poverty gap will widen and this is not good.

Living in Dublin one of the threats to me and mine is being mugged/burgled by someone who has no prospect of legally acquiring a decent wage or owning any property. The links between crime and poverty have been proven time and time again.

SkepticOne

Originally posted by Éomer of Rohan
So to answer the questions, there is no alternative within capitalist principles and no, poor and rich nations will never agree since the poor nations are going to be the losers and the rich nations are so rich they don't have to agree to be the losers, they can bully the poor nations.

However, it seems to me that the only other solution is some sort of world socialist government which would oversee trade between nations. If so, would the US and EU, for example, sign up to it?

Victor

Originally posted by bloggs
Why do people hate the WTO

Because it pretends to be about fairness when in fact it is a rich man's (inlcuding rich men in the third world) club.

shotamoose

Originally posted by SkepticOne
However, it seems to me that the only other solution is some sort of world socialist government which would oversee trade between nations. If so, would the US and EU, for example, sign up to it?

They wouldn't let their trade policies be dictated by it, if that's what you mean. The US and EU, have, however, signed up (along with just about everyone else) to the Millennium Development Goals, at set of targets to halve poverty, fight AIDS, achieve universal primary school enrolment, etc, and if these goals are to be achieved they will have to involve some sort of 'more socialist' international arrangements, as business as usual just won't cut it. So pressuring them to uphold their end of the MDGs bargain could be one way of doing things without quite going so far as a world socialist government, which doesn't exactly seem imminent.

Suddenly nobody really seems sure what the WTO is for. Rich countries only signed up for it because they thought it would be a handy tool to open up the world's market without having to face too many consequences themselves, while poor countries signed up because they thought WTO rules could be used to push rich countries into adopting more reasonable policies. Only now neither camp is getting what they want out of it ...

SkepticOne

Originally posted by Victor
Because it pretends to be about fairness when in fact it is a rich man's (inlcuding rich men in the third world) club.

Whether or not this is true, it is inevitable that this would be the perception since the top few members have more economic and military clout than all the rest of the members combined. Any agreements would tend to reflect this even if the institution itself were impartial.