The biggest non-news news of the yet-young summer arrived July 1 when the Doha Development Round of World Trade Organization talks melted into a muddy puddle of recriminations as the trade yakkers in Geneva failed to even begin their “last ditch” effort to save the troubled talks.
This latest and likely fatal debacle completes a Wagnerian Ring Cycle of sorts for Doha and maybe for the WTO.
First came 1999’s Battle in Seattle, then 2003’s Collapse at Cancun and, later, 2005’s Long Gone in Hong Kong. Now comes the Judgment in Geneva. RIP Doha.
Anti-climatic. None of this comes as a shock to anyone who has followed the flawed negotiating tactics by the big few, the U.S., the European Union, Japan, Australia et al, with the little many, sub-Saharan Africa, India, South America, Indonesia et al: Take down all trade barriers (“broad market access”) and soon you will be rich like us.
Hard to swallow. The trouble with that economic pill is that many members of the developing world have taken it for decades – courtesy of the caring World Bank, International Monetary Fund and transnational corporations – and most are still very, very sick. Doha’s prescription, they feel in their bones, is just another placebo.
More to the point, however, is (was?) Doha’s emphasis on agriculture. When the little many listened to the big few’s idea on ag trade, all foresaw local food production replaced by ag imports, millions of subsistence farmers driven off the land, and the loss of government income because of tariff cuts.
On top of those economic and political poisons, the big few were asking the little many for bigger percentage cuts in domestic ag spending and trade tariffs than they suggested for themselves.
Inequitable formula. “If they will cut 70 [percent],” Kamal Nath, Indian’s commerce and industry minister, told the Washington Post July 4, “I will cut 60; if they cut 60, I cut 50. But they say, ‘We’ll cut 20, and you cut 70′ – well, that’s not what this round is about.”
And it cannot be for nations like Nath’s. What is India to do with its 670 million subsistence farmers if Doha pushes, say, 300 or 400 million of them off the land?
It’s a question most developing nations are not only unprepared to answer, but one that has no answer.
Salvage attempts. So where now Doha? After the last ditch talks hit the ditch, WTO Director-General Pascal Lamy was authorized to meet separately with the many warring parties and report back “as soon as possible” on how the Doha Round can be saved.
Lamy, very French and very suave, is highly regarded in WTO circles but reviving Lazarus may be beyond even his considerable skills.
Others have suggested a “period of reflection,” without noting how long the period might be or what needs to be reflected upon.
Domestic concerns. Whether or not the international trade talkers take the time to rethink the latest WTO crack-up, American farmers and ranchers should.
Specifically, U.S. producers need to consider if the vaunted promise of “market access” (all the while remembering that no one in the WTO uses the phrase without including the qualifying word “opportunities”) is worth the billions in domestic price support they’d give up to get it.
To date, every economic study of Doha benefits – at least the ones done by non-ag linked academic institutions – warns that it is not.
Beyond optimism. Indeed, the numbers used to launch the Doha Round have been widely and soundly discredited by anyone armed with nothing more than a pencil and the ability to add.
Stay conservative. Also, given Geneva, farmers and ranchers must re-orient their 2007 farm bill goals. Why should an unwritten and, in fact, an unlikely, trade deal drive future domestic farm policy?
That’s a pig-in-a-poke and producers now would be better off with a one- or two-year extension of the 2002 bill until the pig can be seen more clearly.
Follow the leader. And, too, U.S. producers must accept the hard fact that this “development” round is now firmly in the hands of the developing nations, and they are not buying “market access” unless someone else pays big. Like U.S. farmers.
(Alan Guebert’s Farm and Food File is published weekly in more than 75 newspapers in North America. He can be contacted at email@example.com.)