Doha Debacle
MichaelW on Aug 23 2006 at 2:20 pm | Filed under: Domestic Politics, Economics, Foreign affairs, MichaelW's Page
With the close of the Doha Round, many see an end to free trade period, with a healthy portion of the blame going to Pres. Bush:
The Bush administration has been quick to point fingers at Europe, India, and Brazil, but the United States deserves much of the blame. That’s because, ever since September 11, the administration has made expanding free trade a key part of its efforts against global instability and extremism. As President Bush said at a recent appearance in Miami, trade talks “have a chance to help lift millions of people out of poverty around the world. … [O]ur government is strongly committed to a successful outcome of the Doha Round.” No wonder, then, that trade observers around the world see in the collapse evidence that the United States has ceded the helm of the global free-trade push. As one columnist wrote in Singapore’s Business Times, “The breakdown of the Doha Round of global trade talks is a reflection of the failure of the Bush administration to project U.S. leadership in the geo-economic arena.”
Dale Franks, who pointed me to the article, agrees that the Bush administration has been long on talk but short on action:
I have been decrying the Bush Administration’s subversion of Free Trade principles since 2002. Outcomes like this are one of the reasons. You can’t exercise leadership in Free Trade, while imposing protectionism on Shrimp or Canadian Softwoods. For the US, policy must match rhetoric, if we expect other nations to go along with us.
Actually, I had noted the tension between the administration’s rhetoric and its actions last year, highlighting a bold claim to end subsidies:
That being said, Bush did make the following bold claim:
“Today I broaden the challenge by making this pledge: The United States is ready to eliminate all tariffs, subsidies and other barriers to free flow of goods and services as other nations do the same. This is key to overcoming poverty in the world’s poorest nations. It’s essential we promote prosperity and opportunity for all nations.”
Really? Because that would just peachy as far as I’m concerned. In fact, why should we wait for other countries? Instead, let’s just eliminate farm subsidies and trade tariffs altogether. Even if other countries don’t follow suit (and it’s virtually certain that there are many who won’t), the U.S. will still be better off. Sure, farmers like ADM, Scotty Pippen and Ted Turner will take a short term hit (the destructive side of Schumpeter’s “creative destruction“), but I think we can bear that burden.
As Dale and Clay Risen noted, if we want to be the leaders of free trade in the world, we need to take action. Protectionism seems like it helps, and maybe it does in the very near term, but in the end it stifles markets and breeds contempt. We would do better to eliminate or roll back our tariffs regardless of what Europe does. Lance remarked on the fierce loyalty that the Kurds have for America because we have been a friend to them when no one else would. There are a slew of developing nations in the world who, I believe, would have the same affinity towards us if we would open our markets to them. In doing so, we would not only foster good will, we would place ourselves at a competitive economic advantage to Europe in the long term, and we would take a big step towards alleviating poverty in the Third World (and at home for that matter).
Technorati Tags: Doha, President Bush, free trade, protectionism, trade policy, tariffs, farm subsidies, poverty, third world
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