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A daily report from the World Trade Organization summit, Seattle

by LBO editor Doug Henwood

Saturday, December 4

This week's street carnival risked turning the main event, the ministerial summit, into a footnote. But the contentiousness outside also seeped into the convention hall, with ministers breaking off talks without a final communiqué. It had been widely assumed that some masterly worsmithing would be used to craft something vague enough to get all 135 member countries to sign on, to avoid the embarrassment of failing so visibly. But even that turned out to be too ambitious.

But Friday's failure was not without precedent. The point of the talks was to agree on a basic agenda for detailed negotiations over the next several years. But the ministers should have begun the conference with a draft that was supposed to have been worked out in negotiations in Geneva over the last several months. That never happened. In the run-up to the conference, there was much worry that the talks might fail. But that always seemed a bit incredible; it seemed more likely that the public worries were part of a strategy of trying to scare the negotiators into a more agreeable mood, or to lower public expectations. Instead, they turned out to be accurate.

A combination of substantive and procedural issues spoiled the proceedings. Clinton's call to include labor rights in the WTO alienated many Third World delegations, who, as a BBC report put it, thought it "was intended to undermine the competitive edge they derived from lower wages." Of course, Clinton probably made the suggestion to mollify the AFL-CIO and other domestic critics, fully aware that it would go nowhere within the WTO, and his negotiators quickly explained to their colleagues that the president "misspoke" when he laid out his position in an interview with the Seattle Post-Intelligencer. But progressives tempted to view the "South" as the good guys in a manichean battle of North vs. South should keep this in mind; Southern elites are quite happy to exploit their workers and ravage their environments (and many delegates from the "developing" countries expressed the wish that the Seattle police had cracked more heads from the first to clear the streets).

But labor rights alone weren't hardly enough to kill the talks. While the European Union (EU) was reported to be giving in to pressure from the U.S. and the so-called Cairns Group of 15 agricultural exporters led by Australia to cut back its farm subsidies, evidently no deal could be reached. It was also reported that the EU would yield on the farm issue of the U.S. would agree to concede on investment issues - that is, to revive the Multilateral Agreement on Investment (MAI), negotiations for which collapsed a year ago - but domestic political pressures kept Washington from doing so. But on Thursday, French Prime Minster Jacques Chirac said that Europe would never concede on the farm issue. Indeed one of the major stories of the WTO has been divisions within the EU. Earlier in the week, the EU negotiators said they were prepared to yield to U.S. pressure to put biotechnology on the agenda, but their bosses back home overruled them.

Another point of contention was Japanese resentment of U.S. anti-dumping policies - the right Washington reserves for itself to retaliate against countries it deems to be pricing their exports unfairly low. Clinton phoned Japanese Prime Minster Keizo Obuchi on Friday, urging him to drop the complaint, but with no apparent success. The issue makes it clear that despite lip service paid to a rules-based multilateral system, the U.S. typically feels free to do whatever it wants in practice.

How the negotiations were being conducted proved as problematic as what was being discussed. The WTO is supposed to work by consensus, which is hard to achieve among 135 member countries. I've already mentioned the issue of U.S. unilateralism, which irritated not only the Japanese but the French as well. On several issues, the U.S., the EU, Japan and several of the larger "developing" countries repaired to small rooms to cut deals among themselves, but African and Caribbean delegates complained, and threatened to walk out of the meeting. This has prompted talk of reforming the WTO's rules of engagement, which presumably means making it more like the IMF and World Bank, where the rich countries rule and the poor countries listen. But such a reform would hardly be uncontroversial.

This failure has given rise to heated talk about the end of the WTO. While that is always possible, it's a bit premature to draw up its death certificate just now. Negotiators will soon repair to Geneva and start talking again, under far less scrutiny in one of the quietest, dullest cities on earth.

But unscrutinized dullness is no guarantee of success, as the failure of the MAI shows. That agreement, which would have essentially allowed capital to do whatever the hell it wants with no interference from pesky governments, was being negotiated in effective if not literal secrecy. But a draft text was leaked on the web, and soon a worldwide movement rose in opposition to it - organized mainly through the Internet. There were also serious disagreements among the major players about the details of the agreement. That combination of elite disagreement and popular mobilization caused the collapse of the MAI talks in December 1998. Could that be a precedent for the WTO?

One of the virtues of the WTO - maybe its only virtue - is that it put a face on a set of issues that used to be abstract and arcane. As recently as five years ago it would have been unimaginable that thousands of people would fill the streets and hundreds of people getting arrested over trade and capital flows (at least in the U.S. - these have been hotter issues in Europe and the "developing" world for a long time). The WTO's architects probably didn't have this in mind when they designed it, but maybe we should give thanks for their work. Sometimes it seems that its critics blame it for too much, as if it were the embodiment of capitalism itself, but it's very difficult to organize around an issue as intangible as capitalism itself. This is certainly the next best thing.

(It's been pretty disturbing, though, to hear lots of people distancing themselves from "anarchists" and their violence, as if the violence was all that serious and anarchy weren't a serious and often admirable political position.)

It wasn't only a new set of issues that exploded into prominence in Seattle; it was also a milestone in a new kind of politics that feels almost world-historical, though maybe the heat of the moment just makes it seem that way. Splits between "real" and "cultural" politics, between labor and environmentalists, between young and old, were not merely forgotten, but explicitly overcome. Progressives, broadly defined, lost the cringing, apologetic demeanor they'd been afflicted with for the last 20 years, replacing it with confidence, style, and wit. Aging boomers stopped looking back to the 1960s and marveled at the intelligence, discipline, and imagination of a generation previously written off as apolitical slackers. Labor shed its nationalism for a new rhetoric (we'll see how it really turns out in practice) of internationalism and solidarity.

Maybe these wonders will evaporate quickly. But maybe the hypercapitalist ascendancy of the last 20 years is over. That would redeem the banality of all the millennial hype for sure.

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