LexisNexis(TM) Academic - Document LexisNexis™ Academic Copyright 1999 The Economist Newspaper Ltd. All rights reserved The Economist December 04, 1999 , U.S. Edition LENGTH: 1308 words HEADLINE: The new trade war DATELINE: seattle HIGHLIGHT: Opponents of globalisation wreaked havoc at a big trade summit in Seattle this week. Their long-term impact will be less dramatic BODY: THE World Trade Organisation summit, launching a new round of talks to liberalise trade, was meant to be a chance for Seattle to show off. Instead, Sea Town became siege town. A furious rag-bag of anti-globalisation protesters brought the city to a standstill. Hordes of angry activists blocked off the city centre, trapping (among others) Kofi Annan, the United Nations' secretary-general, and Madeleine Albright, America's secretary of state, in their hotels. The opening of the summit was delayed. Police in full riot gear with armoured personnel carriers fired tear gas and rubber bullets at protesters who refused to move. Masked youths rampaged through the streets, smashing shop windows. Seattle was put under curfew as the mayor declared a civil emergency and the governor sent in the National Guard. Yet most of the protests were peaceful. Long before the WTO summit started on November 30th, 2,500 campaigners attended a packed teach-in on the evils of globalisation (held, ironically, in a plush symphony hall whose benefactors had made their money from exports). By the time the delegates arrived, the city was teeming with protesters, banners ("The WTO is a hazardous waste") and chants ("Hey, hey, ho, ho. WTO has got to go.") Tens of thousands of trade unionists attended a protest rally and march organised by the AFL-CIO. Environmentalists donned sea-turtle outfits. Human-rights activists conducted a "people's tribunal" that indicted Union Carbide, the Gap and other firms for crimes against humanity. Students carrying Japanese cameras and drinking foreign coffee railed that trade should be local, not global. Jose Bove, a French farmers' leader who gained fame by attacking his local McDonald's, was mobbed by fans when he appeared with his own Roquefort cheese outside a Seattle McDonald's that had just been vandalised. Unsurprisingly, Pat Buchanan, a conservative protectionist demagogue and presidential hopeful for the Reform Party who was also in Seattle this week, revelled in the controversy. "There is something higher than commerce," he declared. "It's called country, and we're joining the battle in Seattle to ensure that someone still stands for ours." Maxine Waters, a Democratic congresswoman, was more lyrical. At an environmentalists' gathering she declared dramatically, "I smell movement in the air." But movement for what? Much of the radical and violent protest had little to do with the WTO. Anarchists breaking glass barely understood what the organisation was. Other radicals were better informed, but keener to shut things down (see ). That still leaves over 1,000 non-governmental organisations (NGOs) and tens of thousands of ordinary Americans who braved the rainy north-west to protest -- and who were furious that their efforts were overshadowed by violence. The fact is that the WTO has become the magnet for a myriad of often contradictory complaints about the perceived ills of globalisation. Old-fashioned protectionists, such as trade unionists, are making common cause with an unruly alliance of greens, human-rights campaigners, consumer-rights groups, sovereignty-obsessed nationalists and others. Trade unionists talk about fair trade, not free trade (in other words, they want to curb competition for jobs from workers in poor countries). Development lobbies, such as Oxfam, think poor countries get a raw deal out of the world trading system. Green groups, such as the Sierra Club or Friends of the Earth, claim that the WTO wrecks the environment. Consumer groups argue that the WTO foists genetically modified (GM) food on them and promotes the interests of big business at the expense of the little guy. As for Mr Buchanan, he is enraged by the constraint on American unilateralism that WTO rules impose. Many of these concerns are not new. But they have assumed greater importance for many people as America luxuriates in an unprecedented peacetime boom, and as free trade's contribution to that prosperity is forgotten. They have, moreover, found a new focus in the WTO, which enforces the rules for a globalising economy. It is a convenient target: a multilateral institution, based in a faraway place (Geneva), whose rulings, though based on rules that have been ratified by Congress, are uniquely binding on America. All this festering resentment came to a head so dramatically because the NGOs were extraordinarily well-organised, in large part because of the Internet. E-mail trees passed the word to thousands of activists; websites provided endless information. In April 1998 the NGOs used the Internet to scupper the Multilateral Agreement on Investment (MAI), another international agreement designed to harmonise rules on foreign investment. Flush from that victory, the WTO was the next obvious target. Less obvious is what impact the protests will have. Certainly, the protesters failed in their immediate aim of derailing the talks entirely. They caused havoc, and massively delayed proceedings. They angered delegates, though many of those were also quick to identify the protesters with their own agenda (the French, for instance, claimed the protests proved how much people hate GM food). But behind the grandstanding the protests have, if anything, steeled the resolve of WTO governments to bridge their differences, notably over agriculture and developing countries' demands for better access to rich-country markets. Mike Moore, the head of the WTO, was in fighting spirit. "To those who argue that we should stop our work, I say: Tell that to the poor, to the marginalised around the world who are looking to us to help them'." Nor will the demonstrations necessarily divert America's immediate trade agenda. Rioting in the streets of Seattle will do little to endear the WTO to Americans, most of whom had never heard of it until now. But nor will it necessarily bolster the critics' cause. Many mainstream NGOs, who seek reform rather than revolution, are furious that the extremists' antics overshadowed their own efforts to raise public awareness of perceived unfairness in the world trading system. Moreover, the Clinton administration's trade policy is already quite close to that of the more moderate protesters. The United States has been pushing hard for trade agreements that include enforceable labour and environmental standards and for a more open WTO. Charlene Barshefsky, America's top trade negotiator, responded to the protests by declaring that the administration's policy already reflected the concerns of those who believe that the WTO is undemocratic and should pay more attention to labour and environmental issues. President Bill Clinton said he was sympathetic to many of the complaints expressed by the (peaceful) protesters, and insisted that the WTO process should be opened up to them. "If the WTO expects to have public support grow for our endeavours," he said, "the public must see and hear and in a very real sense actually join in the deliberations." It is hard to see how much further the administration could go without completely alienating its business supporters. Less certain is whether the furore will make any difference to the presidential race. Only George W. Bush, the Republican front-runner, voices unequivocal support for free trade. He challenged Al Gore, who conspicuously avoided coming to Seattle, to face down the labour unions, whose endorsement Mr Gore has won by sounding an increasingly protectionist note. Bill Bradley, Mr Gore's Democratic rival, made noises about the importance of labour and environmental issues, although he remains broadly committed to free trade. Now that the WTO has become synonymous with tear gas in the minds of many Americans, the danger is that the presidential hopefuls will see even fewer votes in standing up for free trade than they saw before. GRAPHIC: graphic, no caption LOAD-DATE: December 2, 1999