Sunday, July 30, 2006

Another Failure in the Wake of 9/11

The Doha Round of trade negotiations was started soon after 9/11. It was recognized by many leaders in many countries that the grinding poverty in much of the world and the obvious injustice of the global economic system were contributory factors to the anger that fueled terrorists and international terrorism. Many also realized that poor people in poor nations could improve their economic lot if they had freer access to the markets in rich nations. The trade in agricultural and other labor intensive products is constrained by tariffs (especially those by European countries) and by subsidies (notably by U.S. agricultural subsidies). The Doha Round offered to help developing countries to help themselves by leveling the playing field, and thus indirectly to reduce the pressures encouraging international terrorism.

In contrast to many of the other post-9/11 initiatives, this appeared to be an initiative in which all countries would benefit. Freer trade would produce significant increases in overall global production and efficiency, and appropriate negotiations would allow these benefits to be shared by all nations.

It now appears that the Doha Round has failed. It must be assumed that it did so because the negotiators didn't do a good enough job at their work. The U.S. negotiators were one of the "eight hundred pound gorillas" at the table, and must share a significant portion of the blame!

Lets remember that in the next elections!

Read the article in the current Economist about the failure of the Doha Round. (Subscription required.)

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