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From Politics to Technocracy—and Back Again: The Fate of the Multilateral Trading Regime

Published online by Cambridge University Press:  27 February 2017

Robert Howse
Robert Howse*
Affiliation:
University of Michigan
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Extract

As is known to every student of trade law and policy, the modern idea of free trade originates from the theories of absolute and comparative advantage developed by the classical political economists, Adam Smith and David Ricardo. Smith and Ricardo both addressed themselves to a sovereign unilaterally deciding its trade policy. They concluded that, with some qualifications or exceptions, a policy of liberalizing restrictions on imports would maximize the wealth of that sovereign.

Type
Symposium: The Boundaries of the WTO
Information
American Journal of International Law , Volume 96 , Issue 1 , January 2002 , pp. 94 - 117
Copyright
Copyright © American Society of International Law 2002

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References

1 Irwin, Douglas A., Against the Tide: an Intellectual History of Free Trade (1996)Google Scholar; Trebilcock, Michael J. & Howse, Robert, The Regulation Of International Trade, ch. 1 (2d ed. 1999)Google Scholar.

2 For an expression of this conceptual foundation in the language of contemporary economics, see Kyle Bagwell & Robert W. Staiger, Gatt-Think 16 (Nat’l Bureau of Econ. Research, Discussion Paper No. 8005, 2000).

3 See the seminal article by Jeffrey Dunoff, from which I have learned much, The Death of the Trade Regime, 10 Eur. J. Int’l L. 733 (1999).

4 See generally, for a careful and balanced account of the evolution of these arrangements, Robert Gilpin, Global Political Economy: Understanding the International Economic Order, chs. 9–10 (2001).

5 Tarullo, Daniel K., Beyond Normalcy in the Regulation of International Trade, 100 Harv. L. Rev. 547 (1987)Google Scholar; Tarullo, Daniel K., Logic, Myth and the International Economic Order, 26 Harv. Int’l L.J. 533 (1985)Google Scholar.

6 See Hudec, Robert E., GATT Constraints on National Regulation: Requiem for an “Aims and Effects “ Test, 32 Int’l Law. 623 (1998)Google Scholar.

7 Ruggie, John G., Embedded Liberalism and the Postwar Economic Regimes, in Constructing the World Polity: Essays on International Institutionalization 62 (1998)Google Scholar.

8 See Anne-Mari, Slaughter, Regulating the World: Multilateralism, International Law, and the Projection of the New Deal Regulatory State, in The World Trading System: Critical Perspectives on the World Economy 50 (Howse, Robert ed., 1988)Google Scholar, reprinted in Gerard Ruggie, John, Multilateralism Matters 125 (1993)Google Scholar.

9 Slaughter, supra note 8.

10 Hudec, supra note 6; McGinnis, John O. & Movsesian, Mark L., The World Trade Constitution, 114 Harv. L. Rev. 511 (2000)CrossRefGoogle Scholar.

11 See Dunoff, supra note 3; Ruggie, supra note 7.

12 Rodrik, Dani, Globalisation and Labour, or: If Globalisation is a Bowl of Cherries, Why Are There So Many Glum Faces at the Table? in Market Integration, Regionalism and the Global Economy 117, 141–43 (Baldwin, Richard E. et al. eds., 1999)Google Scholar.

13 Obviously, the description of the insider network is stylized—it abstracts from real differences of national interest or personal outlook among the members—and one should not overestimate the homogeneity of this group (indeed, later on in this essay, I shall discuss some of the quite divergent responses of different elements within the insider network to the legitimacy challenges facing the WTO). It must especially be stressed that there is only limited overlap between the insider network and the officials within the WTO Secretariat; many of the latter are not real “insiders,” while, as noted, many of the “insiders” have never held any official position in the GATT or the WTO. Nor am I suggesting something like a conspiracy. What I am describing here and in the rest of this essay could be thought of, in terms of international relations theory, as an “epistemic community.” Thus, John Ruggie suggests:

Institutionalization [of international organization] involves not only the organizational grids through which behavior is acted out, but also the epistemes through which political relationships are visualized. I have borrowed this term from Michel Foucault... to refer to a dominant way of looking at social reality, a set of shared symbols and references, mutual expectations and a mutual predictability of intention. Epistemic communities, then, may be said to consist of interrelated roles that grow up around an episteme: they delimit, for their members, the “proper” construction of social reality.

Gerard Ruggie, John, The New Institutionalism in International Relations, in Constructing the World Polity, supra note 7, at 45, 55Google Scholar; see also Adler, Emanuel & Haas, Peter M., Conclusion: Epistemic Communities, World Order and the Creation of a Reflective Research Program, 46 Int’l Org. 367 (1992)CrossRefGoogle Scholar; Picciotto, Sol, Networks in International Economic Integration: Fragmented States and the Dilemmas of Neo-Liberalism, 17 Nw. J. Int’l Econ. L. 1014 (1996)Google Scholar.

14 On the relationship of technocratic governance in international economics to the fate of politics in an era of globalization more generally, see Kennedy, David, The Disciplines of International Law and Policy, 12 Leiden J. Int’l. L. 9, 119 (1999)Google Scholar.

15 Weiler, Joseph, The Rule of Lawyers and the Ethos of Diplomats: Reflections on the Internal and External Legitimacy of Dispute Settlement, in Efficiency, Equity, and Legitimacy: The Multilateral Trading System at the Millennium 334, 336–37 (Porter, Roger B., Sauve, Pierre, Subramanian, Arvind, & Beviglia Zampetti, Americo eds., 2001)Google Scholar (citation omitted).

16 On the ideology of free trade as it evolved in the GATT regime, see the very insightful article by David Driesen, What Is Free Trade’? The Real Issue Lurking Behind the Trade and Environment Debate, 41 Va. J. Int’l L. 279 (2001).

17 This is because a tariff will always price some consumers out of the market altogether.

18 Trebilcock, Michael J., Chandler, Marsha A., & Howse, Robert, Trade and Transitions: A Comparative Analysis of Adjustment Policies (1990)Google Scholar.

19 See Reich, Robert B., The Work of Nations, ch. 25 (1991)Google Scholar.

20 This is, of course, yet another example of the way the insider network, in professionalizing or technocratizing trade policy and politics, was ultimately dependent on a particular political bargain, that of embedded liberalism, a dependency masked from the network or many of its members by their innate tendency to translate that understanding, or assumptions flowing from it, into universalizing discourse of the kind innately congenial to “scientific” specialists. The phenomenon in question is well characterized by Sol Picciotto, albeit in speaking generally about international economic governance:

[T]he growth of international regulatory or governance networks does not constitute a reduction of the scope of interstate politics, but its pursuit by other means. Certainly, this may entail an attempt to “depoliticize” issues, by deploying scientific, managerial, or professional techniques and basing their solution on universalizing discourses. However, such techniques are neither neutral in themselves, nor in the processes of their development and application.

Picciotto, Sol, North Atlantic Cooperation and Democratizing Globalism, in Translatlantic Regulatory Cooperation: Legal Problems and Political Prospects 495, 505 (Bermann, George A., Herdegen, Matthias, & Lindseth, Peter L. eds., 2000)Google Scholar (citation omitted).

21 See Irwin, supra note 1; Maynard Keynes, John, Mitigation by Tariff, in Essays in Persuasion 271 (1991)Google Scholar.

22 Bhagwati, Jagdish, Protectionism (1988)Google Scholar.

23 Trebil Cock, Chandler, & Howse, supra note 18.

24 See Deardorff, Alan V., Should Patent Protection Be Extended to All Developing Countries ? in 4 The World Trading System: Critical Perspectives on the World Economy 37 (Howse, Robert ed., 1998)Google Scholar.

25 United States—Restrictions on Imports of Tuna, 30 ILM 1594 (1991) (unadopted panel report, Aug. 16,1991); United States—Restrictions on Imports of Tuna, 33 ILM 839 (1994) (unadopted panel report, June 16, 1994).

26 United States—Import Prohibition of Certain Shrimp and Shrimp Products, WTO Doc. WT/DS58/AB/R (Oct. 12, 1998) [hereinafter Shrimp/Turtle case].

27 Chang, Howard F., An Economic Analysis of Trade Measures to Protect the Global Environment, 83 Geo. L.J. 2131 (1995)Google Scholar.

28 Howse, Robert & Trebilcock, Michael J., The Free Trade-Fair Trade Debate: Trade, Labor and the Environment, in Economic Dimensions in International Law 186 (Sykes, Alan O. & Bhandari, Jagdeep S. eds., 1995)Google Scholar.

29 And see the powerful critique of this view by Amartya Kumar Sen, Development as Freedom (1999).

30 Rodrik, Dani, The Global Governance of Trade as if Development Really Mattered, paper prepared for the United Nations Development Programme (Apr. 2001)Google Scholar (on file with author).

31 Id. at 12.

32 See Gilpin, supra note 4, ch. 12.

33 Ernst-Ulrich, Petersmann, The WTO Constitution and Human Rights, 3 J. Int’l Econ. L. 19 (2000)Google Scholar.

34 Howse, Robert & Nicolaidis, Kalypso, Legitimacy and Global Governance: Why Constitutionalizing the WTO Is a Step Too Far, in Efficiency, Equity, and Legitimacy, supra note 15, at 227 Google Scholar.

35 See Cottier, Thomas & Nadakavukaren Schefer, Krista, Good Faith and the Protection of Legitimate Expectations in the WTO, in New Directions in International Economic Law: Essays in Honour of john H. Jackson 47 (Bronckers, Marco & Quick, Reinhard eds., 2000)Google Scholar.

36 Howse, Robert, Transatlantic Regulatory Cooperation and the Problem of Democracy, in Transatlantic Regulatory Cooperation, supra note 20, at 469 Google Scholar.

37 Benvenisti, Eyal, Exit and Voice in the Age of Globalization, 98 Mich. L. Rev. 167, 200 (1999)Google Scholar (citation omitted).

38 See Sykes, Alan O., The Remedy for Breach of Obligations Under the WTO Dispute Settlement Understanding: Damages or Specific Performance? in New Directions in International Economic Law, supra note 35, at 347 Google Scholar.

39 See Nicolaidis, Kalypso & Trachtraan, Joel P., From Policed Regulation to Managed Recognition: Mapping the Boundary in GATS, in GATS 2000: New Directions in Services Trade Liberalization 241 (Sauve, Pierre & Stern, Robert M. eds., 2000)Google Scholar.

40 See Bronckers, Marco C. E. J., A Cross-Section of WTO Law, ch. 9 (2000)Google Scholar (“Better Rules for a New Millennium: A Warning Against Undemocratic Developments at the WTO”).

41 I am grateful to Sara Dillon for reminding me to stress this point.

42 See Driesen, supra note 16.

43 Shrimp/Turtle case, supra note 26; European Communities—Measures Concerning Meat and Meat Products (Hormones), WTO Doc. WT/DS26/AB/R (Jan. 16, 1998) [hereinafter Hormones case]; European Communities—Measures Affecting the Prohibition of Asbestos and Asbestos Products, WTO Doc. WT/DS135/AB/R (Mar. 12, 2001) [hereinafter Asbestos case].

44 Some of these techniques are discussed in extenso in Howse, Robert, Adjudicative Legitimacy and Treaty Interpretation in International Trade Law: The Early Years of WTO Jurisprudence, in the EU, The WTO and the NAFTA: Towards A Common Law of International Trade? 35 (Weiler, J. H. H. ed., 2000)Google Scholar. See also Howse, Robert & Tuerck, Elisabeth, The WTO Impact on Internal Regulations: A Case Study of the Canada-EC Asbestos Dispute, in The EU and the WTO: Legal and Constitutional Issues 283 (de Burca, Gráinne & Scott, Joanne eds., 2001)Google Scholar (commenting on Asbestos case, supra note 43).

45 There are many who still have not got the point, admittedly. Thus, in a recent article Gregory Shaffer pegs or labels me as a “critic” of the “system”—as if the system any longer existed when an official organ of the WTO, the Appellate Body itself, if not rejects, even more tellingly, simply bypasses the insider view of the requirements or fundamentals of the system (Tuna/Dolphin). If I am a critic of the “system,” then a fortiori so is the court of last instance of the “system.” Shaffer, Gregory, WTO-Blue Green Blues: The Impact of U.S. Domestic Politics on Trade-Labor, Trade-Environment Linkages for the WTO’s Future, 24 Fordham Int’l L. J. 608, 619–23 (2000)Google Scholar.

46 Hormones case, supra note 43, para. 177.

47 Id., para. 104.

48 Vienna Convention on the Law of Treaties, opened for signature May 23, 1969, Art. 31(3) (c), 1155 UNTS 331.

49 Rio Declaration on Environment and Development, June 14, 1992, 31 ILM 874 (1992).

50 Shrimp/Turtle case, supra note 26, paras. 168–72.

51 Id., para. 121.

52 The panel’s finding that the U.S. measures, as adapted, are consistent with WTO law was recently upheld on appeal by Malaysia to the Appellate Body. In rejecting the appeal by Malaysia, the Appellate Body reemphasized the importance of its finding in the original appellate ruling that unilateral trade measures directed at other countries’ policies are not, in principle, excluded from justifiability under Article XX. It stressed that this finding was not dicta and in fact was intended in part to give guidance to future panels. Shrimp/Turtle case, supra note 26, Recourse to Article 21.5 of the DSU by Malaysia, WTO Doc. WT/DS58/AB/RW, paras. 107,137–38 (Oct. 22, 2001).

53 The Federal Vision: Legitimacy and Levels of Governance in the United States and The European Union (Kalypso Nicolaidis & Robert Howse eds., 2001).

54 Howse & Nicolaidis, supra note 34. Much of what follows is derived from that essay.

55 On this point, see also Marco C. E.J. Bronckers, More Power to the WTO? 4 J. Int’l Econ. L. 41 (2001).

56 See Rodrik, supra note 30. See also, on the promise of democratic experimentalism, Roberto Mangabeira Unger, Democracy Realized: The Progressive Alternative (1998).

57 See Vandana Shiva, Tomorrow’s Biodiversity, ch. 5 (2000).

58 Keohane, Robert O. & Nye, Joseph S., The Club Model of Multilateral Cooperation and the World Trade Organization: Problems of Democratic Legitimacy, in Efficiency, Equity, and Legitimacy, supra note 15, at 264 Google Scholar.

59 See the debate about codes of conduct in Fung, Archon, O’Rourke, Dara, & Sabel, Charles, New Democracy Forum: Stepping up Labor Standards, Boston Rev., Feb./Mar. 2001, at 4 Google Scholar.

60 A characterization even bought hook, line, and sinker by some academics; ice Shaffer, supra note 45.

61 Thompson, Ginger, Mexican Labor Protest Gets Results, N.Y. Times, Oct. 8, 2001, at A3 Google Scholar.

62 But as Lord Dahrendorf has recently observed, this will be a messy, rather chaotic process, until new institutional structures are evolved:

For some time to come, we shall live with a confused and rather uncomfortable mix of highly imperfect attempts to democratize global decision-making. . . .

. . . If we cannot have world or even European democracy, at least we can have democrats: people who are conscious of their rights as citizens, and take seriously the responsibility actively to defend them. Citizens do not just let things happen. They speak up, and even if they are not always heard, their voices still matter. They use all non-violent means to check the untrammeled exercise of power. They support visible initiatives such as the counter-World Forum at Porto Alegre earlier this year Democrats without democracy offer a more hopeful prospect than the reverse. Perhaps this was the secret of postwar Germany: there were democrats . . . who were prepared to practice what they believed, and thus created a working democracy. For all we know, something of this kind may one day be achieved beyond the nation-state.

Dahrendorf, Ralf, Can Democracy Survive Globalization? Nat’l Interest, Fall 2001, at 17, 22 Google Scholar (citation omitted); see also Marks, Susan, The Riddle of all Constitutions: International Law, Democracy, and the Critique of Ideology, ch. 12 (2000)Google Scholar; Stein, Eric, International Integration and Democracy: No Love at First Sight, 95 AJIL 489 (2001)CrossRefGoogle Scholar.