November 16, 2005

At the Heart of Europe?: Two hundred years after William Pitt took on Napoleon, Europe is in crisis again. Keith Robbins warns Tony Blair that there are no easy fixes to the issues of democracy that have thrown the ‘European project’ off course. (Keith Robbins, December 2005, History Today)

It is arguable that in its various phases from the construction of the Coal and Steel Community onwards, ‘Europe’ could only have begun to cohere because of the enthusiasm, commitment, even deviousness, of an ‘undemocratic’ elite. In the case of the founding six states that signed the Treaty of Rome, in 1957, however, the political context in which its members worked was one in which the nation-states as they had existed in pre-1939 Europe, had ‘failed’ (in a manner that did not apply to the United Kingdom).

The EEC was of course only a partial ‘Europe’. Its founding members were all ‘democracies’ but they had come to their democracies by different routes. Germany was divided in a Europe in which ‘people’s’ democracies faced those of the West. ‘European’ (i.e. a certain sort of Western Europe) consolidation made economic sense and in particular gave a firm foundation to the desirable reconciliation between France and Germany. There was, however, an ambivalent relationship between ‘democracy’ and ‘integration’. ‘Integration’, whatever it precisely entailed, could certainly draw upon a widespread if imprecise notion that a ‘new beginning’ was required. ‘Christian democracy’, at least as espoused by parties that took that label, suggested a transnational ideology. Likewise ‘democratic Socialists’ differentiated themselves from Communists. These similarities made at least a meeting of minds possible. Integrationist minds, however, seeking what they deemed to be a greater good, were somewhat wary of ‘democratic control’. It might be necessary to suppose that both Nazism in Germany or Fascism in Italy had been ‘imposed’ on the ‘people’ but that was not the whole picture. The ‘people’ might again emerge unregenerate and in a xenophobic frame of mind. Democratic governments should, at appropriate moments, seek the ratification of the people for what they had decided to do, but there was a suspicion of decision-making by perpetual referendum. Use of the referendum by authoritarian regimes had shown how easily wording could be manipulated. Its use in Switzerland simply confirmed the prejudice that Switzerland was the exception to everything. […]

The successive enlargements of the Community on its way to the present European Union have had a kind of ‘democratic’ objective. Greece, Spain and Portugal, as early ‘new members’ in the 1980s, had all been nursed into democracy after their periods of authoritarian rule. One of the most compelling arguments for the EU’s recent and dramatic expansion to include the former Communist states of East-Central Europe was that common membership of the ‘democratic club’ would strengthen their own newly democratic cultures and structures. Such a mission was seen as laudable, no matter what stresses and strains might accompany it. It was the existing member governments, not the people, that agreed admissions and enlargements. The governments of applicant countries have been keen to get in and (Norway excepted) have obtained the necessary popular endorsement of membership on the terms that were offered them. What a referendum in existing member states might have said about enlargement is another matter.

The result, from Estonia to Portugal and from Ireland to Greece, has been the creation of a kind of ‘Europe’ that would not have been imaginable in 1955, let alone by William Pitt in 1805. It brings together some states that have had deep relationships over centuries and others whose interaction has been minimal. It is a democratic ‘Europe’ without precedent. And yet, a clear majority of Dutch and French voters have rejected the Constitution. Possibly for contradictory reasons, the Constitution was found unacceptable.

Sure, it was great fun for continental bureaucrats to impose an EU anti-democratically when they imagined it would consolidate power in their own hands. But now that the only feasible use for it is as a trade union, imposing economic liberalization on the older democracies and stripping power away from bureaucrats, they’ve fallen out of love with it.



November 15, 2005

Blair urges EU and US to break world trade logjam (Lisbeth Kirk, 15.11.2005, EU Observer)

To revitalise stalled world trade talks, the EU and the US must make further concessions, Tony Blair has urged ahead of an important world trade summit in Hong Kong next month.

Speaking at the Lord Mayor’s Banquet at the Guildhall in London on Monday evening (14 November) the UK Prime Minister and current head of the EU Council told the US and the EU to move ahead.

Mr Blair picked up on an offer from US President George Bush, who recently in a speech to the UN called for the removal of all agricultural and industrial subsidies, and said the US would do it if other countries did too. […]

Brussels on the other hand insists it has gone as far as it can, given the resistance of some EU members such as France against offering further concessions.

It’s absurd to let vile nations like France and Venezuela hold up a deal, just cut them out of the process.


October 28, 2005

Change your ways, or no WTO, US warns Vietnam (Aaron Glantz and Ngoc Nguyen, 10/29/05, Asia Times)

Vietnam’s attempts to enter the World Trade Organization (WTO) have been blocked by what the country’s negotiators say are unacceptable new demands by Washington that the socialist country change the way its economy works – more than it already has. […]

For the past 15 years, Vietnam has been changing the way it does business, though perhaps not to the extent Washington would like to see it.

It has embraced market economy, attracted factory jobs from overseas, and towering new buildings have sprung up in the capital and in Ho Chi Minh City. In 2002, foreign investors poured more than US$1.2 billion into Vietnam, and the country seems all set to enter the world’s official club of capitalist nations.

Yet, the administration of US President George W Bush has been pressuring Vietnam to eliminate subsidies and state-owned enterprises. Talks with negotiators from Washington have broken down over what Vietnam maintains are “new conditions” introduced in recent rounds of talks. […]

In April, Oxfam released a report entitled “Do as I Say, Not as I Do: The Unfair Terms for Vietnam’s Entry to the WTO”, which noted that Vietnam is being forced to cut tariffs and subsidies twice as much as neighbors such as Thailand, the Philippines and Nepal. Those countries are already members of the world body.

“For any country, joining the WTO is like jumping into a fast-moving river in the dark without a paddle,” said Steve Price-Thomas, Oxfam’s spokesman in Hanoi. “It’s hard to know for sure what will happen but the important thing is if you jump into a fast-moving river at night you want to make sure you’ve got a life belt, a flashlight, know which way you’re headed, that there’s no rocks, etc. So we hope that Vietnam is ready and prepared for life in the club of the WTO.”

Want to be treated like a democratic ally? Become one.


October 27, 2005

Chirac threatens to veto world trade deal (Sophie Louet and William Schomberg, 10/27/05, Reuters)

French President Jacques Chirac warned Europe’s leaders on Thursday he would torpedo a global trade deal if EU negotiators made further sacrifices in farm protection measures to keep the talks alive.

A day before Brussels tries to revive negotiations by putting a revised farm offer to key trading nations, Chirac told EU leaders Paris was prepared to exercise its veto right to block the required unanimous European approval of any agreement.

Chirac told a news conference he had made clear at a summit that France reserved the right not to approve any agreement that went beyond a 2003 reform of Europe’s agricultural spending.

“It’s out of the question for us to take any further step,” he said. “It’s a red line of what would be acceptable for us.”

Why not just drop France from the deal and let them subsidize the whole world’s truffle consumption, or whatever they grow there?


October 25, 2005

Lost in the Woods (LAWRENCE HERMAN and GARY HUFBAUER, 10/25/05, NY Times)

AS Secretary of State Condoleezza Rice continues her talks in Ottawa today, she may find that the most acrimonious disagreement between Canada and the United States is not a question of hard power – issues like Afghanistan, Iraq and nuclear nonproliferation – but of softwood. A quarter-century-old dispute over Canadian lumber exports, which Washington claims are unfairly subsidized, has escalated to the point where it now threatens broader relations between the two countries.

If it remains unresolved, the softwood war might also spill over into the December ministerial meeting of the World Trade Organization, where Washington and Ottawa have long worked together to expand free trade. What kind of example does it set for the rest of the world if the United States and Canada – close neighbors, each other’s largest trading partner and crucial allies – cannot resolve their own trade disputes?

American and Canadian lawyers, lobbyists and negotiators have been fighting on and off over Canadian lumber exports to the United States since the 1980’s. In 1982, a coalition of 250 American lumber mills claimed that Canadian provinces were subsidizing lumber exports by charging set “stumpage fees” – the price forest companies paid when harvesting standing timber – while American mills were paying open market prices. While the fight over things like stumpage fees is complex enough, it got a sharp twist in 2000 when Congress passed an amendment giving American companies injured by foreign trade the punitive duties imposed by the United States, which in the case of Canadian lumber exports now amount to about $5 billion.

Never mind that the right of the United States to impose such duties is in dispute…

Even if the trade dispute is moronic and the duties foolish, we can’t cede our right to act in our own perceived national self-interest.


October 21, 2005

France digs in heels on farm subsidies (Tom Wright, OCTOBER 20, 2005, International Herald Tribune)

France on Thursday dug in on its refusal to permit new cuts in European farm supports that are needed to advance global trade talks, irking the United States and raising questions about whether a blueprint to lower trade barriers around the world can be completed before a crucial set of talks scheduled for December in Hong Kong.

The showdown put Peter Mandelson, the European Union’s chief trade negotiator, under renewed pressure to find a way to open European farm markets after the United States last week offered to cut agricultural subsidies to restart the round of trade talks, known as the Doha round for the city in Qatar where they began in 2001. […]

Developing countries led by Brazil are anxious to overhaul this system, which they say encourages overproduction and crushes the livelihood of their farmers as agricultural products subsidized by rich countries depress global food prices.

The United States also sees an opportunity to reduce some $19 billion worth of agricultural subsidies, as corporations and a growing body of U.S. farmers complain that the backlash against these subsidies has caused trading partners to seal off market access to a variety of U.S.-made goods.

Getting Europe to reduce its barriers would open up markets for American farm exports. But European farmers, supported by $60 billion in annual subsidies, are vehemently opposed to any change in the current system.

In countries like France, politicians often view farm reform with suspicion, equating it with attempts to undermine the French way of life.

Nicolas Sarkozy, the French interior minister, said Thursday in an opinion piece published in the French business newspaper Les Echos that further reform was “not acceptable.” He said it would mean a dismantling of Europe’s Common Agricultural Policy, which dictates farm subsidies across the EU, and would put “an end to Europe’s status as an agricultural power.”

The Australian trade minister, Mark Vaile, lashed out at that stance, saying, “France and other EU members have taken the EU to the brink of collapsing the round.”

Rather than adjusting to the most dysfuntional person in the room, why not leave him in his room by himself while the rest of us get on with life?


October 19, 2005

Tables may be turned on US over Kyoto (Lisa Plit, 9/29/05, Business Day)

ALTHOUGH the US, the world’s leading carbon polluter, remains outside the Kyoto Protocol, its hand could well be forced in the not too distant future. Having declined to ratify Kyoto, the US is not obliged to meet the emission reduction targets the protocol lays down, ostensibly on the grounds that it would hurt the US economy.

By staying out, the US could gain significant economic advantage over its industrialised counterparts that are party to the protocol as they will, in the short term, incur major implementation costs.

Not surprisingly, these countries are so peeved that they may turn to the World Trade Organisation (WTO).

The General Agreement on Trade and Tariffs, predecessor to the WTO, contained a provision that could be used to provide some protection for the environment. It recognised that, in exceptional circumstances — including the need to protect human, animal or plant life or health, and to conserve exhaustible natural resources — international trade could be

The WTO founding documentation states that while “trade and economic endeavour should be conducted with a view to raising standards of living”, it should allow “for the optimal use of the world’s resources in accordance with the objective of sustainable development”. It should also seek to protect and preserve the environment and enhance the means for doing so “in a manner consistent with their respective needs and concerns at different levels of economic development”.