Globalization One Year After Seattle

On November 30, 1999, the "Millennium Round" of negotiations for the World Trade Organization collapsed under the weight of the massive public exposure that it received for the first time in the streets of Seattle. It was an event that changed history.

By last May, the New York Times had noted that the opposition had "made globalization a naughty word," and leading advocates such as International Monetary Fund (IMF) Deputy Director Stanley Fischer were looking for "another way of describing economic integration, if the idea is ever to become popular again."

Congress had ratified America's membership in the WTO five years before Seattle, but only because nobody was paying attention. The organization wasted little time in proving to be its opponents' worst nightmare. Should the US Environmental Protection Agency have the right to set standards for the quality of imported gasoline? Can we decide that shrimp that is sold in US markets must be caught in a way that minimizes the killing of sea turtles, in accordance with our Endangered Species Act? Should Europeans have the right to reject beef that is treated with growth hormones?

In each of these cases the WTO's answer was no, and so it was increasingly seen -- especially by environmental and citizens' groups -- as a threat to national sovereignty and the ability of governments to regulate commerce in the public interest. Labor, too, saw the immediate threat of an organization that was willing to write hundreds of pages of rules to protect corporations, but solemnly declared that the rights of workers were outside of its jurisdiction.

The WTO has not yet set a date for the resumption of the Millennium Round. Given what was on the agenda, the "Seattle coalition" of environmental, labor, citizens' groups has certainly done the world a service.

One of the WTO's main agenda items is to proceed with implementation of its agreement on intellectual property rights. This is much uglier business than it sounds, when one considers the fate of 25 million Africans now afflicted with AIDS or HIV. Many, if not most, of these people could be saved if they had access to anti-AIDS drugs that are now available in the United States. At patent-protected prices, this would cost tens or even hundreds of billions of dollars, and is really outside the realm of possibility.

At the cost of production, the amount required would be a very small fraction of the patent-protected price, and could be affordable with increased foreign aid. More than 4 million people have already died, and it is very possible that millions more will die needlessly, because the principle of enforcing intellectual property rights internationally is considered to be more important than saving lives.

In the last year, the Seattle coalition opened up new fronts against even more powerful global institutions: the IMF and World Bank. Like the WTO, these organizations have served to remove decision-making authority from elected governments to non-elected, unaccountable officials. The IMF and the World Bank control access to credit -- not only from themselves but from other sources -- for many countries. As a result, they are able to decide on the most important economic policies for dozens of countries, often with disastrous results.

The Seattle coalition has demanded an end to some of the most destructive practices of the IMF and the World Bank, as well as the WTO. More than four years ago, under increasing public pressure, the IMF and the World Bank promised debt relief for 41 "Highly Indebted Poor Countries (HIPC), but they have been dragging their feet ever since. So far only one country -- Uganda -- has actually had its debt service payments reduced through this initiative. Meanwhile, the amount of debt service paid by HIPC countries is 25 or 30 times more than the total amount spent on international programs to combat AIDS.

Despite the lack of reform at the top, there has been progress over the last year -- most importantly the WTO's indefinite postponement of new negotiations. The debate has changed, with policy makers and the press now accepting some of the criticisms of globalization that were put forth at Seattle. And just last month advocates for the poor won a significant victory against the World Bank: the Bank agreed, in response to a law passed by Congress, to end its practice of requiring borrowing governments to impose fees on poor people for primary education and health care.

Seattle showed that even the most powerful, unaccountable global institutions were vulnerable to a grassroots campaign that could subject them to public scrutiny. They still haven't recovered from the shock.

Mark Weisbrot is Co-Director of the Center for Economic and Policy Research, in Washington, DC. His latest paper, "One Year After Seattle: Globalization Revisited" is available at www.cepr.net.

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