Confusion and Clarity in Cancun (Lew Rockwell, LRC):
The breakdown of trade talks in Cancun, Mexico, has been rendered as a clash of rich vs. poor nations. If that’s all you knew, you might think that this is a conventional story, and the usual political drama would follow. The left would side with the poor on grounds that they are being exploited by the rich in a cruel system of capitalist global domination. The right would observe that the poor nations, rather than joining the global trading system, are content to demand aid and privileges that rich nations are reluctant to surrender for good reason.
But looking beneath the surface, we find a crazy mixed-up politics at work in Cancun, the culmination of counter-intuitive trends that have been building for some time. The World Trade Organization is supposed to be this great apparatus to push the world toward greater economic integration, a dream of the liberal school for many centuries. In reality, it was nothing but the resurrection of an old central-planning fallacy that world trade needs a central authority to manage it. In absence of an ideological consensus in favor of classical liberalism, the WTO has ended up politicizing trade by putting the stamp of officialdom on some very bad policies (just as many predicted).
The rich nations (meaning, mainly, the US) swaggered into Cancun with an aggressive, three-pronged agenda: to foist a stricter system of investment rules (including patent and copyright enforcement) on developing nations, to extend US-style environmental and labor regulations to cover poorer nations, and to reduce restrictions on exports to poor nations and foreign investment in them from the industrialized world. What was missing here was the good will to make a change in their own protectionist policies, much less to reduce the production supports for their own inefficient industries.
