International Socialist Review Issue 11, Spring 2000 WTO: A World Government? by Paul D'Amato THE WTO is an organization, not of corporations, but of states—more precisely, state trade representatives. These representatives advance the interests of industries and multinationals based in their home countries. The WTO, like other international bodies, answers first and foremost to its most powerful participants—the U.S., Europe and, to a lesser extent, Japan. Some critics of the WTO advance a different argument—that the WTO is a kind of unnacountable world government of transnational corporations that stands above the power of states and dictates to them. It’s true that the WTO is unnaccountable to the majority of the world’s people. But national governments are as beholden to corporations as the WTO. They are not accountable to the majority of their “own” citizens—workers and poor people. They take their cues from large corporations and they appoint trade representatives to the WTO on that basis. The WTO doesn’t violate the “sovereignty” of its biggest players—the “Quad” countries. When these countries have trade disputes with each other, the issue is not that one violates the sovereignty of the other, but simply that powerful states are fighting for position in their ongoing trade wars. It is, in fact, they who gang up and violate the sovereignty of the WTO’s weaker players. The difference between the “Quad” countries and the poorer countries in the WTO is that the latter have far less trade leverage. Where massive, diversified economies like that of the U.S. can afford to take a trade hit if they refuse to abide by a WTO ruling, economies that are often dependent on the export of one crop or raw material cannot. Europe and the U.S., as we have already pointed out, can set the WTO’s agenda whenever they agree. Like the clean-air ruling shows, the U.S. may “bow” to a WTO decision as a cover for implementing policies the government actually supports but doesn’t want to take responsibility for. Like the effects of structural adjustment programs pushed by the IMF, the poorest countries are hurt the most by WTO trading arrangements. UNCTAD, for example, estimated that the 47 least developed countries will lose more than $160 billion in export earnings as a result of the Uruguay Round Accords. Uruguay Round tariff schedules set tariff rates so that they are lowest for raw commodities and highest for processed and manufactured products—an arrangement that benefits the most industrialized countries and penalizes the poorest countries dependent on raw commodity exports. The question of the violation of “sovereignty,” therefore, does not apply to the WTO’s most powerful leading states but to its weaker member states which do not have the wealth or resources to effectively challenge WTO rulings. It is therefore no surprise that more than two-thirds of the complaints made by the U.S. to the WTO against other countries have been judged in favor of the U.S.