Black or white?

A World Without Walls: Freedom, Development, Free Trade and Global Governance By Mike Moore, Cambridge, £ 20

A World Without Walls arrived in my office the week before the now ill-fated Cancun summit started, and I began reading it to see what the past might portend for the future. Mike Moore, former prime minister of New Zealand, was director general of the World Trade Organization from 1999-2002 and had presided over the previously ill-fated WTO summit at Seattle that to this day serves as emblem for the anti-globalization movement. But he also successfully launched a new round at Doha. What could he tell us about the possible strengths and weaknesses of the WTO? What was his diagnosis of why trade negotiations launched after Doha were not making progress?

As it turned out, this book, part memoir of Moore’s WTO days, part polemic on behalf of globalization, underestimated the obstacles to concluding and new round of trade negotiations. Although Moore faithfully catalogues the divisions between the developed and developing world, this book exudes a kind of cheery optimism that does not quite do justice to the depth of these divisions. The book is much stronger on the bureaucratic politics of the WTO, on the manoeuvrings that got Moore to the position of director general in the first place, and as a general brief on the benefits of trade liberalization, than on the challenges the WTO is likely to face in the future.

The first half of the book recounts the success of globalization: the link between trade and growth, the alleviation of poverty that took place in the Nineties and so forth. The book is still worth a quick read. It is written in a nonchalant, folksy style and is lot of fun. Moore is quite candid about the “sordid” deal that was negotiated to allow him to split a six-year term with the present director general, Supachai Pantichpakdi, after a stalemate. He has quite a few good jokes at the expense of his fellow politicians. There are one-liners such as this: in politics “your opponents are in the other party, your enemies are in your own.” But A World Without Walls also provides many accessible insights into the politics of the one multilateral organization that more than any other symbolizes the passions for or against globalization.

The first misconception that this book will remove is the idea that the WTO is anti-democratic. Indeed, the talks at Cancun, or for that matter Seattle, failed not because the WTO is anti-democratic, but because in some ways it is too democratic. The WTO’s rules are negotiated by member states and implemented only by consensus. Indeed, the irony of the failure of Cancun is this: the outcome legitimizes the thought that the WTO has not turned out to be as anti-democratic as its opponents claimed. After all, nothing is moving without consensus. Second, the WTO is not as bureaucratic as is claimed either. It has the smallest staff — about five hundred — compared to the thousands employed by organizations such as the International Labour Organization. Third, its dispute resolution methods, while not perfect, have given all kinds of countries a forum to seek redress, sometimes even against the unilateralism of the powerful. In short, the WTO is an organization with potential to bring a fairer trading order, at least compared to a world of unilateral trade protections that the powerful nations often afflicted on the weak. It is not simply reducible to a partisan organization that serves only the interests of the strong. Indeed, as Moore points out India has managed to achieve most of its WTO agenda: blocking the introduction of labour, environment and other issues, and getting more time on the so-called Singapore issues. Indeed, Moore almost endorses India’s claims that each country will have to find its path to globalization at its own pace.

Fourth, in the final analysis, strong states, such as India, China and Brazil, are a surer means for bringing about fairness than that vague entity known as international civil society. Seattle and Cancun collapsed because of the interests of the states inside, not the protests taking place outside. Its possibilities explain why the WTO’s membership has steadily grown, and Moore rightly thinks that the entry of China to the WTO will affect the balance of power within it. Moore himself is a proponent of reform in the governance of global institutions, principally to strengthen their democratic potential.

But in the end, Moore fails to learn from the insights he himself offers in the book. There are two views on the WTO’s role. One supported by Jagdish Bhagwati, is that it should confine itself to matters of trade and tariffs (not even be the enforcement of property rights issues). The second advanced by Moore himself, is an expansionist agenda. Trade is linked to everything from competition policy to transparency in government procedures, from the environment to labour, and all these issues ought to come under the WTO’s mandate. This will make not only for a more unwieldy negotiating agenda as Cancun demonstrated; it also heightens the fears of those who think the WTO is a great usurper of sovereign power. While Moore is right to suggest that there needs to be thinking about governance at a global level, he is surely too optimistic to suggest that these are the sorts of issues that the WTO can handle.

The second conundrum that Moore never quite faces is this: What is the relationship between global institutions and domestic electoral politics? It is one thing to argue that agricultural subsides in Europe are bad for the developing world; it is quite another to make this argument when you are seeking the votes of farmers in your constituency. Arguably, the WTO succeeded for the same reason that the early phase of economic reforms succeeded: cutting trade tariffs or even protection of intellectual property rights are not big electoral issues, but agricultural liberalization will be. Even creating a more robust civil society at the international level, or more democracy in international institutions will not solve the problem of what incentives politicians face in their own domestic constituencies. The irony of A World Without Walls is that the wily politician Moore, labour leader and prime minister is entirely supplanted by the policy wonk director general, in whose conception of the world, politics disappears. But as we know from Cancun, politics cannot be wished away.