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The World Trade Organisation
- dictates the rules for global economic activity
- thus ensuring that profit will count for more than life in the 4 corners of the globe
- provides a legal gloss to legitimise the interests of the richer countries and their corporations
- deprives the governments of the poorer countries of the power to dictate their own economic future
- makes illegal (under the baner of ‘free trade’) all the tricks used by the wealthier nations so successfully in their past:
-subsidies to infant industries
- i.e. forbids any government intervention to favour local industry
- thus making any nation’s present day ‘comparative advantage’ seem given and natural, rather than the long product of partnerships between government and private enterprise
- allows Europe and the US to restrict entry of products like textiles, footwear, and agricultural produce from low-wage poor countries which have a comparative advantage, thus protecting their own vulnerable economic sectors
- while at the same time forcing the latter to open up their economies to products from rich countries
- thus it deprives poor nations of the capacity for creating competitive advantage
- condemns the majority of the world to poverty
N.B. The US and the countries of Europe were all protectionist when they grew wealthy, with ‘protected industries’ and ‘lax intellectual property rights’. In Asia, the 2 most successful economies, Taiwan and Korea, were also protectionist in their early years.
Quote from the late great economist Friedrich List:
“It is a very clever common device that when anyone has attained the summit of greatness, he kicks away the ladder by which he has climbed up…to deprive others of the means of climbing up after him. Any nation which by means of protective duties and restrictions on navigation has raised her manufacturing power and her navigation to such a high degree of development that no other nation can sustain free competition with her, can do nothing wiser than throw away the ladders of her greatness, to preach to other nations the benefits of free trade” (that she herself has just discovered).
(p. 107 in Gallagher ed. “Putting development first”)
(i) Petrella, Ivan in Rowland, C. ed. “The Cambridge companion to Liberation Theology” CUP p.281
(ii) Fort, M., Mercer, M., Gish, O. “Sickness and Wealth. The corporate assault on global health” South End Press (2004)