IN THE wake of the test ban treaty's defeat in the Senate, it seems slightly surreal that America is preparing to host a summit on world trade. Next month in Seattle, ministers from the World Trade Organization's 134 countries, thronged by nongovernmental organizations and business lobbyists, will gather in the hope of launching a round of tariff-cutting talks. It would be a vastly ambitious project under the best of circumstances; the last trade round took seven years. Now that America's treaty-making credibility has suffered, the launch of the new round looks positively heroic.
The challenge for the Clinton administration, as was the case for the test ban treaty, is to forge a position that is acceptable to foreign negotiating partners but also politically viable at home. Neither foreigners nor domestic opinion are making this easy. In Europe, the French want to protect their movie industry from Hollywood, and most of the European Union is addicted to protectionist farm subsidies. In developing countries, there is opposition to a broad trade round because the job of implementing the last one is not yet finished; but there is also opposition to a narrow trade round for fear that it would include only sectors from which rich countries would gain. Meanwhile in America, the cause of trade liberalization has yet to recover from the demise of fast track two years ago.
Not surprisingly, the Clinton administration fears its domestic critics more than its foreign ones. In a speech on Wednesday, President Clinton insisted that agriculture should top the agenda, despite European objections. He declared that e-commerce should remain free of tariffs, a natural position given America's dominance in that sphere. He made no mention of reforms to anti-dumping regulations and investment rules, which other countries have been pushing for. He did, however, bow to two Democratic constituencies by demanding that the WTO create a working group on the enviroment and labor rights.
If it wants a successful trade round, this administration and its successor are going to have to give as well as take. That will require building a political alliance that supports the giving. The president is well aware of this; indeed, his speech cast the challenge of building a free-trade consensus in his party as the last mountain left for centrist New Democrats to climb. In the hope of starting that process, Mr. Clinton talked of expanding trade's circle of winners--of making tariff cuts more popular by sweetening them with programs to help workers whose jobs the cuts destroy. But some of the president's rhetoric was puzzling. He talked of "a new kind of trade round," of "a round about broadly shared prosperity, about improving the quality of life and work around the world."
That kind of language risks bolstering trade's enemies. It implies, entirely spuriously, that past trade deals have failed to improve living standards in America and abroad. It is true that the recent expansion of trade has been accompanied by growing inequality, both within and between countries. But that trend has less to do with trade than with technology, which displaces uneducated workers and increases the rewards for skilled ones. If America is to return to a free-trade consensus, it is going to need leaders who make the case for trade in more robust terms.