Normalization of trade relations with China depends on China's willingness to open its markets and play by the rules set for members of the World Trade Organization (WTO). With the House due to vote this month and the Senate probably in June, debate on this issue will be on the front burner.
I support permanent trade normalization, but Congress must play a more direct role in determining our future relationship with all WTO member countries, not just China.
In December 1994 Congress passed legislation implementing a new GATT (General Agreement on Tariffs and Trade), which established an international body known as the World Trade Organization. When Congress agreed that the United States should join the WTO in 1994, I was concerned, as were many Americans, that this forum might be harmful to legitimate U.S. interests in global trade. Others believed, and some still do, that Congress was legislating away American jobs and sovereignty.
Since its inception, the WTO and its dispute-settlement decisions have been controversial. Most frustrating have been efforts by some countries to avoid compliance with WTO decisions. The United States wins far more cases than it loses, but any new legislation must address the failure of countries to abide by WTO decisions; otherwise, the WTO will become a nullity.
My proposal addresses situations in which the United States is the losing party in the WTO. I believed while in Congress--and still do--that we should establish a WTO dispute-settlement-review commission to ensure that legitimate U.S. interests are fully protected.
In 1995 I, along with Sen. Daniel Patrick Moynihan (D-N.Y.), introduced legislation to establish such a commission. It had bipartisan support. One supporter, Rep. Sander Levin, now is advancing a proposal that is similar but would apply only to China. In 1995-96 my bill would have passed overwhelmingly but for the procedural maneuverings of those whose ultimate goal was to kill the WTO.
Passing similar legislation now could be helpful to undecided members in determining their vote on permanent normal trade relations with China. My proposal would protect U.S. interests and would strengthen the likelihood that the agreement with China will be to our long-term advantage.
The commission would be a U.S., not an international, agency, composed of five federal judges. It would review all WTO cases in which the United States is the losing party. If the commission determined that the WTO exceeded its authority or abused its discretion, it would report that to Congress. Any member of Congress then would have the right to introduce a joint resolution directing the president to try to negotiate corrective modifications in WTO rules.
If the commission reported three abusive decisions by the WTO during a five-year period, any member of Congress could introduce a joint resolution calling for U.S. withdrawal from the WTO. If such a resolution were enacted within 90 legislative days and there were no changes in WTO rules, the United States would cease to be a WTO member.
The purpose of this three-strikes process is to provide some U.S. control over the WTO dispute-settlement mechanism. It is in our national interest for the WTO to work well and to gain credibility.
Some critics said at the time that my proposal would destroy the WTO, politicize the dispute-settlement process, overburden our judiciary and cause copy-cat legislation to be enacted in other countries. I disagree.
Dispute-settlement panels would be far more careful in their interpretations of trade agreements knowing that a country's impartial judiciary was to scrutinize the result. Perhaps more important, negotiators of trade agreements would use far greater precision in the language of future agreements, which would then reduce the number, complexity and duration of disputes. In the end, the WTO would be stronger.
This proposal would reduce the political influence of both extremes of the trade debate--i.e., those who wish to throw open every aspect of our economy to the world's producers no matter their business methods, and those who would close our borders whether through new tariffs, quotas, sanctions or other methods of protectionism.
If the WTO were found to have acted properly, affected interest groups could complain to kingdom come: The finding of the review panel would validate the WTO process. On the other hand, a finding that the WTO exceeded its authority almost certainly would cause the trade organization to take corrective action.
The "three strikes" test is also a buffer against politicization. It would take three abusive decisions within five years to trigger U.S. withdrawal. The problem then would pretty clearly lie with the WTO, not U.S. politics. With respect to the burden on the judicial system, the record of the WTO to date shows that the commission would be called upon infrequently.
Finally, the United States should welcome the adoption by other countries of similar legislation. Nothing could be more beneficial for the WTO process than more scrutiny, more involvement by its members in precise negotiating of rights and obligations in trade agreements and greater transparency in dispute settlement.
The writer was the Republican candidate for president in 1996.