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September 22, 2003

WILL CHINA BE JOBBED BY WTO?

By Tom Plate

The unnerving collapse of the Cancun trade talks

© 2003 Asia Pacific Media Network


LOS ANGELES -- There is nothing like having a job. Your life has structure (maybe even meaning), you can put food on the table, and you may even have enough money left over for a movie, dinner or vacation.

There is also nothing quite like not having a job. You have nowhere to go and nothing to do, you can’t look your family in the eye, and you can’t afford those little extras.

Unemployment rivals threats like SARS and perhaps even Al Qaeda in the fear it strikes in the hearts of global men and women. For them -- Muslim, Hindu, Christian or Jew -- joblessness is the true homeland insecurity.

Though the overall picture is not yet terrifying, developed economies report little job growth. The largest, the United States, has had to endure seven straight months of employment decline. One now sees job-loss-fear in the eyes of people in successful Singapore, for decades accustomed to near-invisible unemployment. One sees the fear in Hong Kong -- once a near-nirvana of jobs.

‘‘Jobless syndrome’’ was at the heart of the cacophony at Cancun, where the ministers of the World Trade Organization (WTO) recently had a big meeting that dramatically fell apart. It was the WTO’s second major meltdown. The first occurred in the 1999 ‘‘Battle of Seattle,’’ when anti-globalization street demonstrations all but closed down the summit. That scene was repeated in the lovely Mexican resort city hosting some 150 or so national delegations.

The point of global free trade is to generate more jobs and more wealth for all nations. But the conference broke up like a bad marriage, with more finger-pointing than consensus. The killer issue was farm subsidies: import taxes or tax-relief benefits that governments hand farmers to protect their home-grown produce from being under-priced by imported produce. Such protectionism is particularly rampant in France, Japan and the United States.

The point of subsidies is to protect existing jobs; the ambition of globalization is to create new jobs. The worldwide economy is now in equipoise between the conservatism of protectionism and the liberalism of globalization.

Some high-profile jobs were on the line, too. After all, the leaders of the rich countries don’t want to lose their jobs. And so the U.S. delegation resisted lowering tariffs on various imports so farmers and ranchers would not lose their jobs in market openings. If they did, they might not vote for the reelection of President George W. Bush, and so he would lose his job. Ditto Japan (rice farmers and the ruling Liberal Democratic Party are two peas in a pod) -- and many others.

In the poor countries, the politicians’ goal is to keep their jobs by creating new jobs, not saving existing ones, those being in short supply anyway. But the poor can’t gain unless the rich give up something. And that didn’t happen. The rich were in no such mood.

That’s why the Cancun collapse highlighted two serious problems. The first is the ethical issue of our increasingly interlaced global village. Is it morally right for rich countries to maintain (if not increase) their level of wealth if the poor are left behind? Is a resource-distribution system that doesn’t benefit those who are the least well-off in any sense moral -- or in the final analysis even functional?

The second issue concerns China. At Cancun, Beijing positioned itself at the center of the so-labeled G22, a new group of ‘‘emerging’’ economies that includes, notably, India. The G22 balked at the measly concessions on agricultural issues offered by the rich. But China has based much of its recent economic policy on its commitment to globalization, and meeting the requirements of WTO membership has caused unnerving levels of social dislocation and unemployment on the mainland.

For example, wives are waving goodbye to husbands who migrate from rural homes and farms for New Age jobs located in the richer coastal cities. Sometimes the jobs are there, sometimes not; the women remain behind, forced to take up the economic slack with a second or even third job (if such menial tasks exist). An honest poll of women in rural China would probably not show great support for the WTO.

Accordingly, Beijing itself may lose enthusiasm for the WTO (the outside motor for much-needed modernization in China) if the organization continues its dive. Connecting the dots between Seattle and Cancun hardly inspires confidence. Having made the epochal decision just a few years ago to buy into the WTO, the Chinese may now be wondering exactly what they have bought into. The Cancun collapse had to be especially unsettling to the leaders of the most populous nation. If the WTO experiment proves a failure, they could lose their jobs. In China, it’s happened before.


The above weekly column has just appeared in the Honolulu Advertiser, The South China Morning Post and The Straits Times of Singapore. The author, Tom Plate, is a regular columnist at these three papers. The column also appears in other world newspapers, including The San Francisco Chronicle, The Seattle Times, The Japan Times and The Korea Times. Email him at: tplate@ucla.edu.

For publication and reprint rights, contact the author directly or John Simpson (john.simpson@latsi.com) of the Los Angeles Times Syndicate International.


Bio Remarks: Tom Plate is a professor of Policy and Communication Studies at UCLA where he founded the Asia Pacific Media Network. He is a regular columnist for the Los Angeles Times Syndicate International, the South China Morning Post, The Straits Times and the Honolulu Advertiser. He is a member of the World Economic Forum, the Pacific Council on International policy and the author of five books. He has worked at TIME, the Los Angeles Times and the Daily Mail of London.

Previous Columns:

In Japan, It's Time for Special-K
(September 18, 2003)

Watching A Japanese Sunrise
(September 15, 2003)

The Beginnings of Democracy in China?
(September 8, 2003)


The Metaphor of the Two Suns
(September 7, 2003)