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The Business of the World Is …
One of the central tenets of the World Trade Organization is that the nations of the world should operate under a system of rules that facilitate trade. The WTO, through a process of majority rule, develops standards to which each nation must adhere. The priority of the World Trade Organization, as its name implies, is the free flow of commerce. The problem arises when nations enact standards that they believe to be of paramount importance and these standards interfere with the free flow of trade. Frequently these barriers to free trade are motivated by a desire to protect the nation’s environment or its population’s well being.
For example, the U.S. government may enact a regulation requiring all petroleum products to meet certain environmental standards. This may work to the disadvantage of other nations, such as Brazil or Venezuela, who seek to export petroleum that does not satisfy these standards. Their petroleum will thus never enter the U.S. market. Brazil would have the option of challenging these regulations based on the argument that they impose barriers to free trade. The World Trade Organization would be in a position of sanctioning the United States for its protectionist actions.
The legitimacy of this sanction is a subject of some controversy. On one hand this is a completely acceptable action for the World Trade Organization. If the United States is engaging in practices that have the effect of interfering with international commerce, of preventing Brazil and Venezuela from gaining access to essential markets, then it should be sanctioned. The WTO ensures this result. On the other hand, if the United States has concluded that environmental concerns are to receive priority over the interests of commerce, that decision should be honored. If any government has made the determination that commerce is less important than the fate of the planet, then that decision should be respected, not challenged, by the other nations of the world.
The motivation of much of the protest aimed at the WTO is that it values international trade over more important things such as the world’s environment and the health of its people. Do you find merit with this position?
As a personal matter, in which do you place more value: the world’s environment or international trade? Do you believe it is possible to have standards that protect both the global environment and economy? Do you think the World Trade Organization would be able to protect both, or ultimately must a choice be made between the two?
In the situation described above, do you agree with the World Trade Organization’s decision to punish the United States for enacting a standard that prevents some petroleum products from reaching its shores? Should a nation be able to say to the world, "Our environment is more important than international oil companies being able to make money?" Do you think that is what the United States was doing here? Is it possible that the United States enacted these standards, not to protect the environment, but to protect petroleum refined in the United States by American companies? If so, does that change your analysis and conclusions?
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