THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Tuesday, August 16, 1994 TAG: 9408160010
SECTION: FRONT PAGE: A10 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 64 lines
Although it's been thoroughly overshadowed by the crime bill and the health-care battle, another major issue Congress must wrestle with this year is the revision of the General Agreement on Tariffs and Trade, one of the building blocks of post-war world prosperity. A bizarre coalition of Naderite liberals and hard-right conservatives have joined together in an effort to defeat ratification. The agreement, however, deserves to be passed.
The GATT has been continuously revised over the years in various ``rounds'' of negotiations, which set world trading rules. The new ``Uruguay Round'' of revisions would slash many tariffs here and abroad which could result in an estimated $100 billion to $200 billion in newly created wealth. That means more American jobs, especially in Virginia, for which Hampton Roads serves as the major gateway for world trade.
The new GATT on a ``fast track,'' which means its fate will be decided by a single up-or-down vote in both houses with no amendments, would also help fight inflation. It would outlaw anti-competitive practices such as quotas and local-content laws. The GATT would modify such idiocies as ``anti-dumping'' laws - penalizing companies for selling products for less than it supposedly costs to make them - which only hurt the consumer.
Removing those barriers has naturally upset protected corporations and trade unions. Textile manufacturers, who will lose their import quotas, have been the sugar daddies behind much of the anti-GATT campaign that has been running in newspapers and on television across the country. Gov. George Allen is among those who have publicly expressed reservations about the new treaty.
The Clinton administration, unfortunately, has done little to counter the barrage of criticism, perhaps in an effort not to further antagonize the union support it wounded during last year's NAFTA battle. The administration has even sought to mollify its critics by asking Congress for fast-track authority to negotiate labor and environmental standards in future trade rounds.
Such efforts would help stifle further opening of world trade, especially in the developing world. The Senate Finance Committee wisely has refused to extend such trade authority to the Clintonites.
The major point of contention for the opponents of GATT, however, is the creation of the World Trade Organization, which will be created by ratification of the treaty and which will police its provisions. The WTO would give offending nations a choice: Either change the law that is out of compliance with the new treaty, or the complaining nation can slap tariffs on imports from the offender.
Critics say this would imperil U.S. sovereignty, since no individual nation can veto GATT panel decisions, as is now the case. But under the present regime, since any nation can veto a decision, the United States has often ended up the loser since we are the world's largest exporter. Criticism of WTO also overlooks the fact that the choice remains with us. At worst, another nation would place tariffs on our goods, which would hurt that nation's consumers. And if it gets to the point where the WTO is behaving completely unreasonably, the United States can withdraw from the pact on six months' notice.
Freeing up world trade should be a major priority of the Clinton administration. It did yeoman work getting NAFTA passed. But instead of more Japan-bashing, which the administration seems to enjoy, the White House should concentrate on getting GATT through Congress. by CNB