TCS Daily

Destined to Fail

By Claude Barfield - September 4, 2002 12:00 AM

Though last-minute compromises may paper over fundamental disagreements regarding central environmental goals at the Johannesburg Summit, there is already a theme of failure emanating from this vast and disparate assemblage of government officials, public interest organizations and multinational corporations. As a result, there will almost certainly be a reassessment by northern environmental organizations and national (particularly European) politicians who support them regarding the best means of advancing an international environmental agenda.

Among the options that have already emerged-and which will undoubtedly be pushed with greater force after the summit-is the creation of a World Environmental Organization (WEO) that would oversee and enforce internationally-mandated environmental rules. Indeed, French President Jacques Chirac, addressing the Earth Summit, said, "To better manage the environment and ensure compliance with the Rio principles, we need a World Environmental Organization."

Proponents of such an organization see it as a counter weight to the World Trade Organization (WTO), an organization run (in their view) by trade ministers with little or no regard for environmental protection, in conjunction with profit-maximizing multinational corporations. In contrast to the "undemocratic" WTO, some environmental leaders foresee a more "democratic" environmental organization, where national environmental ministries, working closely with the direct participation of non-governmental organizations, will establish new, enforceable environmental rules.

The hard political and economic realities that will underpin a new WEO, however, portend a much different result-and will confirm that oft-stated maxim that organizational reform, and even the creation of a new dedicated international body, cannot resolve fundamental policy and political differences where they exist. Indeed, over the past seven years, the WTO itself has been running a controlled experiment that aimed to get beyond the current stalemate on environment and trade by forging substantive compromises backed by a system of dispute resolution. This experiment came in the form of a Committee on Trade and the Environment (CTE) established in 1995.

From the environmentalists' point of view, the experiment has been a resounding failure-but what they refuse to acknowledge is that the reasons for the failure will carry over to the structure and operation of a new WEO.

First, a new WEO, like the WTO and the CTE, would be dominated by developing countries-about three-quarters of total membership. They would thus control the agenda, and be able to block attempts to force developing countries to put in place new, highly restrictive national environmental rules.

Second, either under a system of rulemaking by consensus as in the WTO, or some mechanism short of unanimity, developing country power would far outdistance that of the U.S., Europe or Japan combined. Proposals in the WTO for a new system of trade-weighted voting have been strongly opposed by leading developing countries such as China and India, who counter that the only "democratic" means of decision making would utilize population size as means of weighting votes.

Third, northern environmental groups will find that, as has been the case in the CTE, southern NGOs will support their governments in resisting attempts to coerce enforcement of international environmental rules through trade sanctions.

Fourth, again as is the case in the WTO and CTE, leaders of developed countries (U.S., EU) will find deeply divided constituencies in their domestic politics-with powerful business groups at odds with influential environmental organizations. This has and will continue to make it difficult for these governments to present a strong, united front on international environmental issues.

Finally, while it is true that in the United States and many European countries, environmental ministries may hold different views than trade ministers, in no instance do environmental ministers have the final say on international economic negotiations-even in developed countries they are often defeated by more powerful commercial and financial ministries (viz., U.S. where the Commerce and Treasury Departments can almost always trump USTR). And many developing countries do not even possess environmental ministries, so by default trade and commercial bodies dominate policymaking on international issues.

All in all, the chances are that a new WEO would indeed be "déjà vu all over again," and merely translate the existing stalemate to another venue.

Claude Barfield is the Director of Trade Policy Studies at the American Enterprise Institute and the author of Free Trade, Sovereignty, Democracy: The Future of the World Trade Organization (AEI Press, 2001).



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