The driving belief is that any restriction on the nation state is wrongby Ian Dunt / March 15, 2018 / Leave a comment
The World Trade Organisation has served as a dreamy utopia for Brexit supporters in recent years. It’s talked about like a free market paradise, beckoning us to our post-European Union life when we will be free from the suffocating restrictions of Brussels.
But look across the Atlantic and it’s a different story. There, it is the WTO which supposedly suffocates trade and intrudes on national freedom. Donald Trump uses the same rhetoric Brexiters have adopted against the EU about the body which they claim is far superior to it. And now he is going to war against it.
In truth, Brexit and Trump’s WTO war are two plots in the same story: the attempt to subvert the multilateral world order. It suggests that once the UK’s right-wing culture warriors are done with leaving the EU, they too may turn their guns on the WTO, because it is a barrier to them doing whatever they like.
For some time now, the Trump administration has been blocking nominations to the WTO’s appellate body on technical grounds. It’s a canny move which essentially cuts the organisation down at the knees. It means that as judges’ terms expire, the dispute settlement system at the WTO will grind to a halt.
“We have not been treated fairly by the World Trade Organisation,” Trump told fellow world leaders at the Asia-Pacific Economic Cooperation summit in Vietnam. “We can no longer tolerate these chronic trade abuses, and we will not tolerate them.”
Last week, he ramped up this strategy and effectively declared war by signing an order imposing 25 per cent tariffs on steel and ten per cent on aluminium.
It should be impossible to suddenly ratchet up tariffs in this way, or discriminate in how they are applied. Yet Trump excluded Mexico and Canada from the order, which seems to go against the WTO’s Most Favoured Nation rule—a membership clause forcing countries to apply tariffs equally to all their trading partners (unless they have a free trade deal).
Trump got around this by invoking a national security exemption. Domestically, he used Section 232 of the 1962 Trade Adjustment Act, which allows the president to block imports deemed threatening to national security. At the WTO, he’d use Article XXI of the General Agreement on Tariffs and Trade, which lets…