December 5, 1999

Seattle Talks on Trade End With Stinging Blow to U.S.


SEATTLE -- President Clinton's effort to shape an ambitious agenda to liberalize trade and broaden the mandate of the World Trade Organization collapsed here Friday night, after a rebellion by developing countries and deadlock among America's biggest trading partners forced the administration to all but abandon one of its major foreign policy goals for the end of Clinton's presidency.

The collapse of the talks ended a tumultuous week of riots on the streets of Seattle, the arrest of more than 600 protesters, and bitter infighting among 135 nations. They could not agree even on whether to discuss workers' rights and the environment in trade negotiations that were supposed to be started here. In the end, weary ministers headed for the airport without even issuing a final communiqué.


Also in Sunday's Times

  • News Analysis: White House Miscalculation Led to Talks Without a Focus
  • New World Disorder: Free Speech Vs. Free Trade
  • Protest Studies: Ways to Up the Revolution

    Recent Coverage

  • Trade Obstacles Unmoved, Seattle Talks End in Failure (Dec. 4)
  • Trade Ministers Sidestep Issue of Secrecy (Dec. 4)
  • Saboteurs Cut Power at W.T.O. in Geneva (Dec. 4)
  • The Overview: U.S. Effort to Add Labor Standards to Agenda Fails (Dec. 3)
  • Street Rage: Dark Parallels With Anarchy Concocted in Oregon (Dec. 3)
  • News Analysis: After Clinton's Push, Questions About Motive (Dec. 3)
  • In Stormy Seattle, Clinton Chides World Trade Body (Dec. 2)
  • Clenched Fists in Seattle Lead to Pointed Fingers (Dec. 2)
  • Seattle Is Stung, Angry and Chagrined as Opportunity Turns to Chaos (Dec. 2)
  • Seeing the Fear of Free Trade Made Concrete (Dec. 2)
  • Internationally, Embarrassment for U.S. (Dec. 2)
  • A Chaotic Intersection of Tear Gas and Trade Talks (Dec. 1)
  • A Time of Trial by Taunt for the World Trade Chief (Dec. 1)
  • Trade Talks Start in Seattle Despite a Few Disruptions (Nov. 30)
  • Protesters Could Steal the Show at Seattle Trade Talks (Nov. 29)

    At a Glance

  • Protesters' Complaints

    Video Collection

  • Protesting the World Trade Organization

    Audio Special

  • Rudra Bach, Protesting in Downtown Seattle (Nov. 30)

    Slide Show

  • Protesting the World Trade Organization (Dec. 1)

    Speech Text

  • President Clinton: "Open This System Up" (Dec. 1)


  • Join a Discussion on the Protests Against the World Trade Organization
  • The failure is a sharp setback, and perhaps a fatal blow, to President Clinton's hopes of setting in motion a new round of trade liberalization in his final year in office. Coming on the heels of the Senate's rejection of the Comprehensive Test Ban Treaty, the collapse of trade talks also marks his second major foreign policy defeat since the summer.

    Clinton's aides conceded that the failure revealed that questions of trade, labor rights and the environment had become deeply politicized around the world -- a world in which economic accords are the equivalent of the arms control treaties of the 1970's and 80's.

    "There was an intractability on these issues that developed over many months that we hoped would melt away under the pressure of deadline," Gene Sperling, Clinton's chief economic adviser, said at the airport. "There comes a time in any negotiation where you have to say, 'It's just not going to work.' "

    Clinton himself issued a statement Saturday saying he was still hopeful. "I remain optimistic that we can use the coming months to narrow our differences and launch a successful new round of global trade talks," he said. "I am determined to move forward on the path of free trade and economic growth while ensuring a human face is put on the global economy."

    Other members of his administration, however, said this week's talks had turned into a "fiasco" and a "circus," with the tensions heightened by the scenes of tear gas and protests by the tens of thousands of demonstrators who descended on Seattle for the week to press an array of causes -- all of them aimed at halting or slowing the post-cold-war march toward freer trade.

    As the streets erupted and a small, violent group of protesters wreaked extensive damage on downtown Seattle, the talks quickly dissolved into an airing of grievances about American power, arguments about the results of past trade accords and questions about whether the trade organization's mission of liberalizing trade had come at too high a price for poor nations and millions of workers.

    Clinton's advisers worried that the agenda emerging from the talks would so outrage American labor unions that they would denounce both the administration and Vice President Al Gore, who needs the unions' energetic support in his bid for the presidential nomination. Some feared that this agenda could further jeopardize chances of winning Congressional approval for China's entry into the trade organization, which was negotiated in Beijing just two and a half weeks ago.

    "The only thing worse than no agreement," one official said, "was the agreement it looked like we might get."

    Exulting protest groups immediately claimed victory for disrupting the negotiations. "Ding Dong the Round is Dead," one new flier from a consumer group read.

    "When you take something as secretive and rotten as the W.T.O. and put it in sunshine, it does not last for long," said Lori Wallach of Public Citizen, an American consumer organization that was active in the Seattle protests. "We have succeeded in turning back the invasion of the W.T.O. into domestic policy decisions."

    Also among those who celebrated the failure was John J. Sweeney, the A.F.L.-C.I.O.'s president, who had warned the Clinton administration that no deal was better than a bad deal -- one that failed to set up a study group within the trade organization to make recommendations on labor rights.

    Sweeney said there was one success this week: the protests put globalization on the nation's public and political agenda. "This week's heightened scrutiny of negotiations punctured the veil of secrecy and insensitivity in which the W.T.O. has shrouded itself and made it impossible for trade negotiators to paper over differences," Sweeney said.

    "The breakdown reflects the first step in a serious coming-to-terms with pivotal issues: accountability, democratic procedures, workers' and human rights, and the environment."

    At a news conference, Charlene Barshefsky, the United States trade representative and the chairwoman of the talks, said that it would have been fruitless to continue the negotiations. "We could have stayed all night, maybe for five more days, it wouldn't have mattered," said the normally unflappable Ms. Barshefsky.

    "Governments were not ready to take the leap," she said.

    The decision to abandon the talks came after a flurry of last-minute phone calls from Clinton to other world leaders, including Prime Minister Keizo Obuchi of Japan and the president of the European Union, Romano Prodi. But that effort to break the deadlock failed. And by 8 p.m. here Friday, Clinton, Ms. Barshefsky, Sperling and the White House chief of staff, John Podesta, decided that "the patient could not be resuscitated," according to one senior administration official.

    The failure of the Seattle talks is the most notable setback for the trade group, which had expanded its reach since replacing a much weaker international trade body, called the General Agreement on Tariffs and Trade, in 1995.

    It also is the latest in a string of trade-related disappointments for Clinton. After winning Congressional backing for the North American Free Trade Agreement and then for the formation of the W.T.O. in his first term, Clinton has repeatedly failed to garner support for his trade initiatives. He has sought and failed to extend Nafta to Latin American countries. Congress has also denied him expedited fast track consideration of new trade accords.

    Frustrated at home, the Clinton administration had hoped to expand the mandate of the Geneva-based World Trade Organization and to push into new territory, like the environment and labor rights.

    The trade group will now take up negotiations on some narrow aspects of agriculture and services as part of its regular duties.

    The failure of the talks will disappoint many American companies. Agricultural companies had counted on tariff reductions and an end to trade-distorting subsidies to give a big lift to exports. Electronic commerce companies had high hopes that the trade group would extend a moratorium on taxation of Internet transactions well into the future. Either of those areas could be negotiated separately, outside of a huge trading round, but the prospect of progress is uncertain.

    Ms. Barshefsky and trade organization officials said the talks broke down because the agenda grew too unwieldy and the time too tight to reach consensus on key issues before a midnight deadline.

    Seattle Mayor Paul Schell, whose police force was roundly criticized for mishandling protests early in the week, insisted that the delegates leave the Washington Convention and Trade Center, their negotiating venue, by midnight to make way for other parties that had rented the space beginning Saturday.

    Throughout the day Friday, trade ministers hammered out compromise draft texts on a number of sensitive points and were expected to produce a watered-down framework for new negotiations that would allow almost everyone to claim victory, while falling far short of the Clinton administration's goals.

    By evening, however, disagreements on agriculture, trade and investment rules and labor rights proved overwhelming, people who participated in the talks said. The United States, the European Union and Japan faced off over the elimination of subsidies for farmers and the use of laws to prevent below-cost dumping of goods in foreign markets.

    "We would make progress, and then the Europeans or the Japanese would come back and start right where we began hours before," said one participant. "You had to conclude that the outcome they wanted was the outcome we got: a collapse."

    A Clinton administration push toward making labor rights a core part of trade talks divided developed countries from less developed countries, who view the issue as code for protectionism by wealthy nations.

    The talks also buckled under pressure from poorer nations -- long junior partners at such forums -- which used the meeting to demand equal say in all aspects of the trade organization's work, delegates said.

    The trade group, unlike some other world bodies like the International Monetary Fund, operates by consensus, with all countries accorded equal votes. Wealthy nations, especially the United States, have long set the pace and the tone of trade negotiations.

    "This is the first signal that things are not as they were in the past," said Ibou Ndiaye, the trade minister of Senegal. "We are stronger now."

    Delegates from developing countries said that they made clear to Ms. Barshefsky and Mike Moore, the trade organization's director general, that they were unhappy with the way negotiations were being handled.

    Under Ms. Barshefsky's stewardship, large committees convened early in the week gave way to smaller, closed sessions with a select group of negotiators.

    As at least six small groups were cloistered Friday afternoon, the scores of delegates left out of the process began complaining. A number of countries, including a vocal group of Caribbean nations, threatened to walk out, several people who followed events said.

    Ms. Barshefsky said she and Moore eventually concluded that even if closeted negotiators were successful, nations that had not participated might fail to ratify the final agreement.

    "The W.T.O. has outgrown the processes that were appropriate for an earlier time," Ms. Barshefsky said. "There are clearly issues of transparency that effect perceptions of the W.T.O. by member economies themselves."

    Youssef Boutros-Ghali, Egypt's chief trade representative and a key opponent of several American initiatives at the trade talks, said the failure of the round amounted to a "catharsis for the organization."

    "We needed a decision to stop this process until we can figure out how to balance transparency and efficiency," he said.

    Dan Seligman, an official with the Sierra Club who helped organize the Seattle protests, said he believed that the W.T.O. was staggering under its own weight.

    "The creation of the W.T.O. was an act of pure hubris -- to promote trade by micromanaging policies of every government on earth," he said. "It was only a matter of time before that over-ambitious agenda reached a point at which it could go no further."


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