Clinton must save GATT
Even after 124 trading nations signed the General Agreement on Tariffs and Trade (GATT) in Marrakesh in April, it was no guarantee that the projected US$500 billion annual bonanza for signatories would come naturally. Ratification could prove problematic in some countries. Their commercial interests may conflict with GATT rules, or political priorities could get in the way.
It was always feared that the United States, which had a big part in getting the deal concluded, would by force of its convoluted political adversities be the one to destroy what it had helped create. The worst may yet happen, as control of both chambers of the U.S. legislature has been lost by President Bill Clinton's Democrats to the Republicans. Herein lies a dual irony. The first is that Mr. Clinton could not have the agreement passed even when his party had control of Congress before its mid-term electoral defeat two weeks ago.
Anti-GATT Democrats had conspired with Republican leaders Bob Dole and Newt Gingrich, who will head the Senate and House respectively in the new Congress, to put off a vote.
The second is that the Republicans, free traders by instinct in whose charge presidents Ronald Reagan and George Bush began and nearly wrapped up GATT, should now be the ones most likely to torpedo it. That can happen in one of two ways: The GATT Bill is defeated in next week's vote, or the vote is postponed again until the new Congress is installed in January.
In either case, GATT, as far as American participation goes, will be a dead letter. With the world's largest economy and buyer of goods out, the multi-lateral trading system would look like organized anarchy. For that reason, not many countries have ratified the agreement precisely because the U.S. has not. GATT's chief Peter Sutherland should be believed when he warned of "political tension within trade" if failure to pass GATT brought an age of cynicism. Clearly, American leadership is on the line. This is Mr. Clinton's chance to revive his flagging fortunes. He can, and must, convince the doubters and holdouts that state and local interests cannot stand in the way of what every interested party in America accepts as beneficial.
-- The Straits Times, Singapore