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One World?

Free Trade Today

by Jagdish Bhagwati
Princeton University Press, 128 pp., $35.00; $14.95 (paper)

1.

Globalization was the most dramatic idea to emerge from the collapse of communism and the end of the cold war. Suddenly, it seemed, there was “one world.” US State Department official Francis Fukuyama said it first: there was now no ideological obstacle to the spread of markets and democracy. Further, it seemed highly plausible to suppose that the fall of political barriers to trade and the movement of capital would unite the world into a single economic unit. On top of this came the revolution in communications: cell phones and the Internet would, at the very least, speed up the emergence of a global consciousness. At the earth summit in Rio de Janeiro in 1992, a grimmer aspect of globalization was unveiled: “global warming,” or the threat to the world’s climate from carbon emissions. Common to all these perceptions was the thought that the traditional divisions of humanity into tribes, races, nations, religions, and cultures were obstacles to the “global” thinking needed to bring about prosperity, peace, and justice to all, or indeed to avert planetary disaster.

We now know that many of the hopes aroused by the fall of communism were sheer delusion; that it was, in fact, the cold war that “froze” history; and that with its end the familiar clashes of states and religions started up again. But it was not all delusion. A World Trade Organization was set up in 1995 with 148 members. Even though it is riven by conflicts of interest, it forces the conflicting sides to confront their differences. The Kyoto Protocol limiting greenhouse gas emissions was agreed to by seventy countries in 1997—though, unfortunately, not by the United States. In international relations, the doctrine of state sovereignty is clearly in retreat—though whether it is retreating before the advance of American imperialism or regional organizations like the European Union or a reinvigorated United Nations is not yet clear. Those who commit atrocities have been put on notice that they will be held accountable for their crimes by the “international community.” Global thinking creeps forward, encountering numerous resistances, to an uncertain future.

Two important examples of this new thinking are One World: The Ethics of Globalization, by the philosopher Peter Singer, and Free Trade Today, by the economist Jagdish Bhagwati. Singer aims to overcome the tensions that have beset globalization by the application of a single perspective—that of utilitarianism. This requires us to act so as to maximize the happiness of all human beings, indeed all sentient creatures. As a philosopher, Singer seeks to interpret “happiness” in the broadest way, including in its sources everything from the environment and animal rights to international law and world health. The growing interdependence of the planet gives us, he says, a new and convincing reason to do our utilitarian duty. Singer quotes from a UN report:

In the global village, someone else’s poverty very soon becomes one’s own problem: of lack of markets for one’s products, illegal immigration, pollution, contagious disease, insecurity, fanaticism, terrorism.

So we must take the whole world to be our ethical unit, ignoring all claims of “partial benevolence”—partiality to those closest to us—unless these can be shown to contribute to the welfare of the whole world. In ethical terms, there is only “one atmosphere,” “one economy,” “one law,” and “one community.” So what will an agenda that takes the welfare of the world as a whole seriously look like?

Consider the problem of atmospheric depletion. Most people agree that what is needed is a reduction in the global level of greenhouse gas emissions. How is this to be arranged? True to the utilitarian principle that every person’s welfare counts equally, Singer proposes that everyone be allocated an equal emission “quota.” The poor and heavily populated countries like China would therefore get the largest quotas; the United States, with its much smaller population, would have to reduce its output of gases to about 20 percent of what it now produces. To avoid the total breakdown of the world economy that would result from this, Singer advocates a more extreme version of the “emissions trading” concept envisaged by the Kyoto Protocol: rich countries that want larger quotas would have to buy them from poorer ones who don’t need them.

Singer’s chapter “One Economy” is largely an attack on the World Trade Organization for putting free trade ahead of human and animal welfare. Under WTO rules, a country is entitled to ban the import of a product on health and environmental grounds, so long as the ban extends to the country’s own producers and is thus even-handed between foreign and domestic producers. But WTO law does not allow countries to ban the import of goods produced by cruel processes, even if such methods are forbidden at home. For example, when the US banned the import of Mexican tuna because the drift nets used to catch these fish resulted in the death of dolphins that got caught up in them, the WTO tribunal declared the US ban illegal. Singer is outraged at this and similar decisions. He wants the current WTO commitment to free trade to be replaced by a commitment to “minimum standards for environmental protection, worker safety, union rights, and animal welfare” across the world. Pending this, a country should be unilaterally entitled to stop the import of goods on moral grounds.

In another chapter, “One Law,” Singer suggests that the tendency to genocide may be too deeply rooted in human nature to be removed simply by the abolition of poverty. So genocide needs to be deterred by enforceable international criminal law. To this end Singer proposes to reform the UN Charter to give it a legal right to intervene in countries’ domestic affairs to prevent genocide. He carefully distinguishes the legal from the ethical right to intervene:

There is only one [ethical] standard, that it is right to do what will have the best consequences, and that standard tells us not to intervene when the costs of doing so are likely to be greater than the benefits achieved.

Singer goes on, in a chapter headed “One Community,” to discuss the ethics of international distribution. If we make the plausible empirical assumption that an extra dollar is worth a lot more to a poor person than to a rich person, it follows on utilitarian premises that there should be a large-scale redistribution of wealth toward the poorest people in the world. As a matter of practical politics, Singer advocates that rich countries raise their annual foreign aid to poor countries from 0.2 percent of GDP to 1 percent; but he chooses this 1 percent only because advocating the much higher transfers that his argument implies might be too shocking to be accepted.

Singer’s main engine for enlarging the scope of ethical concern is democracy—the global counting of heads. This is because democracies pay more attention to the welfare of their peoples than do dictatorships. Thus he thinks that membership of multilateral organizations such as the WTO and the UN should be confined to democracies—a limitation that would presumably exclude China—and that voting power within them should be proportional to population. This will ensure that these organizations legislate for the benefit of the greatest number.

Singer’s book is a heroic attempt to picture a world organized and managed according to the principle of utility. It is what a Benthamite world-state would look like. It will annoy those who dislike utilitarianism and be dismissed as irrelevant by practical people. The last criticism is unfair: ideas are important even if they have little immediate practical influence. It would be just as absurd to dismiss Singer as irrelevant to current global issues as it would have been to dismiss Kant’s project for perpetual peace as irrelevant to the world of Napoleon. And many of Singer’s policy suggestions are simply extensions of current thinking: for example, his discussion of criteria for humanitarian intervention in the domestic affairs of states is in line with speeches by UN Secretary-General Kofi Annan. Serious criticism of Singer’s approach would follow one of two lines. The first would accept his utilitarianism, but deny that it leads to his conclusions. The second would question the adequacy of utilitarianism itself as the basis for a better world.

The general criticism of Singer from inside utilitarianism is that he relies on political rather than on economic mechanisms, underestimating both the power of economics and the pitfalls of politics. He would curtail trade between democracies and nondemocracies, ignoring the losses in welfare that economic sanctions inflict on peoples living under dictatorships, as well as the possibility that open frontiers in trade tend, over time, to undermine closed frontiers in politics. For example, to stop trading with countries that use child labor may close off the escape from the poverty that produces child labor.

His proposal to set up the WTO as a guardian not of free trade but of moral, social, and environmental standards ignores the near certainty that such high-minded standards would simply be used by protectionists in rich countries to keep out exports from poor countries. If Singer is seriously interested in reducing poverty, he should be arguing for more trade liberalization, not less—particularly in agriculture, labor-intensive manufactures, and intellectual property rights. Indeed, the real charge against the WTO is not that it fails to set moral standards, but that it fails to live up to its own free trade goals. As The New York Times recently commented,

The developed world funnels nearly $1 billion a day in subsidies to its own farmers, encouraging overproduction, which drives down commodities prices. Poor nations’ farmers find they cannot compete with subsidized products, even within their own countries. In recent years, American farmers have been able to dump cotton, wheat, rice, corn and other products on world markets at prices that do not begin to cover their cost of production, all courtesy of the taxpayers…. The World Bank estimates that an end to trade-distorting farm subsidies and tariffs could expand global wealth by as much as a half-trillion dollars and lift 150 million people out of poverty by 2015.

It is little wonder that at the disastrous September meeting of the WTO in Cancún, twenty-one developing nations, led by Brazil, India, China, and South Africa, demanded stringent cuts in agricultural subsidies and improved access to industrial countries’ markets as the condition of discussing anything else.

Even from a utilitarian perspective, substantial redistribution of wealth and income toward poor countries is subject to a variety of problems. Will poor countries be able to absorb aid productively? Will the aid reach the poor? Will it promote reliant self-development? A particularly stark issue arises from the fact that the world’s poor (those living on less than $1 a day) are increasingly to be found in so-called “failed states,” many of them in sub-Saharan Africa—states defined not by murderous intent but by lack of competence to secure for their people the basic conditions of life, health, and education. In such states, can poverty be reduced without large-scale intervention, even a takeover of their government and administration? Singer is silent on these practical questions.

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