The Battle in Seattle
But the new economy has not worked very well for most working people. By 1999, 200 million more people lived in abject poverty (on less than $1 a day) than in 1987. Inequality has grown both between and within countries. Only thirty-three countries achieved sustained 3 percent annual growth in GNP from 1980 to 1996. In fifty-nine countries, primarily those in sub-Saharan Africa and the former Eastern bloc, GNP per capita actually declined. Environmental despoliation is getting worse. The Nike economy saw the rebirth of the satanic mills--child labor, young women working for a pittance in export-processing zones where union organizers are routinely fired, beaten or killed.
Even in the advanced countries that should have benefited the most from the system, workers haven't fared particularly well. In Europe, slow growth has left millions unemployed. Japan has suffered a decade of decline. In the United States, now basking in its extended growth, wages declined after the mid-seventies and still have not recovered the ground lost over those years. Inequality has hit new heights, while most families actually have less net worth now than they did two decades ago.
Opponents of all this were generally dismissed as protectionist victims--the "turtles," as New York Times columnist Tom Friedman dubbed them--who just couldn't keep up. But then, beginning in 1997, the opposition showed its clout in the United States. An unlikely coalition of progressives concerned about labor rights and the environment and isolationist conservatives blocked fast-track presidential trade authority twice. The political defeat was reinforced by the global financial crisis--the worst since the Great Depression--which shook the confidence of the financial elite.
Since that time, the Clinton Administration has been scrambling to contain and co-opt the rising opposition. The Jubilee 2000 movement, a coalition of religious and secular groups, forced wealthy countries to put debt relief for the most impoverished countries on the global agenda. A coalition of labor, consumers and environmentalists torpedoed negotiations on the Multilateral Agreement on Investment, which would have pushed financial deregulation further. Consumer revolts, led by students against sweatshops, had companies like Nike scrambling for the cover of codes of conduct.
President Clinton's response was to adopt the rhetoric of reform, calling on the WTO to be more open, pushing the International Labor Organization to promote a ban on the worst forms of child labor, supporting a working group on labor rights at the WTO. But as Seattle's streets will illustrate, the President's gestures won't suffice. By its very existence, the WTO strips away the myth of free trade. That becomes even clearer as its secretive panels of corporate trade lawyers and experts challenge national laws that conflict with WTO rules--a European ban on hormone-treated meat, a US law to protect dolphins, a Massachusetts law to boycott Burma. If the global economy is regulated, people will demand that its regulations reflect more than the private interests of corporations and banks. As AFL-CIO president John Sweeney has made clear, labor will applaud progress on a working group to study labor rights at the WTO but will not end the demand for enforceable labor rights in trade accords.
The real tests won't come in Seattle. They will come in continuing battles on fast track, environmental regulation and future trade accords. They will come when the US trade deficit becomes unsustainable. They will come as developing countries turn away from export-led growth. It is only if the corporate project is stalled that governments will be forced to respond to their people.
The current moment is akin to the last period of Progressive reform at the turn of the century. At that time corporate trusts and banks forged a national economy that featured the stark inequalities of sweatshops in the Gilded Age. To consolidate their position, pre-empt local and state regulation, manage competition and limit instability and protest, the corporate leaders wielded their political clout to develop new national regulatory laws and authorities. But a rising tide of popular movements--unions, women's movements, socialist and populist parties--forced broader reforms. Over time, national laws were passed to enforce the forty-hour week, a minimum wage, consumer and environmental protections, the right to organize, prohibitions on child labor. But each concession was bitterly fought. In the end, it took a Great Depression and World War II to make significant progress.
The struggle to civilize the global economy has just begun. Progress will be slow; the resistance will be fierce. Perhaps the agonies of the past century of reform will make the way easier in the next. But as the demonstrators in Seattle would say, don't count on it.