The WTO Couldn't Change China, so Robert Lighthizer Found Another Way - WSJ - 0 views
-
Last month, a WTO panel ruled in its favor, declaring most of the U.S. tariffs violated the organization’s rules.
-
The ruling is subject to appeal to the WTO’s top court, the Appellate Body, but that body isn’t functioning because the U.S. has blocked the appointment of new members. Thus, the “phase one” trade deal the U.S. and China reached in January will, for the foreseeable future, govern their bilateral relationship, not the WTO.
-
Mr. Lighthizer argued that the Appellate Body’s enhanced role had turned the WTO from a negotiation forum to a litigation forum. Rather than achieve access to the U.S. market through the painstaking give-and-take of trade negotiations, countries instead ask the WTO to overturn an adverse U.S. trade law or measur
- ...5 more annotations...
-
Historically the U.S. sought rules and institutions like the WTO that apply equally to everyone. Under Mr. Trump, the U.S. now crafts its own rules, as it has with China, according to what it considers its own best interest.
-
USTR says up to 90% of cases against the U.S. have led to a finding that some U.S. law or measure violated WTO commitments. True, the U.S. brings lots of WTO cases and wins the vast majority, but what Mr. Lighthizer focuses on is that the U.S. is sued more often than anyone else despite having among the world’s lowest trade barriers.
-
The WTO’s Appellate Body tilted the rules further in China’s favor—for example, by making it difficult to punish anticompetitive subsidies that come via state-owned enterprises, which dominate China’s economy.
-
Mr. Trump’s actions may make U.S. allies more, not less, willing to work with it on China. Perhaps the strongest defense of Mr. Lighthizer’s approach to managing China is that it beats the status quo. He said: “The fact that it’s complicated is not a reason not to try to do it. And even if you have a little extra inefficiency in the system, it’s still worth it because the way we [had] it is absolutely crazy. It’s destined to fail.”