False Economy - Alan Beattie [151]
Many countries' main priority in the talks was to retain the right to defy the logic of comparative advantage. Nations such as Indonesia and the Philippines, with large populations and a shortage of land and water, have traditionally imported many staple foods, particularly rice. But their response to the food crisis, although they did encourage food imports in the short term, was to fight ever harder to retain the right to block imports in the future—part of a drive for national self-sufficiency. Should the Philippines maintain its plan to become self-sufficient in rice, it is likely to lead to highly inefficient use of land and will make the country vulnerable to shortfalls in domestic rice supply from bad harvests. Unlike the crises of the 1840s that led to the repeal of the Corn Laws, countries in 2008 did not seize the opportunity presented by the food-price crisis to permanently reduce their agricultural protectionism.
Other food importers were taking a different tack. Bypassing the trade talks altogether, the likes of Saudi Arabia were busy leasing large tracts of land in countries in Africa to grow grain for themselves. They, at least, had grasped the logic of importing (embedded) water from abroad. It was a shame they had chosen to do it in a way that resembled the imperial landgrabs of the nineteenth century, if not quite ancient Rome's policy of invading its main food supplier and exacting its tribute in the form of grain.
Back in Geneva, the Indian trade minister kept talking about the need to protect the incomes of small farmers. "I will negotiate over commerce, but not over livelihoods," he would say. Yet back in India, those smallholders are routinely pushed aside by the larger, more influential farmers who suck up most of the subsidized water and power provided by the state. Corruption, and a political system that hands out benefits to the best organized rather than the most deserving, has frequently left the most deserving bereft. Trade policy is actually a rather minor part of what is keeping Indian farmers poor.
And Russia was not even participating in the talks. Its self-isolation from the postwar economic order, wearyingly typical of the country's past, had extended to staying out of the General Agreement on Tariffs and Trade, the forerunner to the WTO. By 2008, Russia had not yet equaled the achievement of some of the poorest countries on earth and gotten membership in the organization. In the week that the talks collapsed, the WTO did at least have something to celebrate: it welcomed its 153rd member, the tiny West African nation of Cape Verde. (Population: 420,000. Main export: cocaine. The Cape Verdeans don't grow it, however.)
In fact, by 2008, Russia had been trying for several years to join the WTO. But its application was being hindered by a familiar inability to enforce the rule of law. The United States in particular was raising objections, unhappy that Russia could not prevent widespread counterfeiting of CDs and DVDs and illegal music-download websites. On paper, Russia had an anticounterfeiting law. But many of the optical-disc manufacturing plants stood on land owned by the Russian military. And all elements of the Russian state, as we have seen, have long had difficulty subjecting themselves to the constraints of independent courts and judges. Moreover, with stratospheric oil and gas prices bailing out the Russian economy and strengthening the hand of the country's leadership, WTO membership was not an urgent economic priority. Russia was having no difficulty