July, 2003: Players Who’s Up To What

By Greg Rushford

Published in the Rushford Report

"Michael Moore Starves the Poor"

            In July 1999, I reported the story of Zejna Kasic, a Muslim refugee in war-torn Bosnia . Ms. Kasic was one of some 500 war refugees -- mostly illiterate Serbs, Croats, and Kosavars -- who were trying to stitch their lives back together by knitting sweaters and other clothing, rugs and linens. The women of Bosnian Handicrafts -- launched thanks to Norwegian foreign aid and financier George Soros' Open Society Institute -- had somehow managed to launch their business despite their own government, which then levied an astounding 82 percent payroll tax and was demanding 36 percent of any profits.

            But the intrepid Muslim women soon ran into other problems when they tried to sell their sweaters in the United States and Europe , where domestic textile lobbies are protected with high tariffs and quotas. In my research, it soon became evident that European and American politicians weren't exactly falling over themselves to help the women of Bosnian Handicrafts. I called every politician I could think of who might be in a position to help, and got nowhere. Even that champion of women, then-First Lady Hillary Clinton, turned a cold shoulder to Ms. KIasic and her colleagues. This was particularly disappointing, as Ms. Clinton had only recently worked with Paul Charron, the chairman of Liz Claiborne, Inc., to help refugees who worked in Liz Claiborne's operations in Macedonia .

            But after the story became public, one man whom I had not yet met and hadn't thought to call, read it and spoke out without being asked. It was outrageous and unfair that the rich countries throw up such protectionist barriers that deny poor

Third World women access to their markets, declared Mike Moore, the former prime minister of New Zealand who was then the incoming director-general of the World Trade

Organization. It was a typical Mike Moore performance:

well-intended politically, well-grounded in economics.

            Those qualities are now on display in Moore 's important new book about his experiences as head of the WTO, A World Without Walls: Freedom,

Development, Free Trade and Global Governance. Reflecting the author's well-known sense of humor, the cover photo is of a giant puppet of Moore that was displayed by a ragtag group of anti-globalist protestors outside the World Bank's Washington , D.C. headquarters. A sign hanging from the puppet's neck reads: "Michael Moore Starves The Poor."

            Moore, who presided over the Battle of Seattle that trashed the launch of a new WTO "Seattle Round" of trade liberalizing negotiations in November 1999, saw a lot of funny signs in his three years at the WTO. "In one country where the government, or elements of it, have demonized the WTO, I was burnt in effigy in thirty cities simultaneously, which I considered quite an honour," he writes. "It is the solemn duty of citizens to make fun of and question their leaders."

            [President George W. Bush and his attorney general, John Ashcroft, might profit from Mike Moore's tolerant perspective. At press time, a 54-year old leftist political protestor named Brett Bursey was facing a possible six months in jail and a $5,000 fine for holding up a sign last October at the Columbia Metropolitan Airport , in Columbia , South Carolina , waiting for President Bush to land. The sign read: "No War Against Iraq, End Sanctions Now." Seems the president's men didn't think that was funny. The Secret Service is apparently under orders not to permit any protestors to come with the presidential eyesight.]

            But while Moore, who worked successfully to turn the 1999 debacle in Seattle into the 2001 launch of the WTO's current Doha Round of trade negotiations, has kept his sense of humor, his book contains a serious message: Free Trade is the engine that can lift millions out of poverty. "Privilege, and the power that accrues through it and to it, survives and prospers best when protected by the state," he writes, referring to protectionism. "The WTO does not act to preserve monopolies and privilege, but works to accomplish the reverse."

            A World Without Walls explains in some detail why the Doha Round can improve the living standards of hundreds of millions of presently impoverished people. Moore believes that the round will ultimately succeed. Toward that end, Moore credits the European Union's trade commissioner, Pascal Lamy, and US Trade Representative Robert Zoellick with "coherent and credible leadership." As for the EU's notorious Common Agriculture Policy that at $46 billion annually devours about half of the EU budget, Moore sees that this can't go on forever. " Poland will blow out the budget," he notes. "There are more farmers in Poland than the rest of Europe put together."

            Happily, Moore has the knack for using language that clears away arcane trade jargon so anyone can understand what's going on. For example, he explains in clear language something called "tariff escalation," a phrase that is far from a household word.

            Tariff escalation is one of the devices that rich countries inflict upon poor countries. This is just simple taxation. Imports of raw materials from the Third World are taxed at low duty rates, but value-added products that the poor countries try to export are taxed dearly. "Copper goes from Zambia to Japan in raw form because escalation in Japan protects domestic processing," Moore notes. "If that escalation is removed, then value-added opportunities arise in Zambia ."

            But Moore is also quick to point out that countries like Zambia also need to clean up their own houses to attract much-needed foreign investment. "The World Bank reports that 70 percent of the burden on developing countries' manufactured exports results from trade barriers of other developing countries. The quicker those walls come down, the

quicker the returns to developing countries."

            Although Moore understands how difficult the politics can be when it comes to tearing those walls down, he remains optimistic. He has a chapter called "Life is Getting Better," in which he argues that while there is obviously a very long way to go, living standards in the past half century have improved dramatically. "In fact, on the real measurements of human progress -- life expectancy, infant mortality, literacy, access to clean water, democracy, human rights -- there has been enormous progress."

            In another chapter -- "What Does Globalisation mean?" -- Moore cites too-often overlooked history to remind us that the benefits of international trade are not new: "The French "Sun King', Louis XIV (1638-1716) used to drink Yemen coffee, served on Chinese porcelain and sweetened with sugar from the island of Sao Tome, for his soirees. To end his evening tea, he smoked Virginia tobacco."

            Moore also points out that today's anti-globalist protestors really have no fresh insights. "Reaction and protectionism are not new either," Moore notes. " Britain 's canal proprietors organized against the new threat from railways. Nonetheless, countries which are more open to trade grow faster than those that aren't, and so have less poverty and better jobs, hospitals and schools. Thirty years ago, Ghana had the same living standards as South Korea ."

            As the great trade economist Jagdish Bhagwati, himself no slouch with the English language, puts it on the back cover: " New Zealand has two great voices: Kiri Te Kanawa and Mike Moore."

            Read this book.

            Footnote:  I'm glad to report that Bosnian Handicrafts has survived, despite the indifference of American and European politicians. You can buy their sweaters and such in more than 40 outlets in the United States , Canada , France , and Switzerland . If you shop online (npahcp@max.ba), Federal Express will bring the clothes made by these deserving Muslim women to your door.

TOP