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With respect, Senator Hawley, the claims you made in the original op-ed and in this thread are misleading. The WTO isn’t perfect, but there are lots of ways to make the global trading system better without abandoning the system entirely. Our own thread...
The US cannot unilaterally disband the WTO. It can only singularly withdraw. By withdrawing, the US basically self-isolates while other countries continue to participate in the WTO and puts US exporters at risk of much higher tariffs and other barriers in foreign markets.
It’s true that China & the US are classified differently. However, even though China self-classifies as a “developing country,” its obligations under WTO rules are more comparable to that of developed countries.
And the US does generally win trade disputes, especially against China, in cases it brings to the WTO. The US actually wins more of its cases against China than China does against the US.
This complaint of exceeding jurisdiction is not as grandiose as it seems. This 'judicial overreach' surfaces primarily in a subset of US losses in antidumping & countervailing duty (AD/CVD) cases that target specific methods of calculating dumping margins.
We've warned previously that disabling the whole WTO appellate system is a disproportionate response to the specific problem. Abandoning the WTO entirely is even more disproportionate.
piie.com/publications/p…
As we explain in-depth at piie.com/globalization, the % of US jobs in manufacturing has steadily declined since the 1940s, before the rise of China, NAFTA, or WTO, because technology has made it easier to produce goods.
Abandoning the WTO means abandoning a rules-based trading system based largely on US law and practice. Other countries will likely continue without us, and US exporters will face increased discrimination. We have a number of policy recommendations:
On how to use the WTO to fix the issue of China’s industrial subsidies and state-owned enterprises: piie.com/publications/w…
On how developing countries may hold the key to unlocking the Appellate Body crisis: piie.com/publications/p…
Responses to legitimate US concerns with the WTO and how to cure the problems plaguing the system: piie.com/publications/p…
Leaving the WTO would be a bad idea. The US relies on the WTO more than any other country to settle trade disputes AND the US is the 2nd largest exporter in the world. US farmers, manufacturers, & more rely on the global trading rules to receive fair treatment in foreign markets.
We look forward to a productive and research-based discussion on how to make the global trading system fairer for everyone, Senator @HawleyMO. (end)
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