Trying to put the WTO in Perspective.

We hear people throwing big numbers into the news all the time. The numbers might as well be -1 as umpty-seven billion. Both numbers become imaginary numbers to our frame of reference. Lets try to get a bit of perspective:

• The U.S. Population is a bit over 300 Million
• One Billion divided by that equals roughly $3.30
• The EU is claiming damages from our gambling stance of 100-billion
• That is a cost per citizen of about $330
• Antiqua-Barbuda is claiming damages of 3.4 Billion ANNUALY
• That is a cost per citizen of about a ten-spot

Now the government doesn’t send a fellow out from the IRS to collect on a per head basis. Your child in his crib isn’t going to get his blankey garnished. It is actually a bit more diabolical. There are varied revenue sources including business, licenses, and varied fees that the government collects. The amounts mentioned aren’t a tax hit to you directly. Yet, every dollar spent or wasted impacts you directly; much of it is just hidden from your view. It is the way government keeps us fat, dumb and happy. And it is why we like social and pork barrel programs – especially if they seem to benefit us. We always think the other guy is paying. That isn’t the case.

The World Trade Organization (WTO) is our child. It was created by the advanced world economies. We have benefited economically from its activities. We frequently use it to punish those we consider transgressors who use unfair business practices. We have had major claims upheld and have pending claims against China – among others. We expect fairness with a bit of bias toward us – the nice guys doncha know.

The WTO has been granted the ability to resolve disputes under treaty agreements of the member nations:

A dispute arises when a member government believes another member government is violating an agreement or a commitment that it has made in the WTO. The authors of these agreements are the member governments themselves ”” the agreements are the outcome of negotiations among members. Ultimate responsibility for settling disputes also lies with member governments, through the Dispute Settlement Body.

The WTO operations are transparent. You can view the findings to date in the Antigua-Barbuda claim on the WTO website here. [DSU in the document is a reference to: Dispute Settlement Understanding | DSB references: Dispute Settlement Body] DSU is the overall agreements that apply to a dispute and the DSB is the panel convened to arbitrate/decide the dispute.

When you visit the page you will see countries represented beyond Antigua-Barbuda. Included is the EU along with countries like China. These are countries that can make claims based on the initial finding. Other countries can add themselves at a later date. This is an open ended process.

We are 4-years and change into this dispute. Speed is not a part of the process. As the U.S. has lost to the claims by the aggrieved country, it has taken a remarkable path. It abrogated its treaty statement. It basically said, “We didn’t mean to say what we said.” and this is a serious tack to take that throws open our entire treaty rights and obligations. We’ve gone from being a respected partner to the world to being the playground bully threatening to take his ball home if everybody doesn’t play as he demands.

The arbitration findings have gone in favor of Antigua-Barbuda. We are now in the penalty phase. Antigua-Barbuda wants 3.4 Billion each year and the U.S. is offering ‘only’ 500-million. ($1.66/citizen) The E.U.’s claims total 100-Billion and we are disputing that too. There will be a middle ground reached. Typically, that is closer to the original claim than the counter. In a recent Brussels press conference, Naotaka Matsukata, former director of policy planning for the US trade Representative said, “The $3.4 billion claim by Antigua and the much larger claim of over $100 billion by the seven other economies seeking compensation are some of the largest penalties in the history of the WTO, This is by far the most significant WTO case ever and its implications for both the US and the EU are enormous. Given the size of the US gaming market, both the potential benefit for European industry and the corresponding potential damage to US companies is unprecedented.”