Question

Consider whether the United States economy has benefited as the result of US participation in GATT and the WTO.Would the US economy benefit from restricting the importation of foreign goods

Answer 1

The probability of a US‐inspired weakening of the WTO is low, although the incentives for protectionism in the US are strong and growing as a result of globalization and the changing international division of labour. The US domestic political system gives voice to such protectionist interests in international trade policy through a set of administrative and legal remedies that are reinforced by principles such as reciprocity and ‘fair trade’. Countervailing factors to this situation include the growing power of US export interests, the effectiveness of the Executive in deflecting the protectionist tendencies in the US Congress, and the exceptional power and influence of the US over the multilateral regime, in which it is a rule maker rather than a rule taker, enjoying the power to bend the rules selectively to serve its interests. As such, the WTO tends to reflect and reinforce US economic interests, and the US is, therefore, likely to continue in overall terms its efforts to comply with and generally strengthen the multilateral organization, rather than to break away from it.