World Trade Organization (WTO): Issues in the Debate on U.S. Participation

Publication Date: June 2005

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Trade

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Abstract:

The World Trade Organization (WTO) is of interest to the 109th Congress for several reasons. First, House Members considered a joint resolution (H.J.Res. 27) to withdraw congressional approval of the agreement establishing the WTO. The House Ways and Means Committee reported the resolution adversely on May 26, 2005, and the full House disapproved the resolution by a vote of 338-86 on June 9, 2005. Debate on the resolution offered Members an opportunity to examine the costs and benefits of WTO participation and examine other aspects of WTO membership.

Second, the 109th Congress will monitor WTO disputes involving U.S. interests and possibly consider whether or not to amend U.S. laws to address WTO dispute panel findings. Members have criticized the WTO dispute process for several reasons, but the process does offer a stable multilateral forum for trade disputes. Third, the United States and other WTO members are actively engaged in a multilateral round of trade negotiations in the WTO. The 109th Congress is monitoring those negotiations. Final agreements are not expected until 2006 or later.

In a report submitted to Congress on March 2, 2005 on the costs and benefits of continued participation in the WTO, the Administration cited a number of statistics that show growth in the U.S. and world economies since establishment of the WTO. Whether the growth cited was the result exclusively or mainly of activity in the WTO is arguable. Academic studies indicate that the United States would gain substantially from broad reductions in trade barriers worldwide. At the same time, some workers and industries might not share in those gains.

Questions of governance and power are among the issues at the heart of the debate on the WTO. Major decisions in the WTO are made by member governments, who determine their negotiating positions, file dispute challenges, and implement their decisions. However, some challenge the claim that the WTO is democratic in nature by arguing that smaller countries are left out of the decisionmaking and that governments tend to represent large commercial interests only.

The United States has been a frequent participant in WTO dispute proceedings, both as a complainant and as a respondent. There have been many complaints of the WTO dispute process, including the arguments that countries do not adhere to decisions and that U.S. trade remedy laws have not been judged properly. On the other hand, this multilateral trade dispute forum is unique, and the United States has been successful in many of its challenges.

Other issues include (1) the relationship between WTO rules and a country's right to establish domestic standards for labor, the environment, food safety, and other areas; and (2) U.S. policy toward developing countries, including a balance between providing assistance to those countries in the WTO and addressing their demands in trade negotiations.