Free Trade or Fair Trade: You Make the Decision

What should take precedence in decisions by international organizations: the pursuit of free trade around the world or the efforts of particular states to pursue policies that at times run counter to free trade, but serve other national policy concerns? This question is central to the conflict that exists between the World Trade Organization (WTO) and the United States over shrimp imports and "turtle safe" harvesting of shrimp. In early April 1998, the WTO ruled against a U.S. law prohibiting the import of shrimp from countries that fail to protect sea turtles--an endangered species--from potentially deadly entrapment in trawler nets. In order to protect the turtles, the United States has insisted that shrimpers use turtle excluder devices (TEDs) in their nets. They are simple cage-like devices that allow turtles to swim back out of the net once captured in it. These devices have reduced sea turtle mortality by 97%.

The Clinton administration, backed by numerous environmental groups, implemented this law that at one level could be interpreted as an effort to limit free trade by imposing a nontariff barrier--turtle safe fishing methods--on other countries interested in selling shrimp in the United States. After the April 1998 ruling, environmental groups continued to call for the administration to defy the WTO ruling and work toward international negotiations focused on balancing economic and environmental issues worldwide. As of April 2000, forty-one nations have signed a document agreeing to safeguard the endangered sea turtle in the process of shrimping thus allowing them the right to export shrimp to the United States.

Given that the United States was a primary mover behind the creation of the WTO in the early 1990s, defiance of the ruling has caused international political problems for the WTO's legitimacy in the first years after its inception.

This ruling, which was still in effect in 2001, also demonstrates that the WTO is clearly focused on preserving and promoting free trade and is unlikely to pursue policies that counter that primary goal no matter how popularly or normatively fair or appealing they may appear.

Now that a new administration has taken office, you are asked to advise the new president of the United States on how he should respond to the WTO ruling. There are some questions below that may help you make your recommendation.

Questions to Consider

• What is a more important issue today: pursuing free trade or maintaining environmental quality?
• Should the WTO and individual countries make exceptions to free trade rules to benefit particular endangered species? (NOTE: a similar case was raised a few years ago regarding "dolphin safe" tuna fishing.)
• Who should have the power to decide situations such as this? Should U.S. law (and that of other countries in similar cases) be superseded by the decisions of international organizations?

Your Decision. What do you recommend to the president?

NOTE: Sources for this exercise were:

http://www.cnn.com/TECH/science/9810/14/turtles.yoto/
http://www.wto.org/english/tratop_e/envir_e/envir_e.htm

1		Defy the WTO ruling.
			A)	Agree
			B)	Disagree
			C)	Don't know
2		Comply with the WTO ruling.
			A)	Agree
			B)	Disagree
			C)	Don't know
3		Defy the WTO and open new negotiations on balancing economic and environmental concerns.
			A)	Agree
			B)	Disagree
			C)	Don't know