Tuesday, June 3, 2003

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Doha round update

I'm frequently asked by students about when a theory of international relations should be discarded due to a lack of explanatory power. In response, I will occasionally launch into a disquisition about Kuhn and Lakatos, but more often I give the following answer:

Any theory must do a better job of explaining variation than a simple rule of thumb, such as, "Every major disruption of the global political economy is the fault of the French."

Laugh if you want, but that rule of thumb actually jettisons a lot of bad theory. Which leads me to the current state of the Doha round of world trade talks. From today's Financial Times:

Franz Fischler, the European Union's farm commissioner, on Monday vowed to stand firm over his proposals for a sweeping overhaul of EU farm subsidies, amid growing signs that member states will agree to at least substantial parts of his reform package at a meeting next week.

The US and many other WTO members view next week's talks as vital to the fate of the Doha round, in which agriculture is the biggest stumbling block. They say the success of the CancĂșn meeting hinges on the EU agreeing reform of its farm subsidies. A successful outcome would inject some much-needed momentum into the stalled talks on liberalising farm trade....

At the heart of Mr Fischler's package lies a plan to sever the link between subsidies and agricultural production, leaving farmers free to tailor output to demand. In theory, this should reduce overproduction and put an end to the dumping of farming oversupply on to world markets - a practice widely criticised for hurting farmers in developing countries and distorting trade....

However, he is facing strong pressure to scale back his plans - especially from France, which receives the largest share of EU farm subsidies and has long been the most ardent defender of the CAP [Common Agricultural Policy].

Officially, France remains strictly opposed to cutting production-linked subsidies ("decoupling"), but Mr Fischler insisted on Monday he was not prepared to sacrifice the central plank of his plans.

"To be absolutely clear: a reform without decoupling is no reform," he said

The U.S. is far from pure on the question of agricultural subsidies. However, the success of the Doha round of world trade talks now hinges on whether the French are willing to walk away from the Common Agricultural Policy.


UPDATE: Kevin Drum has additional thoughts on the matter -- and there's an interesting debate among his commenters.

posted by Dan on 06.03.03 at 11:20 AM