Sunday, August 20, 2006

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The muted power of transnational capital

If the International Whaling Commission is my favorite international governmental organization, then my favorite international non-governmental organization would have to be the TransAtlantic Business Dialogue. Why? Because despite the impressive membership roster, this group does not appear to accomplish all that much. On issues like data privacy or genetically modified foods, the TABD has repeatedly issued stern proclamations with no effect on the outcome.

Which is why I am unmoved by this Financial Times story by Stephanie Kirchgaessner

Citigroup chairman Charles Prince has urged President George W. Bush to reinvigorate multilateral trade discussions and “identify a way forward” on the Doha round of trade talks.

In a letter also signed by British Airways chairman Martin Broughton on behalf of the TransAtlantic Business Dialogue, the executives said it was “unacceptable” that transatlantic differences over agriculture, representing less than 3 per cent of transatlantic gross domestic product, were dictating progress on increased market access for goods and services that comprise the majority of global trade.

The corporate chiefs said several factors should prompt the administration to revitalise the talks, including the rise of protectionist tendencies, the increase in bilateral agreements between stronger trading nations, and the expiration next June of the president’s trade promotion authority to negotiate trade agreements.

After such a proclamation, any good Marxist would predict that Doha would be reborn. And, as usual, they will likely be wrong.

UPDATE: Henry Farrell disagrees:

I think Dan is wrong here. The main reason that the TABD isn’t very influential in the grand scheme of things is that it doesn’t need to be. Business leaders on both sides of the Atlantic have plenty of access to policy makers without any need to go through the formalities of the TABD....

There is still an interesting question here, which is why businesses with an interest in increased transatlantic and international trade don’t have more impact than they do. But this doesn’t say anything about the structural power of business more generally. Indeed, I suspect that you could tell a reasonably convincing Marxist or marxisant story about how this demonstrates the relative strength of agribusiness as opposed to the internationalist types who make up the membership of TABD.

Henry's point that multinationals have access to policymakers beyond the TABD is well-taken. That said, I do think the failure of transnational capital to pry open the transatlantic market poses a greater challenge to structural Marxists than Henry asserts. To be sure, there are political economy arguments that explain the collapse of Doha and other transatlantic trade frictions as placating agribusiness and other forms of national capital. But these kind of political economy arguments do not mesh well with this part of the Communist Manifesto:
The need of a constantly expanding market for its products chases the bourgeoisie over the entire surface of the globe. It must nestle everywhere, settle everywhere, establish connexions everywhere.

The bourgeoisie has through its exploitation of the world market given a cosmopolitan character to production and consumption in every country. To the great chagrin of Reactionists, it has drawn from under the feet of industry the national ground on which it stood. All old-established national industries have been destroyed or are daily being destroyed. They are dislodged by new industries, whose introduction becomes a life and death question for all civilised nations, by industries that no longer work up indigenous raw material, but raw material drawn from the remotest zones; industries whose products are consumed, not only at home, but in every quarter of the globe. In place of the old wants, satisfied by the production of the country, we find new wants, requiring for their satisfaction the products of distant lands and climes. In place of the old local and national seclusion and self-sufficiency, we have intercourse in every direction, universal inter-dependence of nations.

posted by Dan on 08.20.06 at 09:23 PM


Any good Marxist would note that the collateral activities ("the rise of protectionist tendencies" and "the increase in bilateral agreements between stronger trading nations") will do more for the businesses than Doha would, and therefore would expect that this is either window-dressing or bottom-feeding.

Unless there were reason to believe that the agreement could actually be concluded in time for King George to say "my way or the highway."

posted by: Ken Houghton on 08.20.06 at 09:23 PM [permalink]

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