Will the WTO Die on Dec. 10, 2019?

♠ Posted by Emmanuel in , at 11/22/2019 03:03:00 PM
Meet (trade) Killer BOB.
To those following international trade, it's been no secret that the United States has been blocking the appointment of appellate judges to the WTO's Dispute Settlement Mechanism--international trade court, if you will. Without having judges to hear appeals on different trade-related rulings at the WTO, a critical component of the organization will be terminally wounded--its legal one.

With an avowed isolationist like Trump as the US leader--and a US trade representative with a similar view of the world in Robert Lighthizer--this outcome was perhaps inevitable after the 2016 elections:
The world will not end on December 10, yet for many who have spent their careers within the global trading oversight system, the date has apocalyptic consequences. That is when the World Trade Organisation’s (WTO) highest dispute-resolution body will cease to function after the administration of US President Donald Trump blocked reappointments to its panel. Without a working appeals system, international trade disputes may never see resolution and could quickly evolve into tit-for-tat tariff wars that spiral out of control.
Lighthizer makes no efforts trying to disguise US efforts to kill of the Appellate Body:
The US sees the Appellate Body's role as one which strictly enforces a “contract” agreed to by WTO members. The European Union and many other countries, however, view the body as more of a court that is able to create new laws for the organisation, WTO deputy director general Alan Wolff said recently.

Lighthizer made that same point in a rare public speech in 2017 when he said the European Union views the WTO and its dispute-settlement rules as “sort of evolving kinds of governance.” “There’s a very different idea between these two things,” Lighthizer said. “And I think sorting that out is what we have to do.”
So what is the US position, then? Either it gets what it wants--a much-circumscribed set of issues the appellate body can rule on to avoid "judicial overreach" on trade matters--or it will simply blow up this international legal mechanism.

Despite criticisms that the WTO--its rules and legal rulings--favor wealthy countries, think of what the alternative situation is of a world without the WTO. It would be a move away from a (relatively more) rules-based order to, well, a move back to more of the law of the jungle. The realist situation awaits us once more--and Trump and his boys will be quite happy with that situation, actually:
But even if the US manages to ram through its fixes to the dispute system, American officials have a litany of other changes they want to see at the WTO. They include making it harder for countries like China to self-proclaim “developing” status, which affords them certain preferential treatment on trade. The US also wants more transparency from all nations, especially from China, on subsidies given to domestic businesses that export overseas.
A weakened WTO could bring back an era that allowed economically strong countries to steamroller other nations. Before the WTO established a rigid dispute process, trade was governed by the General Agreement on Tariffs and Trade, which determined trade disputes through diplomatic muscle rather than a deliberative, legal manner.
That may not necessarily be seen as a bad thing for Trump and his group of trade officials, who have long viewed the WTO as a suspect institution aimed at undermining US economic sovereignty.
Welcome (back) to the jungle--coming to an international trade partner near you December 10, 2019.