TRADE PREVENTS wars, they say. This guiding prinicple has become the cornerstone of the United Nations and World Trade Organization (W.T.O.), especially under the Clinton Administration. Such economic multilateralism "to promote international cooperation and to achieve peace and security," as the Treaty of Versailles put it, certainly has intuitive appeal as the panacea to all the world's problems. Unfortunately, it can also prevent effective broad-based action on world security concerns by making the world a much more dangerous place. In short, while economic liberalism has the ability to improve the lives of rich and poor alike, it must always be considered as part of larger geopolitical and security concerns.
Bill Clinton entered the Oval Office with a promise to focus on the economy "like a laser beam." And so he did. Clinton successfully lowered tariff barriers, secured the passage of the North American Free Trade Agreement, and successfully completed the Uruguay Round of trade talks.
President George W. Bush struck a rare policy congruence with Clinton by getting the Central American Free Trade Agreement passed and by securing a plethora of bilateral trade agreements -- all the while working his hardest to continue the Doha Round of trade talks.
Given America's booming service sector, highly competitive manufacturing sector desperately in search of more markets and American consumers' perpetual desire for cheaper goods, it is of little surprise that trade liberalization should hold so much sway in the White House. Furthermore, removing barriers to trade and investment offers uncerdeveloped countries a way out of poverty by offering them access to cheap manufactured goods, a welcoming market for their own goods, and an inflow of capital for building crucial infrastructure. But despite such a seeming similarity in policy, there are subtle differences between the two administrations' approaches to international economic policy that have vastly different implications for world security.
The Clinton administration, while certainly engaging in both bilateral and multilateral trade talks, was an adamant supporter of being inclusive and using multinational organizations to promote his economic agenda. This led to the beginnings of China's entry into the WTO in November 1999 over the objections of Congress. Despite its questionably open economy and highly managed currency, China has one of the worst human rights records in the world and had dealings with (and still deals with) both Iran and North Korea. Yet the Clinton administration pressed on, allowing China expanded access to American trade. In fact, many international relations experts, such as Prof. Stephen M. Walt of Harvard University's call Clinton's moment of acquiescence to Congress in April 1999 over China's entry into the WTO one of his biggest policy mistakes.
Now flash forward to 2006. North Korea is in open violation of Clinton's darling 1994 Nuclear Non-Proliferation Treaty and the specter of a nuclear Iran looms large in the daily headlines. In an extraordinary exertion of diplomacy, the United States has gotten the EU-3 (Great Britain, France and Germany) and now even Russia onboard for referring Iran to the U.N. Security Council for sanctions.
Who is the remaining permanent member of the Security Council threatening a veto? China. China has a very lucrative energy trade going on with Iran and, thus far, has learned the virtues of economic liberalism well. China has expressed opposition to even the flimsiest of political sanctions and would certainly oppose economic sanctions lest its coffers cease to be filled with Iranian oil. Trade in this case, it seems, does not prevent wars so much as it prevents the protection of world security. The Clinton administration, in blindly pursuing trade liberalization, has sowed the seeds for an international crisis by emboldening nations such as China.
While the ongoing Iran crisis is the current manifestation of unbridled economic policy, similar problems can be prevented by adopting nuclear non-proliferation and zero-tolerance for terrorism as guiding international norms. There are certainly gains from trade for all involved to opening up restricted economies, but access to lucrative U.S. markets ought to come with qualifications. We dole out billions of dollars of aid with strings attached -- it is time to do the same with access to our consumer and financial markets.
The failure of multinational organizations such as the United Nations to effectively combat nuclear proliferation, state-sponsored terrorism and state funding for terror behooves individual countries, especially the richest, to clamp down on these abuses. Funding for terror and active disarmament ought to be topics seriously discussed in international meetings such as the World Economic Forum and the G-8 conference. Policy has begun to move in this direction with the Bush administration and the EU-3 threatening to impose boycotts of Iran should the U.N. Security Council fail to levy sanctions. However, there is still a long way to go since no one even whispering of levying economic pressure on China to stave off a nuclear Iran or control an already nuclear North Korea. Until that day comes, the world will continue to be a dangerous place.
Josh Levy is a Cavalier Daily viewpoint writer.
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