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Unformatted text preview: November 16 th 2011 Lecture 18 POLI 351: Approaches to IPE GATT in Crisis Evolution of the Trade Regime Monday was about how GATT became incredibly successful due to the principle supplier rule and linear reduction as the principle to negotiating in the 1960s Todays lecture is how GATT became a victim of its own success in the 1970s and 1980s- Response in domestic settings as the economy slowed down was to push back for protectionism for particular sectors- Call it the new protectionism Problems: The New Protectionism- GATT had been lowering tariffs a little in the 50s and quite a lot in the 60s- The rules in GATT allowed for tariffs but set-up the process for retaliations o States were reluctant to do this, and against the spirit of GATT and liberalization o Tried to find other ways to get the same protectionist effect without looking like a tariff- Tokyo (Nixon) Round 1973-79 o Long negotiations o Named after American president when negotiations started Later changed to Tokyo once opinion of Nixon had fallen- Government procurement o Are big consumers within their domestic economies At the federal, provincial and municipal consume huge amounts of computers, automobiles etc o In this period governments clearly preferred local supplies Decisions made by politicians looked better when local goods were bought For a country that exports a lot of trucks that were cheaper and better this is not fair and does not work through the market- NTBs (non-tariff barriers) o New protectionism shows up in legislation that was being passed o Safety and environmental regulations States could legitimately say they had concerns in the 60s and 70s about these issues One of the early ones is that states said cars should have seatbelts and have minimum crash standards o These standards could be used to block products and trade from occurring- Bending of the rules o Pressure on several countries, with the US as the forefront of the bad guys...
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- Fall '11