Mexican police stand outside the convention centre in Cancun, Mexico, where the WTO will meet tomorrow.
Tomorrow begins the next chapter in the great saga of globalization as trade ministers of the now 146 member-countries of the World Trade Organization meet in Cancun, Mexico, to mark what's supposed to be the halfway point in the Doha Round of international trade talks. Named after the capital of Qatar, where it kicked off two years ago, the Doha Round has also been dubbed the "Development Round" since its goal is to make sure the world's poorer countries, which now constitute a large majority in the WTO, enter fully into the international trading system, the better to start them on the road to becoming if not rich, at least less poor.
You'd think aiming to end world poverty would put the WTO on the side of the angels for once. But, of course, there will be protesters, street theatre and as many mass demonstrations as the Mexican police allow. The impression that will come through on TV is that the suits want Doha and the street doesn't (even if in the heat of the Yucatan, many of the suits might actually be wearing sports shirts).
If gatherings of the nations since the infamous WTO ministerial meeting in Seattle are any indication, some of the opposition at Cancun will be just plain loony. In every generation, some young males must struggle to find themselves, although it's puzzling why they insist on involving the rest of us in their search.
But concluding that opposition to freer trade is mainly hormonal and therefore illogical would be a big mistake. In fact, the most white-bread, mainstream economic theory of international trade there is - it was devised by a couple of Swedes 80 years ago - stresses that when countries open up their borders and let trade happen, some people win and some people lose. On the whole, each country can produce more total output specializing in what it does best. But that doesn't mean some folks won't be hurt in the process.
There's even a pattern to who gets hurt. The rule is: Don't be in relatively scarce supply. These days, most rich countries don't have a lot of unskilled labour. But the world at large is awash in it. Free up trade, and rich-country unskilled workers will face merciless competition. No wonder they often oppose free trade.
On the other hand, our skilled workers will do rather nicely. Compared to the rest of the world, where they're scarce, they're in abundant supply here. If the products they make get into poor-country markets, they stand to prosper at the expense of high-skilled workers in poor countries, for whom the gig will be up when rich-country goods come pouring in.
Conclusion? High-skilled workers in rich countries and low-skilled workers in poor countries should support freer trade while the low-skilled in rich countries and high-skilled in poor ones should oppose it. That might sound too neatly symmetrical to be true, but in fact, a new study by Irish economist Kevin O'Rourke finds just that pattern of support for freer trade in a public opinion survey in 24 countries.
Seeing a theory confirmed is comforting, but, for liberal internationalists, part of O'Rourke's study is alarming. People were asked whether their country "should limit the import of foreign products in order to protect its national economy." A score of 1 indicated strongly no, 3 was neutral and 5 was strongly yes. Of 24 countries surveyed, only two (the Netherlands and Japan) scored less than 3, with scores varying between 2.91 (in the Netherlands) and 4.19 (in Bulgaria). We were sixth most liberal, at an illiberal 3.26.
This is supposed to be the age of globalization, but judging by these numbers, lots of people around the world aren't yet convinced. We who favour globalization need to figure out how its winners can better share their gains with its losers.
William Watson teaches economics at McGill University.
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