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. Last Updated: 07/27/2016

Making Something of Another Doha Chance

A new dawn, or another false start? If the faint signs of life in the Doha round are to amount to anything at all, it needs to get going quickly.

The odds are still stacked heavily against success in Doha. But U.S. President George W. Bush has on at least two previous occasions -- the Group of Eight summits in 2005 and 2006 -- banged the table about the need to get Doha done. But no changes at the negotiating table reflected the cheap talk from the top.

Almost everyone loses from the death of Doha, and with it an erosion of the credibility of the World Trade Organization as a negotiating forum.

Conventional wisdom correctly has it that developing countries have most to lose. Even India and China will be overstretched from keeping dozens of bilateral and regional plates spinning, and no trade agreement with either the United States or the European Union is going to bring the negotiating advantage a WTO deal would offer.

The United States and EU also have more to lose than they admit publicly. The WTO is an absurd necessity. Its mercantilist structure trades off one member country's "concessions" to allow in more imports against those of the others. In reality it is the import liberalization, not the export gain, that benefits the countries most.

One-sided bilateral deals -- and particularly those filled with non-trade measures of dubious economic merit, such as obsessive intellectual property rights protection or rules against capital controls -- keep the export lobbies happy. But they deprive ordinary families across Europe and the United States of the gains from trade.

Most of the WTO's member countries say the United States should make more concessions to get the round going. Washington should compromise by offering more reductions in its farm subsidies, not by radically reducing its demands that others open their agricultural markets.

The United States could, without too much difficulty, cut by nearly one-quarter the ceiling of $22.5 billion per year implied by its current offer on farm subsidies. The U.S. negotiators themselves argue that they could not in practice use $5 billion of the theoretical limit. Like a lizard's detachable tail, it was designed to be lost to predators while leaving the animal essentially unharmed.

As Washington did when making its initial subsidy-reducing offer back in October 2005, an offer now could jump-start the round by calling the bluff of Brussels, Paris and New Delhi that no progress is possible because the United States is unwilling to make sacrifices. At least it would settle the matter one way or another.

A longer version of this comment was published as an editorial in the Financial Times.