The Case for Reviving the Doha Trade Round

New CAP report urges action on trade agreement as Bush meets with European Commission President to begin resolving differences.

Read the full report (PDF)

The suspension last July of the Doha Round of multilateral trade negotiations has generally elicited indifference, or at most mild regret, in American political and policy circles. This is an unfortunate irony because a careful look at the Doha agenda suggests that an eventual agreement could avoid the unproductive, polarized debate produced by many of the Bush Administration’s bilateral and regional trade agreements. Instead of remaining stuck in an argument over the merits of trade agreements in general, we should assess whether the elements of this specific negotiation are consistent with important national economic and security interests. The components of the Doha Round indicate that it passes that test. In fact, it is the kind of trade negotiation that should command widespread support.

The Doha Round is a back-to-basics trade negotiation. Because it focuses mostly upon tariffs and trade-distorting subsidies, it avoids the controversial inroads into domestic economic and regulatory policies that have characterized the Uruguay Round and many bilateral agreements. Its modest ambition is a virtue, rather than a flaw. Although the gains to U.S. export interests—while real—will not be as great as many would like, the harm to trade losers will also be moderated. This limited scale is prudent given current uncertainty as to where, and how, large numbers of good new jobs will be created.

The Doha Round emphasis on agricultural policies and trade allows us to negotiate increased international market access for competitive U.S. farmers in return for limits on our agricultural subsidy programs that are needed for purely domestic reasons. Budgetary pressures will likely reduce the inflation-adjusted value of the programs in any case. These programs should also be better targeted to family farmers, and to promoting sound environmental and energy policies.

The focus on agriculture also underscores that this negotiation is called the Doha Development Round. The potential benefit to agricultural interests in poor developing countries is a strong independent reason to support this round. The market-based boost to development would serve U.S. political and security interests in avoiding failed states, humanitarian interests in combating poverty around the globe, and commercial interests in a stable and growing world economy.

Beyond the advantages that would flow from the terms of a Doha agreement, an American initiative to bring the Doha Round to a successful conclusion serves our interests in maintaining a healthy multilateral trading system. A world dominated by bilateral and regional trade agreements would not only be less efficient; it would also reduce the U.S. influence that comes from being the most important single actor in any global arrangement.

Jump-starting the Doha negotiations to achieve an agreement that advances global economic and development aims would also boost U.S. economic leadership more generally. Recapturing our leadership is vital in a period where the rules of the global economy will be changing. Even acting together, Congress and the Bush administration cannot assure Doha’s success. Other countries must do their part. But it would be a serious mistake to pass up the opportunity to seek agreement.

To seize this opportunity, we need:

  • The president to become personally involved in restarting Doha
  • The Bush administration to seek genuine cooperation with the Democratic leadership of the Congress
  • The United States to take the lead in expanding the trade opportunities that a successful Round would offer the poorest countries.

Only then will we know if the Doha Round can be successfully negotiated and ratified. That effort is well worth making.

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