The scientific evidence for concern is reinforced in Europe by public demand for regulation. The European Union adopted its bans in 1980 in response to public outcry over reports of developmental problems in infants and children caused by eating hormone-treated meat. Given the strong public demand for banning hormone-treated meat, the European Union has strongly resisted compliance with the WTO order to lift its ban, even at the cost of US-imposed trade sanctions.

The hormone-treated beef case dramatically illustrates the point that nations do not choose health and environmental standards based on what economists view as the least trade-restrictive solution. They adopt solutions that available scientific evidence suggest and that their political systems demand and can best manage. If WTO rules discourage them from adopting a least costly but strongly environmental solution, they will adopt less stringent environmental standards.

Sanctions and Sovereignty

Environmentalists generally agree that the WTO is not the appropriate forum for finding solutions to protect the global commons. We simply suggest that it acknowledge this lack of competence and step aside. Bagwell and Staiger, however, propose a different solution that is a stunning departure from established principles. They assert that “the use of trade sanctions by one country to adopt standards to which they have not voluntarily agreed…is a clear violation of national sovereignty.” This statement is made explicitly in the context of the global commons. No justification is offered.

The WTO has taken the position that such sanctions violate its rules. But there is no basis for treating such rules as violations of sovereignty. Even if we grant that there is a sovereign right of access to the global commons, which has been the tradition, although not an unchallenged one, there is no sovereign right of access to another nation’s markets. If the United States chose to close its borders altogether, no other nation could complain that its sovereignty had been infringed upon.

So why is a selective denial of access to goods produced in a manner which destroys the ozone layer and increases cancer rates in New England, for example, a violation of sovereignty? As a consumer, I can choose not to buy goods made in a manner that either threatens my interests or offends my values. Why is it a violation of national sovereignty for the United States, as a community, to make a similar decision? Bagwell and Staiger seem to believe that among the rights nations enjoy is not only the right to degrade the global commons, in the absence of clear international law to the contrary, but also the right to export the fruits of that degradation to every consumer market in the world. Such a right is indeed embodied in the current rules of the global trading system, it is not intrinsic to the historical rights of sovereign nations. If it exists, it is a new right, and it is this purported new right, more than anything else, which has provoked environmental organizations’ resistance to the WTO.

Oceanic Implications

It is not accidental that so many of the most intense environmental trade disputes involve marine resources—tuna, dolphin, sea turtles, and shrimp. The seas are a global commons that, unlike any other, can be exploited to an almost unlimited degree by even miniscule nations. Ships carrying the Liberian flag could strip mine the ocean in a few years even if every other nation agreed to firm marine resource treaties. Only the closure of national markets to nations that mine the oceans will prevent such resource depletion. No other global commons has this vulnerability. A single rogue nation cannot destroy the ozone layer, because its economic capacity to use ozone depleters would be very limited unless it were a very large nation, like China or the United States, that has a substantial stake in the global system.

Allowing Liberian President Charles Taylor to determine the rules of ocean management is simply unacceptable—but that is what the WTO rules seem to envisage. Of course, this example is, in WTO terms, extreme. Taylor cannot do what this scenario suggests, because Europe and the United States could close their markets and invite him to retaliate, knowing that any bans Liberia could enforce would have minimal effects. So the WTO does not prevent the United States from closing its markets to strip-mined fisheries as long as those fisheries come from economically powerless countries with small populations unable to absorb the harvest themselves. In the real world, less extreme problems are very much at the forefront; Japan wishes to whale, India to shrimp without turtle-excluder devices, Mexico to fish for tuna with dolphin surrounds. These countries are major international players, and a set of global rules that forbids trade sanctions against such countries’ environmentally irresponsible products tilts the playing field against the responsible use of resources. Indeed, in response to negative rulings in trade tribunals, the United States recently weakened its standards for “dolphin-safe” tuna.

Most trade economists would oppose such “unilateralism,” even to prevent environmental problems. So do many representatives of developing countries, who say it is unfair that only wealthy nations can use market access to express their values in the utilization of the global commons. Why do environmentalists disagree? If the global commons can only be defended once international treaties are binding, they often will not be defended adequately or in time. This is not to say that good-faith efforts to negotiate treaties should not normally be attempted before a nation acts alone to protect global resources. After all, a single nation can only use the leverage of its own market against commons-damaging products. A treaty, if negotiated, can establish global standards applying to all markets, disrupt trade less, and better protect the commons. But after a reasonable time period, if an adequate agreement cannot be reached, the trading system must leave nations free to act in the interest of preserving the global commons.

Trade economists, perhaps disingenuously, often claim that the WTO must bar any and all unilateral action to defend the global commons in favor of multilateral solutions. They ignore the reality that many nations will only negotiate if they know that the alternative is trade restrictions that will deprive them of valued markets. Each nation in the global community will set a different priority for protecting the commons; typically each will have a different set of interests affected by commons degradation, a different valuation of present and future outcomes, and different discount rates. Without trade sanctions, nations placing a high value on the commons and great importance on the future will simply not be able to extract treaty agreements from nations with different values, and the race to the bottom will continue.