Why the US Should Stay in the WTO by James Nespole

After former President Donald Trump’s many threats to leave the World Trade Organization (WTO) during his presidency, much debate has taken place over whether or not the United States should remain in the WTO. However, it is in the United States’ best interests to remain in the WTO because the agreements within the WTO protect American exporters from trade barriers like tariffs, the WTO provides the US with a forum for settling disputes with foreign countries, and the US would forfeit a substantial amount of their power over the world's economy to China.

Over the last few decades, exports have become an increasingly large part of the American economy. This can be mainly attributed to trade agreements made in the WTO that have been favorable for the US. For example, since the General Agreement on Tariffs and Trade (GATT) was adopted and then turned into the WTO, according to Daniel Griswold, “...the average level of global tariffs levied against U.S. exports has dropped sharply from 22 percent to under 5 percent.” (Griswold) Furthermore, Griswold also states that since the WTO was created, American exported goods and services have increased from $700 billion in 1994 to $2.5 trillion in 2019. This represents a jump from 10% of the American economy to 12% during this period of time. The agreements made within the WTO can be accredited for these increases in American exports. These exports of goods and services support the American manufacturing sectors and, in turn, American manufacturing jobs. If the US withdrew from the WTO, American producers would be denied the protection they currently receive against trade barriers like high tariffs. This would greatly damage the export sector and the American economy as a whole. A second reason why the US shouldn’t leave the WTO is because it creates a forum where the US can settle disputes with foreign countries. The WTO provides a panel, in which the US can file grievances with other country’s trade policies and fix them in a way that is beneficial to all states involved. There is even evidence that the US is more successful in settling trade disputes through the WTO panel than they are by negotiating directly with countries. Brian Schonfeld references a study by Professor Christina L. Davis from Harvard University that made this finding. Schonfeld says, “And one study finds that the U.S. government gets better results by using the WTO’s trade dispute settlement system instead of negotiating with other countries directly.” (Schonfeld) A forum where the US and foreign nations can file complaints allows for foreign trade to continue to run smoothly, rather than spiteful escalations taking place that are detrimental to all parties involved like embargos or even war. Thirdly, if the US left the WTO, they would be forfeiting a substantial amount of power over the world’s economy to China. Given the competitive relationship between the US and China, which is starting to be compared to the cold war in ways, both the US and China are constantly searching for ways to obtain power over one another. Given this, it is a very realistic and major concern that if the US were to leave the WTO, the US economy could potentially fall behind the Chinese economy when considering the fact that the member states of the WTO makeup 99% of the world economy. If the US left the WTO, they would be completely susceptible to high tariffs and other trade barriers from the entire world economy. This would greatly damage the American manufacturing industry and manufacturing jobs. China would be able to dictate WTO policy and agreements which would highly favor Chinese manufacturers. This would leave the US with no real legal response. (Murphy)

The WTO has had a multitude of benefits for the United States. These benefits include reducing barriers to foreign markets and providing the US with a forum to file complaints and grievances about other countries' trade policies. Furthermore, leaving the WTO would essentially leave China in control of the world economy and potentially cause the American economy to fall behind the Chinese economy. 


Griswold, Daniel. “Should the United States Withdraw from the WTO?” TheHill, The Hill, 8 July 2020, thehill.com/opinion/international/506267-should-the-united-states-withdraw-from-the-wto. 

Schonfeld, Bryan. “Why the U.S. Needs the World Trade Organization.” The Washington Post, WP Company, 7 Dec. 2021, www.washingtonpost.com/news/monkey-cage/wp/2016/09/20/would-the-u-s-be-better-off-without-the-wto-not-when-the-wto-guides-98-percent-of-global-trade/. 

Murphy, John G. “Why American Business Needs the WTO.” U.S. Chamber of Commerce, www.uschamber.com/international/why-american-business-needs-the-wto. 

Comments

  1. Hayden Groves March 24, 2022 at 9:54 AM

    I also argued that the United States would face more serious consequences rather than positive effects if they were to leave the World Trade Organization. In your argument, you have very clear and concise arguments that I also stated, such as trade tariffs and the loss of power the United States could potentially be sacrificing to China. Where you extend your arguments further than me, however, is when you argue that the World Trade Organization is also a panel for discussion and settling mainly trade disputes. This is a very strong argument that I had not initially thought of, but after further reading it makes much sense that the World Trade Organization is a panel in which common disputes among other countries are resolved.

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  2. Madison McCormackMarch 28, 2022 at 10:06 AM

    After reading your blog, I couldn't help but notice that it seemed like you had a clear understanding of the topic your were writing about, and you were able to convey your thoughts to the readers excellently. You start off your blog by quickly stating your opinion on why the U.S. should remain in the WTO, and you provide specific reasons as to why this would benefit the United States. Additionally, the cited information you provide strengthens your blog immensely, and seeing how many cited sources you have in your works cited section lends itself to the credibility of your blog and argument. The main part of your blog is packed full of information and explanation, and I'm not sure if this was something on your part, but bolding certain words within the quote to emphasize them really makes these sections stand out as being important, which assists in directing the readers attention. My only recommendation would be to see if you could maybe split up your blog into two separate paragraphs instead of one large chunk, since it can get confusing to decipher when so many words are jumbled into one large piece. Overall, I really enjoyed your blog and I think you conveyed your argument excellently.

    ReplyDelete

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