Today's FT reports that the WTO negotiations are bogged down. Not a surprise, and it reinforces a kind of facile comparison to the Uruguay Round. Oh yes, agricultural brinksmanship again. The parties are playing chicken and the one with the most to lose will swerve at the last moment. Oh, but when exactly is the last moment? And who has the most to lose? Sometimes these guys just crash.
The EC Commissioner for trade, Mandelson, said he had been granted some flexibility by the Council to offer a bigger cut than the initial 39% average cut initially offered--something "just below" the Group of 20 proposal of 54%. He was immediately contradicted by Christine Lagarde, the French trade minister. He commented in response "The French are the French." This is also reminiscent of the Uruguay Round, and the scuttled Blair House deal, where the French asserted the Luxembourg Compromise/Ioannina compromise--to the effect that for really important issues, majority voting won't apply. That is, the French (or any other country) may veto the package despite the broader agreement to majority voting. This is an area of some uncertainty. In fact, the better formal legal position appears to be that no such veto exists. But what's to stop France from pursuing the "chaise vide" tactics of Degaulle in the 1960s?
France's position may contribute to the stalemate, but it might equally, or more likely, be blamed on the U.S., which is declining to do a Doha lite deal. Why?
