The always interesting Dani Rodrik proposes the following:
A broadened safeguard agreement—call it an agreement on social and developmental safeguards—would enable countries to opt out from their international obligations under specified circumstances. The process for obtaining such an exemption would be a domestic one, as in the case of AD and safeguards currently, but it would be subject to multilateral review to ensure procedural requirements are met. Any interested party would be allowed to seek an exemption or opt-out. One requirement would be for the plaintiff to make a compelling case that the international economic transactions in question are in conflict with a widely shared social or developmental norm at home. For example, an NGO may try to make the case that goods imported using child labor violate domestic views about what is an acceptable economic transaction. Or a consumer body may want to ban imports of certain goods from a country because of safety concerns.
...
... the ultimate decision would rest with a semi-autonomous government body that would consider the testimony given to it and determine (a) whether there is sufficiently broad support for the exercise of some kind of opt-out; and (b) what the best remedies are in cases where the answer to (a) is affirmative. The decision would be subject to periodic review to ensure that protection does not become permanent. It would also be open to review in a multilateral setting (say the WTO) to ensure that multilaterally-agreed procedural requirements have been met.
I had two reactions:
1) Wouldn't this proposal make it more difficult to do many of the things he proposes, like ban products made with child labor or ban unsafe imports? Currently, governments can do these things without a hearing in front of a quasi-judicial body (although clearly they have to be careful to implement in a manner that meets various WTO obligations).
2) I rarely hear economists propose more litigation as a means of solving problems. Trade lawyers around the world will be very excited if this comes to pass.
