Sheriff or Prisoner? The United States and the World Trade Organization

One might think that the recent fiasco in Seattle put an end to the claim that globalization and U.S. hegemony amount to the same thing. The United States advanced itself as the host of the World Trade Organization ("WTO") ministerial meeting to identify the next round of global trade negotiations with U.S. objectives and values, as well as to build the Clinton presidency's claim to a legacy. The refusal of the participants to agree to an agenda for further negotiations, as much as the bizarre street theater that hectored the delegates, proved a terrible embarrassment. The institution most closely associated with open global markets has faltered, quite in opposition to U.S. desires. If the United States cannot even set the topic of the conversation, how can it be seen as dominating the world economic system? Yet reports of the demise of U.S. dominance over the post-Cold War international environment may be premature. The last decade has seen a remarkable convergence in economic policies and expansion of the authority of institutions designed to promote them. We still speak of a "Washington consensus" about the way the international economy should work. Around the world politicians, intellectuals, and workers alike decry the extent of U.S. influence, especially in economic matters. Coca-Cola and McDonald's have come to stand for a particular kind of threat to national self-determination, and those symbols ride on the back of the American eagle. To understand these claims about U.S. hegemony, we need some perspective. I would like to compare two competing accounts of the U.S. role in the global economy. In one version, the United States has built an international system that replicates its ideology, culture and values. This is a unipolar world where a broad range of fundamental choices about political and economic structure reflect Washington's preferences. The United States may not make every meaningful decision in administering the world economy, any more than the headquarters of a multinational corporation dictates precisely what its local managers must do. But in this scenario, the United States has final say on all questions that significantly affect its interests. I will call this the hegemon story. The contrasting account depicts the United States as a passive instrument subject to forces outside its control. The identification of these forces varies, but often they are seen as some combination of large multinational corporations and international technocrats. The regime may advance some interests of the United States, at least in the sense that it produces better outcomes than would genuine international anarchy. But where the goals of the regime conflict with national interest, the regime prevails. This I will call the regime story, because it asserts that some broader regime limits U.S. action. An essential component of these accounts is the perceived relationship between the United States and the international institutions that help shape the world economy. Those who see the United States as a hegemonic power portray the International Monetary Fund ("IMF"), the World Bank, the WTO, and similar bodies as instruments of U.S. policy. Typical is the renowned historian Eric Hobsbawm, who speaks of the IMF and the World Bank as "de facto subordinated to US policy" and attributes the success of the General Agreement on Tariffs and Trade ("GATT") system "primarily to the overwhelming economic dominance of the USA and of the dollar."1 In contrast to the hegemon story, the regime account sees these international institutions as imposing significant constraints on what all nations can do, including the world's only superpower. Whether the institutions determine their own agenda or instead act as the instruments of private interests, they lay down and enforce rules that the United States would not choose on its own. These perceptions complement other stories depicting the "hollowing out" of the U. …