November 18, 1999

by Peter J.M. Orvetti

Let's Make A Deal
Give A Hoot, Don't Pollute
The Lights Go Out On Nuke Power

Let's Make A Deal

China will likely enter the World Trade Organization before the international body meets in Seattle for its latest round, AP reported. China and the United States have reached a trade agreement, removing one of the last barriers to Chinese WTO entry. United States Trade Representative Charlene Barshefsky visited China's foreign trade ministry three times in pursuit of a deal. China has been trying for 13 years to join the world trade's rule-making body.

During the debate over WTO accession for China, several Cato Institute commentaries have been produced. In "The Right Way to Get China into the WTO", Mark Groombridge writes that "there is a right way to get China into the WTO. That is for the world trading community to secure not only firm commitments from China on market access, but commitments on the methods for evaluating China's progress as well. Any agreement with China should have clearly delineated methods on how the WTO will monitor China's progress when inevitable conflicts arise. The key word for the WTO should be 'transparency' so that foreigners understand clearly the myriad of sometimes conflicting administrative laws at work in China." Daniel T. Griswold wrote in "Admit China To The WTO, But Don't Bend The Rules", "The issue should not be whether to admit China to the 132-member club, but when and under what conditions. After two decades of domestic reform and falling trade barriers, China has become the world's 11th largest trade economy. Barring a retreat on liberalization, its 1.2 billion people guarantee that its weight in the world economy will only grow larger in the next decade… As the price of admission to the WTO, China should agree to abide by the full range of obligations that the charter requires. That includes further liberalization, transparent trade rules, national treatment of imported goods and investment, and the abolition of subsidies, quotas and import licensing. In return, the advanced countries should agree to treat China as a grown up in the WTO by forgoing any extraordinary powers to block Chinese imports through enhanced 'safeguard' provisions and abuse of anti-dumping laws."

And in "Risky... or Worthy WTO Bid?", James Dorn writes, "The PRC has made significant progress in moving from a planned to a market economy. Today only about 5 percent of industrial product prices are determined by the government, compared with nearly 70 percent in 1979. More than 90 percent of retail prices and more than 80 percent of agricultural and raw material prices are market-determined… That competitiveness has come about because the central government has allowed the growth of the nonstate sector, including private and foreign-funded enterprises. Since most of China's export growth is due to the growth of the nonstate sector, denying China greater opportunities for free trade invariably harms its emerging market economy and strengthens state-owned enterprises. Although China has to develop its legal system and afford better protection of property and contractual rights, in order to move from a 'socialist market economy' to a private market economy, treating China as a NME, in order to protect inefficient U.S. producers, is harmful not only to the Chinese people, who seek greater economic freedom, but to U.S. consumers and businesses, who are deprived of the benefits of free trade."

Give A Hoot, Don't Pollute

Despite federal spending, America's national parks are facing increasing pollution, AP reported. Smog has started to flow over the 800,000-acre Big Bend National Park in Texas, making Big Bend, one of the most popular Texas destinations for outdoor enthusiasts, one of the most polluted national parks in the West.

The pollution shows that federal land management does not reduce pollution. In the Cato Policy Analysis "Federal Ecosystem Management: A 'Train Wreck' in the Making", Allan K. Fitzsimmons wrote, "The nation is not facing serious environmental perils requiring drastic new federal policies. The ecosystem concept, while quite useful within the realm of science from which it was borrowed, is inappropriate for use as a geographic guide for public policies. Instead of introducing science into public policy, use of the ecosystem concept interjects uncertainty, imprecision, and arbitrariness. Federal management of ecosystems would significantly expand federal control of the use of privately owned land and lead to increased restrictions on the use of the nation's public lands for economic purposes. Economic activity and private property rights would be subordinated to ecosystem protection." An early Cato Policy Analysis, "Inside Our Outdoor Policy", examined federal land policy and the use of land for recreation.

The Lights Go Out On Nuke Power

Germany will likely phase out its nuclear power industry, AP reports. The nation's 19 nuclear power plants are likely to be closed even if no consensus can be reached with their management. Economics Minister Werner Mueller said that legal experts are preparing the draft of a law that would stand up even if nuclear power operators appeal against it in the Supreme Court.

But conventional energy sources are sustainable, lessening the need for other means, Robert L. Bradley Jr. writes in the recent Cato Policy Analysis "The Increasing Sustainability of Conventional Energy": "The conversion of fossil fuels to energy is becoming increasingly efficient and environmentally sustainable in market settings around the world. Fossil fuels are poised to increase their market share if environmentalists succeed in politically constraining hydropower and nuclear power. Artificial reliance on unconventional energies is problematic outside niche applications. Politically favored renewable energies for generating electricity are expensive and supply constrained and introduce their own environmental issues… The greatest threat to sustainable energy for the 21st century is the global warming scare. Climate-related pressure to artificially constrain use of fossil fuels is likely to subside in the short run as a result of political constraints and lose its 'scientific' urging over the longer term... A 'reality check' of the increasing sustainability of conventional energy, and a better appreciation of the circumscribed role of backstop technologies, can reestablish the market momentum in energy policy and propel energy entrepreneurship for the new millennium." Bradley examines the nuclear option and other alternative sources in comparison to conventional energy in the Cato Policy Analysis "Renewable Energy: Not Cheap, Not 'Green'".