The Case of the Missing Sovereignty

by WILLIAM R. HAWKINS September 25, 2017

The theme of President Donald Trump's first address to the United Nations General Assembly was sovereignty. This was a fitting place for such a topic, as too often the bureaucrats at the UN try to present the institution as the ultimate arbitrator of world affairs when it is really only a Member organization that depends on national governments to provide the resources and the directions of how they are used. When one goes to the website of the UN and clicks on "Overview" one is greeted by the arrogant claim that "the United Nations can take action on the issues confronting humanity in the 21st century" followed by a long list of topics. But the UN cannot act on any of these matters without the backing of Member states, who will use the UN as cover for the pursuit of their own interests----or who will oppose it. The nations are not united. In such a world, Trump promised, "As President of the United States, I will always put America first, just like you, as the leaders of your countries will always, and should always, put your countries first." Gerald Seib, the Washington Bureau chief of The Wall Street Journal declared this was "refreshing" and "the return of American foreign policy to realpolitik." And fitting, since the rest of the world has never abandoned it.

According to the Merriam-Webster dictionary, sovereignty means "supreme power, especially over a body politic" and "freedom from external control." The United States is supreme over its own territory and policies, and secure from external control as long as it has the power to defend itself. It is not subject to external control by the mere assertion of others or by any legal-moral authority of this earth. As President Trump said, "In foreign affairs, we are renewing this founding principle of sovereignty. Our government's first duty is to its people, to our citizens -- to serve their needs, to ensure their safety, to preserve their rights, and to defend their values." 

Many on the Left denounced these sentiments out of a globalist ideology, or a lust for divisive class warfare or just a hatred for the very existence of the United States as an independent power capable of shaping world events. To them, any Trumpian vision of American "greatness" that allows "individuals to flourish in the fullness of the life intended by God" is "dark and tempestuous" or even "belligerent" as Alex Shephard, the news editor at The New Republic, put it. Shephard also called President Trump's speech "rambling and incoherent" but that is only because the President was speaking of noble values as a patriot; uplifting concepts that have become alien to the flag-burning denizens of the fever swamp. Even on a basic level, Shephard found the argument "that nations should embrace self-interest while calling on them to work together to solve urgent problems" to be "confusing." He apparently doesn't remember that the term United Nations was first used in regard to the Allies who banded together to defeat the Axis in World War II. Each "ally" pursued its own interests during the larger struggle, as the post-war world revealed.

But there are issues at the heart of sovereignty upon which many conservatives and liberals in Washington can agree, and which could give the American people hope that there can be at least some bipartisanship on basic questions of national security and prosperity. The president got to one of these near the end of his speech when he turned to international trade. He noted, "For too long, the American people were told that mammoth multinational trade deals, unaccountable international tribunals, and powerful global bureaucracies were the best way to promote their success. But as those promises flowed, millions of jobs vanished and thousands of factories disappeared." American diplomats, relying far too much on the "advice" of transnational corporate lobbyists using the sophistries of transnational intellectuals as cover, made many mistakes while negotiating the North American Free Trade Agreement and the creation of the World Trade Organization. The one that most subverted sovereignty was the creation of dispute settlement procedures that substituted arbitration by foreign judges for the traditional practice of negotiating differences while protecting national interests.

The U.S. has called for the elimination of the arbitration tribunals in NAFTA as part of its renegotiation of that damaging pact. The effort to further expand foreign arbitration in the Trans-Pacific Partnership agreement was one of the major reasons President Trump scrapped that deal before it was concluded. In both cases, the strongest criticism of the dispute settlement process had come from Democrats and labor unions concerned about the impact of adverse rulings on jobs and safety regulations. But they were joined by conservatives who rejected the very idea that foreign judges (and the foreign interests behind them) can "rule" that U.S. laws and regulations, enacted by representatives of the American people, are illegal and must be rescinded under threat of sanctions.

The U.S. has its own process of judicial review that ultimately rests with the Supreme Court; a body comprised of American judges appointed by the President and confirmed by the Senate who base their decisions on the Constitution. The panels set up under trade agreements claim superiority over the American body politic, thus transferring sovereignty beyond borders. And the purpose of this system was clearly understood to be to overrule and cripple the ability of national governments to protect critical parts of their economy and society from external actions. The panels are wedded to the doctrine of "free trade" which means "free" of government intervention in commerce to protect or advance national interests. It is economic disarmament.

I was working on Capital Hill when the WTO was being debated and in the years since was always shocked when proposals to help American-based producers better compete against foreign rivals were dismissed because "the WTO won't like it." It was as if we had given overseas bureaucrats a veto over the American legislative process---- because we had.           

The idea of creating a supranational court to govern economic policy was not embraced by Presidents Ronald Reagan and George H. W. Bush despite their interest in reforming the General Agreement on Tariffs and Trade which had liberalized the trade in goods after World War II. President Bill Clinton, however, fell for this notion during the euphoria that attended the end of the Cold War and the supposed dawn of a New World Order. Transnational corporate lobbyists exploited the moment to push the idea that commerce no longer needed to be constrained by concerns over national security or the balance of power. The old sophistry of early 19th century classical liberalism was revived to allege that trade was inherently peaceful (despite its clear competitive nature). Walter B. Wriston, CEO of Citibank, even wrote  a book on The Twilight of Sovereignty (1992), as did other business leaders and academics.           

The target of the WTO was the United States, the richest market in the world which every other country wanted to penetrate with exports to support is own growth and jobs. In the traditional world of diplomacy, America's great strength gave it an edge; but in a "legal" environment predicated on the equality of nations before the "law" the U.S. can not use its strength; the 800-pound gorilla is caged. It is clear why America's trading "partners" like this system; it prevents Washington from returning to the policies that built the country into the world's greatest power. So America strains under a mounting foreign debt, having run a trade deficit in goods every year since the WTO came into existence in 1995; including a deficit of $736.8 billion last year.  

The first principle of the WTO is "a country should not discriminate between its trading partners and it should not discriminate between its own and foreign products, services or nationals." A statement that makes no sense to a patriot. What American citizen can feel safe when his government has pledged to give foreigners the same rights as he has in his own country? Foreigners who want to take his job or run his company out of business. Every member of the middle and working classes should object to such a system. They are rooted in America. They are not going to pack up and move across the globe to seek profits helping other countries rise to challenge the U.S. But it surely tests their loyalty to be told that the officials they have elected are forbidden to have any loyalty to them. And that tribunals have been set up to enforce that betrayal under both NAFTA and the WTO.

The post-Cold War world is over. The endless international struggle for wealth and power hardly paused. As Yale historian Paul Kennedy argued in The Rise and Fall of the Great Powers: Economic Change and Military Conflict 1500-2000 (a book that should be on the desk of every policy wonk), "how a Great Power's position steadily alters in peacetime is as important to this study as how it fights in wartime." And those peacetime changes are rooted in competing economic performances which can be enhanced or subverted depending on how trade rivalries play out.

President Trump's approach is the one that better fits the times than that of his immediate predecessors of both parties, "While America will pursue cooperation and commerce with other nations, we are renewing our commitment to the first duty of every government:  the duty of our citizens. This bond is the source of America's strength." A bipartisan majority in Congress believes this as well. Lawmakers on both sides of the aisle must put aside their petty behavior to remember what their real duty is as public servants. If they do, the system can be reformed to restore American sovereignty over the economy upon which we all depend. 

William R. Hawkins is a consultant specializing in international economic and national security issues. He is a former economics professor and Republican Congressional staff member.

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