Ian Welsh:

So, it looks like the Doha round, after 7 years, has failed. As anyone paying even a slight bit of attention anticipated, it did so because Americans and Europeans don’t want to allow other countries to protect their farmers and internal food markets from subsidized competition by the West, nor is Europe or the US willing to reduce subsidies in any meaningful way.

To which I say “who cares?” The world doesn’t have free trade, it has very heavily managed trade which has been sold as free trade. When China has spent 10% of GDP on keeping the Yuan undervalued (otherwise known as an export subsidy); when the US and Europe have huge subsidies for agriculture; when the US dollar during various years has been kept afloat primarily by government interventions; when the Japanese were giving away money for nothing for most of the past decade; when various strategic industries like aircraft are massively subsidized—well, I can’t get all that excited about “free trade”, because, well, we don’t have it.

What we got instead was managed trade, where various countries were forced to open their markets in specific goods, as enforced by various transnational organizations like the WTO and the IMF. Even more than that we got free capital flows, which have almost nothing to do with free trade and in fact, according to Ricardo, make it impossible to get most of the benefits of classic free trade.

And we got a lot of rent-seeking, especially in intellectual property, where the US tried to force everyone else to pay for US IP in software, entertainment and drugs. Millions of people have died to keep Pharma’s bottom line producing, courtesy of “free trade”.

Meanwhile forcing countries to open their borders to cheap, heavily subsidized western food produced through mechanized agriculture destroyed the livelihood of hundreds of millions of small and subsistence farmers, turned entire nations which used to produce enough food to feed themselves into food importers and helped create the massive slums which ring almost every 3rd world country. They helped lead to the rise of Islamic fundamentalism in many countries, since folks who are poor and have no hope for the future tend to decide they’re at least going to have a good afterlife. And, in badly damaging Mexican agriculture and pushing food prices higher and higher (even before the ethanol stupidity) they were one of the main causes of the immigration influx to the US.)