The appeal to “sovereignty”, in international debates, like the appeal to “patriotism” in domestic politics, is the “last refuge of scoundrels”:http://www.bartleby.com/100/249.75.html. bq. The world’s 20 poorest countries are just about as poor today as they were 40 years ago. That can be changed only if they start to function quite differently from before, which will take a great deal of outside help. But it will also require radical domestic transformation. If the sovereignty of such dysfunctional states is protected, their peoples will remain impoverished. If their people are to be helped, the sovereignty of their states must be challenged. This is a dilemma, which will not be solved by platitudes about good governance and respect for human rights. (Martin Wolf, “Financial Times”:http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1077690832268&p=1012571727102 [sub]) “Sovereignty” is one of those concepts bounded, in the imagination of some people, only by ambition even when the power to act with unlimited ‘sovereign’ independence is lacking. Over and over, in plenary sessions of international conferences where 150 or more national statements are broadcast to small, distracted audiences, you hear stern refusals to consider any limits on ‘sovereign rights’ from representatives of governments that have mortgaged the public debt several times to foreign lenders or that have accepted the ‘security’ guarantees of neighboring countries or that cannot feed their populations in two years out of five without gifts of food from abroad. Yet these governments’ sense of their own sovereignty would be offended by acceptance of obligations, shared with all other governments, to manage economic regulations such as investment regulations or trade barriers in a particular way. Any treaty, by diverting unspecified—and therefore unbounded—comity, which is the foundation of relations between sovereigns, into specific mutual undertakings might be said to limit sovereignty. So what? The networks of global exchanges (goods, services, funds, information) that underwrite the wealth of every economy are bound by links that mean no government, not even the most powerful, has unrestrained independence of action. But there are domains where these networks of obligations do not reach, yet. For example, only in 1995 with the adoption of the General Agreement on Services Trade was there any attempt to limit ‘sovereign’ rights to regulate traded commercial services such as education or transport or ‘outsourced’ call-centers. Even that extension of obligations was limited (‘national treatment’ of imported services is an option not an obligation). The most difficult debates in future WTO negotiations may be about the acceptable boundaries of the domains in which global agreement is necessary and effective: all of the ‘Singapore issues’ that led to the disagreements at Cancún, for example, have at their heart a debate over the value of limits on a government’s actions in some domain such as investment or competition policy where, in theory, there have been no previous limits. There is no doubt, however, that sovereignty may be limited in this way without harm to such independence as most states enjoy or that such limits to sovereignty have opened opportunities for immense welfare gains on a global scale.
Peter Gallagher is student of piano and photography. He was formerly a senior trade official of the Australian government. For some years after leaving government, he consulted to international organizations, governments and business groups on trade and public policy.
He teaches graduate classes at the University of Adelaide on trade research methods and the role of firms in trade and growth and tweets trade (and other) stuff from @pwgallagher