WORLD TRADE IN THE CHOPPY WAKE OF SEATTLE

WORLD TRADE IN THE CHOPPY WAKE OF SEATTLE

The protests at last week's World Trade Organization summit in Seattle vividly demonstrate how poorly international trade is understood, and the scale of the effort needed to rebuild the national consensus for open markets.

Inside the WTO the challenge is no less daunting, as the call for openness, the size and diversity of its membership, and the complexity of the issues it is being asked to address are aggravating an already difficult negotiating environment.On the surface, the benefits of trade should speak for themselves. Since the General Agreement on Tariffs and Trade was created 50 years ago, the volume of world trade has increased eighteenfold - three times faster than world output. In the same period trade's share of the world's economy has grown from 7 percent to 17 percent. In other words, GATT and its successor, the WTO, have very successfully promoted trade expansion.

The economic benefits of trade are also clear. Tens of millions of people in developing countries have been raised from poverty by economies built on exports. Its recent problems aside, Asia's phenomenal economic success can be traced to its ability to sell in an open world economy. The ability of many Latin American economies to overcome poverty and recession is linked to their increasing orientation to global markets.

As trade has expanded and the developing world has grown in affluence, new markets have been created for U.S. exports, creating millions of jobs at home. Nearly 12 million U.S. jobs are directly or indirectly linked to exports. Most pay well above average.

Why, then, did dockworkers, whose jobs depend on trade and a growing world economy, shut down West Coast ports? What brought steelworkers to the streets of Seattle along with French farmers, environmentalists and human-rights and other activists? And what is it about the WTO that raised such an emotional response?

To a degree we witnessed old-fashioned protectionism, draped in the more fashionable and politically acceptable clothing of environmental protection and labor rights. The street show in Seattle, a virtual carnival of protest, also brought out activists with only the loosest connections to trade.

More profoundly, however, what happened in Seattle also reflects a growing insecurity about globalization and the loss of control felt by ordinary people.

With technology moving faster than our social institutions can keep pace, corporate consolidation and restructuring on a massive scale, and national and global market forces penetrating communities in every nation, our prosperity is tempered by disorientation and social unease.

While the great majority of people benefit from the new economy, many are left behind. In real ways the WTO, a small but important U.N. agency, has become a symbol of rising globalization that few understand and most feel powerless to control.

Fear and ignorance are the greatest enemies of the WTO and trade. Demonized as the cause of worldwide ills ranging from child labor to deforestation, the WTO has become the vessel of our fears.

In truth, trade is not the cause of the world's ills, but it is a big part of their solution. History shows that the strongest force for human, labor and social rights, democracy, environmental protection and other social goods, is economic prosperity and a growing middle class. Once basic human needs are met, people demand more respect and accountability from their governments.

For tens of millions worldwide, trade holds the promise of a better future. Collapsing world trade is the best way to dash these hopes.

After the WTO meeting in Seattle, opponents exulted at having ''stopped globalization.'' Nothing could be further from the truth. Driven by technology and the information revolution, globalization is a fact of life. Stopping the clock by erecting walls imperils U.S. leadership and opportunity, and will not succeed.

At the same time, Seattle showed that labor and environmental concerns are a fact of life for the WTO, and will not go away. The WTO must find a way to engage legitimate leaders in the labor and environmental communities, severed from protectionist agendas. It can also ease concerns about globalization by increasing its own transparency.

This won't be easy. The task is more difficult because of the increasing complexity of global negotiations. Politically, the United States needs to win on agriculture, but Europe won't relent unless it gains in other areas such as investment.

Investment, however, raises labor and environmental issues, a severe problem for most developing nations. Along with non-governmental organizations, they are demanding more openness. But as the WTO's membership grows and these issues are added to the agenda, consensus will be elusive.

The near-term upshot may be a less ambitious WTO agenda that focuses on incremental improvements in market access for industries such as information technology, rather than a new global trade round. A limited or damaged WTO, however, is in nobody's interest.

Trade means opportunity for our partners, while as the world's largest exporter and its most productive and innovative economy, we stand to gain heavily. Realize it or not, we are all stakeholders, and proponents of trade must redouble their efforts to bring that message home.