Turning The Other, Other Cheek? : Soviet Entry Into Gatt, New Reward For Baltic Repression

The Center for Security Policy today challenged on economic and foreign policy grounds the Bush Administration’s efforts to permit the Soviet Union to gain access to the General Agreement on Tariffs and Trade (GATT) . Until the whistle was blown on a plan to present the Congress with a fait accompli by acceding to the Soviet request for observer status at the GATT Council meeting tomorrow in Geneva, the Administration intended to add this important concession to a growing list in the run-up to the Bush-Gorbachev summit starting on 30 May.

"It is astonishing that President Bush can proceed unchecked with his campaign to shore up the Gorbachev regime economically even as Moscow is embarking upon a major escalation of its repression of the Baltic states," Frank J. Gaffney, Jr., the Center’s director said.

Gaffney added, "Soviet incitement of Russian anti-independence demonstrators today resulted — as could have been reliably predicted — in increasingly violent clashes in Latvia and Estonia. Next we are likely to hear that the Soviet Union is compelled to intervene directly to ‘restore order in this unruly region.’ If so, must we expect Secretary of State James Baker, now in Moscow reportedly offering a menu of arms control and trade concessions, to excuse Soviet-sponsored crackdowns in the Baltics, as he did earlier episodes in Baku and Tbilisi?"

The U.S. decision to accelerate Soviet access to the GATT under such circumstances is all the more bizarre because it also conflicts with the Bush Administration’s own, stated policy. As the Center reported in a 4 April 1990 analysis entitled The Bush Administration’s Response to Repression: U.S. Concessions on GATT Membership, as recently as last March, the White House reiterated its view that such access should not be granted immediately. In the National Security Strategy of the United States report, President Bush said:

We have offered to support observer status for the Soviet Union in the structures created by the General Agreements on Tariffs and Trade after the Uruguay Round of Multilateral Trade Negotiations is completed [not expected to occur before December 1990], and I personally urged Chairman Gorbachev to use the intervening time to move more rapidly towards market practices in the Soviet economy. (Emphasis added.)

 

Roger W. Robinson, Jr., former chief economist at the National Security Council and a member of the Center’s Board of Advisors, said, "Far from effecting a rapid transition to market practices, the evidence suggests Gorbachev is continuing to postpone systemic economic reform. Rewarding Moscow with GATT observer status under these circumstances is likely to diminish incentives for genuine structural reform; worse yet, it may well undermine the market-oriented philosophy on which GATT is predicated."

In stark contrast to the Bush Administration’s policy of bending over backwards to accommodate Gorbachev’s economic wish list, Japan has exhibited justified caution and restraint. Japan’s wariness over this precipitous GATT concession, like its earlier opposition to Soviet membership in the ill-conceived European Bank for Reconstruction and Development, has reflected to date the most visionary Western policy approach to cosmetic Soviet economic half-steps.

If they obtain observer status in the GATT, the Soviets would be permitted to attend monthly GATT meetings, participate in GATT Committee business, and receive all organization documents. Should the Soviet Union, in due course, obtain full GATT membership — which they fully expect would follow from observer status — U.S. efforts to continue to withhold most-favored nation status through the Jackson-Vanik amendment could be compromised.

The Bush Administration’s incipient concession to the Soviet Union on GATT runs directly counter to rising sentiment on Capitol Hill. Key members of Congress, notably Senators Riegle, Dixon, D’Amato and others, are sponsoring S.276, a resolution urging the Administration to postpone action on Soviet GATT observer status and other elements of U.S.-Soviet trade ties as long as Soviet intimidation and use of economic force in the Baltics continues. Clearly, even more vigorous congressional efforts may be required if the executive branch and the allies are to be persuaded of U.S. commitment to defend bedrock American principles and values.