Pick Yourself Up and Try Again

It was not exactly a surprise, but it was certainly a blow. The suspension of the special 107-nation trade talks in Brussels comes at a time when the United States, and other countries, are either nearing or already struggling with economic recession. A deal to modernize the General Agreement on Tariffs and Trade, or GATT, could not have cured recession, but it would have provided a needed dose of sunny optimism for an American economy ever more morose-looking with each new official statistic.

The finger-pointing for the breakdown of the GATT negotiations has already begun. The prime culprit is the European farmer--and his allies, the chancellor of Germany and the president of France. But there is plenty of blame to go around, and, alas, Washington must share in it. Preoccupied by the Persian Gulf stalemate, it may not realize that in fact Saddam Hussein is a less serious threat to prosperity over the long run than a world fragmented into rival trade zones, each erecting Cold-War-type trade barriers that undermine economic growth.

Later this week the European Community meets and the GATT issue is sure to come up. The Europeans should agree to return to the bargaining table with new concessions, particularly on reducing their farm subsidies. Such a move would then pressure holier-than-thou Washington, which has the habit of making far better trade speeches than trade reforms, into further concessions. The GATT breakdown is not a disaster, only a failure, unless the parties have in fact given up.