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Memo: Issues for the Future
The institution that comes closest to being able to is the WTO. The WTO is currently
understood to be a specialized organization focused on trade liberalization, but because the rules it set
have such large economic consequences, it also has a potential enforcement capability not present in
other specialized international institutions like the ILO or the WHO. For this reason, I do not think that it
is an accident that so much attention has been focused on the WTO, both before and after the Seattle
ministerial last fall. Given the potential leverage that the WTO exercises over member (and non-
member) states, I think it is almost inevitable that this body will become the seedbed of a future
international governance body, and that those who want to keep the WTO focused just on trade will not
be successful in the long run.
For this reason, a good deal of thought needs to be given concerning a strategy for the evolution
of the WTO as an international governance institution over the next few years. Although I do not
support the incorporation of American organized labor's particular list of labor rights into the WTO
agenda, there is no reason in principle that this body should not broaden its mandate to consider non-
trade political issues.
But even if the WTO evolves in this direction, it will still be subject to severe decision-making
constraints that will limit its effectiveness. The WTO has even less of a hierarchical structure than the
UN; decision-making must proceed by consensus and it is impossible at this juncture for majorities to
force their will on individual member states. The world community exercises its greatest leverage while
states are still outside the WTO; once in, they can use their membership to block initiatives they don't
like. Unless there are structural changes in the WTO's internal decision-making procedures, it will be
very difficult for it to act forcefully as an enforcer of international rules.
In light of these problems, it is necessary to search for other, perhaps radically different ways of
doing international governance. The Internet has suggested some alternatives, like the Internet
Engineering Task Force (IETF) which has served as a bottoms-up source for common network rules
and protocols. The Internet Corporation for Assigned Names and Numbers (ICANN) is another
example. The ICANN was set up as a much more informal, flexible type of organization, in direct
reaction to the excessively slow and bureaucratic ITU.
The jury is still out on the ICANN, however. Early reactions suggest that this is not the optimum
governance model either, and that its designers have erred in the direction of being too informal and
flexible. Formal bureaucratic organizations have one important virtue, which is that they are relatively
transparent and accountable; the informal structure of the ICANN has led outsiders (and particularly
players outside the US) to question on what grounds decisions are being made. ICANN deserves
closer watching not because the issue it deals with is terribly important, but because it is a key
experiment in the design of international institutions.
A third model might be called "governance by NGO." There is today a very dense layer of
international "Third Sector" organizations on issues like environment, human rights, women's issues,
and the like, which play an important role in monitoring and occasionally policing the activities of
governments and corporations around the world. They have in many instances acted quickly and
decisively in blocking actions like the Mexican government's intervention in Chiapas in the early 1990s
or Shell Oil's building of a new pipeline in Nigeria. International NGOs often have the resources,
knowledge, and flexibility to act in the quick and decisive manner that formal international organizations
seem to be are incapable of achieving.
There are numerous problems with this form of governance as well, mostly having to do with
legitimacy and accountability. Who, for example, nominates a group like Greenpeace or Amnesty
International to speak on behalf of the interests they represent? While we may approve of the agendas
of specific groups, there are no internationally recognized standards for openness and transparency on
the part of influential NGOs. Moreover, government by interest group (no matter how well intentioned)
does not guarantee that society's interests will be accurately represented. Formal democratic
institutions exist, after all, to allow the different interests in society to be aggregated in some manner
2
2/20/00
Confidential
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"ocrText": "Memo: Issues for the Future\nThe institution that comes closest to being able to is the WTO. The WTO is currently\nunderstood to be a specialized organization focused on trade liberalization, but because the rules it set\nhave such large economic consequences, it also has a potential enforcement capability not present in\nother specialized international institutions like the ILO or the WHO. For this reason, I do not think that it\nis an accident that so much attention has been focused on the WTO, both before and after the Seattle\nministerial last fall. Given the potential leverage that the WTO exercises over member (and non-\nmember) states, I think it is almost inevitable that this body will become the seedbed of a future\ninternational governance body, and that those who want to keep the WTO focused just on trade will not\nbe successful in the long run.\nFor this reason, a good deal of thought needs to be given concerning a strategy for the evolution\nof the WTO as an international governance institution over the next few years. Although I do not\nsupport the incorporation of American organized labor's particular list of labor rights into the WTO\nagenda, there is no reason in principle that this body should not broaden its mandate to consider non-\ntrade political issues.\nBut even if the WTO evolves in this direction, it will still be subject to severe decision-making\nconstraints that will limit its effectiveness. The WTO has even less of a hierarchical structure than the\nUN; decision-making must proceed by consensus and it is impossible at this juncture for majorities to\nforce their will on individual member states. The world community exercises its greatest leverage while\nstates are still outside the WTO; once in, they can use their membership to block initiatives they don't\nlike. Unless there are structural changes in the WTO's internal decision-making procedures, it will be\nvery difficult for it to act forcefully as an enforcer of international rules.\nIn light of these problems, it is necessary to search for other, perhaps radically different ways of\ndoing international governance. The Internet has suggested some alternatives, like the Internet\nEngineering Task Force (IETF) which has served as a bottoms-up source for common network rules\nand protocols. The Internet Corporation for Assigned Names and Numbers (ICANN) is another\nexample. The ICANN was set up as a much more informal, flexible type of organization, in direct\nreaction to the excessively slow and bureaucratic ITU.\nThe jury is still out on the ICANN, however. Early reactions suggest that this is not the optimum\ngovernance model either, and that its designers have erred in the direction of being too informal and\nflexible. Formal bureaucratic organizations have one important virtue, which is that they are relatively\ntransparent and accountable; the informal structure of the ICANN has led outsiders (and particularly\nplayers outside the US) to question on what grounds decisions are being made. ICANN deserves\ncloser watching not because the issue it deals with is terribly important, but because it is a key\nexperiment in the design of international institutions.\nA third model might be called \"governance by NGO.\" There is today a very dense layer of\ninternational \"Third Sector\" organizations on issues like environment, human rights, women's issues,\nand the like, which play an important role in monitoring and occasionally policing the activities of\ngovernments and corporations around the world. They have in many instances acted quickly and\ndecisively in blocking actions like the Mexican government's intervention in Chiapas in the early 1990s\nor Shell Oil's building of a new pipeline in Nigeria. International NGOs often have the resources,\nknowledge, and flexibility to act in the quick and decisive manner that formal international organizations\nseem to be are incapable of achieving.\nThere are numerous problems with this form of governance as well, mostly having to do with\nlegitimacy and accountability. Who, for example, nominates a group like Greenpeace or Amnesty\nInternational to speak on behalf of the interests they represent? While we may approve of the agendas\nof specific groups, there are no internationally recognized standards for openness and transparency on\nthe part of influential NGOs. Moreover, government by interest group (no matter how well intentioned)\ndoes not guarantee that society's interests will be accurately represented. Formal democratic\ninstitutions exist, after all, to allow the different interests in society to be aggregated in some manner\n2\n2/20/00\nConfidential"
}