The Globe and Mail / MARCUS GEE
Of all the arguments made against globalization and free trade, the loudest comes from environmentalists. They argue that, as global capitalists spread their tentacles around the world, nature inevitably suffers. "The international flow of goods and money, if unregulated, can have devastating impacts on the environment," says Friends of the Earth.
The green argument has a certain appeal: Factories cause pollution and globalization means more factories in more places, so globalization must be bad for the environment. But quite the opposite is true. Far from ruining the environment, globalization improves it. In the long run, a free-trading world is a cleaner world.
Doubt it? A generation of real-world experience shows countries that welcome trade and investment inevitably prosper. The OECD found that countries relatively open to trade grow twice as fast on average as those more closed. As trading countries grow wealthier, their citizens grow more concerned about the environment. And unlike their poorer neighbours, they can afford to do something about it. Research has shown that once countries reach a per capita income of $8,000 (U.S.) a year, pollution levels start to fall.
Consider Canada, which relies on trade more than almost any other country yet now has cleaner air and water that it did a generation ago. Or consider Mexico, which has improved its environmental regulations while courting trade and investment. Then look at the Soviet Union. It shunned the global economy yet saw its natural environment devastated by industrial pollution. Protectionism and isolation were no help to nature there.
Environmentalists have another gripe. As Friends of the Earth puts it, "Agreements such as the North American free-trade agreement and World Trade Organization have been used by governments and corporations to challenge and weaken environmental laws." These worries came to the fore when the WTO ruled against a U.S. ban on shrimp from countries that (according to Washington) were using nets that swept up endangered sea turtles. Environmentalists say that proved free trade threatens environmental laws.
Wrong again. The WTO puts no restrictions on the power to create or enforce such laws. In fact, its basic charter says member countries can take any trade measures they like to "protect human, animal or plant health." All the WTO says is that members should not use trade as a weapon when other issues, such as the environment, are at stake. Does that hamstring governments? No. If the United States does not like the WTO ruling on its shrimp ban, it can ignore it, taking the risk that the shrimp-producing countries will fire back trade sanctions of their own.
It is right to be worried about the environment in a world where industrialization is rampant and capitalism triumphant. But it is wrong to blame trade. The real enemy of the global environment is poverty. Poor countries in the early stages of development are hardest on nature because they lack the resources to stay clean. Consider a place such as India, where hillsides are stripped of their trees for cooking wood and ancient factories belch toxins into the atmosphere. India's pollution has little to do with globalization, because until recently it barely took part in the global economy.
In the end, the best way to protect the environment is to make countries such as India richer, and the best way to do that is through trade.
mgee@globeandmail.ca:
