Trump’s bid to dismantle global trading system poised for a win

Bloomberg

US President Donald Trump’s assault on the World Trade Organization — and the global system of rules that guide inte- rnational businesses — may be quietly scoring a major victory.
Thanks to a US veto on new appeals judges, the WTO’s dispute arm is expected to start slipping into the institutional equivalent of a coma at the end of this year. That has set off a scramble by the European Union, Canada and other countries to set up a temporary alternative allowing the use of arbitrators rather than three-judge panels to hear appeals.
But by creating that system, WTO members may be giving Trump and aides — who, like him, have deep-rooted skepticism of multilateral institutions — the very thing they want.
The US has been both the biggest user and target of the WTO’s dispute settlement system, according to WTO data.
“The US went into the dispute settlement system thinking that it was going to be an arbitration process that would be limited in its ability to force members to do things that they had not agreed to,” said Stephen Vaughn, who until earlier this year oversaw the Trump administration’s assault on the WTO’s appellate body as the US Trade Representative’s general counsel.
Arbitration would above all provide the flexibility the US is after, Vaughn said. It would see disputes treated as individual cases, avoiding the precedent-dependent system the WTO appellate body has become.
“It doesn’t have to be a one-size-fits-all system,” said Vaughn, who argues the WTO should allow members to “not only set up different dispute settlement systems between different countries but also varying dispute settlement systems from one case to the next.”