Put Up Or Shut Up a Gatt Agreement, After Seven Long Years of Talk and Countless Delays, Would Lower Prices and Create Jobs

By JAY BRANEGAN/BRUSSELS

No wonder they call it the General Agreement to Talk and Talk. U.S. Trade Representative Mickey Kantor and his European Community counterpart, Sir Leon Brittan, met in Brussels last week to wrap up their end of world trade negotiations that have been dragging on for seven years -- and wound up haggling for 23 consecutive hours. They emerged, drawn and weary, without an agreement in hand -- the final holdup was over movies and aircraft subsidies -- and flew to Geneva for yet more discussions.

This week, three years after the so-called Uruguay Round of the General Agreement on Tariffs and Trade missed its first supposed deadline, the talking stops. On Dec. 15 the world will either have in hand the most comprehensive and complex multinational trade accord ever attempted or brace for new waves of protectionism. "The current system is collapsing," warns GATT Director- General Peter Sutherland. "Failure would be one of the biggest collective follies of this century. The losers would be consumers, export industries, the unemployed and the developing countries."

Outwardly Clinton's White House seemed calm, as though a GATT victory were little more than a serendipitous way to end the year. But behind the scenes, officials were mounting the now familiar all-out push to make sure they get the deal done, and done on their terms. That meant trying to appease a wide range of U.S. industries that feel either that the agreement fails to open key foreign markets to them or that it would make it impossible for them to retaliate against "unfair" trade practices. The financial-services industry, for example, is furious that it will not be getting unfettered access to such potential new business areas as India and South Korea, while inveterate complainers like textiles and steel want harsher restrictions on imports.

President Clinton telephoned French President Francois Mitterrand, Prime Minister Edouard Balladur and European Commission President Jacques Delors to emphasize the importance of U.S. movie and TV exports to America. Japan's government, riven with internal dissent, dithered over approving the historic move to import foreign rice, while in South Korea, President Kim Young Sam declared that "after many sleepless nights' agonizing" he had agreed to open the country's rice market because "we were on the brink of inviting international isolation."

The Uruguay Round is sweeping in scope and mind numbing in detail. It covers just about everything from paper clips to jet aircraft and, for the first time, brings under the GATT umbrella such areas as textiles, banking and computer software, all part of the $7.6 trillion world trade in goods and services. In the end, however, the talks have been all about jobs, jobs, jobs -- those created, to be sure, but also those lost and those about to be transformed.

No one argues that the arrangement would affect the livelihood of many Japanese and South Korean rice farmers, threaten textile workers in Europe and the U.S., and create problems for factory workers at inefficient plants worldwide. Such losses should, in theory, be offset by new employment in export-related industries, where wages are usually higher than average -- 17% higher in the U.S, for example. An accord should also lower prices for consumers, who ultimately pay the hidden costs of protectionism. A U.S. family of four pays as much as $420 a year more for clothes than necessary, thanks to high U.S. textile barriers.

One of the most controversial parts of the accord is the section covering the financial-services industry, now one of the fastest-growing parts of world trade. While banks, insurers, securities firms and lawyers in the U.S. and Europe argued for access to restricted markets in Japan and Southeast Asia, those countries fought to keep them out. Meanwhile, the debate over "intellectual property" mostly pitted the developed against the developing world. GATT's new language for patents and copyrights gives the developed countries better weapons to fight piracy and counterfeiting of Cartier watches, Madonna videos or Lotus spreadsheet software -- an epidemic problem in Asia and Latin America that costs the U.S. $60 billion a year in lost sales.

Perhaps the most vexing potential deal breaker was the films, TV and music that dominate Europe's cinemas and airwaves and are America's second biggest export. France fought to have audiovisual services excluded altogether but appears ready to settle for retaining the European Community's airtime quotas against U.S. TV shows. "We feel that we have given the French enough to satisfy them on agriculture," said a senior Washington official and "now it's their turn to give on the audiovisual agreement." Once negotiators get a GATT, the U.S. Congress has until April 15 to approve the deal. If it appears the U.S. gave away too much just to win agreement, there could be a donnybrook. Still, GATT is likely to pass because it will mean lower prices, higher-quality goods, more income and better jobs -- and those are certainly things worth talking about.

With reporting by Bruce Crumley/Paris, Edward W. Desmond/Tokyo and Michael Duffy/Washington