THE WORLD of international trade talks is filled with optimistic rumours. A breakthrough is near, the next session will break the logjam, progress beneath the surface is waiting to break out.
Veteran World Trade Organization negotiators and watchers have learned to discount most of the phantom optimism.
It’s true that in 1992 the chasm between positions seemed insurmountable and yet by December 1993 there was a deal crafted by the then-biggest players, the United States and the European Union, grudgingly embraced by all other countries in the flawed General Agreement on Tariffs and Trade.
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This time, almost six years into a negotiation, the field is much more cluttered with significant players, the Big Two no longer can dictate a deal and developing countries like India and Brazil have emerged as the true deal makers or breakers.
With gaps so great, the idea of a quick, dramatic breakthrough seems ludicrous. More credible are predictions that these WTO talks are on hold for at least several years.
Still, for the Canadian government, the will-it, won’t-it scenario must be nerve wracking.
The dilemma is this: when can Canada’s governing politicians be sure that a deal truly is so inevitable that it must begin to make the painful compromises that will allow the country to be part of any new agreement?
When do promises of perpetual support to sectors like supply management begin to be broken in the name of what the government sees as the national greater good?
And make no mistake: the government in power in Ottawa the day a WTO deal is announced, whether in 2007 or 2010 and whether Conservative or Liberal, will make compromises and break political promises.
If there is a deal on a new world trade agreement, the writing is on the wall for the current supply management protection regime. Over-quota tariffs will be cut by at least 25 percent and probably more and tariff rate quotas will be expanded.
To be part of the deal, the government of the day will sign on.
Right now, supply management leaders say that would be the death of the system. Whether that is true or not, the government that makes the painful decision will pay a political price.
Opposition politicians will accuse it of a sellout, even though in the decision seat, they would do no different.
Farm leaders from organizations supporting dairy, poultry and egg industries will accuse the government of treachery.
Leaders of those industries will present government with a demand that there be a multibillion-dollar quota buyout, with the Crow rate as a precedent, because farmers spent a collective $20 billion or more on production quota that was devalued because of the government WTO retreat.
Provincial governments that also pledge support for supply management as a part of the business risk management system might consider whether that makes them liable for any of the enormous compensation claim that would follow a WTO deal.
Meanwhile, this government – any government – must see WTO stalling as a mixed blessing. It stalls the economic outcome desired by most in government but delays the political betrayals that could cost billions of taxpayers’ dollars and some rural votes for a generation.
Talk about a Faustian choice.
