Today, Consumer Watchdog joined the AFL-CIO, Americans for Financial Reform, Citizens Trade Campaign, Public Citizen, and U.S. Public Interest Research Group (PIRG) in releasing a letter to U.S. Ambassador to the World Trade Organization (WTO) Michael Punke calling for a review of WTO rules to ensure that countries have sufficient policy space to re-regulate the financial sector.
The non-jargon version: International agreements shouldn't block us from writing new rules to rein in Wall Street greed, but some of our current agreements might do just that. We want to make sure that the US doesn't stand in the way of reviewing those agreements. Suppose that the first victory of the Occupy movement is to build a critical mass of support for breaking up the too-big-to-fail banks. Outdated WTO rules could block such a plan.
The letter urges the U.S. government to support a proposal raised by member state Ecuador to include language in the upcoming WTO Ministerial Declaration that instructs the WTO’s Committee on Trade in Financial Services to review related WTO rules in light of the financial crisis.
The letter says, in part:
“Given that many of us worked tirelessly on the major financial reform package promoted by the Obama administration last year, we, the undersigned organizations, are concerned about how current and any future expanded financial liberalization under the current WTO rules may affect financial reregulation efforts here at home and in other countries. Therefore, we believe it would be appropriate, now that sufficient time has passed from the height of the financial crisis, for the Ministers meeting at the WTO’s December 2011 Ministerial Conference to instruct the Council on Trade in Services and the Committee on Trade in Financial Services to conduct a thorough review of WTO rules implicating financial services in light of the crisis. In the aftermath of the global financial crisis, governments around the world as well as an unprecedented array of scholars have called for improved domestic and international-level financial regulation as a means to avoid future crises and restore global financial stability. For these measures to succeed, it is critical that the policies of the various international economic bodies are coherent.
The full text of the letter is here.