How free should trade be? 
A New Economics debate at the ICA

by Oliver Reichardt 
07 July 2004

Last night nef (the new economics foundation) hosted a debate at the ICA on questions surrounding free trade. Does world trade need regulation and, if so, how? Is free trade good for poor countries as well as rich ones - or do we need to find ways of protecting emerging economies? Is the WTO a good thing - or is it inevitably biased towards the richer nations? Can it be improved - or should we be looking towards an alternative form of global governance? And is free trade anyway compatible with protecting the environment and respecting workers' rights?

Jubilee Research's Senior Associate Ann Pettifor was on the platform along with World Development Movement Director Mark Curtis and Chief Economist of the Financial Times, Martin Wolf. The event was chaired by nef's director Stewart Wallis.

In a good natured and wide ranging debate the focus swung from Argentina's economic woes to corporate power to free migration of labour and more. Between Martin Wolf's neo-liberal standpoint and Ann Pettifor and Mark Curtis' new economic standpoint there was space for some areas of agreement, most notably about a country's right to determine its own economic policies and that economic crises are an unavoidable feature of the neo-liberal system. Of course Ann Pettifor and Mark Curtis felt better systems could be developed to avoid such crises while Martin Wolf believed the benefits outweighed the costs.

From that relative consensus their views diverged rapidly, Ann Pettifor advocating a need to reign in the power of financial markets and capital flows, Mark Curtis focussing on the dangers of corporate power, and Martin Wolf defending the present architecture. Ann Pettifor pointed out that in view of the fact that 90 per cent of global financial transactions now take place in the capital markets, and only 10 per cent are represented by trade, some regulation of capital flows is essential to curb the volatility that has caused economic crises in so many developing countries, adversely affecting their trading sectors and the welfare of their populations. 

Questions followed the opening addresses by the panel, and these were mixed between hypothetical queries such as what would the world look like if there was, in fact, completely free trade, and questions directed mainly at Martin Wolf. Being a New Economics event there were a large number of alternative viewpoints on offer, and Martin Wolf defended his beleaguered traditional stance in a calm and dignified way.

The debate lasted an hour and a half yet it only scratched the surface of the topic. Judging by the questions and divergent opinions of the panel it could have gone on into the night had time allowed, as people clearly wished to pursue some of the issues further.

It was a pleasure to be able to have such opposing views on offer on the same platform, and this made for an informative and interesting debate and a thoroughly enjoyable evening's entertainment.