In contrast with the headlines generated by the original GATT (General Agreement on Tariffs and Trade) controversy of two years ago, the news from Geneva on January 17 made barely a ripple; small items in the business pages reporting that a three-judge panel of the World Trade Organization (WTO) had ruled in favor of Venezuela and against the United States in a dispute involving Venezuelan gasoline. For three years, the U.S. government had barred Venezuela’s state refiner from shipping a product high in smog-producing “aromatic” chemicals to East Coast service stations. The WTO’s judges ruled that this country acted unfairly in demanding that Venezuelan gasoline meet the same average purity standard as gasoline refined domestically. Although the arguments were technical, the up-shot is that the United States can ignore the riling, appeal it, or allow the Venezuelan gasoline to be sold.
“Aromatic” is actually a good word for the predicament pro-GATT forces now find them- selves in. It’s little wonder that the main U.S. proponents of the GATT’s new dispute-resolution mechanism—Trade Representative Mickey Kantor and Treasury officials Robert Rubin and Lawrence Summers—had almost nothing to say about the gasoline ruling. It must be rather em- barrassing to them and to the White House that the very first WTO case would challenge administration enforcement of the Clean Air Act. The New York Times, which also plumped relentlessly for the streamlined trade accord, reassured its readers that the WTO decision “does not force the U.S. to change its law.” But the Times editorialist (Peter Passell) surely knows that the United States can ill afford to stiff the very GATT procedures it earlier insisted were essential to rapid trade expansion.