"Creating a Harmonious Society Through Cooperative Globalization "
Jeffrey S. Lehman
Professor of Law and Former President, Cornell University
President of the Joint Center for China-US Law & Policy Studies
Cornell-Beida Conference on the WTO
Beijing, China
May 23, 2006
I would like to do three things this evening. I want to begin by saying a few words about the extraordinary conference that is going on at this moment, and about what it represents.
I then want to connect the subject of the conference to some very important challenges that are facing the world, and especially the U.S. and China, at the start of the twenty-first century.
And then I want to return to this conference and suggest that it might be a model for how our world can address those challenges.
Part One. How did this conference happen?
Last night it was observed that while I was president of Cornell, I agreed with President Xu Zhihong of Beida and President Hao Ping of Beiwai that our universities should work together for greater intellectual collaboration.
I want to confess something to all of you tonight. I want you to know that it was very easy for us university presidents to say that. It is easy to say, “we would love to have a great conference.” But saying such a thing does not produce a great conference. That is not why we are here this evening celebrating such this extraordinary event.
The reason for the success of this event is not to be found with university presidents. I want to tell you where the credit really belongs.
This conference would not have happened without the leadership of the dean of the Cornell Law School, Stewart Schwab. It was he who recognized the possibilities of a conference such as this, and it was he who understood what would be required to make it successful. To begin with, he knew that a successful conference would have to draw on an area of shared strength among the universities. He recognized the importance of involving his faculty colleagues in a process to identify such an area, which ultimately led to a focus on trade law and the WTO.
And then it was he who recognized that to be successful, a conference such as this would require a commitment of financial and human resources, drawn together from many sources. Collaborating closely with his counterparts at Beiwai and Beida, and building an effective team of faculty and staff leaders, the net result has been a series of quality panels, bringing together talented thinkers to discuss important topics.
In all of this, Stewart has enjoyed the ongoing support of his wife, Norma, who has made his deanship a family commitment. Stewart and Norma, would you please stand so that all of us who have enjoyed this conference might thank you for your efforts?
Part Two. Global Challenges.
I am very proud to be a member of the faculty of the Cornell Law School. Within the United States, the Law School is recognized as one of the great institutions of American higher education. In recent years, it has achieved special recognition for the quality of its faculty, and their contributions to a broad set of areas, including quite prominently empirical legal studies.
In the second part of my comments this evening I would like to do something that is typical for members of our faculty. And that is to try to associate practical questions about law and legal policy with a broader, more abstract question about values. A question that nonlawyers can understand and debate just as well as lawyers can. A question that is easier to ask than a technical legal question, but often harder to answer.
So here is a big question. Do the citizens of one country have an ethical obligation to worry about the well-being of citizens of other countries? In other words, suppose one country has the resources to be self sufficient. Can it say, “we have everything we need; we don’t care about the rest of you; go away and leave us alone”?
I want you all to think about the following possible answer. Perhaps the answer to the question is, “A pre-industrial country may live in isolation. But an industrialized country may not.”
Here are two reasons that might support such an answer. One is that industrialization brings so much prosperity that a country may no longer turn away from poverty and human suffering outside its borders. It must be charitable. A second is that the technology of industrialization reshapes the global ecosystem in ways that require countries to cooperate with one another. They must be responsible.
Even if an industrialized country does not have to engage with the rest of the world, it may choose to do so. As the economist David Ricardo demonstrated long ago, whenever a country engages in liberal trade with other countries its citizens are, on average, better off.
But Ricardo’s insight must be qualified in three ways:
First, the great benefits from trade come only when countries specialize along the lines of comparative advantage. Specialization means that countries become much more interdependent. They cannot change their mind and withdraw from trade without paying a huge penalty in terms of their quality of life. This is a good thing, in many ways. But it has drawbacks as well.
Second, even though liberalized trade means that every country is, on average, better off, it also means that some individuals within each country may be worse off. These are the people who used to work in an area of that country’s comparative disadvantage. If these workers are not going to switch countries, they will need to switch sectors. If they are to avoid internal unrest is critically important that every country find ways to tax the individuals who are the big winners from globalization and use those proceeds – for retraining and income security programs – to help ensure that individuals who would lose out are able to make the necessary transitions.
Third, just as a capitalist economy within a country requires the development of a national system of regulation and income security, globalization challenges us to find a way to ensure that those systems exist everywhere in the world. And this is a great challenge. If we do not pay attention, international competition can lead to a kind of global race to the bottom, leaving us all to struggle in a cold and nasty world without compassion.
Strong national policies were required to transform the brutally free markets of the early twentieth century into the well regulated mixed economies of the late twentieth century. How can we ensure that the same transformation takes place today, at a global level?
Yesterday, Professor Francis Snyder made a very important observation with which I agree. He suggested that the way to do this will not be to impose a single, one-size-fits-all answer through the WTO. He suggested that we need to make place for the expression of different national values within an overall system of globalized trade, a way to combine the spirit of national sovereignty with the spirit of transnational integration.
Where does this leave us?
* Industrialized countries like China and the U.S. have chosen to participate in worldwide trade.
* We need to create new structures to ensure that this choice does not undermine, on a worldwide level, the kind of social advances that took place last century on a national level.
* And we will not be able to create those structures easily, through a coercive, top-down system of global governance.
And this brings me to Part Three, Cooperative Solutions.
I believe that the only way for us to develop pluralistic, coordinated solutions to worldwide challenges is
through sustained engagement. We need ways for leaders from government, business, and higher education to meet and talk candidly about different approaches. This is in part to stimulate creative thought. And it is also to promote networks of trust and cooperation.
This year, I have been working with the leaders of Beida and Beiwai, and with U.S. Supreme Court Justice Anthony Kennedy, to create a new entity that will support just this kind of sustained engagement, called the Joint Center for China-U.S. Law & Policy Studies.
I hope that the Joint Center will be able to make contributions in the years ahead to the kinds of difficult challenges I described in Part Two of my talk. But I also know that if we are to be successful, it will only be because of the kind of leadership I described in Part One. It will require the guidance of great leaders like Dean Schwab. And it will require the active leadership of institutions like Cornell, Beida, and Beiwai, to do the hard work, on the ground, that is needed to produce first-rate intellectual activities of the kind that we are seeing at this conference this week.
