The crisis of the WTO appellate body and the current trajectory of neoliberalism

The World Trade Organization (WTO) is in a deep crisis because its dispute settlement system has been disabled by consecutive U.S. governments which refused to agree to the appointment of judges for the Appellate Body (AB) of that system. Without the possibility of an appeal there is no guaranteed way to resolve trade disputes once and for all in court. As the data presented by this study show, the U.S. derives strategic advantages from this situation in its international trade relations. The WTO has often been characterized as a vehicle of neoliberalism, an organization based on neoliberal principles which promotes and enforces these principles on a global scale. The dispute settlement system played a central role in the neoliberalization of global trade and the establishment of neoliberal hegemony in this area. This study assumes that the neoliberal organization of global trade by the WTO was based on an international consensus in the neo-Gramscian sense. It combines the Gramscian concepts hegemony and historic bloc with a Foucauldian analysis of governmentality to gain deeper insights into the neoliberal hegemony in global trade. It was found that the obstruction of multilateral trade adjudication by the U.S. resulted in a transformation in the ways in which governmental rationalities become effective in global trade. These changes neither signal the end of neoliberalism nor of neoliberal hegemony in international trade. The U.S. strategy does not seem to involve a move toward post-neoliberalism, it rather represents an effort to redistribute discretion and redefine discipline inside the neoliberal framework.