Most major financial papers and Web sites lead with the collapse of the Doha round of global trade talks, a seven-year tragedy of errors in which the convergent agendas of developed and developing worlds have become starkly drawn. In times of soaring food prices, the United States and Europe are bound to cling to free trade as a solution as fiercely as China, Brazil, and India cling to tariffs. Thus, the papers find plenty of blame to go around; the Financial Times quotes European trade minister Peter Mandelson faulting American agricultural expansion by Congress this spring as ” ‘one of the most reactionary farm bills in the history of the U.S.’, though he did give credit to President George W. Bush for attempting to veto the bill.”
Perhaps unsurprisingly, the American papers did not include that quote, even though many have opposed, on their editorial pages, American farm subsidies. Instead, the New York Times cited a European consultant who indicated that “the sticking point this time was countries like China and India, which have become more aggressive in advancing their interests.” The Wall Street Journal has for several days been trying to place failure or success on the shoulders of India’s commerce and industry minister; in a profile last week, the paper quoted a U.S. Chamber of Commerce official who said, “Success or failure of the Doha Round may very well lie in the hands of Kamal Nath alone.”
That seems overdone, as the Journal notes today: “China broke its traditional silence in global trade talks and dug in its heels over the weekend,” which turned out to be a chief factor of the breakdown. Regardless, few dispute that most countries need to continue trading, even as they bicker over terms; Bloomberg’s analysis is that the cessation of talks “may be only a bump in the road for world commerce, which continued to expand while negotiations sputtered.”
As we noted Monday, the American auto sector continues to suffer from shriveling demand for those emblematic SUVs of the last decade. A Page One WSJ article notes that Ford and GM “are significantly scaling back their auto-leasing business,” echoing Chrysler’s announcement on Friday. Maybe it seems inevitable to you that one company’s woes would be echoed across the sector—banks don’t want to lend money for leases, and fewer people want to buy the used gas-guzzlers. But consider the predictions made on CNBC on Friday by auto analyst Rebecca Lindler: “I don’t see Ford or GM doing this. I don’t think that they will do that. I think they are going to try and manage their losses in a different way.” We’ll see if CNBC invites Lindler back for more crystal-ball reading.
Along with free trade and the SUV, another ‘90s-era icon that seems to be dying is “casual dining.” The Bennigan’s and Steak and Ale chains closed down and will file for Chapter 7 bankruptcy, “the latest casualties in the so-called casual dining sector, considered a cut above fast food,” as the NYT puts it. Technically, only the 150 or so corporate-owned branches—not the roughly equal number of franchisees—are immediately affected, “but the franchisees now find themselves owning a brand with no corporate cousins,” as the Dallas Morning News points out. It seems hard to believe, but no one has ever before compiled definitive numbers on how much food and beverage companies spend on advertising to American children; it was $1.6 billion in 2006, according to a newly released Federal Trade Commission report. As the Washington Post notes, “the biggest category, $492 million, was carbonated-beverage advertising.” Inevitably, such measurements provoke what the NYT calls a “tug of war” over not only questions of who should regulate these ads, but also over definitions of what constitutes marketing and even, it would seem, what constitutes a child. How else to interpret this sentence—”Cadbury Adams has stopped marketing Bubblicious gum to children, said a spokeswoman, Luisa Girotto”—from the Times? Perhaps the gum is targeted at Wall Streeters, always in search of that next bubble.