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An examination is made of the relationship between the US and the General Agreement on Tariffs and Trade (GATT), and its successor, the World Trade Organization, addressing the crucial question of the likelihood that the US will exit, or through its behaviour undermine, the multilateral trade organization in favour of regional or bilateral alternatives. It is concluded that the probability of a US‐inspired weakening of the WTO is low, although the incentives for protectionism in the US are strong and growing as a result of globalization and the changing international division of labour. The US domestic political system gives voice to such protectionist interests in international trade policy through a set of administrative and legal remedies that are reinforced by principles such as reciprocity and ‘fair trade’. Countervailing factors to this situation include the growing power of US export interests, the effectiveness of the Executive in deflecting the protectionist tendencies in the US Congress, and the exceptional power and influence of the US over the multilateral regime, in which it is a rule maker rather than a rule taker, enjoying the power to bend the rules selectively to serve its interests. As such, the WTO tends to reflect and reinforce US economic interests, and the US is, therefore, likely to continue in overall terms its efforts to comply with and generally strengthen the multilateral organization, rather than to break away from it.

This chapter examines the transformation of the landscape of political power in the United States and reflects on the current state of American democracy by looking at the democratizing synergy between political associations and governmental institutions. The emphasis is on labour unions, whose decline in power can be attributed in part to their increasing inability—or perhaps simply lack of commitment—to transform the narrow material interests of members into an aggregate preference for the general weal. This has implications for domestic policies and international trade policy, which the chapter discusses by analysing the politics surrounding outsourcing from the United States to India. The chapter also explores the opposition of many American labour unions and workers to outsourcing, and considers fair trade.

This chapter presents a wide critical discussion on the various perspectives and principles of developmental industrial policy (DIP) and in doing so explores its close links with international trade policy (ITP). The chapter proceeds by then identifying and subsequently debunking ten myths/false dichotomies associated with the debate on developmental industrial policy. Instead, Pitelis proposes an alternative set of principles (for DIP) based upon utilizing/integrating contemporary concepts, such as co-opetition, glocalization, manuservices, and public-private-polity partnerships. Exploring these concepts more deeply, the chapter suggests business policy and strategy can be carefully used to inform contemporary DIP. Pitelis concludes that, extant political and governance structures notwithstanding, such an approach to industrial policy could provide firms and national economies with genuine sustainable competitive advantage.