The Perils of Institutional Rigidity, or How the WTO Helped to Sow the Seeds of Trump

The informal exit of the United States from the WTO under Trump is the culmination of US frustration with the organization's legislative and judicial rigidity, a frustration that has been building on a bipartisan basis for two decades. The WTO's commitment to a single undertaking, its reliance on consensus-based decision making, and an activist Appellate Body that imposed de facto stare decisis eroded political support for WTO rules in the United States and opened the door for political opportunists to cast them aside. We argue that the original GATT was, on balance, a more flexible and politically savvy bargain despite its imperfections. The 30-year history of the WTO that replaced it suggests the folly of trying to rein in powerful countries with a ‘rules-based’ institution, at least when the rules are unable to adjust to political shocks.