Rejoice trolls: I’m back. I spent my summer vacation in a beautiful place (downtown Seattle) working on my next mystery novel and writing the forward to an academic book. Now, to work. While I was gone, Russia became a member of the World Trade Organization. Northwest trade advocates are enthusiastic about the possibilities. In 2011, the Russian Federation was America’s No. 31 trade partner, at $8.3 billion. It was No. 28 for Washington with $445 million in exports, up from $260 million in 2005. Half of that is transportation equipment, i.e. jets.
This will almost certainly rise, especially if the United States repeals the Cold War-era Jackson-Vanik amendment. Boeing could be a big winner. Still, as Business Week pointed out, Russia remains a tough place to do business. It ranked 120th in the World Bank’s list of ease of doing business.
Inconvenient for the boosters is the two-year prison sentences meted out against three members of the punk band Pussy Riot (can I write that in a family newspaper?) for a protest held on the steps of a church. It’s a forceful reminder that under Czar Vladimir Putin, Russia has a, let us say, casual approach to human rights.
Trade advocates may say that increased commercial intercourse between countries mellows the authoritarian states, an assertion that hasn’t held true with the People’s Republic of China. But businesses should be on their guard. The rule of law in Russia means what Mr. Putin says at any given moment. The exporter from Washington state probably won’t land in prison on trumped-up charges. But Russia’s ascension to the WTO deserves cautious celebration.
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Today’s Econ Haiku:
A whiff of autumn
While the parties mount their shows
Dress for brain damage