SLIPPERY BUSINESS

Slippery business THE `BANANA WAR' Clinton administration misfires in a
World Trade Organization dispute with the European Union. hile much of the
world was watching Baghdad being bombed again, the Clinton administration
also was launching bananas over Brussels, headquarters of the European
Union. The collateral damage from the latter could prove far more damaging
than from the former.

After months of threats, President Clinton last week ordered 100-percent
tariffs imposed on $500 million worth of such luxury products from Europe as
designer scarves, English linens, Italian cheeses, and Mont Blanc pens. Why?
Because the administration is angry that the Europeans continue to give
preferential treatment to bananas grown in their former colonies in the
Caribbean over those grown in Central America. And it happens that most of
those Central American banana plantations are owned by two American-owned
corporations, Chiquita and Dole.

The threatened sanctions, which could take effect in February, are
tantamount to hunting fleas with an elephant gun. The Caribbean bananas make
up just 4 percent of the world's market and 10 percent of Europe's. But for
years the Clinton administration -- perhaps influenced by generous campaign
contributions from Carl Lindner, Chiquita's controlling shareholder -- has
demanded that Europe drop its preferential treatment of Caribbean bananas.

There's no doubt that trade law is on the side of the United States. The
World Trade Organization ruled several weeks ago that the EU's favoritism
must stop. It allows no room in the international marketplace for
sentimentality toward former colonies. Free traders must applaud the WTO's
ruling.

U.S. trade experts say that the administration's hard line is necessary to
demonstrate this country's commitment to the WTO. If Europe is allowed to
flout this agreement, of what value are future ones? Or so goes the
reasoning.

But consider the collateral damage that could flow from that hard-line
policy. While a few corporate titans grow richer, subsistence farmers in the
eastern Caribbean could be pushed out of business. Their alternative might
include cultivating another cash crop, say marijuana, or joining the refugee
stream to Miami.

Pushing this issue makes no sense. President Clinton should find some way to
settle this matter before a new trade war breaks out and innocent bystanders
are crushed. In invoking sanctions, he may be standing on solid legal
ground. But as for the moral ground, his foot is planted on a banana peel.