Todd Tucker has an interesting post over at Eyes on Trade, in which he makes the following points:
1. Certain trade experts have been saying that WTO rules do not apply to subsidies to the financial services industry (or, at least, do not provide much discipline). Thus, in their view, bailouts to this industry do not violate the rules.
2. These trade experts are wrong, as the GATS NT and MFN rules do, in fact, apply to subsidies on services.
At least, that's how I understand his argument -- Todd can correct me if I'm mis-stating it.
I'm not sure the disagreement here is as signifcant as it first appears. What I think the trade folks he quotes are saying is only that the services rules which relate to subsidies are fairly limited. Under these rules, if a domestic financial company or industry is about to go bankrupt, you can bail them out. At the same time, the trade experts would acknowledge that there are certain rules that apply to these bailouts, such as the NT and MFN requirements. So, for example, when bailing out a domestic company, you could not make the bailout money contingent on the use of domestic services of some kind (assuming the sector in question is covered).
Here's the tricky part, though, which Todd refers to in his post: "