One of the most pernicious aspects of the former eastern bloc - and there were many - was the restriction placed on people's right to travel. Understandably it was also one of the west's favoured propaganda weapons. Our governments actively encouraged people to defect. Those who managed to dodge the snipers on the border or who could face not seeing their families again were welcomed with open arms.

Before they even opened their mouth, each new arrival was living evidence of the wickedness of communism. The very fact that they had to escape and could not return marked a violation of their basic human right to the freedom of movement.

Last week the British government spearheaded a European Union proposal to send immigration officers to Bosnia and Croatia to teach them how to put a stop to the traffic of the world's "undeserving poor". "The Balkans' route is the single most important source of illegal immigration into western Europe," said Jack Straw. "If we can close it or restrict it, we are on the way to winning the battle." The Berlin wall has collapsed; welcome to Fortress Europe. Politics used to keep people in; now economics keeps them out.

Even as the west encourages the former communist states to open up their markets to foreign investment, it is teaching them how to close their doors to foreign people. For what was once hailed as a human right is now opposed as an economic liability. Our governments are trapped in a morally warped and ideologically unsustainable paradigm. They applaud the free movement of capital; they abhor the free movement of labour.

Lay off workers here and move your factory to the other side of the world, where labour is cheaper, unions are weaker and regimes are more brutal and you are hailed as an entrepreneur. Arrive at Waterloo clinging to the Eurostar or in Dover on the back of a lorry with the intention of working long hours for low pay and you will be branded "bogus" and labelled a scrounger.

The two are inextricably related. For it is the increasingly unfettered free movement of capital, championed by the west, that helps create the poverty which prompts the economic migration from the developing world. Structural adjustment programmes, imposed on countries by the International Monetary Fund and the World Bank in return for loans, generally lead to swingeing cuts in health, education and welfare spending and mass privatisation. The effects can be devastating. Take Zambia: IMF-imposed reforms forced the government there, among other things, to charge for healthcare and privatise the copper mines. GNP dropped 16%, the mortality rate of under-fives almost doubled and 60,000 workers were laid off in two years.

Norman Tebbit's dad should have counted himself lucky; he only had to get on his bike to look for work. These people take planes, trains and boats. But when they arrive the response of the wealthiest nations is not to rethink the policies which are creating this havoc but to build higher walls, train more border guards and target new arrivals with racist rhetoric.

That does not mean that Britain has turned its back on economic immigration - far from it. It is one of the paradoxes of recent years that as the vitriol against asylum seekers has increased so has the number of economic immigrants. According to the Home Office the number of work permit holders and their dependants has risen by more than a third since Labour came to power. The sharpest increase has been from Africa which indicates that we are not only hammering their weakest, we are cherry-picking their strongest too.

So it is not foreigners per se our government loathes; it is poor people. Asylum seekers, with their tales of torture, rape and solitary confinement, can get to the end of the queue and wait for their vouchers. Britain wants professionals with IT skills, teaching qualifications and nursing certificates.

As a further round of trade talks begin today in Geneva these contradictions are set to be brought into sharp relief. The World Trade Organisation's general agreement on trade in services (Gats) aims to liberalise everything from health and education to water and tourism. "I suspect neither governments nor industries have yet appreciated the full scope of these guarantees or the full value of existing commitments," the former WTO director- general, Renator Ruggiero, has said.

Campaigning organisations, such as the British-based World Development Movement, take this as an ominous warning. Gats, they believe, will undermine democratic sovereignty throughout the world, strengthen the hand of the multinationals and wealthy western nations and weaken the developing world by forcing countries to privatise essential services and then forbidding them from reversing these decisions.

The WTO insists these concerns are either exaggerated or fabricated. Gats, they say, neither obliges countries to privatise, nor open markets and does enable them to reverse decisions, negotiate waivers and override commitments when health and safety is at stake.

But their assurances wilfully ignore one golden rule - whoever has the gold makes the rules. The agreement is for free trade, not fair trade. Any rich nation or huge multinational with an eye for a new market has access to lawyers and lobbyists that poorer countries cannot afford, who will find loopholes and twist arms to get what they want.

That is more or less how "free trade" works at the moment. With considerable persuasion from the Chiquita banana company, which funds both the Democrats and Republicans, the American government sought to make an example of small Caribbean island producers. It is difficult to imagine Dominica, which has a population smaller than Fargo, North Dakota, taking on the US over its farm or sugar subsidies.

The WTO's position at present amounts to asking poor nations to trust them as honest brokers. Given their record, this is a bit like the big bad wolf telling Little Red Riding Hood: "Sorry about your granny. Why don't you pop over for lunch?"

At a meeting with non-governmental organisations on Friday, one EU negotiator explained wearily that American domination was "a fact of life". As with joining the euro, which most Britons do not want but believe is going to happen anyway, an air of destiny had grown up around globalisation. Governments from the developing world have, in the past, seen little alternative to trying to get the best they can from a bad deal.

But there is nothing inevitable about this round of talks giving the west or the WTO what they want. For what the big guns cannot buy is public approval. Their agenda is unpopular in the west too. An NBC-Wall Street Journal poll last April revealed that by 48% to 34%, Americans think that foreign trade is bad for the US economy.

The failure to reach an agreement in Seattle last year was a sobering moment for them. Mike Moore, the WTO director, insists this will not happen when the WTO roadshow moves to Doha, Qatar, in November: "We will not fail this time, because if we aren't sure of success by September we will redefine the goal."

This gives the NGOs and developing world everything to play for but also, potentially, an awful lot to lose.

gary.younge@theguardian.com