"Free" Trade
It seems that arguments in favor of protectionism have been made from all across the political spectrum, from right-wing, "free-market" types, to libertarians, to pro-labor old-school leftists, with examples from each on this very forum.
All of these arguments are individually surprising, in that they invariably force those who make them into inconsistency with their own fundamental precepts.
I think I finally understand why this particular issue provokes so much schizodoxy, and this understanding can be summarized with reference to the parable of the blind men and the elephant.
This post, then, will not be concerned with individually drawing out the inconsistencies associated with protectionist rhetorics, but in the deeper question of how they have come about in the first place, across such a broad ideological spectrum.
I'll keep it really simple:
PART 1: WHAT HAS COME BEFORE
Contemporary "free trade" has been a specific policy instrument toward two ends:
a. State capitalism
b. Geopolitical stabilization
"State capitalism", as Clyde Wilson defines it: "a regime of highly concentrated private ownership, subsidized and protected by government."
State capitalism is best epitomized by the United States Republican Party, in that it, for almost its entire existence, has been focused on diverting the energies of the federal/national government from specific policy issues of concern to the general population, to supporting a "court" system that links professional political agents with professional corporate-economic agents in such a way as to allow both to abet one another's profit at the expense of the larger national state and its inhabitants. The other major US party, the Democrats, have assimilated to this mode of governance in order to survive as a political body.
In this aspect of "globalized" free trade, China and the USA have been both the most eager parties to initiate the necessary policies, as their leadership over time has stood to gain the most from these policies. Indeed, the Chinese population at-large, as well as the aggregate populations of similar developing countries such as India and Mexico, have gained considerably from foreign investment and the collateral rise in incomes and construction of infrastructure. The benefits to the developed partners in the free-trade relationship were mostly concentrated in the short-term. They were there, but the returns have rapidly diminished in the medium-term.
"Geopolitical stabilization" is used in the sense that much of international relations since WW2, especially between neighboring countries and global powers, has been a means of creating economic, political, and social interconnections such that the burdens of modern international relations are reduced, particularly in regard to national defense. For example, it is not at all innovative to comment that the project of Europeanization on the Old Continent has had as its guiding principle the pacification of the Germanic world. However, even the relationships of the USA, Japan, and China to each other could be viewed from this perspective.
Thus, one way to narrate post-war free-trade policy would be as indirect subsidies exchanged between sovereign states. However, from the state-capitalistic ideology, this is ultimately only a secondary consideration to the quasi-feudal dividends, what many might call institutionalized corruption of the highest order. Globalization of general human activity since the beginning of the Industrial Era is the crucial factor here, driving the transition of state capitalism from an inward-looking, and thus protectionistic enterprise to one that broadly supports the policy of free trade. The dilemma is just that, insofar as corporations have become "multi-national", they are simply "non-national", and thus have come to embody the Medieval stereotype of the cosmopolitan-yet-parochial itinerant Jew. It is no surprise that large banks especially are subject to criticism here. Economic actors formerly subordinated to one state and embedded within a relatively-homogeneous population in which they had incentive to invest through networks of patronage are now well into the process of becoming discrete extra-state and extra-national political units. Multinational corporations are in this way entities specialized in extracting and juggling state resources for the benefit of a professional and self-perpetuating class of non-national individuals...
Protectionism is essentially coming back into vogue, especially as a populist issue, because the balance between state and corporate benefit has begun to shift too far in the latter's favor, resulting in corporate actors that are on paper - and in fact - more powerful than the majority of de jure state actors. Associated with this shift is mounting inequality between the professional non-national corporatists (and their direct beneficiaries) and the vast majority of national subjects. If in the decades following WW2 the world reached a level of (in)equality not seen since the transition of societies from hunting-gathering to agriculturalism, then in the decades since (c.f. the Conservative Ascendancy of the 1980s) inequality has come closer to early-modern levels that spurred widespread popular unrest across the (contemporary) developed world.
PART 2: WHAT MAY COME (or, Free Trade is Indispensable)
Even more succinctly than the first part:
1. There is simply no way to maintain the world at its current level (or, for that matter, a higher level) of development without breaking down most (and soon enough all) trade barriers between traditional political entities.
2. Free trade is not intrinsically detrimental in the long-term to national subjects - quite the opposite, in fact.
It is the second point on which I would like to elaborate, though it is closely-related to the first. Free trade, I argue, is only harmful inasmuch as we allow it to be directed by non-national actors who parasitically thrive off the energies of national actors. My perspective is essentially a statist one, and so should only profoundly offend the most ardent libertarians and anarcho-syndicalists (though the whole edifice of modernism is their foe, so there is no helping them). If state-level actors could collaborate to form truly-effective global bounds on economic activity, and so present a sort of "unified front" towards existing multinational actors, then these would simply dissolve into the basic units of organized economic activity that compose them, with their efficiency provided for and guaranteed purely by the coordinated activity of sovereign states. In other words, state capitalism would be disestablished, and without even the need for pernicious and unwieldy levels of oversight that distress those who prefer small government, and international markets would naturally reorganize in such a way that efficient distribution of of goods and commodities would be maximized according to the principle of comparative advantage.
The challenge is to frame debates around the world along the lines presented above, overcome national tensions per se, and, of course, overwhelm the tenacious and immanent political influence of non-national corporate actors in the governments of the great powers.
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Originally Posted by Husar
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