In Our Second-Best World, Most Free-Trade Agreements Deserve Applause

by Don Boudreaux on July 9, 2013

in Crony Capitalism, Trade

In my latest column in the Pittsburgh Tribune-Review I discuss (as they are dubbed) “free-trade agreements” – agreements that, despite their many imperfections, I generally applaud.  Here’s roughly the last half of my column:

Think of gangs of young men who routinely kill and maim each other in street fights. No benefit comes from such fights — save the fleeting glory that gang culture bestows on two-bit street warriors.

Now suppose that some members of these rival gangs wise up a bit and agree to rules that will reduce but not eliminate the fighting. Gang leaders might meet in a neutral neighborhood and bargain for hours toward an elaborate agreement in which each gang agrees never to fight on Mondays, Wednesdays and Fridays, and also to never use switchblade knives longer than 6 inches. The gangs, though, reserve the privilege of fighting each other on Tuesdays, Thursdays, Saturdays and Sundays, and with any weapons other than long switchblades.

Most people would applaud the above agreement between gangs to diminish their fighting. This accord might be called a “no-fighting agreement” — even though a great deal of fighting is permitted by the agreement. Yet even the most sincere applause for this “no-fighting agreement” would in no way imply that it is ideal.

Everyone of good sense and common decency understands that the ideal agreement would be one that stops the fighting altogether, an agreement far less wordy than the so-called “no-fighting agreement” that admits many exceptions.

The analogy of street gangs that fight to governments that impose trade restrictions isn’t perfect. But it does serve well to highlight the reality that our standards for government behavior aren’t much higher than are our standards for the behavior of violent street gangs.

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