≡ Menu

Are Free Traders Guilty of Naïve Globalism?

In my latest column for AIER, I argue that the case for a policy of free trade has overwhelmingly focused on the benefits of free trade – and the harms of protectionism – to citizens of the home country. A slice:

Yet the false impression that liberal advocates of free trade naively ignore the salience of the nation-state is indeed widespread. This impression is created, however, not by free trade’s liberal supporters, but instead by free trade’s illiberal opponents. Whether out of ignorance or cunning, a familiar protectionist tactic is to falsely accuse advocates of free trade of putting the interests of foreigners on a par with, or even ahead of, the interests of fellow citizens.

A few years ago, for example, just before he and I were to debate free trade at Hillsdale college, the outspoken protectionist Ian Fletcher asked me why American libertarians are so willing to put the interests of foreigners over the interests of Americans. Fletcher seemed genuinely to believe that free-traders’ foundational argument is that free trade enriches poor countries by more than it impoverishes rich countries and, therefore, free trade is justified by a cosmopolitan utilitarian calculation.

If we free traders really made our case on such grounds, we would indeed deserve much of the blame for whatever skepticism the public has of free trade.

But in fact, the core case for free trade has never taken such a form. Both the theoretical and practical cases for a policy of free trade have always emphasized the gains bestowed by free trade, I repeat, on the people of the home country. Read Adam Smith. Read Frédéric Bastiat. Read Henry George. Read William Graham Sumner. Read Gottfried Haberler, Milton Friedman, Leland Yeager, Jagdish Bhagwati, Arvind Panagariya, Russ Roberts, Dan Griswold, Scott Lincicome, and Doug Irwin. Read any remotely prominent proponent of free trade – or read even me – and you will find, front and center, arguments that demonstrate that free trade is a boon to the home country, whether that country be rich or poor, big or small, industrial or agricultural.

You will, in addition, it’s true, often find arguments about how home-country moves toward free trade help also to enrich foreigners. But such arguments are not central to the case for free trade, and for good reason: trade is positive-sum. Whenever trade is made freer in the home country, net economic gains are created both for fellow citizens and for foreigners. There’s simply no need to justify free trade by resorting to a utilitarian calculus in which net gains to foreigners are weighed against net losses to fellow citizens, for such losses are mythical.

The fact that the case for free trade is mistakenly regarded by so many people to be rooted in global cosmopolitanism is a cheap public-relations victory for protectionists. They incessantly repeat untruths about free trade, such as that free trade with low-wage countries lowers American workers’ wages. Another false, but frequently heard, accusation is that America runs trade deficits only because foreign countries engage in “unfair” trade practices, or because insufficiently patriotic American leaders allow foreign countries to take advantage of ordinary Americans. These and similar untruths convey the impression that American supporters of free trade are either dupes who are blind to the damage done to the U.S. economy by free trade, or are starry-eyed globalists willing to sacrifice the interests of fellow Americans to those of foreigners.