Co-operation: Get it right, don’t scuttle it
Donald Trump’s speech on what he calls “economic independence” was enormously useful to illustrate the contradictions inherent in both left wing and right wing reflexive anti-globalization, and how they ultimately come out to the same thing.
As one might expect, those contradictions are right there in Trump’s own policy, if you can even call it that. He devoted one part of his speech to glorifying tariffs, rhapsodizing about how wise the Founding Fathers were to be protectionist, and lamenting the current ability of foreign countries to “export their goods to us tax-free.”
Make America great again by making everything Americans buy, and all their manufacturing inputs, cost more!
Then, later in the speech: “We need bilateral trade deals. We do not need to enter into another massive international agreement that ties us up and binds us down.”
It’s hard to imagine what the point would be to a “bilateral trade deal” that didn’t reduce tariffs or bind either country to any sort of agreement, but whatever. This is Trump, right? Nobody expects him to make sense.
The thing is, many people hold similarly incoherent positions when it comes to international agreements and institutions.
At its core, trade doesn’t depend on international agreements at all, as my colleague Andrew Coyne pointed out in a recent column. Governments can just drop tariffs any time they like. They tend not to, though, partly because it is politically expedient to appear to have their arms twisted, and partly because of the “you first, no really, you first” dance with their trading partners. But also because trade isn’t just about tariffs, once theory becomes practice.
It’s about regulations: Was Mexico’s ban on Canadian beef truly necessary for the safety of Mexican consumers? It’s about the flow of services, labour and people across borders: Was Canada’s visa requirement for Mexico in the best interest of either country?
Political and economic co-operation can’t be separated. When governments talk, they (ideally) agree on things. Hey, maybe we can work together to end acid rain, or produce automobiles. When they agree on things, they shake hands. Sometimes they sign things. Sometimes they set up joint bureaucracies or regular international meetings to make sure their agreements are carried out.
That’s how international institutions form. And to a great extent, the worldwide anxiety about globalization has to do with institutions. Some on the left mistrust economic co-operation in the form of the G7, the International Monetary Fund, the World Bank. Some on the right mistrust geopolitical co-operation in the form of the United Nations, especially the Security Council. Some on both sides mistrust the (nascent) Trans-Pacific Partnership and the European Union.
All of those institutions are legitimate targets for criticism and reform proposals; they all have spectacular mess-ups on their records. But the fundamental mistrust of what Trump calls “a leadership class that worships globalism over Americanism” has less to do with how those institutions work, and more to do with their mere existence. It’s a fear of losing national control.
And indeed, any international agreement does require a country to give its word to act in a certain way. That’s why it’s important that countries enter into those agreements democratically and openly, and that their governments respond to domestic concerns when institutions mess up.
It’s worth remembering that political and economic co-operation sprang from the same historical need. The Bretton Woods Conference of 1944 that created the IMF and the World Bank was, to an extent, a response to the Second World War, just like the creation of the United Nations.
Trump demonstrates that the concepts of “left” and “right” are not very useful for evaluating the politics of 2016. His anti-globalization is rooted in fear of institutions, fear of elites and fear of foreigners: “It will be American hands that remake this country.” It’s pure populist nationalism, and it has cropped up in parties of both the right and the left over the last couple of hundred years.
For those of us who don’t want to be ruled by fear, the question ought to be not whether countries should co-operate, but how they should do so.