International Trade and National Security

International Trade and National Security
Back to Basics
Bevin Chu
December 09, 1999

WTO? Just Say No!

The federal government of these United States of America should withdraw from and refuse to acknowledge the legitimacy of the World Trade Organization, the World Bank and the International Monetary Fund.

Why?

The WTO violates Americans' Right to engage in Free Trade

Because as Austrian economist Llewellyn Rockwell of the Ludwig von Mises Institute has underscored recently, supranational entities such as the WTO, World Bank, and IMF, at least as they are configured in today's world, are a menace to laissez-faire capitalism and global free trade, notwithstanding the good intentions of many of their supporters.

Instead, private American corporations, which are not evil bogeymen, but merely voluntary For Profit associations of individual American citizens, should be left alone to negotiate their own deals with foreign corporations and governments. If they can cut deals satisfactory to their own management and shareholders, and turn a profit in an unregulated international marketplace, then more power to them. If they can't, that's their tough luck. Either way the entire process, from start to finish, ought to remain a strictly private commercial affair.

The federal and state governments of these United States are legally authorized by the American public to enforce commercial contracts within America's territorial boundaries. That's part of the definition of national and state sovereignty.

They are not however entitled to enforce international commercial contacts. No national government is, including all current and future members of the WTO. Empowering our federal leviathan to stick its nose into international commercial contracts, and collude with foreign governments to micromanage "our" corporations' business dealings merely serves to centralize ever more dangerous, unchecked power in the hands of both our homegrown and foreign nomenklatura, socializes international commerce, and weakens the concept of national sovereignty, including American sovereignty.

But what about foreign governments' violations of the principles of free trade? Shouldn't "our" government pressure foreign governments to respect the principles of free trade?

Absolutely not.

If a foreign government is too obtuse to realize that untrammeled free trade is in its own citizens' long term best interest, too bad for them. Their citizens will learn the folly of their government's self-destructive policies, sooner if not later. Their nation's competitiveness in the global marketplace will suffer, the way the former Soviet Union's suffered when her Stalinist nomenklatura imagined they could repeal the iron laws of economics. Their citizens will demand economic reform from within, without any outside pressure whatsoever.

It is neither the duty nor prerogative of our fascistic Keynesian beltway bureaucrats to tutor foreigners on the principles of free market economics, assuming they know anything about free market economics in the first place.

Unfortunately this is not the end of the story. Now comes the unpleasant part.

Protectionists also violate Americans' Right to engage in Free Trade

Protectionist opponents of international free trade, laborite, luddite and nativist alike, have absolutely, positively, no right whatsoever to forcibly prevent American and foreign businessmen who wish to engage in mutally agreeable international trade from doing so.

Protectionists, like warfare statists, invariably resort to the Orwellian vocabulary of collectivism. They can be counted on to invoke the "w" word, "we" and the "o" word, "our." "We" must protect "our" industries, for the sake of "our" national interest, as if "our" national interest could ever be other than the individual interests of millions of sovereign and independent American citizens.

Protectionists operate under a mighty peculiar set of unexamined assumptions. They seem to imagine that just because an American businessman is a fellow American that somehow the businessman owes the protectionist some sort of special consideration, beyond refraining from violating the protectionist's life, liberty and property. Protectionists seem to imagine merely because they are American citizens that private American businesses, which are the private property of other private American citizens, are somehow "our" industries.

Excuse me, but the assumption that "we're all in this together" and therefore owe each some vague, undefined obligation beyond refraining from violating each others' individual rights, is the central premise of communism, fascism, democratic socialism and welfare statism. It is most certainly not the guiding premise which inspired our Founding Fathers to wage the American Revolution.

Unless the protectionist owns shares of stock in the company in question, the company is not "our" company, it is somebody elses' ' company. Merely being a citizen of the same country does not give one the right to dictate how someone else disposes of his economic assets.

But what if the protectionist is an employee of the company in question? Doesn't he have therefore a say in whether "his" company moves its plants or outsources its labor overseas? Doesn't he have a "right" to "his" job?

Sorry, he does not. Not unless he owns shares in the company and can persuade a majority of shareholders to keep him on. What the company owes him is wages or a salary. What he owes the company is his manual or mental labor.

The employee's relationship to the company he works for is morally and ethically no different from that between the protectionist's neigborhood barber and himself. His barber cuts the protectionist's hair. The protectionist pays the barber for services rendered. End of story. Just as the protectionist has no obligation to patronize the same barber in perpetuity, so the protectionist's employer has no obligation to employ the protectionist in perpetuity.

Being an American citizen does not mean that other Americans' bank accounts are the common property of "all Americans," welfare parasites to the contrary notwithstanding. By the same token, being an American citizen does not mean that other Americans' private property, in the form of business enterprises such as traditional manufacturing plants, can be suddenly reclassified as the common property of all Americans.

This is not to equate honest, hard-working blue collar workers in sunset industries with welfare parasites. Absolutely not. It is merely to remind protectionists of the fundamental distinction between capitalism and communism. Laissez faire capitalists know that not only is there no such thing as a free lunch, there is no such thing as an iron ricebowl either. Both Maoist China and Japan, Inc. found that out, the hard way. The most one can do is delay the inevitable day of reckoning.

Radical economic reformer Zhu Rongi caught on to this fact about twenty years ago, and was subjected to Maoist thought reform for talking about it. Apparently many otherwise intelligent mainstream American intellectuals, including some ostensibly on the capitalist right, still haven't figured it out.

Warfare Statists violate Americans' Intellectual Property Rights

In case that was painful, there's more.

Conservative warfare statists like Republican Congressman Chris Cox of California routinely prattle on about restricting the export of "American technology" and "American industrial secrets."

Pardon me Chris, but unless the technology in question was developed as socialized science in government laboratories, by scientists and engineers on the federal payroll, the way Nazi scientists developed German weapons technology for the Third Reich, they are not "American technology" or "American industrial secrets," not in the sense you and your ilk mean it. They are not public property, and ought not to be disposed of at the whims of paranoid politicians and beltway bureaucrats.

Instead, any scientific breakthroughs or technological innovations made by Boeing, Hughes, Loral, Lucent and McDonnell Douglas are private property. They are the private intellectual property of private individuals who work for or own shares of Boeing, Hughes, IBM, Loral, Lucent and McDonnell Douglas. What Boeing, Hughes, IBM, Loral, Lucent and McDonnell Douglas choose to do with their private intellectual property is properly their private decision.

Boeing, Hughes, IBM, Loral, Lucent and McDonnell Douglas must be able to sell their high tech products to recoup their immense R&D costs. If they don't recoup their R&D costs, they lose money. If they lose money they declare Chapter Eleven. If American high tech companies declare Chapter Eleven, high tech companies in foreign nations will replace them in the global marketplace. If foreign high tech companies replace them, America will lose its technological lead.

Question: But what about "National Security?"

Answer: What about "National Security?"

The bedrock precondition of a free economy, hence a wealthy nation, hence a strong national defense, is the sanctity of private property. Private property makes possible private enterprise. Private enterprise make possible immense wealth. Immense wealth makes possible America's superpower status.

Advanced military weaponry is immensely costly. Only extravangantly wealthy nations like America can afford extravagantly expensive weapons such as supercarriers and state of the art air superiority fighters like the F-22.

No private property means no private enterprise, means no immense wealth, means no superpower status. The former Soviet Union learned this lesson the hard way. The former Soviet Union is now a former superpower. This is merely one of many reasons why the threshold for government abrogation of private propety rights must be set extremely high.

You want to be a superpatriot? You want a strong national defense? You want America to remain a superpower into the 21st century? Then keep your eye on the bottom line and remember, "It's the economy, stupid!"