Hornberger's Blog

Hornberger's Blog is a daily libertarian blog written by Jacob G. Hornberger, founder and president of FFF.
Here's the RSS feed or subscribe to our FFF Email Update to receive Hornberger’s Blog daily.

Free Trade, Sovereignty, and Big Government

by

I’m befuddled by those people who are worried about a conspiracy regarding a super-highway between Canada, Mexico, and the United States.

It seems that what concerns the super-highway opponents is the possibility that the governments of Canada, the United States, and Mexico will combine into one super-government, such as the European Union, and adopt a unified currency, much like the Euro.

So far, so good. I can understand why advocates of liberty would be concerned about a super-big government and a super-big-government fiat currency.

However, this is where things get murky because oftentimes it seems that the opponents of such a plan also oppose free trade. Even worse, they sometimes seem to endorse big-government efforts out of Washington, D.C., to interfere with free trade.

First of all, let’s keep in mind that in every trade both sides to the transaction benefit, from their own individual perspective. The fact that both sides voluntarily enter into a trade is confirmation of that phenomenon. The reason that each side benefits is that each party to a trade gives up something he values less for something he values more.

Thus, people’s standard of living can rise through the simple act of exchange. Suppose, for example, that one person has 10 apples and another person has 10 oranges. They trade 4 apples for 6 oranges. Both sides have benefited from the trade even though the apple owner gave up only 4 apples and the orange owner gave up 6 oranges. From their own individual perspective, they both gave up something they valued less for something they valued more. The standard of living of both persons went up.

A corollary of this principle then is: Whenever any government rule, regulation, edict, or law interferes with people’s ability to trade, it is interfering with their right to improve their standard of living.

Therefore, it becomes obvious from both a moral and utilitarian standpoint that people should be free to engage in mutual acts of trade without governmental interference. This is, in fact, the situation in the domestic United States, which is the largest free-trade zone in the world. By and large (with some exceptions, such as drug laws), people are free to transport goods across borders within the United States without governmental interference. That freedom is a major contributing factor to the relatively high standard of living experienced by Americans.

Obviously, these principles apply not only to trades with other Americans but also with people in other countries. Again, to the extent that two people, regardless of citizenship, enter into a mutual trade, they are both benefiting. Otherwise, they wouldn’t enter into the exchange.

Thus, the ideal, from the standpoint of freedom, is a situation in which Americans are free to enter into trades with anyone in the world. That would mean, obviously, that Americans could buy and sell across international borders as easily as they buy and sell across state borders.

That is, just as we don’t have customs officials at state borders to prevent goods from crossing state lines, there would be no customs officials at international borders to prevent goods from crossing international lines. People would be free to trade with others, both foreign and domestic, without governmental interference.

That’s what genuine freedom, free trade, and free enterprise connote — an absenceof government interference.

Yet, it seems that in their opposition to a unified political body and a unified currency, opponents of that plan sometimes support governmental suppression of free trade. Their seem to think that since a unified governmental unit will interfere with U.S. sovereignty, so would free trade, an odd conclusion given that there is no governmental involvement in free trade. (Again, the reason it’s called “free” is because it’s free of governmental interference). Moreover, as we all know, each state of the Union continues to maintain sovereignty and jurisdiction over the territory within its boundaries despite the fact that goods are crossing back and forth across state borders every day.

Moreover, in order to regulate and interfere with the millions of trades that would ordinarily take place across borders, it is obvious that one needs a very centralized, powerful government operating along the border, perhaps even with military troops, to interfere with such trades. It’s impossible to reconcile that position with a purported opposition to “big government” because it obviously takes a big government to perform that task.

So, what about the so-called super-highway? Well, as libertarians have long held, socialism in any endeavor, including highways, is not a good thing. But given that the American people have delegated the responsibility of highways to the government, why would it surprise anyone that governments build highways to facilitate trade. Isn’t that one of the justifications for the Interstate Highway System — that it facilitates the movement of goods across borders? Why would the principle be any different across international borders?

Those who are opposed to a unified government consisting of the governments of Mexico, Canada, and the United States are on the right track. But we must take care that we don’t permit that concern to lead us into opposing freedom and free trade.

This post was written by:

Jacob G. Hornberger is founder and president of The Future of Freedom Foundation. He was born and raised in Laredo, Texas, and received his B.A. in economics from Virginia Military Institute and his law degree from the University of Texas. He was a trial attorney for twelve years in Texas. He also was an adjunct professor at the University of Dallas, where he taught law and economics. In 1987, Mr. Hornberger left the practice of law to become director of programs at the Foundation for Economic Education. He has advanced freedom and free markets on talk-radio stations all across the country as well as on Fox News’ Neil Cavuto and Greta van Susteren shows and he appeared as a regular commentator on Judge Andrew Napolitano’s show Freedom Watch. View these interviews at LewRockwell.com and from Full Context. Send him email.