Sunday, March 11, 2018

An Unasked Question

     Typically, the most important questions are the ones no one is asking. However, that qualifying adjective is important, too: some questions aren’t asked because no one sincerely cares about the subject – or the answer.

     Here’s one: What is “free trade,” really? And the follow-up: Why are “free trade agreements” always hundreds of pages long?

     You’d think the first of those two questions would qualify as important, especially in today’s environment of global marketing (and hyper-contentious politics). Well, if that were so, it would be a regular topic of discussion on the talking-head shows...but it isn’t.

     You see, no one involved in trade policy, trade negotiations, or the promulgation of economic nostrums cares to have those questions answered right out in front of God and everybody. Whatever they may say about “free trade,” it’s a matter of absolutely no interest to them. So, just as with many other phrases and positions, they use it as a shibboleth: a touchstone for evaluating potential allies and a verbal shield against their opponents.

     What matters to them, if “free trade” genuinely doesn’t? Ah, that’s the nub, isn’t it?


     In Power and Market, the late Murray Rothbard presented a powerful unifying conception about kinds of human-government actions and interactions:

  • Monadic: These are characterized by a single actor, regardless of whether he acts on others. In political economy, the actor is always a government (e.g., a ban on some good or service).
  • Dyadic: These involve two active elements: one human (or private-sector organization) and one government. Their interaction is dictated by the government (e.g., taxation).
  • Triadic: Here there are three active elements: two human, one government. The government dictates the ways in which the human elements must, may, and must not interact (e.g., trade regulation).

     Dr. Rothbard omitted the case of the international trade agreement from his paradigm. That may be because he saw the matter in terms of two discrete interactions: one government with organizations within its jurisdiction, on each side of the border. Alternately, we might view a “trade agreement” as a form of supra-government which sets terms for interacting private parties, in which case it fits the triadic scheme.

     An international trade agreement – the soi-disant “free trade” agreement – invariably imposes innumerable conditions upon the trading parties. Such an agreement typically specifies tariffs and restrictions that cover hundreds of products or product categories: massive impositions of rules and taxes upon the trades it covers. Wherefore, then, do we call that “free trade?”

     Isn’t this a misnomer? A deliberate attempt to disguise a massive governmental intrusion into commerce as something diametrically different? If so, why do the talking heads who claim to favor free trade permit it? Indeed, why do they assist in perpetuating the lie?


     Free trade, in a world in which words have exact meanings, would be trade that is genuinely free: i.e., in which all that matters are the desires of the buyer and the seller. Free trade would not partake of governmental interference of any sort. Governments would not lay conditions upon it, would not tax it, would not subsidize it, and would not exclude particular categories of goods from it. Yet every “free trade” agreement of the postwar era involves some or all those intrusions.

     Governments are predatory, parasitic entities. Whereas individuals and private organizations live by production and trade, governments live by the sword. By their very nature, they incorporate an incentive structure and a dynamic that can never be altered:

  • To grow without limit;
  • To perpetually increase their power;
  • To exact as much tribute as possible from their subjects.

     Therefore governments are opposed to genuinely free trade by their very nature. They will seek power over it – and they will seek power, and advantages over other governments, from it. When possible, they will disguise those aims with euphemisms and prattle about “national security” or the “common good.”

     If it were not so, we would not confront the farcical phenomenon of the thousand-page “free trade agreement” festooned from end to end by tariffs, regulations, qualifications, and exclusions. Intergovernmental negotiations over free trade would begin with a single question – “Are you for free trade in [some commodity or product]?” — and end with a yes or no reply. As this is not the case, it follows that governments neither permit free trade nor will they ever countenance it in the future.

     Yet while the government most likely to hurt you is the one closest to you, there is no government on Earth that’s not a danger to every living soul. Since we delegate the responsibility for our national defense to the federal government, a certain degree of federal supervision of international trade must go along with it:

  • Trade in weapons;
  • Trade in strategically vital materials;
  • Trade in knowledge germane to weapons science.

     And indeed, the federal government has taken that role in Americans’ trade with other lands for many decades.

     But clearly, federal intrusions into trade go far beyond those areas, as do the intrusions of other national governments. At least, I can see no strategic aspect to peanuts, sugar, or imported tea.

     Most maneuvering over international trade is motivated by politicians’ desire to protect their friends, allies, and foreign clients. Why else would they seek the power to tariff or regulate international trade in shoes? Why else would they promote the importation of oil, especially at a time when the domestic production of oil and gas is breaking all records? Only a desire to direct revenue streams away from disfavored entities and toward favored ones could possibly explain it.

     Over the next few weeks we’ll hear many arguments over the Trump Administration’s tariffs on imported steel and aluminum. The Administration considers those items to be vital to the national security, and a good case can be made for that. But you will never hear any political-class advocate of “free trade” answer, directly and candidly, the questions I posed in the opening segment. Too many rice bowls are at stake. Oftentimes, the advocate’s own livelihood is one of them.


     Now, as a sweetener for the above, somewhat caustic discussion, have an answer to a question virtually no one has asked lately. At least, it hasn’t been asked around the Fortress of Crankitude in a dog’s age:

How To Make Nesselrode Pie:

Author: Kate Wheeler
Serves: 8
Prep time: 25 mins
Cook time: 15 mins
Total time: 40 mins

Ingredients:
For crumb crust:
     1½ cup chocolate cookie crumbs
     2 tablespoons sugar
     ½ cup butter
For the filling:
     ½ cup finely diced candied fruit
     ⅓ cup rum
     1½ cup heavy cream, divided into ¾ c. and ¾ c.
     3 egg yolks
     2 tablespoons sugar
     1 tablespoon gelatin
     ⅓ cup cold water
     ½ cup sweetened chestnut puree
     1 teaspoon vanilla
     3 egg whites, beaten until stiff

Instructions:
For crumb crust:
     Process sugar and crumbs in food processor.
     Melt butter, combine with sugar and crumbs.
     Press into a 9 inch pie plate until firm.
     Bake at 325 degrees for about 15 minutes, let cool.
For the filling:
     Pour rum over the fruits, let macerate for at least one hour.
     Bring ¾ c. cream to a simmer. Beat egg yolks with sugar until pale yellow. Whisk in part of the hot cream, then return the eggs to the remainder of the cream and whisk over low heat until the mixture is thickened. Fold in chestnut puree.
     Meanwhile, sprinkle the gelatin over the cold water in a small bowl. When the gelatin has absorbed the water and the custard is thickened, whisk the gelatin into the cream and eggs mixture. Refrigerate until firm.
     Break up the firmed custard with some vigorous stirring. Beat the egg whites until stiff and whip the remaining cream. Fold the macerated fruits (with the rum), the whipped cream and the beaten egg whites into the chestnut custard mixture. Pour into the prepared pie shell.
     Chill until firm, and garnish with curls of chocolate.

     Enjoy – in very small portions.

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