Saturday, March 21, 2009

Protectionisms Threat – Pt. 4

But what makes this the largest threat to the United States foreign policy? What makes the prevention of protectionism and the survival and progression of international trade more important than that of terrorist threats, rising regional and world powers, global warming, the need for alternative fuels and other pressing problems?

First, let's take a look at terrorism. The fact is, whether the year is 1783 or 2083, "terrorism" – by whatever definition it will take on – will be a possibility and a fear for everyone in every country. Whether terrorism takes on the form or definition of Native American raids on settlements, Irish ultra-nationalists, Islamic fundamentalists, or mercenaries paid to detonate WMD's, they will always be a threat to United States national security. But being that they are a constant in our world – although the form and definition of "terrorist" may change over time – it is hard to say that "terrorism" is the most important issue that our foreign policy makers should put into consideration for the next half-decade for the reason that its definition – and hence its security risk - could evolve and change overnight. But can the idea of radicalized, religious zealots who act according to what they have been taught be offset by a more free-trade world? According to Thomas Friedman, a plausible way to combat our current understanding of terrorism could be to encourage their entrance into a free-trade world:

Religions are the smelters and founders of imagination. The more any religion's imagination – Hindu, Christian, Jewish, Muslim, Buddhist – is shaped in an isolated bubble, or in a dark cave, the more its imagination is likely to sail off in dangerous directions. People who are connected to the world and exposed to different cultures and perspectives are far more likely to develop the imagination of 11/9 [post Berlin-wall world]. People who are feeling disconnected, for whom personal freedom and fulfillment are a utopian fantasy, are more likely to develop the imagination of 9/11 (Freidman, 2006).

    Terrorism can be fought not only on the battlefield, but in the economic connectivity of people from all over the world. The idea is that the wealthier the country – and the higher the standard of living of the people of that country – the less likely they are to go to war with another country because of the high economical cost of a conflict.

    Another possible threat the United States could face in the next five years is a new regional or even world superpower. Why would the survival of Liberalism be more important than the risk, as stated earlier, that multipolarity "is inherently destabilizing – and hence inimical to economic openness"? It is precisely the fact that if the United States maintains a strong free-trade Open Door policy then the likeliness of a regional or world superpower is greatly decreased:

Washington's ability to provide other major states with collective goods – in both the security and economic spheres – is a wasting asset…other major states experience growing doubts about whether they can count on the United States to protect them, they…acquire military capabilities so that, if necessary, they can defend themselves without U.S. assistance…Precisely because multipolarity is antithetical to the Open Door world that the United States seeks, the aim of American grand strategy is to prevent the other major powers – even U.S. allies – from gaining autonomy in the realm of security… As America's relative economic power wanes, others will have decreasing incentives to bandwagon with the United States. The ongoing redistribution of global power is bringing forward the day when eligible states will be strong enough economically to challenge U.S. preponderance militarily… It is a truism that economic strength is the foundation of hegemonic power. A strong economy provides the resources that can be converted into military power and generates the wealth to pay for the extensive military apparatus necessary to maintain the hegemon's dominant position… At some point, the relative decline of U.S. economic power that is in the offing will bring American hegemony to an end. (Layne, The Peace of Illusions: American Grand Strategy from 1940 to the Present, 2006)

    If the United States loses its hold on international, free-market trade, other nation's belief that the United States will be able to back up its commitments to them – in terms both defense and economic – will be reduced which then will encourage them to begin building their own defenses, reducing U.S. power and influence. The cause-effect relationship is not that a new regional or global superpower will adversely affect United States Liberalism, but the inability of the United States to promote and backup its free trade policies will result in an international uncertainty and rearmament.

    An outside problem facing the United States' national security could be the role it takes – or doesn't take – on the issue of global warming. Certain parties believe that the risks that the United States could face if it keeps on its track of "dirty energy" – such as coal and oil – could become loss of prestige internationally, falling behind the curve in manufacturing, and a heavy burden on its citizens in both the inefficiencies of outdated energy grids and the derivative effect of poorer health care due to "dirty energy".

    But according to Fareed Zakaria:

Between 2006 and 2012, China and India will build eight hundred new coal-fired power plants – with combined CO2 emissions five times the total savings of the Kyoto accords. (Zakaria, 2008)

    The rising regional and world powers of China and India are propelling their growth by the use of this same "dirty energy" that some Green movement proponents are claiming will bring American industry down. But American still is pushing ahead in this area of renewable energy, even if it is slower than some people would like. Last year, wind-powered energy gave out the same amount of power as five nuclear power plants. Solar energy and hybrid technology is on the rise and getting special attention for tax breaks and subsidies for their research and development by the United States government. This year, the Obama administration has helped pass $150 billion dollars over 10 years into the development of clean energy.

    This now brings us to the present. The case that there is a current re-birth of nationalism will rest chiefly on deduction from current events. The basis for economic nationalism rests on the view that in order to stabilize current economic conditions, countries should urge companies to keep jobs and capital at home. That goes contrary to free-trade economics which states that trade encourages specialization, which brings prosperity. That the global capital markets allocate money more efficiently than local ones, and economic co-operation encourages confidence and enhances security. (The Economist, 2009).

    Charles Wheelan writes a good analogy that proponents of economic nationalism need to consider:

To understand the costs of trade barriers, let's ponder a strange question: Would the United States be better off if we were to forbid trade across the Mississippi River? The logic of protectionism suggests that we would. For those of us on the east side of the Mississippi, new jobs would be created, since we would no longer have access to things like Boeing airplanes or Northern California wines. But nearly every skilled worker east of the Mississippi is already working, and we are doing things that we are better at than making airplanes or wine. Meanwhile, workers in the West, who are now very good at making airplanes or wine, would have to quit their jobs in order to make the goods normally produced in the East. They would not be as good at those jobs as the people who are doing them now. Preventing trade across the Mississippi would turn the specialization clock backward. We would be denied superior products and forced to do jobs that we're not particular good at. In short, we would be poorer because we would be collectively less productive. This is why economists favor trade not just across the Mississippi, but also across the Atlantic and the Pacific. Global trade turns the specialization clock forwards; protectionism stops that from happening. (Wheelan, 2002)

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