[NOTE BENE FROM KJL: We held this until now because I knew Derb was traveling and didn’t want him sucked into a debate outside the comfort of his home—or something.]
Before you start drawing up bylaws for the new Bismarck Wing of the Conservative Movement, Derb, I beg you to reconsider.
The rise of Bismarck’s Germany? Industrialization. Bismarck took a still largely agrarian Germany on a forced march, mandating, for example, the formation of enormous steel, chemicals, and arms combinations. Even the Soviet Union was able to boost living standards by industrializing, for crying out loud. The idea that economic growth in the Second Reich disproves the theory of comparative advantage is silly. (And there’s another wrinkle here. In unifying dozens of German states, Bismarck created a single, vastly enlarged internal market, permitting German enterprises to benefit, if not from free trade, then from freer trade.)
Britain’s “sad, slow economic decline after 1846?” What economic decline? Allowing for certain temporary setbacks, living standards in Britain continued to rise handsomely after 1846. Britain certainly underwent a relative decline, as other nations, notably Germany and the United States, industrialized (and, in the case of the United States, experienced high rates of immigration). But the United States has undergone just the same sort of decline since the Second World War, slowly accounting for less and less of the world’s output. Have we grown poorer? Of course not. Other nations have grown richer—and thank goodness.
Alexander Hamilton? His theories notwithstanding, actual practice in the early United States were one of relatively free trade. (When Jefferson attempted to impose an embargo in 1808, cutting off trade to Europe, he found himself facing massive civil disobedience. Even his own customs officials made only sporadic attempts to enforce the measure.) I’ll grant you that we imposed high tariffs during periods in the second half of the nineteenth century and the first decades of the twentieth. But you’d be hard-pressed to find evidence that those tariffs encouraged our economic growth.
By contrast with these counterexamples that are not, actually, counterexamples at all, consider, to name just one example, Hong Kong, which started out with no wealth and no natural resources—but a commitment to free trade. For that matter, take a look at the international growth of the last six decades, which has disproportionately taken place in countries committed (however imperfectly) to free trade. And (again, if I may) read around a little in Milton Friedman. Friedman is that rarest of men: A supremely gifted academic—he didn’t win the Nobel Prize for being a slouch—who writes lucid, accessible prose.