Montesquieu was right. That’s my reaction to Trump’s ban on people from some Muslim countries entering the US.
The thing is that, as the Washington Post has pointed out, the ban does not apply to nations where Trump has business interests, such as Saudi Arabia, Egypt and Turkey – despite the fact that these countries are no strangers to terrorists.
What we’re seeing here, then, is vindication of Montesquieu’s claim (pdf) – recently revived by Deirdre McCloskey – that commerce “polishes and softens barbaric ways”. Trump’s barbaric ban is tempered by his commercial interests.
You might say this is just fascism mitigated by greed. But I’d prefer this to unmitigated fascism.
This poses the question: how exactly does commerce soften barbarism? Roughly speaking, there are two mechanisms.
One – which we see in Trump’s decision – is pure self-interest. If we are trading with people, it’s in our interests that they are prosperous and that they regard us favourably. We therefore try not to hurt them.
In this sense, there’s an echo of Bretton Woods II (pdf) in Trump’s actions. In this system, westerners invested in Chinese factories and China invested in western bonds. This promoted a mutual self-interest in respecting others’ property rights: the risk of westerners being expropriated by the Chinese government is tempered by the fact that such an act would be met with sanctions against China’s western investments.
Another mechanism, though, is that commerce brings people together and so humanizes them and breaks down antipathy. One big way in which racism was diminished in the 70s and 80s, for example, was through the emergence of black footballers; increased commerce between white fans and black players broke down racism.
Thinkers such as Karl Polanyi have objected that market economies break down communities, replacing strong communal ties with the weaker ties of trade. There is, though, an upside to this. Strong homogenous communities can be insular and hostile to outsiders: the League of Gentlemen were right to see that there’s something sinister in the question “are you local?” It’s no accident that the vote to leave the EU tended to be strongest in areas where there were fewer migrants. And it might be no accident that, in a wider historical perspective, the growth of the market economy has coincided with a decline in violence.
It’s in this context that we should worry about Trump’s protectionism. I agree with Tyler Cowen that the macroeconomic damage of border taxes might be limited. Instead, their danger is cultural.
For one thing, protectionism rests upon the idea that trade is a zero-sum game – that “their” win is our loss – rather than an arrangement that benefits both parties*. This validates and encourages anti-foreigner sentiment. And for another, if there are fewer trade links between nations there’ll be fewer meetings between different nationalities and hence in the longer-run less tolerance and goodwill.
In this sense, what Trump is promoting is a form of feudalism. The idea that wealth creation is zero-sum is a feudal idea. And immigration controls are feudal, in the sense that they use force to ensure that those born into poverty stay poor.
Today, it’s not enough to be anti-capitalist. We must also be anti-feudalist.
* You might object that there’s some truth in the zero-sum conception of trade as some people have indeed lost out through globalization. I’m not so sure. Capitalism is a mixture of soft commerce and hard exploitation and it is the latter that is most responsible for workers’ losses (pdf) – both in the sense that factors such as the decline of trades unions and power-biased technical change have harmed workers, and in the sense that we’ve not had the policy responses that would ensure that globalization did benefit everyone.