Donald Trump’s former trade chief makes the case for more tariffs - Robert Lighthizer (The Economist)

 A Economist resolveu dar voz ao maior e mais explícito protecionista nos EUA. Se Trump for eleito, o país ficará muito parecido com o Brasil na política comercial. PRA

Robert Lighthizer foi o “trade representative”( uma espécie de Ministro do Comércio Exterior) de Trump e provavelmente será o futuro Trade Representative do próximo governo americano caso Trump seja eleito (o que é bastante provável...) nas eleições de novembro próximo nos Estados Unidos

MD

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By Invitation | American trade policy

Donald Trump’s former trade chief makes the case for more tariffs

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There are economic, geopolitical and moral reasons to increase protectionism, says Robert Lighthizer

Robert Lighthizer 

WHEN AMERICA grew in the 19th century from a modest agricultural country into the world’s largest economy, tariffs were critical to its success. In recent decades, however, the T word has become toxic to some. Free-trade purists argue that tariff increases destroy capitalism. When tariffs rose during the Trump administration, and that didn’t happen, the purists claimed that we should ignore the facts and rely on their antiquated economic models.

Now that Donald Trump has proposed a modest tariff on many goods and larger tariffs on Chinese products, Americans deserve a reasoned public discussion. His stated objective with the broader tariff is to reduce America’s trade deficit and to rejuvenate American manufacturing. The China tariffs are designed to help America prevail in that all-important geopolitical competition.

The usual objections are raised. But the notion that tariffs are always good or always bad is guided more by theology than by reason. The truth is that they are often beneficial. In a pretend world of completely free and balanced trade and no government interventions, one can imagine tariffs being unnecessary. In the real world, though, they can be useful.

Since the end of the cold war, America has come as close as almost any major country in history to eliminating significant tariffs. It was a bold experiment, and it has failed. America has run up more than $17trn in cumulative trade deficits over the past 24 years. Now, foreign interests own over $18trn more in American assets than Americans own in all their countries. Foreigners will get the future earnings associated with those assets, and Americans will have to work harder to make up for the earnings they have lost.

These massive trade deficits also drag down American economic growth. Countries with persistent trade surpluses artificially lower global demand. Rather than expanding global production by buying foreign goods (how trade is supposed to work), such countries use massive market distortions to replace foreign production capacity with their own and use the proceeds of trade to buy long-term assets in countries with deficits. This slows growth in the deficit countries, particularly America.

These facts help to explain the collapse of American manufacturing, and, importantly, of advanced manufacturing. Today, America annually imports $218bn more high-tech products than it exports. It invented personal computers, yet now virtually none are made there, and those that are require imported parts. It led the world in making semiconductors in the 1970s and 1980s, yet today it makes only 12% of global supply and is wholly dependent on imports for the most advanced chips. America has fallen behind China in cutting-edge sectors such as advanced batteries, nuclear-power equipment and drones.

None of these developments result from the type of “comparative advantage” you read about in economic textbooks. Instead, they result from the industrial policies of other countries. South Korea doesn’t have a great steel industry because it has cheap ore. Taiwan isn’t a great semiconductor-manufacturing centre because it has inexpensive silicon. China’s manufacturing dominance was largely paid for by its government. These and other countries benefit from a mix of subsidies, domestic market restrictions, lax labour laws and numerous other policies aimed at giving their companies an edge in global markets.

In the case of China, its government distorts the market by allocating resources to manufacturing and away from consumption. As a result, its per-capita consumption is very low. Letting consumption rise to natural levels and allocating more resources to individuals is inconsistent with the communist theory of personal austerity and could threaten Communist Party control.

America should change its own policies because making things matters. There is an obvious national-security benefit from having a vibrant manufacturing base. America doesn’t just need munitions factories. In times of war it needs basic manufacturing, so it can scale up in order to, for example, make the steel used to build new defence plants.

Furthermore, as economists like Harvard’s Ricardo Hausmann and MIT’s Cesar Hidalgo have shown, manufacturing a wide range of complex products is essential to building a high-performing economy. Despite accounting for around 11% of American GDP, manufacturing creates 35% of annual productivity increases and pays for 70% of business research and development. No sector employs more super-STEM(high-end science, tech, engineering and maths) workers. Because the ability to innovate is closely related to proximity to production, losing factories has a multiplier effect on growth.

But the greatest evidence of the failure of free-trade policy can be seen in the effect it has had on America’s middle and lower-middle class. The economy has lost millions of high-paying jobs, and the earnings of many American workers have been largely stagnant for decades (with the exception of a large jump in 2019). As a result, inequality has increased rapidly: the top 1% of Americans now own more wealth than the middle 60%.

This stagnation has devastated many communities. America has experienced an alarming increase in “deaths of despair”: suicide, drug overdoses and alcohol poisoning. Non-college-educated Americans now have a life expectancy nearly nine years lower than that of people with a degree. For most of American history workers could expect to be economically better off and to live longer than their parents. That has not been true since 2000. There are, of course, numerous causes for this calamity, but a failed trade policy is clearly one.

The question then becomes: how can tariffs help? Of course, they are a tool that should be used in conjunction with a pro-growth tax policy, a reduction in unnecessary regulation and the use of subsidies to develop key sectors like semiconductors. But because America’s economic imbalances are driven primarily by global trade flows, tariffs are the vital part of any serious reindustrialisation.

Economists have long recognised that in cases where significant distortions cannot be removed from a market, a second-best option is to take steps to offset the distortion’s effect. As Michael Pettis, an economist, points out, offsetting such foreign interference actually makes markets more efficient and increases the benefits of trade. For example, if a country subsidises a product or if a company dumps in another market, global rules allow the use of tariffs in response. In circumstances where the exporting country’s trade distortions are systemic, broad tariffs may be the only way to offset them and reinstate market forces.

The Trump tariffs proved this point. Before covid-19, real median household income in America rose from $70,840 in 2016 to an all-time high of $78,250 in 2019. From January 2017 to January 2020 the number of jobs in manufacturing rose by 419,000. The pandemic temporarily disrupted manufacturing growth. However, the tariffs have mostly remained in place, and from January 2020 to January 2024 American manufacturers added another 194,000 jobs.

Sector-level data confirm that tariffs supported domestic production of tariffed goods. According to a study by the non-partisan United States International Trade Commission (ITC), America’s Section 301 tariffs drastically reduced its dependence on imports of strategic goods from China and spurred domestic production of those goods. In the wake of the tariffs, imports of Chinese semiconductors, for instance, declined sharply (the largest annual fall being 72% in 2021) and American production increased (the largest gain being 7.8% in 2020).

The broader multi-country tariffs had an even more pronounced effect on domestic production of tariffed goods. The 25% steel tariffs, for instance, led to $22bn in new investment in steelmaking across the industry. Now, with relief from the pressure of foreign overcapacity, American producers are modernising their mills and building electric arc furnaces.

Furthermore, the price effects have been minimal. According to the ITC, the price of domestic steel increased by a mere 0.75% and overall steel prices by about 2.4%. Likewise, restrictions on imports of washing machines led to the opening of two new facilities, in Tennessee and South Carolina. Washing-machine prices fell back to pre-tariff levels after a brief adjustment spike, according to the Bureau of Labour Statistics.

Granted, other studies have concluded that retaliation from China blunted some of the tariffs’ positive effects. But none of these studies challenge the ITC’s core finding that the tariffs boosted domestic production and employment in the tariffed sectors at a negligible cost to consumers.

Donald Trump has proposed a 10% tariff on all imported goods to offset economic distortions created by foreign governments, to reduce America’s trade deficit and to speed up its reindustrialisation. Experience suggests that this will succeed and that high-paying industrial jobs will be created. Indeed, a recent model from the non-profit Coalition for a Prosperous America, which unlike many other trade models does not unrealistically assume full employment, concluded that the tariffs will lead to an increase in real household income and millions of new jobs. Mainstream economists disagree with the notion that tariffs would increase household income, but in the pre-covid Trump years we did raise tariffs and median family income rose, too.

In some cases tariffs higher than 10% will be needed. By using a mix of massive subsidies, low borrowing costs, forced technology transfer, near monopolisation of input material and a relatively closed market, China has created an industry that makes electric vehicles (EVs) much more cheaply than Western companies can. It is now flooding the EV market in Europe and threatening producers there with severe harm. It would do the same in America if not for 25% tariffs imposed by the Trump administration in 2018.

If China’s efforts to manipulate the EV market succeed, tens of thousands of American workers will lose their jobs and fall out of the middle class. In addition, America will send untold billions of dollars to an adversary that will use them to strengthen its armed forces and further threaten America.

Critics of the global 10% tariff allege that, if implemented, it will stoke inflation. There is much reason to be sceptical of this claim. To start, tariffs were raised in the Trump years and inflation stayed below 2%. Second, even an ardently anti-tariff think-tank, the Peterson Institute for International Economics, found that the direct effect on inflation of Section 301 tariffs was an increase of just 0.26 percentage points.

Furthermore, countries with persistent trade surpluses that implement pro-manufacturing policies have tended to have lower inflation rates than countries with deficits. This suggests that there may be little correlation between acting to protect your domestic market and your domestic inflation rate. Finally, it is worth noting that the driver of personal inflation for most Americans is energy, fuel and food prices and the cost of health care. These generally are not imported and would not be subject to tariffs in the Trump proposal.

Both economic and geopolitical facts strongly support the planned tariff increases. But there is also a moral case for them. Americans deserve productive jobs, strong families and thriving, safe communities. The free-trade policies of the past 30 years did not create any of this. The wreckage they have left behind is all around us. Properly used tariffs can be part of the solution. ■

Robert Lighthizer was America’s trade representative from 2017 to 2021 and deputy trade representative from 1983 to 1985

Ludwig von Mises: um texto de 1942, recentemente traduzido para o ingles

Ideas on Postwar Economic Policy

Ludwig von Mises

December 8, 2017

https://mises.org/wire/ideas-postwar-economic-policy

 

Mises Institute-Peru is proud to present this English-language version of an article written by Ludwig von Mises that, until now, was only available in Spanish. The text was translated by Lucas Ghersi.

This article was first published in the Mexican journal Cuadernos Americanos, Mexico, Year 1, vol. 4, July-August 1942.  According to Bettina Bien Greaves’ bibliography, an English or German version of this text is not known (Mises: An Annotated Bibliography, p. 46).  It is likely that the Spanish version was translated from English, but an original draft in German cannot be ruled out.

I

We hope that one day this awful war will end and men may, once again, occupy themselves with the works of peace. Then, the production of arms and other instruments of crime will be substituted by the production of consumer goods for men, women and children. No longer will people think in annihilation and destruction but in establishing and increasing human wellbeing.

This return to peace, of course, presupposes the absolute annihilation of the totalitarian powers since, if the dictators were to prevail, the consequence of their victory would not be peace but unending warfare. In these totalitarian powers, a philosophy that proclaims war, instead of peace, is defended as the natural most desirable state for men that will provide them with joy. Their longing is not permanent peace but permanent war; thus, if they achieve triumph, the world will become a great slaughterhouse.

However, the dictators will succumb; therefore, the question is:

What must we do to close, as soon and as thoroughly as possible, the wounds opened in society during these years of fighting? This is the great problem that should worry us and that will never concern us prematurely. Even now, when the roar of battle is still being heard, statesmen and economists must think about the last day of the war. Even now they should prepare, in their spirits, what will be necessary to put in practice later.

II

Above all, it is necessary to make this idea clear: if postwar economic policy is to be successful, it must be based on measures radically different from those pursued before the outbreak of this war.

The main characteristic of policies implemented in the decade that preceded the current war, was economic nationalism; that is, an economic policy based on the belief that it is possible to promote the wellbeing of all nationals of a country, or at least of a specific group of them, through measures harmful to foreigners. It was understood that deterring or prohibiting, in an absolute way, the importation of foreign goods; restricting the immigration of aliens; or expropriating, partially or totally, the capital owned by foreigners could provide an important service to a country. This is not the appropriate place to analyze if those measures are suitable to achieve their desired end. The classical economic theory of free exchange has already proven, beyond refutation, that the final result of restrictions placed on foreign trade is the general decline of the productivity of labor and, therefore, of standards of living. In this way, production ceases to occur in places where a high return may be achieved and moves to others where, with the same investment of capital and labor, much lower returns can be obtained. The classic doctrine of free exchange of Hume, Smith and Ricardo has never been refuted. All objections to it turned out to be unfounded.

However, protectionism not only creates economic disadvantages. It also precludes peaceful cooperation between states leading to a sure war. The Society of Nations’ efforts to stop the new global conflagration, through a system of collective security, were in vain because of this environment since all states, big or small, tended to harm one another by implementing certain economic measures.

If we are unable to overcome economic nationalism, all hopes of achieving the reconstruction of our culture will prove illusory. Economic nationalism prevents industrialized States ¾ that is, all those that are compelled to import foodstuff and raw materials ¾ from gathering the necessary means to pay for their imports. How would they be able to pay if not through the exportation of their industrial products? If not permitted to export their industrial articles, these states would be fatally forced into autarchy; on the other hand, countries that possess raw materials would loose markets for the produce of their land. In industrialized states, this situation provokes the desire to dominate nations that possess raw materials through military means. We must not fool ourselves: ambitions of conquest lie behind apparently innocent claims for the equal distribution of natural sources of wealth and free access to raw materials.

In a peaceful world ruled by free trade, there would be no problems regarding raw materials. Each country would be able to buy all the raw materials it could pay for in international markets. In a world subject to protectionism things happen in a very different way: in this world the problem of raw materials cannot disappear; and for small countries, that is those that are weaker militarily, having mines or a fertile soil within their borders represents a danger.

All arguments regarding the advantages of peace, international cooperation, the creation of a society of nations and the reconstruction of the world economy are hollow words if there is the intention of preserving protectionism. If one is not willing to renounce economic nationalism, small states will lose their autonomy and become the vassals of strong militaristic states. Coalitions of Great Powers, armed to the teeth, will confront one another and take advantage of any momentary weakness of their adversaries to undertake new campaigns of conquest.

It is necessary to understand that this new World War (as well as the First World War) is not the consequence of a natural catastrophe unleashed upon innocent men; rather, it is the inevitable result of the nationalist economic policy pursued in the preceding decades. In a world were free trade prevails, despite the dynamism of Hitler or Mussolini, reaching a state of war would not have been possible. Evil men will always exist; however, it is important to create an economic order in which their power to do harm is reduced to a minimum.

In summary, without the eradication of economic nationalism, it will not be possible to return to peace and wellbeing.

III

The main problem of the postwar era will be general poverty; that is, the shortage of capital.

In the last decade, politics seemed uninterested in the problem of formation and maintenance of capital. Governments acted as if the availability of greater or lesser amounts of capital for production had no importance for the wellbeing of the people. Through their policy of taxes and public spending, these governments not only slowed down the formation of capital but also ¾ at least in recent years and in many countries ¾ caused the consumption of available capital. Thus, they did not practice a policy aimed at increasing general prosperity and raising standards of living but one aimed towards the impoverishment of the people. After the end of the current war, it will not be possible to maintain this policy unless we deliberately seek the destruction of what we nowadays call Western Civilization.

What made possible the development of this civilization, the greatest that has ever existed, was precisely, at least regarding economics, the continued accumulation of capital goods. In the days before this time of world wars and dictatorships, a greater number of people lived, including in this Western Civilization, than in the days before the Industrial Revolution; and each of these men lived much better than their ancestors a century or two before. Each year brought rising living standards for the masses; each year, new products became available for the average man, which made his life healthier, more agreeable, and more stimulating. Contemporary men would find the life of the nobility in pre-capitalist times indignant, not to mention the living conditions of the commoners.

All of these increases in living standards are due to the fact that, year after year, production exceeded consumption. The surplus was gathered and invested; that is used to develop the production apparatus. In this way, means of transportation were developed and new installations were created to achieve a better and cheaper production of all sorts of goods for consumption. The individual labor of each man yields more today because, for a given quantity of labor, there is a much greater quantity of capital goods than before. Thus, the marginal productivity of labor has been growing and, consequently, real wages have increased. If the standard of living of the masses has increased, it was because the supply of capital in the economy surpassed population growth.

But the masses did not only benefit from the increase of real wages: the modern organization of financial techniques, of systems of credit and of joint stock companies enabled these very masses to become owners of capital. Most holders of deposits in saving banks, bonds and insurance policies are even members of the working class. In a capitalist state, thrift and the formation of new capitals are not the privilege of a minority, but are generalized; and their fruits, in one way or another, benefit everyone.

Governments and politicians have refused to recognize that the increase of capital is the lifeline of economic progress; on the contrary, they made everything they could to take away people`s desire for thrift. They confiscated part of that capital through taxes and impaired small savings by means of inflation. They carried out expropriations thus eroding the stocks of capital that had been achieved.

As an example, we can mention the way Hitler acted in relation to German railroads in the Reich. A long time before the First World War, diverse German states ¾ Prussia, Bavaria, etc. ¾ bought railroads built with private capitals, paying for them with bonds. Since these bonds lost their value due to inflation, in a way, the Government acquired these railroads for free. Hitler managed this vast supply of capital, equivalent to more than 60,000 kilometers of rail, in the most irresponsible way. He did not substitute vehicles (locomotives and railcars) that had been worn out by use, nor did he maintain rails and signal equipment as it would have been convenient; he also completely unattended fixed equipment. The situation is similar in the railroads of southern and eastern Europe. When the current war is over, the greater part of the railroads of Europe will be a heap of stones and scrap metal. In this way, capital worth thousands of millions has been consumed in the strictest sense of the word.

The destruction of capital caused by the war far surpasses that which happened before the war. When the struggle is over, we will see everywhere huge installations dedicated to the production of arms and other materials for war, however these installations cannot be utilized for the production of the goods that are required in peacetime. The capital immobilized in them will be lost and, instead, there will be lack of capital where it is most necessary. Old installations meant to produce goods necessary in peacetime will be useless, either because they have been converted to serve the needs of rearmament, or because they have been ruined after several years of disuse.

IV

What could we do to alleviate this shortage of capital as quickly as possible?

There is only one solution: to produce more than what is consumed; that is, practice thrift and, in this way, form new capital. The more one produces, and the higher the proportion of that production that is invested rather than consumed, the sooner the hard times of capital shortage will be over. All those that propose solutions different from the one explained above are either fooling themselves or trying to fool others.

There are no magical financial procedures to remedy the shortage of capital. The expansion of credit cannot alleviate it and much less, suppress it. On the contrary, the boom artificially produced by the expansion of credit creates distortion and, therefore, a waste of capital by immediately promoting overconsumption; that is, the reduction of capital. Inflationist experiments will only make the ailment worse. What is necessary in this case is, precisely, a monetary and credit policy that guarantees the stability of monetary value.

Governments will have to renounce to all confiscatory measures: they will have to radically change their tax policy.

In many countries, taxes on rent and inheritance have been transformed into ill-disguised measures of confiscation. The continuity of this system is not compatible with the existence of private property and is pointless unless we wished to transit to a communist regime and make standards of living fall to the permanent state of misery that prevails among the Russian masses. Within the limits of a non-communist system, these measures only produce an effect of immobility and destruction. They stimulate the consumption of capital since; what logic is there in thrift for a man who knows that only a small part of his inheritance will go to the hands of his children?

If we wished to preserve an income tax, it would be necessary to transform it into a tax on consumed rent. Incomes that are not consumed, but saved and invested, should be exempt from all taxation since it is of public interest to form as much new capital as possible.

All large corporations are developed through the consumption of only a small part of their profits and the investment of the rest. Due to the simultaneous existence of national and local duties, the current system increased the taxation of larger incomes to rates of 100% or more. This system makes it impossible to create new industries or develop those that already exist. For the benefit of the North American people, the development of corporations that supply markets with a variety of cheap goods did not stop some years ago; however, current efforts to prevent new competitors from emerging cause harm to consumers while granting unjustified protection to the incapable heirs of existing corporations. Tax legislation, considered by its supporters to be in favor of the people, only produces the antisocial effect of hindering the supply of consumer goods.

The decrease of government revenue, as an inevitable consequence of these reforms in the tax system, must be compensated with the restriction of public spending. It is necessary to break free, once and for all, from the illusion that the State has money for everything and everyone. The State cannot give to somebody what it has previously not taken away from others. In order to plan the State’s expenses, it is necessary to carefully assess whether the profits to be obtained from the desired expense are more beneficial than the required increase in taxation and its economic consequences are harmful. It will no longer be possible to give away subsidies or issue bonds to finance the reelection of members of parliament. It will be necessary to return to the economic management of old parliaments, which understood that an ordered budget is preferable to the supposed happiness of leveled budgets.

Capital shortage will probably be less severe in the United States of America than in the British Empire and less oppressive there then in the European continent. In central, eastern and southern Europe, the situation will be completely catastrophic. The industrialized nations of Europe, the most densely populated places on earth, cannot feed their people without exporting the products of their industry, which are largely manufactured from imported raw materials. Those countries will be forced to compete in global markets with their industrialized products and this will not be done successfully unless they rebuild their apparatus of production, which was destroyed by hostile policies towards capital in the previous era and by the war itself, to the levels of capital that existed before the outbreak of the war. They will have to completely renovate their transport infrastructure and the machinery of their factories; in other words, completely address all the problems of industrial production again. But before achieving it, they will have to endure years or decades of hunger and misery.

It is clear that, in these circumstances in Europe, particularly in central and southern Europe, the activities of labor unions will not be possible for a long time. The tendency of labor unions to forcefully obtain higher wages and shorter working hours for their members, through unionist means, must be forgotten wherever capital is completely lacking. Workers will have to satisfy themselves with a job that can protect them from misery. To whom will they address their complaints in a country where there is no capital to set industry in motion? Low salaries, low standards of living, and a general decline of culture: these are the sad but inevitable consequences of the shortage of capital.

When they notice the pitiful luck of their European peers, North American workers must realize that they have effective means to remedy the situation: opening up American borders to European immigration would create a tendency to equate the level of European wages to those of the United States. However, if restrictions to immigration persist, wages in Europe, where natural conditions of production will be worst and capital shortage most acute, will be much lower than those in North America.

Thus, it is clear that, after the war, the shortage of capital will produce radical changes in domestic policy. Now we shall examine what the consequences will be regarding foreign policy.

V

The development of international markets for capital and currency during the 19^th century was a great achievement of far reaching worldwide political consequence. The peoples of Western Europe, which where the first to create political and economic institutions favorable to the formation and conservation of capital, made part of their wealth available to less favored nations through a system of credit. The excess savings of Europe where invested around the world and helped the peoples of Eastern Europe and Asia overcome their state of economic backwardness; it also provided Americans and Australians with the means necessary to exploit the riches of their land. European culture provided all humanity, not only the fruits of modern technique, but also the material means to transform the economy according to the demands of modern technique. Billions poured from Europe (and later also from the United States) to all the countries of the earth and, as payment, European capitalists, men of business and thrift, received property rights and industrial values.

This international organization of credit is now in ruins; the same countries that, once, prospered because of it have destroyed it. Neither the debts’ interest nor their principals were paid either because debtors openly defaulted on their obligations or because governments cancelled the rights of creditors through inflation or currency controls. Businesses belonging to foreigners were expropriated or taxed in such a way that their owners where left with nothing but hollow legal titles. Creditors and foreign capitalists have been completely dispossessed of their rights.

In these circumstances we cannot expect that, after the war, the least ruined countries will make their capital available to the most ruined. The experience of capitalists and businessmen, regarding the concession of credit and participation in foreign ventures, is sufficiently explicit for them to feel inclined to expose themselves to the dangers of such adventures. Maybe the United States, motivated by old friendships, will invest some capital in Anglo-Saxon countries or in Mexico, as help to a neighbor. However, even this is doubtful since American trade unions tend to regard exports of capital as contrary to their interests and, therefore, demand measures aimed at preventing them. In any case, it is certain that other peoples will not expect foreign capital, to help rebuild their economies, unless the dire condition of foreign capitalists changes radically.

Energetic reforms in international law are necessary to set the international mechanisms of capital and credit in motion again. Only states willing to accept great restriction on their sovereignty can hope to obtain credit or direct investment from abroad. In all matters related to foreign capital, these states will have to renounce their autonomy in favor of the Society of Nations; that is, in all that affects monetary and credit policy as well as mercantile and fiscal powers over foreign capital, they will have to submit unconditionally to the jurisdiction of international courts and tolerate the decisions of those courts to be executed through an international coercive power.

Undoubtedly, all this may seem very strange and the leaders of most states will simply consider it unacceptable. But, above all, it is necessary to consider two things: firstly, every state will be free to submit or not to these conditions and to accept or decline the assistance of foreign capital; secondly, it is inevitable to liquidate a conception of state sovereignty that is no longer in harmony with current circumstances. In no way is it possible to accept that cases such as those of Austria, Albania or Ethiopia can repeat themselves. Great Powers must award effective protection to small states from violations such as these. The ambitions of states that secretly practice a policy of rearmament must be contained through an international police force. It will be necessary to treat governments that disturb the peace in the same way as bandits and murderers are treated within states. By establishing such a system, restrictions of sovereignty regarding financial and fiscal policy will not seem intolerable and much will have been gained.

However, we must point out that all these measures will not be able to completely remedy the shortage of capital. What may be achieved is a more equitable distribution of existing capital and with this much will have been gained.

VI

After the current war, the world will not be a paradise. Men will be poor and have to endure the spiritual and moral consequences of poverty.

Not all peoples will suffer in the same way the consequences of war. Latin American countries will probably be among the least affected ones. Thus, their backwardness in relation to Anglo-Saxon countries will be compensated in part. A new era will begin in which the handicap of Latin America will be smaller.

The supposed backwardness of Central and Southern America, that always made ordinary Cook tourists smile compassionately, was only due to the shortage of capital in those countries. Since capitalism reached Latin America two centuries late in relation to other countries, certain institutions familiar elsewhere were lacking in the region. The low level was not moral or intellectual: it was nothing else than a relatively higher shortage of capital.

But now, more or less, all countries will begin again; and, therefore, with the passing of the years, these differences may gradually fade. Through a wise economic policy, it may be possible that Latin American countries can conquer the place in the World Economy to which they are predestined by the genius and industry of their citizens and the wealth of their land. 

Ludwig von Mises was the acknowledged leader of the Austrian School of economic thought, a prodigious originator in economic theory, and a prolific author. Mises's writings and lectures encompassed economic theory, history, epistemology, government, and political philosophy. His contributions to economic theory include important clarifications on the quantity theory of money, the theory of the trade cycle, the integration of monetary theory with economic theory in general, and a demonstration that socialism must fail because it cannot solve the problem of economic calculation. Mises was the first scholar to recognize that economics is part of a larger science in human action, a science that he called "praxeology."

A eterna luta entre o comerciante e o burocrata - Guglielmo Palombini (Mises Institute)

The Eternal Struggle Between the Merchant and the Bureaucrat

• 

Guglielmo Piombini 

Translated from the Italian by Bernardo Ferrero

[This article has been translated from Piombini's Italian original by Bernardo Ferrero.]
https://mises.org/blog/eternal-struggle-between-merchant-and-bureaucrat

Before the State

For a very extended period of time primitive men lived in small groups of hunters and gatherers at a time in which there was no state. The modus vivendi of these clans was such that after having exhausted all nature-given resources in a particular area, they would move elsewhere in search of other available food supplies. This system of nomadic life could endure as long as the human race was limited and the vast majority of land remained uninhabited. Yet, this lifestyle was not sustainable, and within a short period of time the intensification of these hunting activities provoked an ecological crisis that spread across Europe, the Middle East and America, causing the extinction of 32 animal species [that had been an important food source].
The disappearance of the megafauna inaugurated, around the year 10,000 B.C. the transition to a mode of production based on agriculture. The Neolithic revolution could in fact be described as the pragmatic response to the exhaustion of resources that resulted from the intensified exploitation of the system based on hunting and gathering. Even though the lives of the farmers were admittedly harder than those of the hunters, requiring long and heavy hours of labor in the fields, the sedentary life of the village made it possible for a far greater number of mouths to be fed: thanks to appropriations and to the cultivation of land, the human population increased considerably, giving birth to the first civilizations.

The Violent Origins of the State

According to historian William Durant:

Agriculture teaches men pacific ways, inures them to a prosaic routine, and exhausts them with the long day’s toil; such men accumulate wealth, but they forget the arts and sentiments of war. The hunter and the herder, accustomed to danger and skilled in killing, look upon war as but another form of chase, and hardly more perilous, when the woods cease to give them abundant game, or flocks decrease through a thinning pasture, they look with envy upon the ripe fields of the village, they invent with modern ease some plausible reason for attack, they invade, conquer, enslave and rule.

The first states emerged when these nomadic tribes of hunters and herders understood that the systematic exploitation of agricultural villages through taxation constituted a far more efficient and lucrative system than the old one of plunder and extermination. That the state was born in a brutal fashion is confirmed by every historical and anthropological research. On this matter, Friedrich Nietzsche wrote:

a race of conquerors which, aggressive, powerful and organized, pounces with its most horrid claws on an unsuspecting population, one which in numbers may be tremendously superior, but is still undisciplined and nomadic. Such is the origin of the ‘"state."

According to Sociologist Lester Ward,

The state as distinct from tribal organization begins with the conquest of one race by another.

Similarly, wrote the Austrian general and sociologist Gustav Ratzenhofer,

Violence is the agent which has created the state.

and as Franz Oppenheimer observed,

Everywhere we find some warlike tribe breaking through the boundaries of some less warlike people, settling down as nobility, and founding its state.

The concept of State above mentioned is meant in a sociological, rather than in a political sense. In the field of political science one intends the state to be a particular type of political organization that emerged in Europe at the end of the middle ages. According to the more generic definition used in sociology, instead, one talks about the existence of a state whenever society is divided in two distinct classes: a productive majority who gets by through the employment of economic means (production and exchange) and a ruling elite who gets by through the employment of political means (taxation and expropriation). The typical order of a state and the inevitable division in social classes which defines it emerge simultaneously, according to sociologist Franz Oppenheimer, in that very crucial historical instant in which for the first time the conqueror decides to save the conquered from immediate annihilation in order to exploit him permanently in the years to come.

The Struggle between Merchants and Bureaucrats Begins

From that moment onwards, writes the anthropologist Marvin Harris, producers have precipitated in a dramatic condition of servitude from which they have never really escaped:

For the first time there appeared on earth kings, dictators, high priests, emperors, prime ministers, presidents, governors, mayors, generals, admirals, police chiefs, judges, lawyers, and jailers, along with dungeons, jails, penitentiaries, and concentration camps. Under the tutelage of the state, human beings learned for the first time how to bow, grove, kneel and kowtow. In many ways, the rise of the state was the descent of the world from freedom to slavery.

The birth of the state was then accompanied by a real class struggle between producers and bureaucrats, a struggle which to a great extent remains alive to this day: while the first group desires to keep the fruits of its own labor, the second aspires to come into possession of those fruits through force and inaugurate a system of rule and exploitation. The eternal conflict throughout history is therefore that between men of freedom and men of administration, between social power on the one hand and state power on the other. As will be illustrated in the examples that follow, the progress or decadence of civilization are determined by the trend of this struggle.

Societies of Bureaucrats

1. The Ancient Empires
Since the early days of recorded History, the great majority of people lived miserably under the most tyrannical empires (the Babylonian, Egyptian, Chinese, Persian, Indian, Late-Roman, Arab, ottoman, Incas, Aztec) which extended themselves across large areas. In these ancient empires progress was so slow as to go unnoticed and the reasons for such stagnation were the following: Political power in those empires did not have any need to innovate, rather innovation was fought due to the fear that new discoveries would disrupt the established system; the bureaucratic and military elite that ruled used to come into possession, through force, of every surplus of production repressing every small sign of resistance; every autonomous social force was nipped in the bud and nothing escaped the control of the despot who was the absolute owner of all goods of the reign and of all its inhabitants; finally the people were submitted not only to a confiscatory level of taxation but to forced labor for the construction of grandiose public works such as canals, city walls, pyramids and buildings.
These ancient empires were agglomerates of illiterate peasants who toiled from the morning to the night just to be able to provide for themselves vegetables without protein. Not surprisingly, they were not in a much better condition than their oxen, and at the same time they were completely subjugated to the commands of their superiors who could read and who were the only ones possessing the right of manufacturing and using war like instruments. The fact that these societies have lasted thousands of years sounds like a severe warning: there is no intrinsic force to human activities that can assure material and moral progress.
2. A Perfect Example: the Chinese Empire
The millenary empire of China can serve as a typical example of a closed society, that was completely dominated by a cast of intellectuals and bureaucrats. As the greatest historian of ancient China, Etienne Balasz, has explained, the Confucian state was decisively totalitarian. No private initiative was allowed and no expression of the public life could escape official regulation: clothing, private and public constructions, music, parties, and even the colors that one was allowed to wear were subject to the rigid control of the state. In addition, there were prescriptions of birth and death and the state surveilled with terrifying attention every step of its subjects, from the cradle to the grave.
China in the days of the mandarins was an environment of changeless patterns, routines, characterized by traditionalism and immobility and therefore suspicious towards any possible kind of innovation and initiative, let alone free research and entrepreneurship. The ingenious and inventive spirit that was not foreign to the Chinese would have doubtlessly enriched the country, but it was the state that impeded the country to embark upon an age of technical progress and economic development, by crushing every kind of private initiative just because it was thought to collide with the interests of the bureaucratic cast.
It is not surprising that throughout Chinese history technical and economic progress have coincided only with those phases of relative weakness of the central power, like in the period of the warring states (453-221 B.C), probably the richest and most brilliant of all Chinese history, or the period of the three reigns (220-280 A.D.). Even after 907 A.D. when the Tang dynasty collapsed and the period of endless wars for supremacy began, during the so-called period of the five dynasties and the five reigns, the country experimented a striking explosion of inventions and prosperity due to the lack of centralization.
3. A Modern Case: The Soviet Union
In our epoch, communist regimes have brought back, albeit in a bloodier form, the totalitarian control that was so characteristic of the ancient oriental despotisms. Marxist ideology with its radical hostility towards property, commerce and free enterprise, revealed itself to be the most suitable paradigm in satisfying the will to power of the parasitic classes. In every country where the political and bureaucratic classes have sought to destroy the productive sector, they have found it useful to uphold Marxist ideology as their mantra.
The extreme exploitation perpetrated by the communist bureaucracies against the productive classes, which in the case of the kulaks reached the stage of physical extermination, was denounced by Lev Trotzkij, Ante Ciliga, Milovan Gilas, Mihail Voslensky. Yet the most penetrating and most insightful analysis of the bureaucratic exploitation that took place under communism has come to us from the works of Bruno Rizzi, an ingenious, self-taught Italian scholar. Rizzi was arguably the first to comprehend that a parasitic class of bureaucrats had taken power in 1917, composed as he wrote of “state officials, policeman, writers, union mandarins and all the communist party in block” that kept plundering the workers in the most ferocious way ever to be seen.
The post-1917 Soviet State, Rizzi noted, had been drastically inflated. The bureaucrats with their respective families constituted a mass of 15 million people who had stuck to the upper levels of the administrative throne with the only job of sucking a great portion of the national product. In the Kolchoz, the state owned agricultural enterprises, only 37% of production remained in the hands of the workers, while the remaining went to the state who then turned it over to the bureaucracy. State functionaries, in addition, continuously made deals at the expense of ordinary citizens by fixing wages and prices for various products and by treating the “workers” as its “forced clients”, obliging them to acquire products in state owned stores with a markup that at times reached 120%.
Officials of the state in addition, obtained notable advantages by being able to destine many of the accumulated capital funds, set aside for the construction of public works, in projects that went to the exclusive benefit of their own class, a lucid example being the headquarters of the bureaucracy, the sumptuous 360 meter’s tall house of the soviets (the workers, meanwhile, had to cope with a home that was 5 meters squared on average). By having total control of the economic levers, guaranteed by an extremely invasive police state in the USSR, the bureaucracy was really omnipotent and every action on her part was aimed at maintaining its political hegemony and its well-established economic privileges.

Societies of Merchants

1. The Phoenicians and the Greeks
Around the year 1200 B.C. the empires of the bronze age (the Egyptian, Minoan, Mycenaean, Hittite and Assyrian empires) succumbed into a period of stagnation caused by the progressive suffocation of productive and mercantile activities. The crisis of the central powers gave freedom of action to certain commercial people in the Middle East coming mainly from modern Lebanon, who, with their ships, began to sail the sea transporting goods and products of any kind. For the first time in history one saw the development, in the Mediterranean basin, of a catallactic system based on an integrated division of labor where markets and ports began to grow up to the point of becoming established cities. Commerce soon became the fly wheel of innovation: The Philistines invented iron; the Canaanites the alphabet; the Phoenicians discovered glass and at the same time improved boats, navigational knowledge and accounting systems.
“In truth, writes Matt Ridley, was there ever a more admirable people than the Phoenicians?” Those ancient merchants connected not only the entire Mediterranean, but also the accessible coasts of the Atlantic, the Red Sea and the overland routes of Asia, and yet they never had an emperor and never participated in a memorable battle. In order to prosper the Phoenician cities of Tyre, Byblos, Sidon, Carthage and Gadir did not feel the need of uniting into a single political entity, and therefore never went beyond a very modest federation.
In the words of Matt Ridley:

The Phoenician diaspora is one of the great untold stories of history- untold because Tyre and its books were so utterly destroyed by thugs like Nebuchadnezzar, Cyrus and Alexander, and Carthage by the Scipios, so the story comes to us only through snippets from snobbish and envious neighbors.

Even the Greek miracle confirms the important lesson, first formulated by David Hume, that political fragmentation, by putting a break on the extension of political power, is the real ally of economic progress. The extraordinary dissemination of prosperity and of Greek culture between the years 600 B.C. and 300 B.C presents us with a development similar to that of the Phoenician cities: Miletus, Athens and the other hundred independent cities of Magna Grecia, enriched themselves through the extension of commercial relationships without being part of a single empire. Furthermore, the circulation of ideas that the increased trade made possible, gave birth to the grandiose discoveries of the time. The lesson of the Greek miracle is the following: It is always the merchant who opens the door to the philosopher, not the other way around, by enriching the city and opening it, through foreign trade, to new ideas. Unfortunately, this period of Greek enlightenment died out as soon as new empires began to ascend: first the Athenian, then the Macedonian, and ultimately the Roman.
2. The Communes of Medieval Europe
The fall of the Roman Empire in 476 A.D. represented the luckiest event in the history of the old continent. Thanks to circumstances that one could describe as miraculous, Europe never returned to being a unified political entity, after the repeated failures of Charlemagne and the Germanic emperors. The lack of political unity enabled a widespread social experimentation that unleashed into a creative competition between thousands of independent political units of which the byproduct was rapid economic, social and cultural progress. The weakness of the central authority favored the cities which became the leaders in the 11^th century of a political and commercial revolution that would mark the European institutional setting for centuries to come. In fights that lasted even hundreds of years, the inhabitants of the cities escaped the dominion of emperors and feudal lords, rebuilding society through self-government from the bottom up. The inhabitants of these communes oriented themselves toward the economy and not toward politics because, unlike those of the ancient cities they lacked a great mass of slaves at their disposal: they found themselves forced to abandon predation (which had been the common means of increasing one’s own well-being up to those days) and engage in manufacturing activities and commerce. In this manner, the medieval bourgeois extended the market economy beyond the limits of the feudal world and by the year 1200 A.D. Europe was a region inundated by working men, farmers, entrepreneurs, artisans and merchants who exchanged the fruits of their own labor at the many annual fairs: this was a very different scenario from the one that prevailed in other areas of the civilized world, where the masses continued to be subjugated by omnipotent imperial bureaucracies.
3. 3 Modern Cases: Holland, England, and the United States
In the 17^th century the incredible success of the little country of Holland and the disastrous ruin of the Spanish empire, stands to confirm, in the eyes of contemporary historians, the superiority of the commercial society over the bureaucratic one. In Spain, during those years, a new anti-bourgeois ideology had developed among its elite, an ideology that saw with great scorn and contempt the accumulation of wealth through value enhancing work. The Spanish bureaucratic state as a consequence began to be directed by men who were completely foreign to the world of economics and business and who pushed the country into adopting economic policies that played out to be a disaster for commerce and industry.
In the United Provinces at the time, matters were different. Laissez-faire was a consolidated and fully legitimized praxis, and the success that Holland derived from the adoption of free trade caused a mix of admiration, amazement, and envy all around Europe. In 1670, the Dutch were by far the biggest players in the international trade arena to the point that their merchant navy was bigger and mightier than those of France, Scotland, Germany, Spain and Portugal put together. Holland, in the 1600s was a laboratory in which one could observe and study the capitalistic and bourgeois society in its purest form. Its example showed the path toward self-propelled development: ignoring the Dutch reality meant condemning oneself to continued stagnation.
The English were the first to understand how the prosperity of Holland was closely connected to the liberty that individuals and economic agents enjoyed over there, and it was by imitating the Dutch, that they began to build the basis of their world supremacy. In the 19^th century then, England adopted unilaterally a series of measures that opened its harbors to the rest of the globe and such a drastic and unprecedented move provoked a reduction of custom tariffs in all major countries, via a competitive process. Finally, humanity was able to experience the birth of a free and authentic market economy that operated internationally: a Phoenician experiment on a planetary scale. Each country that participated in this international division of labor benefited, and this is shown by the fact that the world economy throughout this period grew by 3 times. But It was in the two most free-market countries, namely England and the United States, where economic growth surpassed by far that of the rest of the world: from 1820 to 1913 the gross domestic product of England increased six-fold, while the American one grew by 41 times.
Decisive for the success of Victorian England and the young United States, according to economic historian Deirdre McCloskey, was the consolidation at the social level in those years of a bourgeois mentality that praised and honored the common man who created his fortune through work, commitment, creativity and ingenuity. Nothing probably better symbolizes the cultural victory of the productive classes of society than the statue placed in Westminster abbey in 1825 in honor of James Watt, inventor of the steam engine.

For a Libertarian Historiography

One can therefore see how the great intellectual and material creations that have elevated human civilization through the ages have not been the product of bureaucrats, but of producers, merchants, entrepreneurs, some of whom have been obscured, exploited, mistreated and others who have simply been forgotten. The protagonists of human development are not the emperors, kings, presidents, ministers or generals who most often appear in our conventional history books, but the farmers, artisans, entrepreneurs and merchants who improved the many arts, techniques and professions. The bravest among these have defended freedom and civilization arms in hand, refusing to be subjugated by the powers of their day.
The common thread in human history is the endless conflict between tax payers and tax consumers which brings us to the following conclusion: Libertarian scholars should narrate historical events through the lenses of those men who represented the ideas of freedom, not those of power. Civilization, ought to be remembered, has been edified by those men who have resisted power, not by those who have exercised it.

Guglielmo Piombini is an Italian journalist who has collaborated in various magazines and newspapers including Liberal, il Domenicale, and Elite.  His articles have also appeared at Ludwig von Mises Italia. Piombini is also the founder of Tramedoro: the online platform that provides a detailed overview of every major classic of the social sciences. Specializing in medieval institutions he is the author of the book “Prima dello Stato, il medioevo della liberta” (“Before the State: The Middle Ages Of Liberty”). 

World War I and the Triumph of Illiberal Ideology - Matthew McCaffrey (Mises)

World War I and the Triumph of Illiberal Ideology

• 

Matthew McCaffrey

Mises Daily, 08/14/2017

Just over a century ago, in August 1914, the major European nations plunged their peoples into one of the most disastrous conflicts in history. The First World War claimed at least seventeen million lives, destroyed the social and economic fabric of Western Europe, and played a vital role in the expansion of state power around the world. It is therefore difficult to exaggerate its importance.
The causes of the war are too many and too complex to discuss in a short article (however, for those interested, the late Ralph Raico provides a fascinating overview here). I will discuss only one general problem that helped fuel the catastrophe: the ideological shift that occurred in Europe in the late 19^th and early 20^th centuries away from the liberal philosophy of laissez-faire and laissez-passer and toward autarky, protectionism, nationalism, and imperialism. Mises, himself a veteran of the First World War, identified these latter ideologies as joint causes of numerous conflicts. Furthermore, he repeatedly warned that war is a necessary outcome of abandoning economic freedom, which is inextricably tied to the spirit of liberalism and its philosophy of peace:

Aggressive nationalism is the necessary derivative of the policies of interventionism and national planning. While laissez faire eliminates the causes of international conflict, government interference with business and socialism create conflicts for which no peaceful solution can be found. While under free trade and freedom of migration no individual is concerned about the territorial size of his country, under the protective measures of economic nationalism nearly every citizen has a substantial interest in these territorial issues. (Mises, 1998 [1949], pp. 819-820)

Economic nationalism, the necessary complement of domestic interventionism, hurts the interests of foreign peoples and thus creates international conflict. It suggests the idea of amending this unsatisfactory state of affairs by war. Why should a powerful nation tolerate the challenge of a less powerful nation? Is it not insolence on the part of small Lapputania to injure the citizens of big Ruritania by customs, migration barriers, foreign exchange control, quantitative trade restrictions, and expropriation of Ruritanian investments in Lapputania? Would it not be easy for the army of Ruritania to crush Lapputania’s contemptible forces? (Mises, 1998 [1949], p. 827)

By and large, these are the kinds of international conflicts that developed in the decades prior to 1914. As relative free trade declined and imperialism flourished, a culture of militarism swept Western Europe, triggering a race to accumulate military assets and materiel on a previously unknown scale.  By the outbreak of the conflict, every major belligerent except Britain had also adopted conscription so as to ensure an abundant supply of human as well as physical resources. Such policies could only end in disaster.
It is important, however, that even though many soldiers were compelled to fight, extraordinary numbers also volunteered for service, especially in the early days of the war. This fact is not so astonishing once we acknowledge the role of ideology. Throughout the 19^th century, the nation-state had come to play an increasingly important role in forming the identities of many young European men. This development added a personal ideological dimension to warfare that was largely new, and which also created divisions along political lines among peoples who could otherwise have been at peace. It also helps explain the patriotism and nationalism that lead so many volunteers so unwittingly to the slaughter. Crucially, these sentiments were nurtured and reinforced by many important institutions of European society, especially its intellectual classes, who bear a large portion of the blame for rationalizing and glorifying war.
To take only one example, in his book A History of Warfare, John Keegan recounts a call to arms issued jointly by the rectors of the Bavarian universities on August 3^rd, 1914:

Students! The muses are silent. The issue is battle, the battle forced upon us for German culture, which is threatened by the barbarians from the East, and for German values, which the enemy in the West envies us. And so the furor teutonicus bursts into flame once again. The enthusiasm of the wars of liberation flares, and the holy war begins. (quoted in Keegan, 2004 [1993], p. 358; emphasis in original)

This passage hints at the ideological climate in much of Europe after its retreat from an all-too-brief trend toward liberalism. Yet even including the melodramatic rhetoric, the ideas invoked above are indistinguishable from ones made today by both military and culture warriors. The use of religious language to frame a political conflict, the idea that war has been forced upon the blameless, and the claim that barbarians from foreign nations represent an existential threat to civilization that can only be overcome by abandoning reason and resorting to violence based on appeals to tribalism and a (different) barbarian heritage, are still familiar in an age when the European empires have been replaced by an American one. They also run strongly counter to the principles of liberalism.
Historically, the immediate result of the rectors’ appeal was the mass enlistment of German students; so many volunteered that they formed two new army corps. These men were flung almost untrained into battle against British regulars at Ypres in October, 1914, where 36,000 were massacred in only three weeks (Keegan, 2004 [1993], pp. 358-359).[1] This senseless death did not, however, serve as a rebuke to the military class, much less provide an impetus away from international and domestic conflicts; instead, it was simply mythologized and used for propaganda by the Nazis in the Second World War.
The lesson then is that the human costs of war do not in and of themselves teach anything to those who are not willing to listen. War will not cease until the ideas that support it are removed, and until they are, their costs will simply be used as justifications for further conflict. In Mises’s words, “To defeat the aggressors is not enough to make peace durable. The main thing is to discard the ideology that generates war” (Mises, 1998 [1949], p. 828).

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[1] I have been unable to verify this estimate, and other sources suggest the number killed was significantly lower. In any case though, casualties were horrific.

1454) Impasses da Rodada Doha

O questionário que figura abaixo me foi submetido em julho de 2008, e se destinava a alimentar um Trabalho de Conclusão de Curso para estudante do CEABE-FGV-SP.
Verifico agora, que passados 15 meses das respostas fornecidas, pouca coisa mudou no cenário das negociações comerciais multilaterais. Resolvi, assim, tirar o inedetismo desse texto e publicá-lo neste meu blog, sem qualquer revisão ou mudança. Ele é divulgado tal como foi escrito, como sempre rapidamente, originalmente.

Impasses da Rodada de Doha
Paulo Roberto de Almeida
Brasília, 5 julho 2008
Respostas para elaboração de Trabalho de Conclusão de Curso para estudante do CEABE-FGV-SP

1. Em sua opinião, quais são os principais motivos para o impasse da Rodada de Doha?
PRA: De um lado, falta de capacidade dos países ricos em desmantelar seu arsenal de medidas protecionistas e seus mecanismos de subvenção na área agrícola, e, de outro, falta de vontade ou oposição política dos países em desenvolvimento em superar o protecionismo latente exercido em produtos industriais e em certas áreas de serviços. Adicionalmente, estes têm problemas em liberalizar amplamente os investimentos estrangeiros e aceitar normas mais intrusivas em propriedade intelectual e os países ricos ficam insistindo em criar novas regras de proteção a pretexto de defesa do meio ambiente ou como proteção a direitos trabalhistas e respeito a certas normas laborais. Nos dois casos, sentimentos protecionistas em ambos lados, submissão à ação de lobbies setoriais nacionais e desejo de continuar legislando em políticas setoriais, com práticas discriminatórias em várias áreas.

2. A atual crise econômica internacional pode emperrar ainda mais as negociações de Doha?
PRA: Pode, na medida em que reforça os elementos nacionais, discriminatórios, das políticas comerciais e industriais, com tentativas de defesa do emprego ou dos mercados nacionais. Por outro lado, como os preços dos alimentos encontram-se em patamares elevados, talvez isso diminua a necessidade de subvenções estatais, o que teoricamente poderia facilitar compromissos. Mas, agricultores chantagistas e políticos “espertos” alegam que, assim como os preços subiram, eles podem baixar, e portanto não têm a intenção de desmantelar o arsenal protecionista e subvencionista.

3. As nações desenvolvidas têm fortes políticas de subsídios à agricultura, pois alegam que alimentar sua nação é questão de segurança nacional e não de livre comércio. Porém , tais políticas desestimulam a produção de alimentos em países em desenvolvimento e distorcem os incentivos da produção e o consumo. Qual deveria ser a política da OMC em relação aos subsídios?
PRA: A OMC não tem uma política própria, pois não pode legislar por sua própria conta. Se pudesse, assim como outras entidades voltadas para a definição de políticas públicas em diversas áreas (como a OCDE, por exemplo), deveria simplesmente decretar a ilegalidade dos subsídios para fins comerciais, como ocorre na área industrial. Acontece, porém, que esses subsídios agrícolas foram legalizados na Rodada Uruguai, com a aprovação do acordo agrícola; agora fica mais difícil proibi-los. Em todo caso, a ministerial de Hong-Kong já acordou banir os subsídios à exportação de produtos agrícolas a partir de 2013, embora em condições e modalidades que não estão ainda de todo claras, pois algum “rebalancing” com tarifas diferenciadas e o recurso a medidas de exceção continuam à disposição dos países.
Essas políticas são claramente danosas aos países em desenvolvimento mais pobres, pois lhes retira qualquer possibilidade de se inserir na economia mundial com base em suas únicas vantagens comparativas possíveis no plano do comércio internacional, que seria a oferta de bens agrícolas em condições competitivas (ainda que isto não pudesse ser feito numa primeira fase).

4- Muitos analistas afirmam que o maior problema está entre o Brasil e os EUA, pois ambos não querem abrir mão de seus direitos nas negociações. Você considera que os dois países são realmente os pilares para o atraso de Doha?
PRA: Não; esses dois países foram responsáveis pelo desmantelamento das negociações da Alca, no plano hemisférico, mas os pecados que estão sendo cometidos em Doha envolvem um número bem maior de países. Praticamente todos são em grande parte responsáveis, embora as responsabilidades principais estejam, justamente, com os protecionistas agrícolas, de um lado (e aqui vale tanto para EUA e UE, como Japão, Coréia, Suíça, Noruega, China e India, além de vários outros em desenvolvimento), e de outro com os protecionistas industriais, Brasil e India em primeiro lugar, mas vários outros em desenvolvimento também. Registre-se que a posição da UE não é uniforme, pois alguns países querem a liberalização agrícola (Reino Unido), ao passo que outros lutam pelo mais amplo protecionismo (França).
Pecados devem ser uniformemente distribuídos entre os pecadores...

5. O single undertaking, um importante fato conquistado na Rodada do Uruguai poderá ser perdido, devido aos problemas de Doha?
PRA: O single undertaking não deve ser tomado como um princípio sagrado, inscrito nas tábuas da lei, como são, por exemplo, as regras do GATT. Trata-se de uma norma não escrita, ou seja, acordada entre os ministros para facilitar uma aceitação geral por todos. Teoricamente isso permite o exercício do direito de veto por qualquer país membro, por menos importante que seja. Na prática, sabemos que as coisas não se passam assim. Depois que os grandes parceiros comerciais conseguem chegar a um acordo entre eles, eles torcem o braço dos menores e os obrigam a aceitar os seus “compromissos”, ou seja, enfiam goela abaixo dos menos importantes regras que eles mesmos traçaram para eles. Como não há um processo decisório estritamente definido no GATT-OMC, não se sabe bem o que pode querer dizer esse entendimento único, pois ele é suscetível de diversas interpretações. Teoricamente, se deve chegar a uma situação em que todos devem se colocar de acordo sobre todos os pontos de negociação, num pacote uniforme e compacto que todos devem aceitar in totum, pois ele conterá benefícios mas também pílulas amargas. A realidade é que os acordos são construídos mediante certo consenso entre os grandes. Se algum pequeno tentar obstaculizar, pode atrasar certo tempo a conclusão do processo, mas será “convencido” a aderir.
Ou seja, não se trata de um “fato”, mas de um entendimento, que é suscetível de receber tratamentos variados segundo as linhas de força em jogo.

6. Dada as dificuldades, quais seriam as melhores soluções para que Doha seja finalizada? Deveria ser repensada a maneira de se fazer comércio internacional como mais acordos bilaterais e plurilaterais?
PRA: Nas áreas de acesso a mercados, fica difícil esse tipo de acordo, uma vez que vigem as regras de MFN e não discriminação. Pode-se pensar nesse tipo de acordo para setores específicos, como existe para a indústria aeronáutica civil, mas fica difícil para bens agrícolas e industriais.
Já existe a possibilidade de acordos regionais, administrados pelas regras do Artigo 24 do GATT ou pela Cláusula de Habilitação da Rodada Tóquio. Ver a este respeito, dentre outros trabalhos meus, um artigo sobre o minilateralismo disponível no site (link: http://www.pralmeida.org/05DocsPRA/1499Minilateralismo.pdf).
Não se concebe maneira de fazer acordos comerciais senão pela via multilateral e pela via regional, ou minilateral. O fato é que o sistema continua desagregado e fragmentado. Aparentemente vamos ter de conviver com esse regime menos do que satisfatório (second or third best).

Questões suplementares em 28.07.2008:
Complemento de respostas em 29.07.2008.

7) Se Doha não for concluída, você acredita que o sistema multilateral do comércio entraria em um colapso? O que isso significaria para o mundo?
PRA: Não entraria, mas passaria por uma fase muito difícil, com certo debilitamento dos mecanismos multilaterais de negociação e de solução de controvérsias e expansão das soluções “minilateralistas”, ou seja, acordos preferenciais ou de livre comércio entre parceiros seletivos, aumentando, portanto, o grau de discriminação comercial. Em termos globais, significa que a interdependência ativa, ou seja, o processo de globalização avançaria de forma mais lenta, e com muitas áreas submetidas a acordos restritos e parciais.

8) Para o Brasil quais seriam os benefícios de Doha?
PRA: Maior acesso a mercados para seus produtos competitivos, em especial agricultura, e maior pressão no mercado interno, com competição externa de produtos industriais, o que também é interessante, pois significa que a indústria nacional teria de fazer um esforço adicional, em termos de qualidade e preços, para se manter competitiva. No conjunto, reforço dos mecanismos dos esquemas multilaterais de acesso a mercados e de solução de controvérsias, em lugar de arbitrariedades praticadas de maneira unilateral, como ocorre em alguns setores atualmente. Os benefícios regulatórios talvez sejam ainda mais importantes do que a simples quantificação de ganhos de mercado.

9) Na sua opinião, compensa para o Brasil negociar apenas o setor agrícola e "esquecer" da indústria e do serviço? Quais poderiam ser os prejuizos e benefícios desta estratégia brasileira?
PRA: Mesmo que desejasse, hipoteticamente, não seria possível ao Brasil negociar apenas um pacote agrícola, pois os princípios (mesmo informais) que regem uma negociação desse tipo implicam que todos os países têm o direito de colocar seus interesses ofensivos (demandantes) na mesa e esperar compensação por vantagens concedidas a outros parceiros comerciais. No cômputo global, os países de pautam pela regra do “single undertaking”, ou seja, de que os resultados devem ser globalmente aceitáveis para todos, num pacote único e interrelacionado.

Paulo Roberto de Almeida
Brasília, 4 de julho de 2008
Complemento em 29.07.2008