The Moral Presumption in Favor of Free Trade

In chapter 9 of Global Justice as Global Freedom, Bas van der Vossen and I defend free trade from various attacks from various philosophers. Here’s an excerpt from the beginning of the chapter, in which we try to show that there is a moral presumption in favor of free trade, and that restrictionists bear the burden of proof. (This is a first draft, and it hasn’t been proofread. Not that I proofread anyway.)

….

The argument for protectionist measures faces a heavy burden of proof. In the previous chapter, we argued that there is a strong case for regarding the productive rights—the rights to own property, to engage in productive activity, to use property productively, and to trade on one’s own terms—as human rights. But the potential exercise of these rights, as well as the crucial interests that underlie them, don’t start and stop at the borders. Since protectionist measures aim to curtail their exercise specifically at those borders, such measures need to be shown to be justified. As we mentioned before, human rights are not immune to regulation. But such regulation bears the burden of proof.

A strong deontological argument lines up with this case for international free trade. This argument is similar to the one that underlies the case for free movement. To see this, consider this thought experiment, also similar to the Starvin’ Marvin example from chapter 5:

 

Starvin’ Marvin, Fed Ex Edition

Starvin’ Marvin, who lives in Benin, is hungry and poor. However, he makes something that people in Virginia want to buy. Imagine that unless someone stops him, Marvin will be able to trade his goods for a significant amount of money, and thus feed his family. Marvin puts the item in a Fed Ex box and sends it to his eager trading partner in Virginia. However, when it arrives at the Dulles airport, you show up, and either throw the item away or send it back. You announce that from now on, you won’t let Marvin send anything to the United States. (Or, alternatively, you say that you’ll let people in the US buy things from Marvin, but only if they or Marvin first pay you $1000.) As a result, Marvin doesn’t make the trade (neither he nor his customers have $1000 to spare), doesn’t get his money, and stays poor.

 

In this situation, you do not simply fail to help Marvin. That is, you are not doing something equivalent to walking by a beggar without donating spare change. You actively hurt Marvin, forcefully preventing him from making a trade with a willing partner. It is as if you saw someone else offering a beggar $5 to wash a car window, but you scared the beggar and the driver away with your gun. While it’s not your fault that Marvin was poor to begin with, it is your fault that he and his family stay poor. Should he or his family die from deprivation as a result, their blood is on your hands.

It seems as though you have done something deeply, terribly wrong to Marvin. And so it seems that, insofar as protectionist measures are analogous to the Starvin’ Marvin case, they are terribly wrong as well. Protectionism imposes deprivation, poverty, suffering, and death on some of the world’s most vulnerable people. Some people in rich countries want to buy things poor foreigners made. The foreigners want to sell. The money they make through trade can sometimes make the difference between life and death. But the United States and other countries post barriers around their markets. They use violence to stop foreigners from making life-saving or life-changing trades with willing partners. At first glance, this appears morally equivalent to killing the foreigners or forcing them to stay poor.

Note that nothing hangs here on the poor being the seller and the rich the buyer. If people in poor countries want to buy something produced by people in rich countries – something requiring a sophisticated facility, perhaps – the same problem arises. The ability to acquire things from willing rich sellers can make all the difference as well. (Of course, strictly speaking, each party to a trade is simultaneously a seller and a buyer. When the rich buy goods from the poor, paying with their dollars, the poor buy money from the rich, paying with their goods.)

Some might balk at this analogy. Perhaps they think it unfairly loads the dice against protectionism; after all, it’s not as thought forbidding someone from trading overseas usually kills him.

So, let’s consider the following thought experiments about the morality of restricting people’s freedom to trade. To keep things (for now) simple, each of these takes place within a single country. Later we will ask whether changing our focus to international movement makes a difference. Let’s suppose no one is going to die.

 

Individual Restrictions, Fed Ex Edition

Jane lives in rural Montana. Jane is poor and there are not many jobs around. After several years of struggling, Jane starts knitting knick-knacks and puts them for sale on Etsy. To her delight, people in Texas have high demand for her goods. She gets hundreds of orders, which she sends to Texas via Fed Ex. However, when the Fed Ex truck arrives at the Texas border, Jim, who has long lived in Texas, blocks the road. Jim pulls over the Fed Ex driver, takes out Jane’s knick-knacks, and throws them away. Jim says, “I’m not gonna allow Montanan knick-knacks to be sold here in Texas. Texans should buy Texan knick-knacks.

 

In Individual Restrictions, Fed Ex Edition, it seems clear that Jim seriously wrongs Jane. Indeed, it seems plain that that Jim grossly violates Jane’s rights and causes her serious harm.

One might think that the fact that Jane is poor and needs to make the trade is what does all the work. But while Jane’s poverty lends power to her complaint against Jim, even if Jane were not poor, it would still be wrong for Jim to interfere with her:

 

            Individual Restrictions II, Fed Ex Edition

Jason has a high paying job at Georgetown University. He recently has taken up a hobby of building boutique guitar effects pedals on the weekends. To his delight, when he puts them for sale on Reverb.com, he gets hundreds of orders. However, when he shows up at the post office to mail his orders, Brian Wampler and Mike Fuller (two boutique pedal makers) show up, armed, and say, “Hey, man, no taking away our business!” They scare Jason off and he shuts down his business.

 

Again, what Brian and Mike do seems wrongful. Even though Jason doesn’t need, strictly speaking, to sell guitar pedals, Brian and Mike still violate Jason’s rights and mistreat him. Unless they have some very good reason for doing so, they need to step aside and let Jason do his thing.

Some might think it obvious that Brian and Mike have a good reason to stop Jason. Their livelihoods depend on selling guitar pedals, while Jason’s just doing it for fun. When Jason starts his own guitar pedal brand, he doesn’t just make mutually beneficial trades with willing partners, but he also thereby “steals” business or jobs from Wampler and Fulltone (Brian and Mike’s respective companies). In the short-run, competitors are competitors, and so selling a bag of M&Ms comes at the expense of selling a Hershey bar.

That said, if we are going to ask about the distribution of harms and benefits when a new competitor enters the market, we’ll need to also think about consumers. When Brennan sells a pedal, this in some sense comes at the expense of all other pedal makers. But when competing pedal markets stop Brennan from selling his pedals, they do not just impose a cost upon Brennan, but also upon consumers who preferred Brennan’s pedals to the competitors’. We’ll explore the economic questions further in section 2.

Here, though, we’ll ask the moral question, is it permissible to use violence to shut down a competitor, if the competitor outcompetes you for something you desperately want and need? In general it, seems like answer is obviously not. To illustrate, consider a few more thought experiments:

 

Olympic Athletes

Suppose Tanya and Nancy are both competing to represent the US as figure skaters in the Winter Olympics. Tanya is poor, and figure staking is her only hope of making a decent income. Nancy, who is more talented, comes from a wealthy family, and has other options. Right before the Olympic tryouts, Tanya pays someone to smash Nancy’s knee with a metal club. As a result, Tanya goes to the Olympics and becomes a huge star, while Nancy falls back on her trust fund.

 

It seems clear that what Tanya did was wrong, even though strictly speaking losing the spots in the Olympics would be a greater harm to Tanya than to Nancy.

Or, consider the following analogy, which we borrow in modified form from Robert Nozick[i]:

 

Suitors

Suppose Robert and Steve both want to marry Gjertrud. Suppose Gjertrud goes on a date with both men, and decides to pursue a relationship with Robert, she prefers Robert’s better looks and keen intelligence. Suppose this leaves Steve devastated. He feels life is not worth living without Gjertrud’s love. He later dies miserable and alone.

 

Suppose someone suggested that Robert and Gjertrud owe Steve compensation for the harm they’ve done to him. Or suppose someone suggested that Robert or Gjertrud owed it Steve money to get plastic surgery done, or to take classes to improve his intelligence, so that he would find another marriage partner like Gjertrud. Or suppose that Steve insisted Robert get plastic surgery and brain damage to worsen Robert’s looks and cut his intelligence, and thus to give Steve an equal chance of winning Gjertrud’s heart. Or, suppose Steve lobbied his congressperson to prevent Gjertrud from being able to marry Robert, with the hope that Gjertrud will then marry him instead. Most of us would regard such suggestions as absurd or evil, even though Robert in some sense greatly hurts Steve by out-competing him, or though Gjertrud breaks Steve’s heart when she picks Robert over him.

Nozick uses a thought experiment like this to point out something odd about how some left-liberals (and others) think. They often maintain that certain arguments or reasons justify restricting economic liberty, or, at more weakly, forcing those who do better under freedom to compensate those who do worse. For instance, someone on the Left might say, “Allowing competition on the market can hurt competitors, so we should restrict economic freedom or require winners to compensate losers.” But, Nozick points out, none of them would also say, “Allowing competition for friends and lovers can hurt competitors, so we should restrict freedom of association or allow winners to compensate losers.”[ii]

This shows that many of the putative arguments the Left gives for restricting economic freedom (or for requiring certain kinds of compensation and transfers) aren’t doing much independent work for them. When someone invokes the harms of competition as a reason to restrict economic liberty or to require that winners compensate losers, they are thereby presupposing rather than proving that economic freedom has a lower moral status than personal or civil liberties. They have already concluded that people are not entitled to economic freedom (or that these entitlements are weak), and so their complaints about competition harming competitors is not doing much work.

Let’s simplify things further. Turn now to examine a case where nothing significant is at stake, and no one can seriously be said to be harmed.

 

Individual Restrictions III, Online Edition

Suppose both Carlos Slim Helu and Bill Gates have self-published their memoirs on their personal websites. The each make their memoirs available for $10, and each makes it clear they plan to use any money they receive for the by-weekly billionaires’ poker games they host. Bas wants to read one, but is indifferent between the two. He flips a coin, and as a result, picks Helu’s memoir. He is about to buy Helu’s memoir, but right before he does, Jason shows up with a gun and says, “I forbid you from buying Helu’s memoir. I insist you buy American.”

 

Here, though Bas is indifferent between the two memoirs, Jason still violates Bas rights. Jason should not coerce Bas, even though Bas is indifferent between the two choices.

One might think that of course it’s wrong for individuals to interfere with each other this way. But, one might respond, things change when states interfere with individuals for the same reasons. States have the right and the permission to interfere even when individuals do not.

Consider two possible explanations for this thought. One is that states are the agents of their people, and that the people, as a group, have the right to restrict people’s freedom of trade in a way that individuals do not. But this will not do. Compare:

 

Group Restrictions, Fed Ex Edition

Jane once more wants to sell knick-knacks to people in Texas. This time, Jim suspected that Jane wanted to sell her wares, and notifies everyone in Texas. In a mass demonstration, all of he people of Texas– except Jane’s the tiny minority who make up Jane’s willing customers—show up at the border and shoo the Fed Ex truck away before Jane’s knick-knacks can cross the border.

 

It seems clear that Jim and the rest of the Texans wrong Jane. The fact that they form a group does nothing to change this. Of course it is possible that there is some further fact about groups that gives them the right to restrict others’ freedom. But that is precisely what needs to be shown. The mere fact that they are a group does not seem to make a difference.

A second possibility is that the decisions of the state that restricts trade are – or, better, can be – democratic. Does this change things?

 

Democratic Restrictions, Fed Ex Edition

Jane once more attempts to sell knick-knacks to willing partners in Texas. Again, Jim suspected that Jane wanted to come and notified his neighbors. He takes a vote, and it turns out everyone in Texas except Jane’s customers want to forbid Jane from selling her knick-knacks in Texas. Together they meet the Fed Ex truck carrying her goods at the border, and pull their guns to drive home the message.

 

Again, the restriction wrongs Jane unless there is some further argument for why the group has the right to decide (democratically) to keep Jane out.

Absent some more involved argument about why groups or democracies have rights to restrict people’s freedom of trade, like this, the reasonable assumption seems to be that they lack them. Normally, Jane would do no wrong by trading with another willing trading partner. And normally, individuals, groups, even democratic groups, need to leave Jane alone if she is doing no wrong. By default, we presume Jane has the right to sell the things she owns to any willing customer, unless we have compelling arguments to the contrary.

The thought experiments above do not quite suffice to prove that trade restrictions are unjust. They are meant only to show who bears the burden of proof. And, at least intuitively, it lies with the trade restrictionist or protectionist. And, at least intuitively, it seems like it will be difficult to meet this burden of proof.

One might object that invoking these intuitions is unfair. For the thought experiments above leave out one important feature that you may think makes all the difference. You, Marvin, Jane, Jim, Brian, Mike, Jason, and Bas all seem to be already living in the same country. Perhaps they are even all citizens of the same country. But surely, one might think, there are meaningful moral differences between citizens and foreigners? And among these differences may be the fact that citizens have a right to trade with each other, but not a right to trade with foreigners. One may think, then, that what needs showing, then, is not that the state has a right to restrict trade, but rather that foreigners have a right to trade with our citizens, or that our citizens have a right to trade with foreigners rather than us.

The problem with this objection is that it assumes an answer to precisely the question that we are asking. Our question is whether states are justified in making these distinctions between inhabitants (be they citizens, residents, or what have you) and outsiders. We cannot answer that question by pointing to the distinction itself.

There are good grounds for asking this question. In general, restrictions on liberty need to be justified. There is a default assumption that people ought to be allowed to do as they please, provided they do not interfere with others’ rights. We presume that it is wrong to interfere with people, push them around, intrude into their lives, or dictate the terms of their existence, without good cause. Accordingly, we take it that those who wish to restrict international (or internal) trade have the burden of proof, not us.

[i] Nozick 1974, 237.

[ii] Nozick 1974, 150-9. Cohen 1995. 229-244, takes the bait and wonders about redistributing eyes. Cecile Fabre, Whose Body Is It Anyway? (New York: Oxford University Press, 2006), argues for the forced redistribution of eyes and other organs.

  • IEIUNUS

    I will be using these arguments in Federal court to defend myself against U.S. Customs and Border Protection for selling Chinese tires without paying the tariffs.

    Let’s see how I fare.

    • Jason Brennan

      Of course, law and morality are distinct.

  • Will L.

    I’m sympathetic to your argument and do agree, in principle, about the morality of state-enforced protectionism. However, there is a possible response to your argument that is not derived from “Left” leaning premises. First, let me say that you are quite right to dismiss objections that begin by drawing a distinction between an individual and a group of individuals or the state. The moral impermissibility of perfectionism does not disappear when perfectionism is imposed by the tyranny of the majority. However, you have neglected the notion of tacit consent. If a person wishes to buy cheap products from another country they rely on certain tools that are built and maintained by government institutions. Here, I am talking about the internet, telephone lines etc. (This is just one way in which an individual could give tacit consent, I am sure we could think of many more). So, one could argue that by using these services a individual tacitly consents to the limitations that are imposed by their government on what they do with these services.

    Of course, a reasonable rejoinder to my objection would be to ask if it it morally permissible for the state to take away some other essential rights and freedoms simply because of tacit consent? Or in other words: because I use state-provided telephone lines, and thus give tacit consent, does this then mean the state can deny me the right of private property? Well, no, and the reason for this is that there is a difference between imposing protectionism limitations and completely denying someone a basic right. However, this is not a rigid distinction by any means and so is certainly open to scrutiny.

  • Ben Kennedy

    Bob and Joe live on an island. Bob’s side has lots of food, Joe’s side has lots of shiny rocks but no food. Bob likes shiny rocks, so he trades his surplus of food to Joe in exchange for his rocks. One day, a boat arrives. They just started a new trade route looking for food for zoo animals, and will outbid Joe by one additional rock in exchange for the food Bob currently trades to Joe. Bob says “ok!” Bob now has one additional rock, and Joe starves to death.

    It seems clear to me that Bob has wronged Joe, letting him die for the sake of a single shiny rock. If this is so, this (because Bob is acting unilaterally) erases any moral presumption in favor of trade. Bob ought to consider the impact of his actions on third parties. This lessens the burden of the trade restrictionist, who can claim Bob is failing in his moral duty

    • M S

      Why is the wrong traceable to to Bob’s decision to trade with the boat instead of his violation of the Lockean proviso? That’s certainly where I’d point the finger.

      • Ben Kennedy

        Sure, you could model it that way if you want to consider the island the sphere of property rights. I’d want to know more about how they ended up that way, if they were castaways that happened to wash up on their respective sides, then Bob homesteading all the food would be a problem on those grounds.

        You could also be a consequentialist and object to Bob’s actions based on the foreseeable starvation of Joe

        • M S

          “I’d want to know more about how they ended up that way”

          Yeah, that’s fair. I imagine that if they had some kind of (really stupid on Joe’s part) agreement re: initial distribution of food and rocks, that might ally Locke’s concerns. But I’m not certain what kind of setup would result in Bob’s legitimate control of all the food, while still having a moral (but not contractual) obligation to trade with Joe.

          “You could also be a consequentialist…”

          Hard pass

          • Ben Kennedy

            “But I’m not certain what kind of setup would result in Bob’s legitimate control of all the food, while still having a moral (but not contractual) obligation to trade with Joe.”

            I think that this moral intuition is rooted in the social concept of division of labor. Specializing improves efficiency and increases everyone’s quality of life, but it also creates dependence, and hence a moral obligation. If someone later backs out (say, all the food producers stop selling food), our moral intuition says “unfair! had we known you would have stopped selling us food, we wouldn’t have trusted you with all the food production”. Trade protection can follow a similar intuition – “unfair! had we known you would have shipped our jobs overseas, we wouldn’t have placed you in charge!”

            This is also higher-order than say property rights or contract law, which is all Libertarians tend to be concerned about. For the sake of an orderly productive society, we can certainly support those things like letting the food producer lock their doors to keep their private property away from trespassers. But I’d put both trade provisions and the Lockean proviso at this higher moral level.

          • Libertymike

            The enforcement of the Lockean proviso is at a lower moral level than the defense of Bob’s natural right to dispose of the food upon the terms he deems best.
            The enforcement of the Lockean proviso would necessarily require the initiation of violence. For what end? To compel Bob to associate with Joe?
            If anybody has shirked their duty in this thought experiment, it is Joe. He had a duty to diversify. He had a duty to have a little foresight.

          • Ben Kennedy

            The point of the Lockean proviso is to give the moral critic a leg to stand on when claiming someone is acting badly.

            Bob and Joe are castaways. By fate, Bob lands on the side of the island with food. He is very worried about running out of food and competing with other castaways, so he gathers it up and surrounds it with motion activated machine gun nests. Joe lands on the side of the island with no food. Joe is hungry, and he will starve to death shortly. If he tries to get to the food, he will be cut down by Bob’s machine guns. Oh, and all the fish have died of mercury poisoning – the only food source is controlled by Bob.

            So – if you think Bob is acting in a completely morally acceptable manner, I think you are a honest-to-goodness disbeliever in the Lockean proviso.

            If you think Bob is somehow morally failing, then you believe in some form of the proviso – whether it is “Bob is obligated to share food”, or “Joe has a right to unimpeded access to food without getting machine-gunned”, it amounts to the same thing.

            As to what is “initiating violence”, it depends on what you think of the proviso. If you think Bob has an absolute right to control his food supply, then Joe initiates violence by trespassing. If you think that Joe has a right to not starve to death, then it is Bob is initiating violence when his machine guns open up on Bob

          • Libertymike

            Ben, I am an honest-to-goodness critic of the Lockean proviso, in general, and, to its application in particular situations; however, its voluntary assumption by actors is fine by me.

            Now, under your modified thought experiment, you have amended the facts to present a much more harsh scenario.

            To be sure, Bob has now crossed the Lockean proviso’s Rubicon by setting up the motion activated machine gun nests whereas one could legitimately argue that he had not on the facts you had originally set forth in your thought experiment (Bob knew that Joe could choose to embrace the pescatarian lifestyle).

          • LLC

            the existence of fish was not part of the thought experiment as laid out. So, isn’t it’s introduction an ‘end run’?

    • Ron H.

      It’s necessary to assume that the boat people value the food more than Joe does – hard to imagine – as we can expect Joe to pay any price necessary to keep from starving, and to outbid the boat people up to his entire supply of rocks. If by “one additional rock” you mean one more rock than Joe’s total supply of rocks, then you already have that covered.

      Then we must also assume either that Bob’s total supply of food is greater than Joe’s total supply of rocks at the current exchange rate, or that the renewal rate of food is greater than the renewal rate of rocks so that Joe will eventually run out of rocks.

      I have a feeling Joe is going to die.

  • efcdons

    Vis a vis the Nozick friends and lovers example, as per @benkennedy:disqus an obvious distinguishing factor between economic “liberties” and making a friend is that economic liberties require something from everyone else in order to be effective. You don’t need a societal structure in order to have a friend but you do need some sort of society in order to own and trade private property. Because economic liberties require our assent it seems like there is more of an argument for society to be involved in regulating or shaping economic liberties.