"From the 18th Century onward, the industrial success of laissez-faire Britain provided the superiority of free-market and free-trade policies." - Ha Joon Chang.
What is really being said there is that Great Britain was the front runner in the worlds economy at this point in time. Britain had its had in everything that had to do with trading across the world. They were able to play the role of the supreme world economic power and eventually bring everyone else into the new age of "Liberal economic order says Chang. Other countries were starting to see that their old ways of "mercantilist policies" were no longer as affective and were beginning to adopt or at least make modification in order to change into a freer economic system. This seemed to work for a while until things started to go wrong with the start of the World War I.
According to Chang, "in response to the ensuing instability of the the world economic and political system, countries once again started to erect trade barriers." By doing this I feel that it further damaged trade relations after the war was over and it took a very long time to get back to the way things were just prior to the war. In another class, we learned that war is good for business but I feel that it may be good for your country specifically but not for the greater good for the whole world. War way help bring your economy back by producing war goods materials and other goods but if you have no one to trade with on a global scale, you could very easily fall right back into where you were before it all started. How do you feel about war production verses international trade? Does it help benefit international trade by opening new trading post with other countries that are supporting you or does it overall hurt the whole world?
After the conclusion of World War I and World War II, there was an agreement met that helped make a significant move in the right direction in trade liberalization through the early GATT (General Agreement on Trade and Tariff) talks.
War production does not last because it goes down after the war to maintain the military. There has to fair trade rather than laissez-faire trade. Laissez-faire trade only benefits a few, and the rest is left up to the larger countries whether they let poorer countries do what they have done to get to where they are. I think fair trade is where we need to go to benefit as the whole world, and that means giving benefits to small countries to add to their wealth.
ReplyDeleteIt's an obvious statement that war production benefits one's economy. People are put to work and production is at a high state. But in my person opinion, I think it's a disgrace to use war production to end a recession/depression. The lives lost on either side are not worth ending a hardship. I agree with your claim that war harms international relations and therefore markets. It takes a lot of time to heal the wounds of war. I like your "greater good for the world" perspective. I think when we talk about politics and capitalism, we often only think of ourselves, but there are others in this world that our decisions will effect. If war production is "good" for our economy, does it mean it is "good" for another nation? Probably not. Your comment about the not having anyone to trade with after a war is fantastic. Who do you trade with after a war? Just your allies? It's a deep question.
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