Opinion: To revive the global economy, we need free trade - Free Market Conservatives

This article was first published on Free Market Conservatives.

In times of crisis, it is not unusual for political priorities to be drastically rearranged. For instance, ordinarily, the government would never consider taking over the payrolls of millions of furloughed workers at enormous cost, but that has become necessary thanks to unprecedented circumstances.

Even though that cost will have to be repaid at huge taxpayer expense in the future, it was the right thing to do. An immediate problem had to be solved by subsidising those people’s incomes. The long-term considerations were temporarily set aside in favour of short-term concerns.

Crucially, though, this policy is just that: short-term. Continuing the government’s furlough scheme for years, until long after lockdown has become a fading memory, would be both unnecessary and impossible. The problem will have gone away, since people will have returned to their jobs, so there is no reason why that radical short-term solution should be continued, at such unsustainable cost.

It is imperative that we apply this same logic to the issue of international trade. While it is true that the current unprecedented and unforeseeable circumstances have led to shortages of vital supplies around the world, that does not mean that it is now sensible to overhaul freedom of trade and resort to single-minded economic nationalism.

It is easy to see why this knee-jerk reaction has arisen. Procuring enough personal protective equipment (PPE) to keep NHS facilities fully stocked has become a mammoth task and shop shelves briefly sat empty amid scarcities of food and basic household goods. Meanwhile, the battle to produce vaccines and treatments for Covid-19 has led to an unseemly international race, wherein countries compete to get their hands on limited biochemical supplies.

The response from politicians around the world to these temporary obstacles has carried a worryingly permanent undertone. We are used to hearing shrieks of ‘America first!’ from across the Atlantic, but we are less accustomed to hearing President Macron of France, famed for his centrist globalism, pledge to move supply chains within national borders.

Those sentiments were echoed by German health minister, Jens Spahn. “We need to discuss the right degree of globalization,” he said. “For medicines and protective gear, we shouldn’t be that dependent on other regions. Security is more important than economic efficiency.”

These comments are emblematic of a wide, sweeping and profoundly troubling trend across the world. Governments appear willing to undo the immense progress of free trade and roll back globalist advances, which have done exponentially more than any other tool in history to lift millions out of poverty and stoke immense and widespread prosperity.

Freedom of international trade is the only effective fuel for the engine that is worldwide economic growth. A strong global economy benefits everyone in normal times, let alone in periods of economic recovery, when it is critical that we do not take any steps backwards.

Fortunately, here in the UK, we have a Prime Minister who is well-known for his bombastic defences of free trade and who was elected on a platform of crafting a global, outward-looking post-Brexit Britain. Liz Truss, Secretary of State for International Trade, has voiced her condemnation of protectionism in no uncertain terms.

The problem is that free trade only works when everyone participates. Britain cannot do it alone. When lockdowns are lifted and normal life resumes, we will have an almighty task on our hands to revive the global economy and restore growth. We won’t be able to do that if we are all boxed into separate corners, refusing to interact in a mutually beneficial way.