Hopefully, you are all

following along

at the Council on Foreign Relations

website

where

The Economist

What really frustrates economists is the debate over trade and national policy is always framed as “exports are good, imports are bad”; the best policy is the one that allows Americans to dump as much of their production on foreigners as possible, while keeping as much of those foreigners’ things out of our country as possible. That is called mercantilism, and it doesn’t work. As you know, healthy exports are only half the equation. Imports provide much of trade’s benefit – which is, indeed, why people import things. If you think buying from China is bad for our economy, ask yourself how many people your company would have to lay off if it had to pay twice as much for every piece of electronic gear in the office—all those computers, fax machines, copiers, telephones—because they were Made In The U.S.A.

's Robert Lane Greene is debating trade (albeit in very agreeable fashion, so far) with Jonathan Jacoby of the Center for American Progress. Mr Greene opens splendidly:

I thought of this as I followed a link from Mark Thoma to this story, on the bartering habits of chimpanzees. It seems that our closest relatives are more than happy to exchange fiat money (tokens, provided by researchers) for goods, and they gladly trade services in the wild. But while they can be trained to barter goods in laboratories, they are unwilling to do so on their own, or in their natural habitat. This reluctance prevents chimps from developing a true (if primitive) economy based on specialisation and gains from trade. Said one of the lead researchers on the study, "They’re perfectly capable of barter, but they don’t do so in a way which will maximize their outcomes."

Fascinatingly, it appears that chimps have not evolved trade in goods due to their inability to develop enforceable property rights:

The observed chimpanzee behavior could be reasonable because chimpanzees lack social systems to enforce deals and, as a society, punish an individual that cheats its trading partner by running off with both commodities. Also because of their lack of property ownership norms, chimpanzees in nature do not store property and thus would have little opportunity to trade commodities. Nevertheless, as prior research has demonstrated, they do possess highly active service economies. In their natural environment, only current possessions are “owned,” and the threat of losing what one has is very high, so chimpanzees frequently possess nothing to trade.

At the risk of treading well outside my area of expertise, I'd suggest that this implies not that humans have evolved some sense of the rightness of trade, but merely the means to develop and enforce contracts (among other things). Back at CFR, Mr Jacoby notes that many people support various trade restrictions, but these same individuals happily and routinely fork over money for goods which have clearly been produced, wholly or in part, in other countries.

Mr Jacoby appears to suggest that the enforcement of labour and environmental standards would assuage concerns regarding trade, but I'm not so sure. For one thing, it's hardly clear that responses to questions on whether or not one supports such measures are at all meaningful. Absent detailed knowledge of trade policy, who would ever be against labour and environmental standards?

What Americans and others fear is uncertainty, and increased labour and environmental standards would do little to eliminate that. Jobs would still be lost for a variety of reasons, and trade would still be a ready scapegoat for ambitious politicians. The processes which lead to import/export imbalances and migrating jobs sit beyond the reach of the familiar and secure rules that govern daily transactions. As such, the possibility of satisfying, for once and for all, consumers' trade concerns is likely to remain slim.

So while there may be cause to invest in cleaner and safer technologies in developing nations, or to create domestic programs to improve the efficiency with which displaced workers find new and appropriate jobs, no one should be under the false impression that new trade restrictions will eliminate trade doubts. Instead, leaders should note the zeal with which their constituents seize upon the fruits of free exchange and recognise the extent to which that exchange has generated magnificent improvements in global welfare. It isn't just contract enforcement that sets us apart from our simian ancestors. It's also our ability to discover, through reason and experience, that our mercantilist instincts are best ignored.