In my recent post on , I was drawn into a debate on trade with China in the comments box.
At one point I wrote
“I view trade with China today as completely irresponsible and morally reprehensible.”
Dave Christian replied
Oh dear. I expected better of you. The living conditions of Chinese people will improve if we refuse to trade with them? The Chinese government will change it’s policies for the better if we refuse to trade with them? Or should we just invade and kill them in large numbers to improve their lives? Your case would be helped if you could give ONE example from history where a trade embargo (alone) had a positive influence upon the target country. Or is it just that you have never heard of comparative advantage and think cheap production of goods is somehow cheating us of something.
I think Dave’s comment deserves a comprehensive response.
Just to clarify. I am an advocate of free trade. I am a dyed in the wool Adam Smith fan. I believe free trade will benefit Kiwi and Chinese alike-economically that is.
There is only one valid reason to interfere with the free flow of goods and services. There is only one reason why a government may legitimately block trade. That is, on the grounds that national security is at stake.
Clearly if we were at war with China, Australia or the Malagasy Republic, it would be perfectly legitimate for the government to ban trade with the enemy nation.
In fact it would be treasonous if they did not.
What if we are in a pre war state? What if we had good reason to believe that another nation had designs on our sovereignty, or on that of our allies? Would it then be justified to ban trade with that nation?
It is highly possible that in the next 20 years, China will go to war with our ally, the USA over our friend, Taiwan.
I don’t relish that prospect, but it certainly considered as a real possibility by many responsible military and strategic thinkers.
Should we be aiding, in any way, the strengthening of the Chinese economy to make China’s victory more probable in such a war?
Should we instead ostracise China, increase our trade with Taiwan and by so doing, decrease the chance of war?
Ostracising rogue nations is far more moral and more likely to achieve real change than “building bridges” for the tanks to roll across.
The socialists understand this very well. They didn’t advocate increasing trade with South Africa to bring down Apartheid. They worked tirelessly to ostracise South Africa and they were ultimately successful.
Now some socialists are trying to do the same to oust Mugabe in Zimbabwe. Even though it was they who helped install him in the first place!
How does the US government try to tackle the mafia. Do they engage with them? Do they encourage their business enterprises in the hope they will mend their ways?
No, they work hard to cut off their funding in every way possible.
The answer to dealing with evildoers, whether it be the Chinese Communist Party, the mafia, the local teenage gang, or a naughty child, is not to engage with the destructive or attention seeking behaviour.
The answer is to ostracise. Leave the evildoer to stew in his own juices. Withdraw your support. Evil cannot survive, but by leeching off good. The Chinese Communist Party would implode very quickly if the West refused to deal with them until they disbanded the Communist Party. .
Do I believe this will happen, Dave? Not on your nelly. Economic integration between China and the West is now so extensive, that barring miracles, nothing will reverse it. I do however think we should do everything possible to slow down the progess of the Chinese Communist Party.
If nothing changes, does that mean that China will eventually strike out militarily, with disastrous consequences for our region? Unfortunately, I think that is a very strong possibility.
I hope I am wrong.