Acton Institute Powerblog

The immorality of tariffs

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The benefits of free trade are vast, and enjoyed throughout the world.  The alternative — trade restricted by protective tariffs and quotas — concentrates benefits to a protected few who profit due to less competition from foreign competitors.

The morality of free trade is clear. Individuals can choose what they buy from where, linking the world through a network of exchange. Integration through trade and exchange is a major factor lifting people out of poverty. The more and freer the trade, the better for human flourishing. Despite this, there is a growing protectionist movement in the United States political landscape.

In Abraham Kuyper’s book Antirevolutionaire Staatkunde (or Anti-Revolutionary Politics), he discusses his political support of tariff increases in the Netherlands. One of Kuyper’s arguments in defense of tariffs is a moral argument, which stems from concerns over unemployment. He writes:

Excessive enthusiasm for Free Trade and for free movement of population can deprive men of work who would otherwise have it in abundance. Free Trade can have as a consequence that many items are fabricated abroad so that there is no work to be done here. This can be observed in its simplest form in the case of lumber. If unsawed logs are imported, then the wages of sawing can be earned here. If, however, lumber arrives sawed, then the wages for sawing are lost here.

Frederick Nymeyer, in a 1956 article titled “Abraham Kuyper’s Unscriptural And Unsound Ideas On Tariff Protection”, takes Kuyper to task for what he sees as grievous moral and economic errors in his defense of tariffs.

Kuyper’s defense of protectionism is rooted in concern for workers, like Dutch sawmill workers, who might be unemployed due to imports of already sawed lumber. These workers, and the sawmill owners, capture the concentrated benefits of restricted trade on lumber. The costs of such a restriction, however, are spread across all the consumers of lumber throughout the Netherlands. They pay in higher prices. As Nymeyer writes:

From this viewpoint there was no gain to be obtained by Dutch sawmill employees except at the expense of other Dutchmen, namely the consumers. What virtuous morality is there in helping one man at the expense of another? Is this good Calvinist brotherly love? Is this the Christian religion? Is this Anti Revolutionary statesmanship? [emphasis added]

Dutch citizens are not the only ones harmed by this protectionist policy designed to benefit domestic sawmill workers. Foreign sawmill workers are harmed in the same way Kuyper fears for the Dutch. With fewer markets for their products, they may also end up unemployed. Nymeyer argues that Kuyper rejects what he calls “the law of brotherly love” in advocating for economic programs that unfairly advantage Dutch over foreign sawmill workers.

In plain language, Kuyper has scales for morality with two sets of weights; one set of weights for Dutchmen; another set of weights for Swedes (foreigners). Somewhere in Scripture there is a very unfavorable comment on the morality of different sets of weights.

Nymeyer rejects the notion that Christians are more obligated to their brothers and sisters that happen to share the same nation as them than those that do not. Citing the Parable of the Good Samaritan, he proclaims “ALL men are our neighbors”. 

Tariffs are immoral because they unfairly benefit one group of people over another through the coercion of the state. They erode individual choice, while simultaneously reinforcing nationalist ideas. The morality (or lack thereof) of tariffs remains an important consideration even today, given today’s political rhetoric condemning trade and calling for renewed protectionism and restricted trade. Christians should reject protectionist tariffs not only because they are economically unsound, but also because of their immorality and incompatibility with Christianity.

Tyler Groenendal

Comments

  • Economists tend to assume that economic arguments are the most important (or even perhaps the only important) arguments, and that whatever economics would indicate (assuming, of course, anything like an economic consensus), that it should carry the day in public policy. Such economists are not only economistic but also are politically naive. Maybe there are no good economic arguments against free trade. That does not mean there are not possible political, or even moral, arguments against free trade. (I say all this as an advocate of free trade, but hopefully not a naive or economistic one).

    I’m thus inclined to agree with the substance of Nymyer’s concerns about Kuyper on this issue and in this particular case. I think Nymyer errs in drawing too much from this particular instance, though, and he does a great deal of interpretation about what this case reveals about Kuyper’s politics and morality. I would say that even if, as I think likely, Kuyper is wrong, it is important to understand why he thought he was right and what motivated him. It’s not obvious to me that Nymyer is sympathetic enough in that regard to really make an effective argument against those who don’t already agree with his position re: trade liberalization.

    For instance, even if it were true that Christians as such are called to love everyone equally and this means that their practice must not show favoritism in any way (e.g. favoring those in intimate vs. extended associations), public office seems to require a somewhat different calculus. I don’t think a prime minister of a nation is responsible for being concerned with the well-being of non-citizens and non-residents of his or her country in the way that he or she is with those who are. This doesn’t mean that those others count for nothing, but it does mean that national public policy is properly oriented toward national interests.

    Now it may be true that a policy of free and open trade is actually in a particular nation’s interests, and Nymyer is at his strongest when arguing along these lines.