Acton Institute Powerblog

PBR: Friedman on Free Trade

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No, not that Friedman. In a wide-ranging lecture for the Carnegie Council for Ethics in International Policy earlier this year, George Friedman touched on American policy with regard to trade. He says of the United States,

it has the potential to reshape patterns of international trade if it chooses. The United States throughout the 20th century, the second half in particular, has operated under the principle of a free-trade regime in which its Navy was primarily used to facilitate international trade. It did not seek to develop any special advantage from that, save those sanctions and blockades that we occasionally imposed for immediate political purpose.

He concludes, however, “there is no reason to believe, with that enormous power, in the 21st century that the United States won’t choose to reshape international trade if it finds itself under extreme economic or political pressure.”

In pointing out the possibility for the United States to pursue trade policy that is at odds with “the principle of a free-trade regime,” Friedman also notes the definition of so-called “soft” power: “Power that isn’t exercised.”

As a side note, one way of construing this definition of soft power correlates quite nicely with the reception of the traditional scholastic distinction between absolute and ordained power, potentia absoluta et ordinata. With regard to God’s power, the older, traditional view of the distinction held that the absolute power of God referred to the contingency of the created order, insofar as God could have created, willed, and concurred in things differently (i.e. a different world order). Things could have been different based on a different divine ordering or decree.

This older view did not hold that the absolute power of God was an active reality in this created order but rather a hypothetical possibility standing behind the creation of this world. But in the high to late middle ages another version of the distinction arose, which argued that the absolute power of God exists as an active possibility residing in and with the current created order. This “operationalized” view of the absolute power of God held that God not only could have made things differently, but also that he has an active power that can overrule or act outside of what he has ordained. (We should note that this “absolute power,” when applied to magistrates, is that to which Lord Acton refers in his famous quote appearing as the subhead of this blog.)

A brief illustration might serve to communicate the difference in these two views of absolute power. Under the former conception, the “absolute power” of the United States government would refer to those powers that could have been granted by the Constitution but for whatever reason were not. Bracketing the possibility of changing the Constitution, these powers are no longer real possibilities. Under the revisionist and operationalized conception, the Constitution would describe the way things normally or ordinarily work, but the President or Congress could act “absolutely” without regard to the constraints of the Constitutional order.

We might also note that this definition of soft power is one that defines “power” essentially as coercion, with the “softness” of the power being the implied threat rather than the “hardness” of actual use. Friedman’s kind of soft power is that which gives nuclear deterrence its only viability. As American ethicist Paul Ramsey has written,

The actuality of deterrence depends upon a credible belief, mutually shared, that one might use a nuclear weapon. If the government of one of the great powers were persuaded by the churches never to be willing to use any nuclear weapon under any circumstances, and this were known, there would be instantly no deterrence and therefore no practical problem of finding a way out. Likewise, the morality of deterrence depends upon it not being wholly immoral for a government ever to use an atomic weapon under any circumstances.

(Towards the end of the video a questioner rightly challenges Friedman’s definition of soft power, noting in its original context it didn’t necessarily depend on the implied threat of coercive force.)

Friedman notes that soft power, “what you could do that you don’t do,” doesn’t corrupt, but instead “gives you the opportunity to be gracious, friendly, and pleasant.” For Friedman, America’s gracious continuation of free-trade policy represents a clear case of soft power.

There’s a real sense in which he’s right, but only to the extent that America would suffer relatively less economically than other nations through the pursuit of isolationist policies. As Spengler notes in the context of the current global crisis, “Although Russia has taken on water in the crisis, its position relative to its former satellites has actually strengthened.” Friedman’s assumptions about the trump card that America holds in the possibility of reversing free-trade policies assumes that the economic power of the United States would in a similar way be relatively strengthened, and that the economic consequences will disproportionately affect America’s trading partners. But has America’s relative economic strength actually improved already in the midst of the global economic crisis?

In a recent STRATFOR report Lauren Goodrich and Peter Zeihan concludes that

while Russia’s financial sector may be getting torn apart, the state does not really count on that sector for domestic cohesion or stability, or for projecting power abroad. Russia knows it lacks a good track record financially, so it depends on — and has shored up where it can — six other pillars to maintain its (self-proclaimed) place as a major international player. The current financial crisis would crush the last five pillars for any other state, but in Russia, it has only served to strengthen these bases. Over the past few years, there was a certain window of opportunity for Russia to resurge while Washington was preoccupied with wars in Iraq and Afghanistan. This window has been kept open longer by the West’s lack of worry over the Russian resurgence given the financial crisis. But others closer to the Russian border understand that Moscow has many tools more potent than finance with which to continue reasserting itself.

Besides the US, Friedman opines that Japan, Turkey, and Poland (because it “faces Russia”) will be the major players in the 21st century. But with regard to the fallout of the economic crisis, Spengler summarizes convincingly, “There are no winners, but losing the least is the next best thing to winning. If America turns inward, even an economically damaged Russia will loom larger in the world.”

Jordan J. Ballor Jordan J. Ballor (Dr. theol., University of Zurich; Ph.D., Calvin Theological Seminary) is a senior research fellow and director of publishing at the Acton Institute for the Study of Religion & Liberty. He is also a postdoctoral researcher in theology and economics at the VU University Amsterdam as part of the "What Good Markets Are Good For" project. He is author of Get Your Hands Dirty: Essays on Christian Social Thought (and Action) (Wipf & Stock, 2013), Covenant, Causality, and Law: A Study in the Theology of Wolfgang Musculus (Vandenhoeck & Ruprecht, 2012) and Ecumenical Babel: Confusing Economic Ideology and the Church's Social Witness (Christian's Library Press, 2010), as well as editor of numerous works, including Abraham Kuyper Collected Works in Public Theology. Jordan is also associate director of the Junius Institute for Digital Reformation Research at Calvin Theological Seminary.