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Woodrow Wilson’s radical vision for free trade

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One hundred years ago today—on January 8, 1918—President Woodrow Wilson gave an address before Congress in which he outlined his goals for ending World War I. American forces had entered the war almost nine months earlier and Wilson wanted to let the world know exactly what he believed the Allies were fighting for.

In the introduction to what became known as the Fourteen Points speech, Wilson said,

What we demand in this war, therefore, is nothing peculiar to ourselves. It is that the world be made fit and safe to live in; and particularly that it be made safe for every peace-loving nation which, like our own, wishes to live its own life, determine its own institutions, be assured of justice and fair dealing by the other peoples of the world as against force and selfish aggression. All the peoples of the world are in effect partners in this interest, and for our own part we see very clearly that unless justice be done to others it will not be done to us. The programme of the world’s peace, therefore, is our programme; and that programme, the only possible programme, as we see it, is this . . .

Wilson then goes on to list the fourteen principles, which included such commitments as open diplomacy and global reductions in military arms. The most radical innovation, of course, was point XIV:

A general association of nations must be formed under specific covenants for the purpose of affording mutual guarantees of political independence and territorial integrity to great and small states alike.

This was Wilson’s proposal for the establishment of what became known as the League of Nations.

But there was one other point which, if they had been enacted, might have changed world history. In his third point Wilson proposes: “The removal, so far as possible, of all economic barriers and the establishment of an equality of trade conditions among all the nations consenting to the peace and associating themselves for its maintenance.”

What exactly did President Wilson mean by this recommendation for free trade?

Edward Mandell House (aka Colonel House) was Wilson’s closest advisor and the executive director of the study group to prepare materials for the peace negotiations following the Great War. In his “Interpretation of President Wilson’s Fourteen Points” House explains point #3 by saying:

The proposal applies only to those nations which accept the responsibilities of membership in the League of Nations. It means the destruction of all special commercial agreements, each putting the trade of every other nation in the League on the same basis, the most-favored-nation clause applying automatically to all members of the League of Nations. Thus a nation could legally maintain a tariff or a special railroad rate or a port restriction against the whole world, or against all the signatory powers. It could maintain any kind of restriction which it chose against a nation not in the League. But it could not discriminate as between its partners in the League.

This clause naturally contemplates fair and equitable understanding as to the distribution of raw materials.

What Wilson was proposing, according to House, was one of the most promising free trade agreements in history. Rather than a variety of agreements, like NAFTA and TPP, the United States would have had a single agreement with every nation in the League. If the League had eventually added the same 193 sovereign states that are members of the United Nations (UN), the U.S. would have free trade with nearly every country in the world.

For various reasons the League treaty was never ratified by the Senate. But it’s an intriguing exercise to imagine what would have happened if the Wilson’s fourteen points—particularly #3—had been implemented.

Wilson once said about his foreign policy ambitions that he was “playing for a hundred years hence.” Now, a century later, we should ask what the world would look like today if Wilson’s radical vision for free trade had been implemented.

Joe Carter Joe Carter is a Senior Editor at the Acton Institute. Joe also serves as an editor at the The Gospel Coalition, a communications specialist for the Ethics and Religious Liberty Commission of the Southern Baptist Convention, and as an adjunct professor of journalism at Patrick Henry College. He is the editor of the NIV Lifehacks Bible and co-author of How to Argue like Jesus: Learning Persuasion from History's Greatest Communicator (Crossway).

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