Raymond Richman - Jesse Richman - Howard Richman
Richmans' Trade and Taxes Blog
George Washington’s Farewell Address Had More to Say Than Avoid Entangling Alliances
In Washington’s Farewell Address 1796, the most frequently quoted passage is his admonition that the USA should avoid entangling alliances. On entangling alliances, he wrote, “It is our true policy to steer clear of permanent alliances with any portion of the foreign world…Taking care always to keep ourselves by suitable establishments on a respectable defensive posture, we may safely trust to temporary alliances for extraordinary emergencies.” He wrote: “Observe good faith and justice towards all nations; cultivate peace and harmony with all. ..In the execution of such a plan, nothing is more essential than that permanent, inveterate antipathies against particular nations, and passionate attachments for others, should be excluded.” What would he think of NATO and our bringing countries bordering Russia into a military alliance directed against Russia? Any NATO country could conceivably force us into a war with Russia.
Temporary antipathies against some nations are often justified especially when the nation pursues objectives that are likely to be harmful to our citizens. Examples are the countries with which we were at war in the 20th century: Germany, Japan and their allies. But whereas we stopped being antipathetic toward Germany and Japan, we have become antipathetic against former allies Russia and increasingly China. We have been antipathetic against Cuba because it supported terrorism and threatened to allow the USSR a base for its nuclear weapons directed against us. We recently ceased being antipathetic to Cuba although it has given us no grounds for ceasing being antipathetic against it and we still provide a haven for its citizens fleeing its tyranny.
Pres. Obama in his last month in office showed hostility to Israel, the only democracy in the Middle-East and a reliable ally. Perhaps it was because Obama no longer needed the Jewish vote and maybe because he had a Moslem father and had pro-Moslem attitudes.
I wonder what George Washington would think of a CIA that undermined foreign governments with which we had peaceful relations, supporting with arms rebels in Yugoslavia, Libya, Syria, and the Ukraine with the result that thousands lost their lives and millions of innocent victims became casualties. What would he think of the CIA intervening in the politics of friendly nations and supporting opposition parties as it did in Israel and many other countries.
Another area of concern to Pres. Washington was foreign trade. Regarding trade with nations, he wrote, “The great rule of conduct for us in regard to foreign nations is in extending our commercial relations, to have with them as little political connection as possible… constantly keeping in view that it is folly in one nation to look for disinterested favors from another; that it must pay with a portion of its independence for whatever it may accept under that character; that, by such acceptance, it may place itself in the condition of having given equivalents for nominal favors, and yet of being reproached with ingratitude for not giving more. There can be no greater error than to expect or calculate upon real favors from nation to nation. It is an illusion, which experience must cure, which a just pride ought to discard.” I wonder what he would think about our membership in the World Trade Organization which recently told Congress it could not pass a law requiring the labeling of the source of imported beef. And how abominable he would find the international bureaucracy, compulsory arbitration, and rules provided in our multilateral trade negotiations like the proposed Trans Pacific trade agreement. Every trade agreement we sign involves a loss of sovereignty.
Of course, I should mention that countries do need to intervene to prevent other countries from employing mercantilist policies, so-called beggar one's nation policies to achieve a chronic trade surplus at our expense. We've invented a simple remedy that all countries could impose to protect themselves -- the "scaled tariff", a single-country-variable-tariff that rises as the trade deficit increases and falls as it is brought into balance. We wrote about it in our book, Balanced Trade (Lexington Books, 2014). Armed with the Scaled Tariff, we could care less that a country employs mercantilist practices, manipulates its exchange rate, subsidizes exports to us or on the other hand whether Congress and the President are pursuing policies that are causing our trade to become unbalanced, harming our industries and workers. The remedy is simple. If you cannot correct those policies for whatever reason, the single country trade-balancing tariff will produce the desired correction. Fears of a trade war are unfounded; the nation with a trade surplus is always the loser. The scaled tariff makes trade agreements obsolete and eliminates the need for an international agency to enforce trade agreements.
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