The Vexations of Free Trade

I meet two groups for coffee each week. One predominantly left in its political orientation, the other conservative. I have almost continual disagreements in person and online with those in the first group (it gets wearing) and am in complete agreement most of the time with those in the second. You will notice I said ‘most’ of the time. It was evident at a recent meeting that free trade divides us. I find this is the case generally when I talk with conservatives, particularly with those of a classical-liberal bent.

I used to be a free trader. David Ricardo set out the script in 1817. Adam Smith had already demonstrated that specialisation and trade was beneficial. Ricardo went further by showing that trade was (almost certainly) beneficial even between two countries where one could produce all tradeable products more cheaply. Economist Robert Findlay described Ricardo’s theory of comparative advantage as the “most beautiful result in all of economics.” It has had a…