The city of Miami prepares for the battle of the Free Trade Area of the Americas. It expects a few thousand angry demonstrators to reject, with shouts and stones, the commercial integration of the Americas. Why do they oppose the FTAA? The argument most used by the globophobes is asymmetry: There cannot be fair economic relations be tween the very rich countries and the very poor countries. Before negotiating the areas of free trade, the powerful nations must correct those harmful differences.
That’s some confusion. In general, when the enemies of economic freedom demand equity or the transfer of wealth from the richer countries to achieve a fairer world, they are comparing standards of consumption. They see that their wealthy neighbors have comfortable dwellings, cars, electrical appliances, sanitation, education, communications, food and clothing, while their own material reality is sordid and hopeless.
Solid institutions
In the 20 most developed nations, there is private property, the state of law is respected, the indexes of corruption are lower, great efforts in education have been made and the civilian society is a major protagonist in the field of economics. In these nations, the state behaves with a degree of sensibility, the judiciary functions reasonably, the institutions are solid and businessmen can make long-range plans. People save, invest, research and compete arduously to gain market shares in a tense productive process that little by little enriches society as a whole.
In addition, these nations have an entrepreneurial culture, more or less homogeneous, that allows a Swedish entrepreneur to use German capital to develop a chain of stores in the United States, or allows Honda and Toyota to send their Japanese executives to build factories in Ireland or Greece, or permits Disney to establish an amusement park in a Paris suburb.
In sum, the First World is a great economic space, with clear and uniform rules of the game, where the means of production and management are similar, interchangeable, and where veryone benefits from his interaction with others, even though the per-capita income of Luxembourg is twice that of Greece or three times that of South Korea.
Imitate civic behavior
But the enemies of economic freedom, almost always from the Third World, want to imitate not the First World’s standards of civic behavior or means of production but only its standards of consumption. They also want something even more curious: that the First World subsidize their stubborn inefficiency so that they may persist in their wrongheadedness while money continues to be transferred from the First World nations to the coffers of corrupt and inept governments that refuse to change their ways to create wealth or manage the state.
If we accept the ”injustice” or ”inequity” derived from the inequality in the level of development between countries and the moral obligation that the more-powerful nations have to grant an advantage to the poorer nations in their commercial relations, we would have to think of some compensatory international formula that affects everyone alike.
It is true, for example, that Americans have four times the per-capita income of Mexicans. But, at the same time, Mexicans have four times the per-capita income of Hondurans and Nicaraguans. Would the Mexicans be willing to transfer part of their wealth to their Central American neighbors to build a more-equitable trade zone? Would the Dominicans do likewise regarding Haiti, the Chileans regarding Peru and Bolivia, and the Argentines in their dealings with Paraguay?
Ideas have consequences
It’s proper to point out that the so-called asymmetry is a natural part of the history of development and is present everywhere, even within a single nation. Massachusetts, for instance, has twice the per-capita income of Mississippi. So does Mexico City, if you compare it with Chiapas; or Sao Paulo, when compared with Brazil’s wretched northeast region. Would it make any sense to establish different forms of trade between these regions only because some are poorer than others? By doing this, wouldn’t we be penalizing the forceful creativity of certain poles of development?
The worst thing about these nonsensical ideas propagated by the globophobes is that, to the degree that they succeed, they gradually drive nations into misery. Ideas have consequences — and the consequences of bad ideas are disastrous and hard to correct.
From an Editorial by CARLOS ALBERTO MONTANER in the Miami Herald.
