Check out the latest episode of Econception, my podcast with the American Institute for Economic Research, where I talked to Samuel Gregg about national security and free trade. It’s true that there are national-security exceptions to free trade, but what does that actually mean? I talked to Gregg about his recent paper with AIER where he looks at the theory and history of U.S. trade policy with respect to national security.
I also talk about the history of economists’ views on free trade. They weren’t always in favor. On the contrary, after World War II, the fashionable view among economists was that developing countries should pursue import substitution and develop their domestic industries behind barriers to international trade. It was only after many developing countries took their advice and stagnated that economists gradually changed their views.
Then I moved on to discuss the socialist mayor of Paris’s failure to clean the Seine in time for the Olympics despite having spent $1.5 billion to do so. Many have nonetheless applauded her for trying, and reasoned that the river is probably at least cleaner than it was. That fails to consider the opportunity cost of what could have been done with that $1.5 billion instead that might have succeeded in delivering benefits for Parisians.
The Paper of the Episode, selected and described by Gregg, is “Fascist Economics” by Wilhelm Röpke from 1935. It’s about why fascist economics is bad, naturally. You can read more about Röpke’s brave stand against the Nazis here.
And please listen and subscribe to Econception by clicking here.