By way of example, I would have pointed to15th century western Europe, wallowing in recession, still recovering from a century or more of warfare, which had destroyed the slender trade routes that it had with the Mediterranean, namely the Champagne Fairs which stretched across France to Genoa and the other prosperous cities of Italy. These, in turn, linked to China via the Great Silk Route. But after these routes were cut off, the individual countries, principalities and the independent city-states of western Europe had to manage on their own -- and they weren't doing very well. Whatever trade existed in western Europe at that time largely consisted of food supplies sent into the cities in exchange for small-scale craft goods to the countryside and, whenever bad weather or drought intervened, people would starve on a massive scale or fall prey to disease. The Black Death didn't happen once -- it would reappear decade after decade whenever the vitality of the population was at a low ebb. In short, their economic machine was grinding down -- with many other consequences.
While poor old western Europe was in the pits, India, China and the Islamic Empire were doing very well, thank you very much. The main thing that finally rescued Europe was the weakened state of the Roman Catholic Church. For centuries the Church had railed against trade because it saw rich merchants and bankers as rivals to their own money-making powers. Encyclical after encyclical had gone out from the popes trying to ban free prices in the market place and also the charging of interest (or usury, as it was called then). However, by the 15th century, the Church was losing out, mainly because of the intellectual quality of its own scholastics in the great universities, such as Bologna and Salamanca, which had been established a few centuries beforehand and were beginning to be independent. Everytime the Church went backwards in condemning trade and usury, their own scholastics in the universities managed to move the discussion forward again. Nevertheless, the popes still had tremendous power and, in 1479 and 1494, gave gracious permission to Spain and Portugal to start trading again, this time by ship in order to bypass landlocked Europe. Portugal, in particular, was in desperate straits and needed the gold that it thought lay in Africa, and the spices that they knew lay in Asia. The Portugese were able to do so because, by then, their fishermen had developed their coast-hugging boats into much more versatile ocean-going vessels suitable for long-distance cod fishing which were able to tack into the wind.
Columbus was thwarted because the land he discovered to the west happened not to be east Asia -- or the Indies as it was then called -- but most of the other explorer-traders were more successful by sailing southwards and eastwards, rounding Africa, thus finding the real Indies. Then England and Holland and other European maritime nations piled in and long-distance trade thus resumed. Europe never looked back from then onwards. The countries of Europe were particularly fortunate by an accident of history in that the whole of the south-east Asia was open to them. In the early 15th century, the then Chinese Emperor had done what the popes of Rome had not been able to do. He had banned Chinese sea-going trade completely. Until that time, the whole of south-east Asia was dominated by the much larger and much more heavily armed junks which wouldn't have allowed the puny European boats any sea-space at all.
The rest, as they say, is history. In due course, the industrial revolution finally got going in Europe. However, apart from the inclusion of North America into the affluent trading network, and the recent revival of China and some of the south-east Asian countries (and the possible, though unlikely, revival of India) that's largely where we are today. Huge land masses and large populations in Africa, South America, Central Europe and the Middle East have been unable to break in for various reasons. True, they are trading with us, legally and illegally, but only because they have oil, which we need, or drugs, which we don't. But, by and large, although a small minority of them, such as the South American Mafia, African dictators and the Saudi Arabian royal family have wealth beyond our imagination, most of their populations live in poverty and misery.
Free trade or no free trade, these excluded populations are likely to remain in the cold, unfortunately. For much deeper historical reasons that I'm not able to try and describe in this posting, these excluded masses do not seem to be able to develop the entrepreneurial culture which is required. For another, the present high standards of living in the west depend almost completely on supplies of cheap fossil fuels which will soon be in decline. Given our present type of energy technologies, there is no way that Africa, South America, Central Europe and the Middle East will ever enter the system, even if they were able to adopt the economic conventions of the west.
My personal view, therefore, is that the argument for and against free trade has now become largely academic, given that the main issue in the coming decades will be bitter and savage wars fought over the declining oil and gas supplies. Western Europe, in the form of the European Union, seems to be very slow in letting down its protective trade barriers, so I think the economic future for the next decade or two will be almost totally dominated by America and China.
However, if we gradually move towards technologies based on solar power, as I believe we will do, then genetic engineering will enable the production of organic-based products rather than those which are metal-based which require the highly intensive energy given by a fossil-fuel energy system. This will mean that the production of consumer goods will, in principle, be able to be far more diversified than at present. All countries ought to be able to benefit. In being able to exchange genetic know-how via the Internet and future telecommunications systems, we will then be much more concerned with Free Information rather than Free Trade. Fortunately, copyright-restrictionists will no more be able to prevent the free flow of information anymore than the medieval guild masters and the early industrialists were able to prevent the leakage of secret manufacturing procedures.
KH
Keith Hudson, 6 Upper Camden Place, Bath, England
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