Is PRISM an argument for Protectionism?Submitted by BILL3 on Thu, 07/04/2013 - 20:31
According to the fundamentalist dogma of free trade, nations have no interest in protecting or fostering the independence of their own firms and industries. Everything, it says, should be determined by the competitive process of the free market, without any regard for borders, national interests, the autonomy of essential industries, or any other factor.
Isn't PRISM and the Snowden leaks one more example of an instance where nations and political units do have a real, demonstrable interest in having at least some industries operating in their borders, under their law, and outside the dominance of some external political power?
People in other countries who desire to ensure the integrity and privacy of their communication networks have an interest in having domestic firms independent from the American government, regardless of what the market decides are the best firms in the industry (ISPs, social networks, search engines).
Google or Facebook may be the best at what they do, but because of political realities, it might be in the interest of other nations to foster a diversity of unprofitable or less profitable competitors that can operate outside of the United States.
While it is true that the market can also offer independent alternatives with security and independence of information, it offers no guarantee of their success. They might fail, in the market, to garner a profit or a wide user base. That is the nature of the market. It does not guarantee any outcome other than the success of the more profitable firms.
A nation might decide as a matter of public policy to promote alternatives to telecom behemoths that the market has crowned as the best, regardless of considerations of profit or loss. It can decide that there is a higher standard than market success and act to impose that standard.
The Broader Principle
The principle established by this example is that some priorities trump free market competition -- having certain industries outside the scope of control or pressure by a foreign government is just one instance.
If country A has certain standards of privacy of information, it needs to foster and protect companies in such industry without regard to market factors. The market -- the consumer -- will not necessarily value this priority, even if "the people" do actually and sincerely value it on the level of political consciousness. Not every value can be expressed economically, or be effected through the price system.
Sometimes the competitive forces in the market deny an outlet to political considerations. We compartmentalize politics and shopping in different mental spheres. This is the simple reality. We believe some things are to be determined on a political level, and that belief influences how we act.
How many of us stop eating chicken if we hear about the mistreatment of chickens on factory farms? How many of us investigate in detail the labor conditions in the distant places where the products we buy come from? There are serious practical and logistical problems in expecting the mass of consumers to make their shopping decisions on the basis of political concerns.
How Broadly Can the Principle Be Applied?
Once the principle is established that some priorities trump purely market determined outcomes, and that there are higher standards than the economic consideration of price and quality, than the whole terrain is opened up to other applications of the same principle.
For instance, if country A has certain standards it applies in the law in regard to pollution, waste disposal, or labor conditions, then isn't it appropriate to limit free trade to those countries and companies which also adhere to the same standards of behavior? Those who operate outside said standards can obviously make the same product at a lower cost, all else being equal, and so profit at the expense of those others who adhere to the common standards. They gain advantage by engaging in behaviors deemed harmful.
So why is the market verdict of better price/product a higher standard than that of the integrity of privacy, or the respect for some agreed upon human rights, or the moral issues of abuse of labor and abuse of the natural environment?
Would free trade trump all moral considerations, to the extent of endorsing trade with firms and countries that permit chattel slavery? The line clearly exists -- where is it drawn?
The Fundamental Question
What makes economic profit a higher standard and higher authority than other value judgments, as expressed through the law? Are there not things above the economic plane, which need to be decided on the political level?
Final judgements of value are subjective, and are above the market process. The market process is a means, and cannot decide ends. It can certainly have moral content and spring from moral principles. It can also spread habits of mind, manners and behavior that are morally beneficent.
Or, potentially, it can spread their opposites, and promote a negative leveling of culture to the lowest common denominator of consumer demand and profit. It can eliminate something essential like investigative journalism simply because it is hard to turn a profit from in comparison with other alternative uses of capital at media firms. The consumer does not demand investigative journalism, apparently.
The market is morally neutral, and whether it promotes a better or worse moral condition or level of culture is up to the judgement of each person. The market, as such, is a necessary institution based on the existence of private property, which is so rooted in human nature that it could never be truly eliminated. No political order with any wisdom would try to do so. But to what extent the market is allowed to decide the character of any given industry or civil institution is a political choice. Ultimate values are decided subjectively, and are not subordinate to the choice of the consumer.
To Round it Out with a Concrete Example
Suppose I am an Icelander. Does my right as an individual to purchase services from top companies like American ISPs trump my countries' interest in having ISPs operating outside the control and legal reach of American secret courts and NSA wiretaps?
What measures can a small European government like Iceland's legitimately take in order to ensure it has its own ISPs, supposing that the pure market outcome deems them unprofitable or inferior to American ISPs?
The same question can be asked in regard to firearms firms, and many other industries essential to a nation's ability to act independently from international bullies and snoops, and to defend itself in a last resort scenario.
So then, if it is legitimate for a nation, through its political and legal system, to prop up, subsidize, or protect x industry, or to tax, exclude, or otherwise handicap its competitors, then doesn't that principle extend to other areas? If so, how far? And why?
Can't citizens in country B decide that their industries, in adhering to certain conditions deemed moral or necessary, operate at a disadvantage to sweatshops or polluters outside their borders, and so deserve a level playing field via some legal restrictions on the competition of those outside the same set of standards?
Think of the principle in war, that signatories to the Geneva convention will be obligated to treat the uniformed prisoners of other signatories according to certain standards, which do not apply to non-uninformed, non signatories. If this principle applies in war, why not also in trade?
Surely the constitution is no argument against protection, anymore than it is an argument for unrestricted movement of labor and populations across borders; America has engaged in protection for a variety of purposes, as well as immigration controls, since the founding.
Let's hear some good arguments, preferably ones that do not rely on blanket claims about the unlimited freedom of individuals to do whatever they want, whatever the cost to society, its laws and institutions.