Decentralization and international affairs
By Scott Sumner
In previous posts, I’ve criticized the US for bullying other countries to adopt our policies on issues such as tax evasion. Here’s an excerpt from a 2015 post:
It seems breathtakingly arrogant for the US to insist that other countries have the same privacy laws that we have. But this is worse. How would you describe a country that used its awesome power to intimidate small countries to abandon their long cultural tradition of protecting privacy, and then turned around and drew in vast amounts of ill-gotten gains from overseas by shielding those investments from public scrutiny?
Today the problem is far worse. Back in 2015, the US bullied countries on issues where there was substantial international support for the American position. Today, the US is the outlier, and yet we continue to bully smaller nations. Consider the following two facts:
1. There is very widespread support among developed nations for the Iran nuclear deal.
2. There is very widespread opposition among developed nations to launching international trade wars.
You might be thinking that just because other countries favor a policy doesn’t mean the US must go along. If so, you are exactly right. Indeed, this is precisely my point. Centralized decisions tend to be dangerous because if they are mistaken then the damage is far greater than if just a single country adopts the policy. One reason the UK is leaving the EU is that the EU went too far, legislating on issues best left to national or local governments.
Unfortunately, the new administration does not believe in decentralization, and is trying to force the entire world to follow the US lead. That would be unfortunate if the US policies still reflected the global consensus, but today it’s far worse. The US is attempting to force other countries into adopting policies that are widely viewed as misguided. Thus the US recently bullied Canada into agreeing not to do a free trade agreement with China. We bully foreign countries to stop doing business with Iran, threatening to cut off access to the US banking system if they do not comply.
Conservatives have traditionally favored a more decentralized approach to policy, as a way of minimizing the damage caused by misguided government policies. Many of today’s conservatives seem to have abandoned that wise approach, and now favor using the economic power of the US to interrupt international trade with other countries.
Hasn’t it always been like this? Not as far as I know. The US has long refused to trade with Cuba, but in the past we didn’t prevent other countries from doing so.
I don’t have firm views on foreign policy. But I do know one thing—no one can claim any sort of certainty as to the best policy regime for international affairs. You may have strong views one way or another on China and Iran, but other equally well informed people will have different views. In a world of uncertainty, modesty is the best option.