Organized Hatred From Above – Econlib

The ongoing trade war between the United States and Canada sheds light on the fundamental difference between free trade among individuals and organizations, and government-controlled trade which often leads to conflict and animosity.

Following President Donald Trump’s announcement of tariffs on Canadian imports, the Canadian government retaliated with tariffs on American exports. In a bold move, Ontario’s Premier Doug Ford imposed a 25% tax on electricity exports to certain US states. He even threatened to completely cut off electricity supply if the US escalates the trade war further. This aggressive stance highlights the tension and hostility that can arise when governments interfere with trade.

The fact that governments have a significant stake in the production and distribution of goods, such as electricity in Ontario, only serves to politicize the market further. With little constitutional constraints, governments can impose tariffs and restrictions at will, leading to a cycle of retaliation and discord.

It is worth noting that Premier Ford, a conservative with populist leanings, was once a supporter of President Trump. This serves as a cautionary tale about the dangers of blindly following the “will of the people” in matters of trade and diplomacy.

As Henry Adams famously said, politics is often driven by organized hatred. The moral implications of trade wars go beyond mere economic considerations, as they can have far-reaching consequences on international relations and peace.

In conclusion, the trade war between the US and Canada serves as a stark reminder of the dangers of government intervention in trade. It is essential to prioritize peaceful and mutually beneficial trade relations between individuals and private entities, rather than succumbing to the destructive forces of mercantilism.

[Credit: Image Source – Two mercantilist kings]