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The Corn Laws and Donald Trump

One of the issues that distinguishes Donald Trump from mainstream Republicans — aside from his bigotry towards Mexicans, women, and Muslims—is his opposition to free trade, which has been a staple of Republican ideology since shortly after World War II.

Trump’s repudiation of free trade flies in the face of economic opinion. A recent University of Chicago survey of a diverse group of high-profile economists found that a substantial majority believe that free trade agreements have benefited most Americans.

Trump’s break with free trade is reminiscent of a similar about face that culminated almost exactly 170 years ago, when a British politician made a similarly abrupt policy reversal—albeit in the opposite direction—and both lost his job and condemned his party to nearly three decades in the political wilderness.

Sir Robert Peel was elected prime minister at the British general election of 1841. Peel’s Conservative Party won a clear majority of both the popular vote and seats in Parliament. The Conservatives were staunch proponents of the Corn Laws, decades-old legislation that imposed tariffs on imported grain. These tariffs raised grain prices and made it easier for more expensive British grain to compete with cheaper imports from central and eastern Europe. Because the Corn Laws favored domestic agricultural interests, British and Irish landholders were strong supporters of the Conservative Party.

The outbreak of the potato blight in Ireland during the autumn of 1845 forced Peel to reconsider the established Tory trade doctrine. Repealing the Corn Laws would make it cheaper for the Irish to purchase grain and would alleviate what was rapidly becoming a devastating famine, one that would eventually claim the lives of a million Irish and lead to the emigration of an even larger number.

Robert Peel by unknown. Public domain via Wikimedia Commons.
Robert Peel by unknown. Public domain via Wikimedia Commons.

In the early hours of 16 May, 1846, supported by Conservatives loyal to Peel and the pro-free trade opposition, the House of Commons passed the repeal of the Corn Laws. Peel quickly lost the support of enough members of his own party to be driven from office and replaced the Liberal Party’s Lord John Russell. The Conservatives would not secure a Parliamentary majority on their own again until the general election of 1874.

Although repeal did not by any means save the Irish from starvation, repealing the Corn Laws was clearly an appropriate policy response to the Famine. It also set in motion a gradual liberalization of trade across Europe that contributed to strong economic growth in the late 19th century.

The outbreak of WW1 set globalization back. The trade restrictions enacted during the Great Depression and the remainder of the interwar period marked the end of the “first era of globalization.”  It was not until after World War II and the gradual lifting of trade restrictions under the General Agreement on Tariffs and Trade (subsequently replaced by the World Trade Organization) and other trade agreements that the second, and current, era of globalization began and, with it, increased prosperity.

Trump’s efforts to sink free trade fly in the face of both economic theory and historical experience. Some economic sectors will, of course, be hurt by free trade—theory and history are clear on that point—however, there is overwhelming evidence that free trade has a net positive effect on the economy as a whole. This evidence has not deterred Trump from currying favor with those who have been—or believe themselves to have been–hurt by free trade and demand a return to protectionism. If Trump succeeds in rolling back free trade, he will make the United States—and the rest of the world—poorer.

Trump’s success may lead to a schism in the Republican party. The signs of such a split are easy to spot. High-profile Republicans, including both former presidents Bush, 2016 presidential candidate Senator Lindsay Graham (R-SC), and 2012 GOP nominee Mitt Romney have declined to endorse Trump. Republicans should remember that after the Conservatives split over trade, they were not able to form a majority government for another 28 years.

Many of the Republicans opposing Trump do so because of his noxious views, rather than specifically because of free trade. Nonetheless, when Trump passes from the political stage—and sensible Republicans and Democrats can only hope that this will take place sooner rather than later–the split in the Republican Party may well endure. If it does, the Republican’s troubles may leave them in the political wilderness for a long time to come.

Featured image credit: wheat field close up by Devanath. Public domain via Wikimedia Commons

Recent Comments

  1. Traruh Synred

    This presents an over simplified picture of the benefits of trade. No trade is bad, fair trade is good, unrestricted trade is bad.

    If LaLa has good conditions for growing Oranges an Washington is good a apples, it makes sense for them to trade. There will be more apples and oranges in the world, if they specialize.

    If LaLa has good labor practices and big C has virtual slavery, then trade makes life worse.

    It may look good because the GDP goes up (equivalent to mean income), but the median income goes down in both countries.

    The rich get richer and the poor are with us even more.

    Bad!

    t

  2. Jorge

    Excellent article regarding the history of trade and the overall benefits to society. However, I would Love to hear how different societies handle the small population of “losers” in this or these trade deals? Have Some societies developed ways of retraining or specifically helping those who lose their jobs because of these deals? This will become even more important as computers, robots, self driving cars and computerized doctors and robot surgeons ( or even, God for bid, computerized economist) leave more of us without work.

    If the “winners” in this equation ignore the plight of the “losers”, look forward to more Brexits in the future!

    Are we headed for A guaranteed annual income to every member of society?

    Inquiring minds want to know!

  3. Horace G Atwater

    I found it interesting and informative!

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