Kant, Hume, Smith, and Addison on Trade and Peace (and War)

Just as nature wisely separates nations, which the will of every state, sanctioned by the principles of international law, would gladly unite by artifice or force, nations which could not have secured themselves against violence and war by means of the law of world citizenship unite because of mutual interest. The spirit of commerce, which is incompatible with war, sooner or later gains the upper hand in every state. As the power of money is perhaps the most dependable of all the powers (means) included under the state power, states see themselves forced, without any moral urge, to promote honorable peace and by mediation to prevent war wherever it threatens to break out.--Kant, Perpetual Peace.

In the passage above, Kant, articulate the Liberal faith in international trade as a means toward peace.  The peaceable "spirit of commerce" operates both (i) within states (by making states averse to war-making) and (ii) between states by (a) enticing them toward peace prior to conflict and (b) giving them an incentive to mediate in other nation's conflicts. In Kant's hands this spirit is a-moral. Kant comes close to endorsing a theodicy of unintended consequences here. However, for Kant, the crucial political issue is to create the conditions under which this spirit can exercise itself by curtailing a commercial state's almost unlimited ability to contract debt to fight wars.

By contrast, while in his essay, "Of Refinement in the Arts," Hume certainly promotes the softening features of commerce within states (people are said to become more "humane" as a consequence of it) as a good thing, one of Hume's main argument(s) to promote commerce is in terms of it's value in facilitating the state's war-marking powers: "according to the most natural course of things, industry and arts and trade encrease the power of the sovereign as well as the happiness of the subjects." ("Of Commerce.")

One might expect, perhaps, that Adam Smith anticipates Kant's Liberal faith.  And, indeed, there is an attenuated sense in which he does. He writes in Wealth of Nations:

Commerce, which ought naturally to be, among nations, as among individuals, a bond of union and friendship, has become the most fertile source of discord and animosity. The violence and injustice of the rulers of mankind is an ancient evil, for which, I am afraid, the nature of human affairs can scarce admit of a remedy. But the mean rapacity, the monopolizing spirit of merchants and manufacturers, who neither are, nor ought to be the rulers of mankind, though it cannot perhaps be corrected, may very easily be prevented from disturbing the tranquillity [sic] of any body but themselves. (WN 4.3.c.93)

For, Smith, an uncorrupted spirit of commerce ought, perhaps lead to peace. In practice, while trade facilitates closer ties among individuals, once the merchant classes capture the state, the spirit of commerce is corrupted by the monopolzing spirit, which sees international trade as fundamentally zero sum. Once the state becomes an extension of the interests of merchants and manufacturers, violent conflict among states and imperial conquest follow in its wake. “These misfortunes [i.e., imperial conquest--ES], however, seem to have arisen rather from accident than from any thing in the nature of those events themselves.” (WN 4.7.c.80, 626; emphases added). In context, Smith is referring to the very unequal military power between Europeans and colonized.

Moreover, while Smith clearly intimates that one can guard against the capture by the state of merchants and manufacturing interests, he does not think that trade is a full "remedy" against the violence and injustice of the rulers of mankind. If Smith believes in theodicy at all, it's very incomplete. As Maria Pia Pagnaelli has argued, Smith argues that trades also increases the likelihood of war (she cites WN 4.8.53: 661 & 5.3.37, 920.) So, only when trade occurs within a balance of power, can one expect it to be conducive toward peace.

But Kant's Liberal faith does have a British predecessor in Joseph Addison (recall):

THERE is no place in the town which I so much love to frequent as the Royal Exchange...I must confess I look upon high-change to be a great council, in which all considerable nations have their representatives. Factors in the trading world are what ambassadors are in the politick world; they negotiate affairs, conclude treaties, and maintain a good correspondence between those wealthy societies of men that are divided from one another by seas and oceans, or live on the different extremities of a continent. I have often been pleased to hear disputes adjusted between an inhabitant of Japan and an alderman of London, or to see a subject of the Great Mogul entering into a league with one of the Czar of Muscovy. I am infinitely delighted in mixing with these several ministers of commerce, as they are distinguished by their different walks and different languages: sometimes I am justled among a body of Armenians: sometimes I am lost in a crowd of Jews;* and sometimes make one in a group of Dutchmen. I am a Dane, Swede, or Frenchman at different times; or rather fancy myself like the old philosopher, who upon being asked what countryman he was, replied, that he was a citizen of the world--Spectator No. 69, Saturday, May 19, 1711.

Addison offers a striking vision of trade as autonomous and distinct from state activity (while being parallel to it).  He clearly thinks that trade is conducive toward peace in virtue of generating a shared legal framework. Moreover, trade facilitates a cosmopolitan outlook. And Addison thinks that by pursuing their "private Fortunes" they (unintentionally) promote "the publick stock; or in other Words, raising Estates for their own Families, by bringing into their Country whatever is wanting, and carrying out of it whatever is superfluous."

Addison intimates that the division of labor is a consequence of provential division of good/talents, which allows the globe to "be united together by common interest." For Addison, the "merchants" are, therefore, "the most useful members in a Commonwealth. They knit mankind together in a mutural intercourse of Good offices, distribute the Gifts of Nature, find work for the Poor, add Wealth to the Rich, and Magnificence to the Great."** But it is unclear to me if Addison thinks merchant interests will necessarily predominate against determined state control or if trade is capable of securing peace among states.

 

* The mention of Jews here is no accident; Addison treats Jews as essential to world trade (Spectator, No 495). It seems that Addison is inclined to promote Jewish distinct identity for this purpose.

**Addison also thinks that trade emancipates within a country; it turns people fram vassals into a private men, negotiating "like princes."

 

Comments

[Vernon L. Smith]

In public lectures years ago on Globalization, I used the proposition: “If goods don’t cross borders, soldiers will,” attributing it erroneously, as have many others, to Bastiat.
For a correction, see
http://oll.libertyfund.org/index.php?option=com_content&task=view&id=1678&Itemid=281
The form of the proposition affirms the idea that although trade may be peace-enabling, trade is not a sufficient condition to prevent armed conflict. The absence of trade invites hostility, but the existence of trade yields conditions that might promote peace or might not. I recall that people would sometimes tell me that the proposition did not hold; e.g., that the European countries were trading with each other prior to World War I. This form of misinterpretation seems quite common, even natural, because I think there is an urge to find policies that are unambiguously instrumental—sufficient—in producing the results intended, such as human betterment. People want propositions like that of Robert Frost: "Good fences make good neighbors."
We harbor the hope that the set of such policies is not empty.