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Obama’s “Free-Trade Pact” Is the Opposite of Free Trade


President Obama’s “free-trade pact” with Colombia at the recent Summit of the Americas demonstrates the statist mindset of liberals and, well, for that matter, conservatives — and shows how different their mindset is from that of libertarians.

According to the Los Angeles Times, “When the pact takes effects May 15, most industrial and manufactured products exported from the U.S. and Colombia will immediately become duty free, making it cheaper for American businesses to sell their goods in Colombia. More than half of U.S. agricultural exports to Colombia will also become duty free.”

What’s wrong with tax-free commerce between the United States and Colombia?


What’s wrong with this picture is that when governments are entering into these types of “free-trade” agreements, that’s not “free” trade, it’s managed or controlled trade.

Underlying these types of issues is a critically important question: What is the role of government in a free society? Should government have the authority to control and dictate what its citizens do with their own money? Should it have the authority to impose tariffs and import restrictions on the purchase of foreign goods?

Both conservatives and liberals, being the good, little statists they are, say that of course government should have the authority to control, manage, direct, and restrict what people do with their own money.

In principle, the statist philosophy of American conservatives and liberals is no different from that which exists in Colombia, Cuba, Bolivia, Mexico, and other Latin American countries. All those countries are guided by statism. People there believe that government should tightly control the economic activities of the citizenry, just like American statists do.

The difference between Latin American countries and the United States is one of degree, not of principle. There is much more economic control by governments in Latin America than there is by the U.S. government here within the United States, which is why people in Latin America are much poorer than people in the United States. But the principle of government control over economic activity in the United States and Latin America is the same.

That principle is demonstrated perfectly with the “free-trade pact” entered into between Obama and the Colombian regime. Both regimes maintain tight economic controls over the trading decisions of their citizens, and some of those controls are now being lifted by mutual consent of the U.S. government and the Colombian government.

That’s not free trade. That’s managed trade. That’s trade by government permission. That’s government control over economic activity.

How are libertarians different from conservative, liberal, and Latin American statists?

We believe in the concept of fundamental, natural, God-given rights — that is, rights that preexist government. Among those rights is what is called economic liberty, a right that conservatives sometimes pay lip service to but don’t really believe in.

What is economic liberty? It entails the right to engage in economic enterprise free of government control. That’s what “free” enterprise and “free” trade mean to libertarians — enterprise and trade that are free of government regulation, control, management, or interference.

Economic liberty also entails the right to engage in economic transactions with anyone anywhere in the world without governmental infringement or interference.

That means the freedom to sell whatever you own to anyone on mutually agreeable terms. It’s your property, after all. You own it. You have the right to dispose of it without getting permission from the government.

The principle is the same with respect to buying something. It’s your money, not the government’s. You have the right to spend your money any way you want, without governmental interference.

So, what should the U.S. government do with its pervasive array of tariffs, import restrictions, sanctions, and embargoes?

Just lift them. No negotiations and no “free-trade agreements.” Just free the American people to do whatever they want with their own money with anyone anywhere in the world.

Economic liberty means a total separation of economy and the state, just as our ancestors separated religion and the state.

Wouldn’t this mean that foreign regimes could still maintain statist economic controls on their citizenry? Of course. But that’s a problem for the citizens of other countries to resolve. It’s up to them to get their governments to lift their restrictions.

Having the U.S. government infringe on the freedom of the American people as a way to retaliate against foreign regimes for infringing on the freedom of their citizenry is nonsensical, immoral, and counterproductive. It’s the wrong way to go. Why become a statist nation just because other nations have gone statist?

Anyway, what better way to lead the world to peace, harmony, and liberty than by example?

This post was written by:

Jacob G. Hornberger is founder and president of The Future of Freedom Foundation. He was born and raised in Laredo, Texas, and received his B.A. in economics from Virginia Military Institute and his law degree from the University of Texas. He was a trial attorney for twelve years in Texas. He also was an adjunct professor at the University of Dallas, where he taught law and economics. In 1987, Mr. Hornberger left the practice of law to become director of programs at the Foundation for Economic Education. He has advanced freedom and free markets on talk-radio stations all across the country as well as on Fox News’ Neil Cavuto and Greta van Susteren shows and he appeared as a regular commentator on Judge Andrew Napolitano’s show Freedom Watch. View these interviews at LewRockwell.com and from Full Context. Send him email.