Thursday, March 05, 2009

Corn Laws and the Ironies of History

In the 1840s, England's Corn Laws (corn being a generic term for wheat, barely, and rye) were under a hot debate. The Laws issued a series of tariffs ensuring bread prices stay two to three times higher than they were 100 years ago. But as the Industrial Revolution pushed forward, mill owners knew cheaper food was crucial to feed their employees. There thus arose a battle between the landed aristocracy, arguing mercantilism and questioning this "new" economy, and manufacturers, citing Adam Smith and the logic of free trade. Thankfully the latter, led by Richard Cobden, won the day.

Manufacturing, once a great advocate of free trade, now in the West is its enemy. And if Lou Dobbs, a vocal opponent of free trade on the grounds that it hurts factories, lived a century and a half ago, he would be raging against the very sector he so persistently defends today.


jeremy h. said...

It seems like a stretch to claim that manufacturers supported free trade, broadly, simply because they supported repeal of the Corn Laws. I doubt manufacturers today are in favor of agricultural tariffs. (See also John Nye on this topic.)

David said...

I'm not claiming they were free traders in the broad sense that you or I are (though some were, notably Ricard Cobden). But trade creates winners and losers and, as Stolper and Samuelson noted, the winners will favor free(er) trade and the losers will be opposed to it. Notably, Coden advocated free trade to Napoleon III (who Nye rightly credits with France's jump in free trade until Napoleon's government was kicked out).

jeremy h. said...

In your post it sounds to me that you are claiming they were free traders broadly ("Manufacturing, once a great advocate of free trade"). If you are merely claiming that they supported free trade when it benefited them, that is a much narrower claim and I am in agreement. The reference to Lou Dobbs becomes particularly confusing in this light.

David said...

Like any movement, there are those who argue in sweeping terms and those who argue in narrow terms. Yes, I'm certain many people who advocated free trade did not read nor understand Ricardo. They'll cite whatever gets them farthest (though all Cobden was probably a true believer).

At the same time, there were many who were arguing against free trade but unconnected with trade's "losers." Autarky has its intuitive draw. I propose that Dobbs, living back then, would argue against trade as he does now, this time attacking manufacturing instead of defending it.