Trade: a better path to freedom

Chief Executive, The, March, 2005

WE'RE HEARING A LOT about "freedom" these days and how it requires a major escalation of military spending to achieve it. In some cases, that may be necessary. But an important part of the debate is missing.

The question is, Freedom from what? Everybody understands freedom from tyranny. But a far larger percentage of the world's population is yearning for freedom from civil and ethnic strife, from hunger, from not being able to drink the water, from dying at a tender age. What are the solutions to those yearnings for freedom? Guns don't seem to work.

We think business and globalization are part of the answer and the Bush Administration ought to begin recognizing that. We'd argue that business and trade, on balance, bring about more positive than negative results: American CEOs are building factories, creating R & D centers, offering new products, spurring trade, training workers and paying taxes in countries around the world.

Although outsourcing is still intensely controversial, it is creating jobs in India, the Philippines and even Africa. If you believe in free trade, you have to accept that it is desirable to allow less developed countries with abundant manpower to trade their services. It is much the same with the exchange of goods. While furniture companies may be closing factories in North Carolina, they are creating bright futures in China.

Asia is, of course, the best example of what prosperity creates: the chances of a Chinese invasion of Taiwan, nuclear war between North and South Korea or bitter conflict between India and Pakistan--all these possibilities have been sharply reduced because everyone has an economic stake to defend.

What can any president do to spread prosperity and therefore freedom? One step is to create an environment in which American CEOs have confidence in their domestic operating climate. The rising tide of regulation, litigation and out-of-control costs should be checked. Corporate leaders also need to enjoy an international climate in which U.S. business is well-received, not mistrusted.

In short, if we truly believe in freedom, military action may be more divisive than it is helpful. At a bare minimum, the administration should establish a new balance in its foreign policy. It should recognize that trade is, in some ways, a more lasting solution than armed intervention. As George Washington once said, "I am for free commerce with all nations; political connection with none; and little or no diplomatic establishment." Obviously, we still need diplomacy. But arguably, trade should be as paramount as it was for one of the nation's founders.