False Economy - Alan Beattie [86]
There are, too, more prosaic reasons for farmers' power. As we saw in the water chapter, they can claim, sometimes even with justification, that keeping some food production at home will help protect the country in case a war or some other disaster cuts off imports. They are also often very good at lobbying, frequently being concentrated in ways that maximize their power, and skilled at building coalitions. The U.S. cotton interest, for example, has power beyond its size partly because it is spread among a number of smaller southern states. Since every state has two senators, regardless of size, cotton commands a disproportionate bloc in the Senate. In 2006, ten southern senators wrote to the U.S. trade representative's office threatening to vote against any deal in the Doha round that made radical changes in the U.S. cotton support program. The six states they represented have a combined population of less than 33 million. California, by contrast, where many of the asparagus growers live, and which receives a disproportionately small share of government farm subsidies, has just two senators for 36 million people. American cotton growers are part of a powerful coalition with other heavily subsidized farmers. They also have managed to co-opt many U.S. textile producers. In theory the textile interests should prefer cheaper imported cotton to the expensive domestic variety, but they have been bought off through a special government compensation program.
Indeed, the textile and clothing industry is not far behind farming in its ability to stage protracted defenses of an uncompetitive position. Mass-production clothing is cheap to set up and employs a lot of unskilled labor. It is also a ferociously competitive arena and hence even small shifts in costs or efficiency can put a whole national industry rapidly at risk.
So it is not surprising that the modern debates over free trade more or less began with an antecedent of the bra wars, the "Calico Law" controversy that dragged on for decades in the late seventeenth and early eighteenth centuries. It set English textile and clothing manufacturers against importers and provoked the most extraordinary political and intellectual ferment—particularly remarkable since formal theories of free trade were not elaborated until a century or so later.
At the time, one of the dominant beliefs in England about trade was "mercantilism"—broadly, that exports were an intrinsic good, as they strengthened the country, earned money in the form of precious metals from abroad, and helped build up the naval expertise on which an island nation depended. Modern-day economists would shudder at this, arguing that exports are a necessary evil. What matters is what we consume, not what we make, and exports are merely the good stuff we have to sell to foreigners in order to pay for what we want in return. It doesn't specifically benefit the Chinese to ship iPods to America rather than use them themselves: they do it to earn dollars to import the oil and aircraft and so on that they need. However, this was a time when trade often followed the mail-gloved strong arm of the state, and the distinction between the military navy and the merchant navy was less clear than it is now. Without a functional international market in place, it was more justifiable to think of exports as evidence of strength. The argument about their importance in building up shipping was later accepted even by Adam Smith, generally a staunch supporter of free trade.
For England to expand its trade in the mid-seventeenth century, for example, the Lord Protector, Oliver Cromwell, had had to eschew the standard practice of conducting wars against religious opponents. He launched, instead, the first in a series of sea battles against the Dutch, the other big Protestant power in Northern