State governments may laud the praises of free trade but it is difficult to implement under present economic conditions. Like disarmament free trade falls victim to a Mexican standoff. The first one to disarm or open borders to trade unilaterally is placed at a disadvantage. The tendency is for States to negotiate partial disarmament and partial opening of borders to more unrestricted trade. But this becomes a lengthy and complicated process because the need for verification and monitoring for compliance puts a serious strain on resources and friendships.

The North American Free Trade Pact and the European Common Market are two notable attempts to increase free trade within a restricted area though the Russian Federation was also a free trade zone while the communists were in power the benefits of which were more than offset by the absence of a private sector to actually engage in free trade.

Creating free trade requires more than just bilaterally opening borders to the exports of other nations. Free Trade as an idea presupposes the existence of Second Generation Free Markets and what Free Trade agreements attempt to do is to define the rules of the game so the two sides can compete on a relatively even playing field. Of course no human agency is able to level out the differences that exist between trading partners so the trade is never totally equitable.

Third Generations Free Markets not being confined to Zero Sum thinking or Zero Sum solutions do not promote Free Trade as a specific objective because Free Trade is part of the Third Generation structure.

 

 

 

 Index of essays

 

 


Why Is There Not More Free Trade