Donald Trump likes to tell us that ‘tariff’ is ‘the most beautiful word in the dictionary’. He does not remind us that the word comes from the Arabic ta’rif, or that such duties were first applied by medieval sheikhs and sultans in some of the places he has designated as ‘shithole countries’. They were not really things of beauty either, being modest tolls to raise a little revenue, not intended to keep out foreign stuff, and were seldom charged at more than 5 per cent. It was the same in ancient Greece and Rome: customs duties were charged at ports of entry at rates of between 1 and 5 per cent. In Rome, the portoria on luxury imports – silk, pearls, incense, pepper – could go much higher, up to 12 or even 25 per cent, but these were sumptuary taxes, to appease killjoys such as Seneca and Pliny. They too were not protective, being levied on goods that Rome could not produce itself.
Trump once scribbled a note on the way back from a frustrating G20 conference: ‘TRADE is BAD.’ Classical thinkers would have tended to agree, if not on quite the same grounds. Aristotle thought that the life of tradesmen and mechanics was ‘ignoble and inimical to virtue’. He rather approved of the way that Thebes disqualified business types from public office until they had been retired for ten years. In The Laws, Plato deplores people living near harbours: ‘Although there is sweetness in proximity for the uses of daily life; for by filling the markets of the city with foreign merchandise and retail trading, and by breeding in men’s souls knavish and tricky ways, it renders the city faithless and loveless.’ Self-sufficiency, autarkeia, was always preferable, trade at best a necessary evil. Only Pericles, according to Thucydides, had positive things to say about an open commercial society:
The greatness of our city brings it about that all the good things from all over the world flow in to us, so that to us it seems just as natural to enjoy foreign goods as our own local products … Our city is open to the world, and we have no periodical deportations in order to prevent people observing or finding out secrets which might be of military advantage to the enemy.
It was also Pericles, however, who brought in a law forbidding foreign-born Athenians from claiming full citizenship, which would certainly have appealed to Trump (though his wife would have fallen foul of the law, as indeed did the second wife of Pericles).
We do not often find in the ancient world the fierce determination actually to keep out foreign imports, and foreigners too, in the sort of language the president uses, which Ben Chu quotes at the start of his sharp analysis of modern tariff mania: ‘There never has been a time in the history of the United States when tariff protection was more essential to the welfare of the American people than at present.’ Such a plonking plank of policy finds little or no support in economic theory. More than a thousand economists wrote to the White House imploring the president to think again. Undaunted, he persisted with tariffs across the board, twinning them with the repatriation of more than a million Mexicans (half of whom were US citizens). The president that Chu is quoting was of course Herbert Hoover in 1932. Very little that Trump has actually done is without parallel in the Hoover years, and neither is the reaction from mainstream economic theory. A thousand economists delivered exactly the same message to Trump in 2018, making just as little impact as their predecessors. All that is different today is the saucy, teasing rhetoric of the incumbent, of which the buttoned-up Herbert would have been incapable.
This is an unnerving parallel, and not the least unnerving aspect of the rise of the tendencies – isolationist, nationalist, populist or a combination of all three – which have so abruptly turned ‘globalist’ into a term of abuse. Chu, a BBC journalist of Chinese descent brought up in the North of England, is an acute guide, both to the historical resonances and the present economic realities, which leave even the most cocksure of us breathless and not a little baffled. We might start at the very least by looking further back beyond the 1930s, to try to trace the peculiar origins of protectionism as a weapon of choice in the armoury of modern governments. Trade history is too often a sideline reserved for economic historians, yet any effective study of the past four hundred years ought to move it to centre stage, as a prime generator of war and peace, stability and chaos, prosperity and dearth. As Clausewitz might have said, shooting wars are trade wars carried on by other means. Napoleon’s invasion of Russia, for instance, came after the tsar quit the Continental Blockade.
Through the Middle Ages, there seems to have been a presumption that unimpeded, if not untaxed, trade was a good thing. The door needed to be kicked open now and then, as, for example, by Clause 41 of the Great Charter of 1215: ‘All merchants may enter or leave England unharmed and without fear, and may stay or travel within it, by land or water, for purposes of trade, free from all illegal exactions, in accordance with ancient and lawful customs.’ There were toll points on bridges, mountain passes and harbours, but the goods got through, often facilitated by local colonies of foreign traders, such as the German merchants on the Rialto.
It is only with improved trading links and the appearance of ambitious and energetic rulers that the idea of blocking imports or subsidising exports comes into play. The period that historians have designated as early modern Europe has been associated with several things: the Reformation, and the rise of capitalism and of colonialism, to name just a few. But what it is certainly soaked in is the rise of protectionism, as both an economic tool and a demonstration of national virility. Henry VIII’s declaration in his 1533 Statute in Restraint of Appeals that ‘this realm of England is an empire’ has been a rallying cry for nationalists ever since. The sense of a separate national identity and of an increasingly manifest destiny becomes unmistakable.
Sceptics such as the historian William Bouwsma have argued that even the roi soleil did not always get his own way. Monarchs who wanted to throw their weight about remained as short of cash as ever. Even under Jean-Baptiste Colbert, the greatest of mercantilists (as proponents of the new orthodoxy later came to be called), the government’s deficit went on rising.
Mercantilism usually means cronyism. As soon as a government resorts to protection, it is besieged and then manipulated by entrepreneurs angling for contracts and subsidies. That certainly happened in France, where Colbert’s friends and relations collected most of the taxes and then dished out the proceeds to their own businesses. Samuel Daliès de la Tour, for example, was not only chief tax collector for the Dauphiné but also a big supplier of timber and iron to the rapidly growing navy, with a nice sideline in textiles and sugar and also shares in the great colonial companies – quite a match for the Rockefellers and Musks of the modern era. Rather than ‘l’État, c’est moi,’ Daniel Dessert writes in his scorching demolition of the Colbert myth, Colbert ou le mythe de l’absolutisme (2019), it was a case of ‘l’État, c’est eux!’ The same nexus of omnivorous oligarchs was to be seen in America’s Gilded Age, and now in the mob of tech bros crowding into the photo at Trump’s second inauguration. The itch to have it all had come to stay, along with a willingness to deploy every tool that came to hand: tariffs, blockades, monopolies.
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