Nationalism is the support of one’s national interests, often to the detriment of the interests of other nations. Defense and nationalism often go hand in hand as protectionist values are seen as necessary to promote and protect national interests. I am not a nationalist (indeed, I consider it a bad idea along with socialism and fascism); here I want to question the connection between nationalism and protectionism. I argue that, if one is a nationalist, one should be object protectionism, as protectionism weakens the body politic and national unity.
Protectionism, through tariffs and subsidies, aims to support various industries designated by the government as important to the country’s interests. These can be military industries (ships, weapons production, important inputs and natural resources, etc), technology (superconductors, AI research, etc), or goods necessary for the life of the country (food, art, entertainment, etc). There is then a common and common point that resources are scarce and that the support of these industries harms other industries. This choice can sow the seeds of national discord and division, but it is unlikely that it alone will weaken the body politic.
Rather, what is more important is that industries tend to be clustered and regionalized. In technical terms, there are external economies of scale: firms may pool together to use a common resource, reduce production costs, or reduce other costs, allowing them to produce more at a lower average cost. Famous examples of these external economies of scale include Silicon Valley, Dalton Georgia, Detroit, or the biomedical research cluster in Boston Massachusetts.
The fact that industries are clustered, rather than scattered randomly, across the nation is what leads to security that weakens the body politic. Certain regions of the country are favored at the expense of other regions. Some constituencies may resent being deliberately harmed at the expense of other parties. In the language of Carl Schmidt, the “friend-enemy” distinction is no longer directed at people outside the nation, but rather at the nation itself; unity is broken as people in the nation begin to see other nations as “enemies.” These internal divisions lead to internal strife and, in extreme cases, ethnic divisions.
In the US, there are several examples of this regional fragmentation weakening the body politic. Indeed, the American Revolution was fought slowly due to security protection values. In the list of complaints against the “pretend law” contained in the Declaration of Independence, one of them is: “to cut off our Trade with all parts of the world,” referring to the Navigation Acts. The Navigation Acts favored British shipping and commerce at the expense of Colonial trade. In turn, this made Americans feel marginalized and inferior as British subjects. Indeed, Adam Smith, also a (cautious) supporter of the Navigation Acts, asserted that they were “a stop in that great bloody vessel” of commerce and would “bring a most dangerous disturbance to the whole body politic” (The Treasure of Nations Book IV, Chapter 7, Part III, page 605). How right he was.
After the Revolution, tariffs remained a source of contention between the Founding Fathers and early Congressmen. Others, like Alexander Hamilton, wanted tariffs to be revenue-driven and disrupt trade as little as possible. Others, such as James Madison and Thomas Jefferson, argued that the new nation should use tariffs to try to force Great Britain to open trade with the US. In general, the Hamiltonian concept of income, instead of protection, taxation has succeeded, although there have been attempts at protection.
The most famous, and most dangerous, of these resulted in the Void Problem. Beginning in 1816, the federal government began imposing protective tariffs to support Northern manufacturers, but at the expense of Southern manufacturers and farmers. These costs culminated in the Tariff of Abominations of 1828. Southern states, especially South Carolina, were upset that the federal government was denying them such opportunities. South Carolina openly challenged the authority of the federal government by declaring the tax null and void within its borders. Finally, the crisis was tackled in 1833 with a new bill that gave South Carolina and the southern states much of what they wanted. But that event came dangerously close to dividing the newly formed nation (for a longer discussion of this history, see Trade Conflict by Douglas Irwin, Chapter 2).
Recently, such industrialization was used by China during the Trump administration’s trade war. By favoring certain industries at the expense of others, the administration opens the door to Chinese retaliation. China retaliated by targeting US agricultural exports to regions that were volatile states. These protectionist fees create perceived divisions that the enemy can use to weaken the political system.
In conclusion, nationalists should object The amount of protection given to the defenders weakens the body of the nation. Perhaps in a small, homogeneous nation, where there is little economic diversity, nationalism and protectionism can complement each other (although this is unlikely given that taxation in such cases can lead to an overall decline in national welfare). But that is not the case in many nations of the world today, not least in the United States of America.
Jon Murphy is an assistant professor of economics at Nicholls State University.
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