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CIAO DATE: 07/06
Daniel Griswold is director of the Center for Trade Policy Studies at the Cato Institute in Washington, D.C. He is the author of numerous studies and articles on trade, immigration, and globalization, including the January 2004 study "Trading Tyranny for Freedom: How Open Markets Till the Soil for Democracy," available at www.freetrade.org.
When trade and globalization are discussed in the U.S. Congress and in the American media, the focus is almost entirely on the economic impact at home—on manufacturing, jobs, and wages. But trade is about more than exporting soybeans and machine tools. It is also about exporting freedom and democracy.
Since September 11, 2001, the Bush administration has articulated the argument that trade can and must play a role in promoting democracy and human rights in the rest of the world. In an April 2002 speech, President Bush said, "Trade creates the habits of freedom," and those habits "begin to create the expectations of democracy and demands for better democratic institutions. Societies that are open to commerce across their borders are more open to democracy within their borders."
Trade, Development, and Political Reform
The connection between trade, development, and political reform is not just a throwaway line. In theory and in practice, economic and political freedoms reinforce one another. Political philosophers from Aristotle to Samuel Huntington have noted that economic development and an expanding middle class can provide more fertile ground for democracy.
Trade and globalization can spur political reform by expanding the freedom of people to exercise greater control over their daily lives. In less developed countries, the expansion of markets means they no longer need to bribe or beg government officials for permission to import a television set or spare parts for their tractor. Controls on foreign exchange no longer limit their freedom to travel abroad. They can more easily acquire tools of communication such as mobile phones, Internet access, satellite TV, and fax machines.
As workers and producers, people in more open countries are less dependent on the authorities for their livelihoods. For example, in a more open, market-driven economy, the government can no longer deprive independent newspapers of newsprint if they should displease the ruling authorities. In a more open economy and society, the "CNN effect" of global media and consumer attention exposes and discourages the abuse of workers. Multinational companies have even greater incentives to offer competitive benefits and wages in more globalized developing countries than in those that are closed.
Economic freedom and rising incomes, in turn, help to nurture a more educated and politically aware middle class. A rising business class and wealthier civil society create leaders and centers of influence outside government. People who are economically free over time want and expect to exercise their political and civil rights as well. In contrast, a government that can seal its citizens off from the rest of the world can more easily control them and deprive them of the resources and information they could use to challenge its authority.
Increased Democratization
As theory would predict, trade, development, and political and civil freedom appear to be tied together in the real world. Everyone can agree that the world is more globalized than it was 30 years ago, but less widely appreciated is the fact that the world is much more democratized than it was 30 years ago. According to the most recent survey by Freedom House, the share of the world's population enjoying full political and civil freedoms has increased substantially in the past three decades, as has the share of the world's governments that are democratic.
In its annual survey, released in December 2005, the human rights research organization reported that 46 percent of the world's population now lives in countries it classifies as "Free," where citizens "enjoy open political competition, a climate of respect for civil liberties, significant independent civic life, and independent media." That compares to the 35 percent of mankind that enjoyed a similar level of freedom in 1973. The percentage of people in countries that are "Not Free," where political and civil liberties are systematically oppressed, dropped during the same period from 47 percent to 36 percent. The percentage of the population in countries that are "Partly Free" has remained at 18 percent. Meanwhile, the percentage of the world's governments that are democracies has reached 64 percent, the highest in the 33 years of Freedom House surveys.
Thanks in good measure to the liberating winds of globalization, the shift of 11 percentage points of the world's population in the past three decades from "Not Free" to "Free" means that another 650 million human beings today enjoy the kind of civil and political liberties taken for granted in such countries as the United States, Japan, and Belgium, instead of suffering under the kind of tyranny we still see in the most repressive countries.
Within individual countries, economic and political freedoms also appear to be linked. A 2004 study by the Cato Institute, titled "Trading Tyranny for Freedom," found that countries that are relatively open to the global economy are much more likely to be democracies that respect civil and political liberties than those that are relatively closed. And relatively closed countries are far more likely to deny systematically civil and political liberties than those that are open.
From Economic Reform to Political Reform
In the past two decades, a number of economies have followed the path of economic and trade reform leading to political reform. South Korea and Taiwan as recently as the 1980s were governed by authoritarian regimes that did not permit much open dissent. Today, after years of expanding trade and rising incomes, both are multiparty democracies with full political and civil liberties. Other countries that have most aggressively followed those twin tracks of reform include Chile, Ghana, Hungary, Mexico, Nicaragua, Paraguay, Portugal, and Tanzania.
In other words, governments that grant their citizens a large measure of freedom to engage in international commerce find it increasingly difficult to deprive them of political and civil liberties, while governments that "protect" their citizens behind tariff walls and other barriers to international commerce find it much easier to deny those same liberties. Of course, the correlation between economic openness and political freedom across countries is not perfect, but the broad trends are undeniable.
The application for U.S. foreign policy is that trade and development, along with its economic benefits, can prove to be powerful tools for spreading broader freedoms and democracy around the world.
In mainland China, for example, economic reform and globalization give reason to hope for political reforms. After 25 years of reform and rapid growth, an expanding middle class is experiencing for the first time the independence of home ownership, travel abroad, and cooperation with others in economic enterprise free of government control. The number of telephone lines, mobile phones, and Internet users has risen exponentially in the past decade. Millions of Chinese students and tourists travel abroad each year. That can only be good news for individual freedom in China, and a growing problem for the government.
Free trade and globalization can also play a role in promoting democracy and human rights in the Middle East. In a May 2003 address outlining his plan for a Middle East free trade area, President Bush said, "The Arab world has a great cultural tradition, but is largely missing out on the economic progress of our time. Across the globe, free markets and trade have helped defeat poverty, and taught men and women the habits of liberty."
Economic stagnation in the Middle East feeds terrorism, not because of poverty but because of a lack of opportunity and hope for a better future, especially among the young. Young people who cannot find meaningful work and who cannot participate in the political process are ripe pickings for religious fanatics and terrorist recruiters. Any effort to encourage greater freedom in the Middle East must include an agenda for promoting economic liberty and openness.
The Future
On a multilateral level, a successful agreement through the World Trade Organization (WTO) would create a more friendly climate globally for democracy and human rights. Less developed countries, by opening up their own, relatively closed markets and gaining greater access to rich-country markets, could achieve higher rates of growth and develop the expanding middle class that forms the backbone of most democracies. A successful conclusion of the WTO Doha Development Round of trade negotiations that began in 2001 would reinforce the twin trends of globalization and the spread of political and civil liberties that have marked the last 30 years. Failure would delay and frustrate progress on both fronts for millions of people.
For the past three decades, globalization, human rights, and democracy have been marching forward together, haltingly, not always and everywhere in step, but in a way that unmistakably shows they are interconnected. By encouraging globalization in less developed countries, we not only help to raise growth rates and incomes, promote higher standards, and feed, clothe, and house the poor; we also spread political and civil freedoms.
The opinions expressed in this article do not necessarily reflect the views or policies of the U.S. government.