Should the nations of the world with free market economies create a federal trading system as an alternative to free trade?
Such a system could improve the dynamics of world trade and make it fair without undermining the benefits of the nation-state system. It would make the individual, rather than the nation-state, the basic unit of world trade.
The proposed federal trading system would:
- Establish a sound world currency. Participating nations or special interest groups could not manipulate it. This currency would be backed by a gold and/or silver standard. It would not replace national currencies.
- Establish a common market designed to protect the citizens it serves against nations with substandard labor and environmental standards. Nations that exploit labor and the environment would face a significant trade adjustment tariff.
- Seek to harmonize labor and environmental standards within the common market by meeting in the middle.
- Establish a dispute settlement system for the citizens buying and selling within the common market. The rule of law would govern world trade rather than managed trade agreements.
A federal trading system would differ from managed trade regimes and other bodies such as the European Union. The purpose of the federal trading system would be to enforce basic rules of trade between individuals rather than nations. Government planning and intervention in the common market would be minimized.
How Can We Explore this Idea Further?
I suggest we use the convention approach to explore a federal trading system with other nations interested in joining the enterprise. With the help of the United States Congress, President Trump should establish a bipartisan U.S. Citizens Commission on Fair Trade to meet with other delegations at a Free World Convention on Fair Trade. These eminent citizens should represent multiple schools of economic thought. They would be officially appointed by the United States, but participate in their private capacity without official instructions or binding power.
There is a historical precedence for the convention approach. Citizen-led diplomacy was used to strengthen Atlantic unity and resolve during the Cold War. To move forward, a courageous member of Congress must step up to the plate and introduce a Free World Convention on Fair Trade resolution. This resolution should be modeled after the U.S. Citizens Commission on NATO resolution that spawned the Atlantic Convention of 1962.
Most Americans are not familiar with the Atlantic Convention of 1962. Before you dismiss the idea of a federal trade system, I urge you to explore the history of the Atlantic Union Movement in the United States Congress. For many of you, this history will be a real eye opener, and a source of hope.
Although I consider myself to be a libertarian-leaning proponent of international federalism, I am not suggesting that an Atlantic Union is desirable today. I believe we must focus on establishing a federal trading system that fosters fair trade without political and cultural entanglements. The one thing that almost all citizens of the world share is a desire to trade.
Atlantic Union: An Alternative to Free Trade
It may surprise you, but every President of the United States from Harry S. Truman to George H.W. Bush favored exploring the Atlantic Union idea. From 1949 to 1980, prominent members of the United States House of Representatives and Senate introduced and co-sponsored Atlantic Union resolutions designed to call an Atlantic Convention to discuss the potential merger with our NATO allies.
Atlantic Union was considered an alternative to free trade. It would have created a transatlantic –
- common market,
- executive, and
It would have addressed trade relations between NATO nations, and eventually all nations, the same way trade relations between the American states are governed.
The Atlantic Union Movement in the United States Congress is well documented by Federal Union, Inc. This 501(c)3 nonprofit organization was set up in 1939 by Clarence K. Streit, author of Union Now, to educate the American people about the Atlantic Union idea. A former New York Times foreign correspondent, Streit established Freedom & Union: Magazine of the Democratic World to cover the movement he inspired. After the Atlantic Union Committee was established in 1949 to advance the Atlantic Union Resolution in Congress, Freedom & Union tracked its legislative progress, often citing Congressional Record, committee hearing transcripts and reports.
There are literally thousands of pages documenting the Atlantic Union Movement in the United States Congress. I have condensed the history into a chronology with relevant exhibits. You are encouraged to download and share this publication:
It includes links to PDF copies of House and Senate committee hearings and reports in case you want to read the full record.
Please review Atlantic Union: An Alternative to Free Trade before rejecting my call for a Free World Convention on Fair Trade. The idea of a federal trading system is not as far fetched and controversial as the actual history of the Atlantic Union Movement was.
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