How is World Trade Unjust? Michael Goodhart University of Pittsburgh Paper prepared for the 6th ECPR General Conference University of Iceland, 25th‐27th August 2011 DRAFT: Comments welcome to goodhart@pitt.edu. Please to not cite or distribute without the author’s permission. ©Michael Goodhart, 2011
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How is World Trade Unjust? Michael Goodhart Debates about the justice of world trade arise in settings as diverse as global economic summits and suburban coffee shops. While ministers parse the nuances of intellectual property and non‐tariff barriers to trade, baristas extol the virtues of fair trade coffee and newspapers weigh the merits of trade pacts and agricultural subsidies. Trade touches all of us – and implicates all of us in a complex system of interactions the effects of which have life and death consequences for people all over the globe. How it implicates us, how much, and why, are among the questions I hope to shed light on here. Because of its enormous practical significance, trade has attracted significant scholarly attention, the vast bulk of it from economists. Among mainstream (neoliberal) economists, there is little theoretical debate about the benefits of trade; the empirical evidence on trade’s effects, however, is mixed. Moral and political philosophers, who have been debating questions of global distributive justice for the past four decades, have only lately begun to focus on trade. There is a small but growing literature that focuses directly on the justice of trade, and it is with this literature that I engage here. The primary aim of this paper is to question the general approach philosophers have taken to thinking about trade and to propose an alternative that avoids the problems I highlight in their accounts. My larger aim is to use this argument to illustrate a broader critique of ideal theoretical approaches to questions of global justice that I am developing. So in exploring the various puzzles that arise in connection with trade and (in)justice, I am seeking both to say something useful about them and to say something larger about how we should approach such puzzles when thinking about global (in)justice. The paper begins by considering some of these puzzles as they have been discussed in the literature. I will show that many prominent claims about trade and justice are unreliable, relying on Rawls’s idea of the burdens of judgment to substantiate my case. Next, I propose an alternative approach that emphasizes injustices that arise in connection with trade. This approach bears much lighter burdens of judgment and thus offers a more promising guide to reform. Finally, I step back from the debate on trade to say something about how this case illustrates the advantages that a non‐ideal theoretical approach enjoys over ideal theoretical approaches. Lest this introduction make the paper seem overly methodological, let me foreshadow the main substantive conclusions here: I shall argue that trade is unjust 1
when it is exploitative (reflects domination) or when it is oppressive (violates rights). While these conclusions might seem pedestrian, my argument will show that they are both normatively exacting and empirically sound, unlike many of the more elaborate claims advanced in the literature. The Burdens of Judgment To begin, it might be helpful briefly to review Rawls’s idea of the burdens of judgment , which I shall rely on throughout the paper. According to Rawls, the burdens of judgment explain why people living under free institutions will nonetheless hold different comprehensive views, why metaphysical (as opposed to political) agreement on justice will be impossible.1 Put differently, the burdens of judgment simply explain why it is that reasonable people might disagree about matters of justice. Rawls identifies six burdens: epistemological uncertainty (the facts are empirically or scientifically complex); the varying weight people assign to relevant considerations; conceptual ambiguity (our concepts are vague and often confounded by hard cases); diversity of life experiences, which shape people’s understanding and judgment differently and in ways we don’t fully grasp; conflicting normative considerations of different kinds often arise on both sides of an argument; and, social institutions affect the selection of values, making it difficult to prioritize and adjust our values.2 The burdens of judgment provide a useful heuristic in thinking about the problems that plague ideal theoretical accounts of justice, including accounts of justice in trade. I use them as a kind of shorthand to track the occurrence of these problems across various and varied arguments. Does the global order harm the poor? Before taking up the issue of trade and justice directly, I want to consider Thomas Pogge’s arguments about how the global order harms the poor. Pogge has been a powerful and prolific advocate of the view that citizens of affluent countries harm the global poor by imposing an unjust global order on them . This argument bears on questions of trade insofar as the trade regime is a significant element of the global institution order (GIO). It is also relevant because many of Pogge’s arguments, and his debate with Mathias Risse, bring important empirical and conceptual issues to light. 1
Rawls presents the burdens are obstacles to agreement among people living under the institutions recommended by Justice as Fairness, but I see no reason why these burdens would arise only under those institutions; they are more like conjectures about the conditions for agreement in a complex and pluralistic world. 2
I have condensed Rawls’s points considerably (though I hope accurately) in paraphrasing them. 2
Pogge argues that the rich harm the poor n both of the common senses noted above: the GIO makes the poor worse off and leave them worse off than they otherwise would have been. Invoking the actual violent histories from which much cotemporary inequality and poverty emerged as well as fictional histories (state of nature arguments), Pogge maintains that the rich impose the legacy of historical crimes on the poor and hold them below any reasonable baseline “natural” condition . Moreover, he argues, because there are feasible alternatives to the present GIO that would include less suffering and fewer human rights violations, we (the affluent) harm the global poor “if and insofar as we collaborate in imposing an unjust order upon them.” An unjust institutional order is one that “foreseeably perpetuates large‐scale human rights deficits that would be reasonably avoidable through feasible institutional modification” . There are two things to note here. First, while Pogge presents the actual and fictional histories arguments as examples of harm in the conventional sense, it is not clear that this is correct. Both arguments involve an extra step; the initial harms occurred long ago in the historical or fictional past; the rich harm the poor today by imposing the legacy of these historical crimes. It is not clear whether the imposition itself constitutes a recurring harm, or whether the harm consists in the failure to remedy the past harms. The latter seems unlikely, as Pogge regards the failure to alleviate harms like poverty morally outrageous but not as a violation of rights The harm would then consist in imposing the legacy of these crimes, which would make it an example of contributing to harm. The second point is that Pogge develops two distinct lines of reasoning regarding contributing to harm, a point that is rarely commented upon. The first line concerns the specific mechanisms through which the global order directly harms the poor. This argument rejects the the thesis popular among economists that local (domestic) or institutional factors explain global poverty and inequality. While he acknowledges that bad government plays a significant causal role, he insists that “the existing world order is itself a crucial causal factor in the prevalence of corruption and oppression in the poor countries” cf. . In his view, we need a global political economy explanation for “why incompetent, oppressive, and corrupt governments which are unresponsive to the needs and interests of “their” populations are so very frequent in the developing world” . Pogge identifies three such explanations, which we might call “bad incentives” explanations: bribery, the resource privilege, and the borrowing privilege. Rich countries only recently made bribery illegal, ending tax and other incentives that encourage corporations and government officials to pay bribes. Rich countries have not yet ended the practice of encouraging leaders in developing countries to buy goods and services they don’t need, often with little attention to price and quality, in exchange for 3
support and generous rewards In addition, the global order (including the laws and regulations that structure it) effectively recognize anyone who gets control of the presidential palace to legally sell a country’s resources (or access to them) and to benefit from the profits. This practice provides incentive to coups and encourages mismanagement of resources . Similarly, anyone who gets control of the presidential palace can borrow in name of the country, and successor governments must make good on debts or lose access to global credit and assistance. This facilitates corrupt governments staying in power, can cripple democratic successor governments, and again provides incentives to coups . Pogge’s second, and very different, line of reasoning is that the GIO is unjust because it perpetuates foreseeable and avoidable harms when feasible alternatives are reasonably available . The affluent impose this order and thus contribute to the harms it perpetuates. The available justifications for upholding this order, Pogge argues, are not acceptable: that it benefits us (the rich), that it will benefit the poor in the long run, that the benefits flowing from existing arrangements are enough to compensate the losers, or that those who set up the existing arrangements didn’t know they would work this way . Pogge replies that the first position is never articulated, the second strains credulity, the third ignores that such compensation is rarely if ever paid, and the fourth, while plausible, is no excuse for not changing things. The first line of reasoning makes a direct causal argument: specific mechanisms lead to identifiable harms. The second makes a doubly indirect causal argument: the GIO tolerates or perpetuates certain harms, and the affluent are responsible for this because they impose – or fail to cease imposing – the GIO on the poor. This second line of reasoning is difficult to support. First, it leaves the idea of the GIO being imposed by the rich grossly underspecified. Is it “imposed” because the rich countries are by and large democracies, and because those countries are the primary beneficiaries of the existing order? If so, it would have to be shown that these benefits, whose flip sides are the harms endured by the poor, are unjust. Put differently, it would have to be shown that the harms the poor suffer are wrongful harms, and that the rich are doing the wronging. As I suggested earlier, many common economic harms are generally not considered wrongful, at least in the domestic case. One important finding, then, is that when examining the harms associated with trade, we will have to pay special attention to whether they are wrongful harms and why. (I return to this question below.) The second difficulty is that the causal role of the GIO is grossly underspecified. Unlike Pogge’s examples of bribery and the resource and borrowing privileges, the harms attributed to the global order on the second line of reasoning are not supported by clear causal arguments. In light of the burdens of judgment, the second line of reasoning appears much more difficult to sustain. This is perhaps clearest in Mathias 4
Risse’s challenge to Pogge’s claims that the GIO harms the poor. Risse asserts that global conditions have improved significantly in the period between 1820 and 1950, which roughly corresponds to the time when the global order began to take shape . There is less human misery than ever before, he argues, insisting that it makes no more sense to blame the global order for being less than ideal than to praise it for improving living conditions. In particular, Risse contends that because things are not as they should be in the global order does not mean that the global order causes this. Besides, to ask why there are so many poor people, and so few rich, improperly establishes expectations we have no empirical basis for Risse’s own position assumes (for the sake of argument, he says) that the domestic institutions thesis is correct; “the quality of domestic institutions… primarily explains why a country is rich or poor” . As Risse characterizes this argument, institutions are rules of the game, humanly devised constraints that shape human interaction. They structure incentives for social, political, and economic exchange. Constraints are beneficial when most follow them; government can implement some of these by fiat, but not all. The legal system, a culture of trust, and shared views of justice can emerge and persist only with broad domestic support. Such institutions can’t be imposed by government or “especially” by outside interference. Bad institutions are not necessarily the fault of those living under them, but they cannot be improved without can’t improve without their support. In short, the domestic institutions thesis provides the most plausible explanation of the causes of growth and poverty . Risse articulates a second “authenticity” thesis, which he characterizes as “the view that especially those institutions requiring broad domestic support matter for prosperity” . Outsiders can ruin domestic institutions but can’t do much to (re)build them . Combining the authenticity and institutions theses leads Risse to the conclusion that development assistance is not a question of resource transfers ; it is rather a question of assistance with building institutions: external aid can contribute to such institution‐building efforts, through analytic work, the identification of internal champions of reform, technical assistance, and the training future leaders, bureaucrats, and professionals . The institutions these can account for international variables, Risse argues . “To the extent that the global order (or an oppressive past) causes bad institutions, this, along with geographical factors, must be considered in the execution of the duty of assistance” . Geography and integration also play a role; all three affect each other ; the influences of geography and integration work through institutions, he claims, so that the institutions thesis takes them into account . Again, these factors don’t argue for additional duties – they make the duty of institutional assistance more or less demanding (e.g., because geography makes good institutions harder). He also rejects 5
the “shared institutions” argument (including violent history), claiming that states don’t exist in the kind of environment in relation to one another that gives rise to distributive claims. He cites in arguing that only ongoing coercive relations give rise to redistributive claims. Cooperation, Risse says, gives rise to claims of fairness – “fair exchange and proportional benefits” – not redistribution Besides, he argues, the idea that there are feasible alternatives to the current GIO is weak, since it assumes a mechanism that cannot work (except through institutions). Pogge is wrong to see redistribution of resources as a feasible alternative; besides, any transfer of resources that would help and be sustainable would require better institutions . We need good institutions to make aid effective, but there is little that outsiders can do to build these, and it is not the case that there is a single development program that states can be told to follow to spur growth; there is no consensus on this question. Finally, Risse rejects Pogge’s arguments about the effect of bad incentives through bribery and the resource and borrowing privileges. He maintains that oppression is a constant, and that no incentives are required for leaders of poor countries to govern badly . It is not my intention to take sides in this debate between Pogge and Risse; rather, I want to highlight several deficiencies in their approaches. With a few exceptions, Pogge is unable to establish the causality needed to support his account of harms. Risse is right to argue that things being amiss under the present GIO is not proof that the GIO causes things to be as they are or worse than they otherwise would be. Pogge’s feasible alternatives thesis holds that because things could (fairly easily) be otherwise, the GIO is implicated. But apart from his three concrete examples of bad incentives, Pogge posits no causal relationship between the GIO and poverty at all, so it is hard to know what these feasible alternatives might look like. Moreover, if the institutions and authenticity theses are correct, redistribution is unlikely to make a significant difference and could even make things worse – as aid is a major target of rent‐seeking activity by governments. Yet Risse’s position is also problematic. He wrongly treats the hypothesized primacy of social institutions in development as evidence that the global order plays no significant role; put differently, he leaps too quickly from the hypothesis that institutions are primary to the conclusion that they are the only thing that matters. In addition, his rejection of incentives is not persuasive. Pogge’s bad incentives arguments show persuasively how the GIO can directly and significantly impact domestic institutions. To try to shoehorn these effects into the institutions thesis understates the significance of global arrangements and their interdependence with domestic ones. Further, by Risse’s own lights, colonialism – which destroys authentic domestic institutions – requires rectification. Yet former colonial powers get off the hook as there is little outsiders can 6
do, in Risse’s view, to rebuild domestic institutions. Yet as shows, there is in fact a lot outsiders can do to help get the poor up to the level where institutions can take hold and begin to develop – to get up to the bottom rung of the development ladder. In addition, Risse is too quick to argue that cooperation only generates obligations of fair exchange and proportional benefit. First, shows us that the idea that coercion is distinctive of states in the way Blake says is flawed – cf. . Second, even if the global order involves only cooperation, Risse himself admits that this gives rise to claims of fairness, but he arbitrarily – and without argument – limits this to fair exchange and mutual benefit. In fact, much depends on the nature and extent of the cooperation, particularly the degree of formalization or institutionalization involved. Trade provides an excellent example, which I take up below. The epistemological uncertainty surrounding the nature and workings of the global order makes it hard to establish causality in the way Pogge’s argument seems to require to show that the rich are harming the poor by imposing and unjust GIO upon them. It also makes it difficult and perhaps unwise to rely on a controversial thesis like institutions, as Risse does, especially in making rather bold arguments about the extremely limited nature of our obligations to the poor. Perhaps the biggest problem with Pogge’s and Risse’s accounts concerns the way the questions they ask and the kind of answer they look for. First, the question whether the global order harms the poor is not – as the burdens of judgment clearly illustrate – the kind of question we should expect a clear or singular answer to. The GIO is massively complex and multifaceted. Different countries – and different regions, sectors, social classes, age groups, and sexes – will be differently affected by it in different circumstances. In some instances the global order undoubtedly harms the poor; in others it might well help them (though again, who “the poor” are varies wildly – the urban poor of China are affected very differently by the GIO than the rural poor of southern Africa. A much more meaningful question would be how specific groups in particular places are affected by the global order – though this is not the kind of question philosophers – as opposed to more empirically‐minded scholars – are particularly good at answering. Perhaps even more importantly, in focusing on harms, Pogge and Risse make a rather significant assumption: for both of them, it seems clear that if the global order harms the poor, it should be considered unjust. They apparently agree on this normative point, while disagreeing strongly about certain empirical and conceptual matters important in answering it. Apart from the difficulty in establishing causality noted above, there is a normative problem here as well, once concerning the relationships among harms, wrongs, and injustice. 7
Harms, Wrongs, and Injustice In conventional philosophical usage, harms set back the interests of agents; agents are harmed when they are made worse off, or left less well off had things remained as they were. Wrongs are impermissible acts or omissions; agents are wronged, on my account, when some actor exploits them or violates their rights. Not all harms are wrongful, and not all wrongs are harmful. Consider some examples: if I contract cancer, I am harmed – I am worse off than I was, or will end up worse off than I would have been. Yet I have not been wronged: people unfortunately become ill, it is part of life. If, however, my cancer results from the ingestion of carcinogens present in my drinking water thanks to the illegal dumping of waste into the local aquifer, I have been wronged by whoever did the dumping (and possibly by those responsible for preventing it). The main distinction is not causality, however. Consider another example: you are walking in front of me when I trip on uneven pavement; I fall into you and knock you down, breaking your arm. I have clearly harmed you, but I have probably not wronged you; I tripped through no fault of my own and had no intention of injuring you. If I am drunk and stagger into you, knocking you down and breaking your arm, I wrong you through my negligence in addition to harming you.3 Wrongs typically involve harm, but they need not do so. Suppose I am persuaded that your lottery ticket is the winner; when you are not looking I steal your ticket, replacing it with mine. It turns out that my ticket – the one I gave to you – wins. I wrong you (by stealing your ticket) but do not harm you, as you end up better off by winning. Wrongs are, by definition, morally intolerable, but not all harms are. In some cases, such as my “innocent” cancer, nothing moral has happened at all (though something unfortunate clearly has). Similarly, in the tripping case, there is no wrong involved, even though one person harms another. (There might be a wrong if someone was negligent in repairing the pavement.) In fact, there are many harms we find it morally acceptable to inflict on others: you swim faster than me, winning a spot on the Olympic team; you open a new restaurant with great food that puts my establishment out of business. In both cases you harm me, but in ways that are usually considered morally tolerable. (If you cheat, or spread false rumors about rats in my kitchen, you wrong me as well as harming me.) Permissible or tolerable harms are especially commonplace in the economic sphere, where they are seen as not only unavoidable but also as legitimate. We accept that routine economic competition benefits some actors and harms others: a new technology renders my product obsolete; more efficient production methods adopted by my competitors price me out of the market; you get the job we both applied for. I 3
I adapt this example from David Miller, "Distributing Responsibilities," in Global Responsibilities: Who Must Deliver on Human Rights?, ed. Andrew Kuper (New York: Routledge, 2005). 8
clearly suffer harm in these cases, but the harms are not wrongful (again, assuming there is no perfidy involved). I shall return to these economic harms in discussing trade, below. The next question is how harms and wrongs relate to injustice. I follow Rawls, and most contemporary political philosophers, in thinking that justice and injustice have to do with social institutions broadly understood. (I don’t agree that justice is the “first virtue” of social institutions, however; see . There is little agreement, among philosophers or in general, about justice. This makes sense, in light of the burdens of justice: people’s different life experiences, in particular, will lead them to very different conclusion about what constitutes the good life, how social affairs should be arranged, and so on. Disagreements about human nature and psychology, competing normative considerations, and difficulty in weighing and prioritizing different values will also make consensus on justice elusive. Thus, any account of justice is likely to encounter opposition from people with differing views – indeed, the burdens of judgment indicate that we should expect such disagreement, even welcome it as a sign that we are living under free institutions. The approach I shall adopt here starts from the observation that it is likely to be easier to determine what it is wrong to do to people than to work out an account of what justice requires. With this in mind, I define injustice as any social (social, economic, or political) condition that results from wrongs. This definition departs from the standard usage, in which injustice represents a deviation from justice or a violation of its requirements. Identifying injustice on my definition requires an account of what counts as a wrong and an analysis of existing social arrangements and relationships. Let me say something about the claim that it is easier to reach agreement about what it is wrong to do to people than about what justice requires. I haven’t worked out a complete analytic argument for this claim yet, but it seems, in light of the burdens of judgment, that injustices, wrongs, are less likely to be experienced differently by people, are less likely to bring normative values into conflict across the range of standard cases, are less likely to involve reliance on vague concepts, and so on. Moreover, empirically there appears to be much less disagreement about injustice. Killing, stealing, depriving people of their liberty of sustenance – all of these things, and many others, are commonly regarded as wrong by people whose views of what is right or just diverge dramatically. I don’t want to pretend that there will be no disagreements about what it is wrong to do to others; I am only suggesting that these disagreements will be fewer and less intractable than disagreements about justice. I cannot articulate a complete account of what it is wrong to do to others here. Instead, I will simply describe what I think is a fairly uncontroversial view and rely on it throughout. On my view, it is wrong to exploit people, and it is wrong to oppress them. 9
By exploitation I mean essentially what political philosophers call “domination.”4 Domination exists whenever one party is dependent upon another, where dependent means something like subject to the will of another or to the right or power of arbitrary interference held by another . So to exploit people is to exercise arbitrary power over them, to subject them to your will. By oppression I mean unwarranted interference in a person’s life (see . A good shorthand understanding of oppression is that it occurs whenever someone’s human rights are violated. (Domination is roughly the threat of such violations.) Domination and oppression are wrongs; they are morally intolerable. They are incompatible with most accounts of justice, even if those accounts differ profoundly. The absence of domination and oppression is not tantamount to justice, however; most accounts of a just world entail much more. That is because, while plainly unjust, domination and oppression are not defined directly in reference to any account of justice; we recognize them as wrongs in themselves. (One could imagine a range of meta‐ethical bases for these judgments; I prefer a political account, though I cannot present it here. For my purposes in this essay, it does not matter much which basis one adopts.) On the account I am developing, then, to wrong people is to do them an injustice. An action or omission is unjust if it wrongs people, that is, if it exploits or oppresses them. With this definition, I want to turn to the questions of whether trade is just and how trade might be unjust. Is Trade Just? Among the first difficulties we must confront in considering whether trade is just is that there is a great deal of uncertainty surrounding the empirical effects of trade. The fundamental theoretical tenet of classical economics regarding trade is the Ricardian theory of comparative advantage, which states that trade is mutually beneficial and that the gains from trade are always sufficient to fully compensate the losers while still leaving the winners better off. Obviously, whether such compensation is paid makes a significant difference in evaluating the justice of trade arrangements – a question economists hand off to political scientists! Theoretically, at least, trade can be just insofar as it can be Pareto‐optimizing; it can make some people better off while leaving no one worse off. The other vitally important claim from economics to consider here is the empirical contention that trade leads to economic growth (“development”), which leads 4
It seems awkward to say that it is wrong to dominate people; exploitation seems to me to capture the main ideas. 10
to poverty reduction (e.g., . This hypothesis figures prominently in deliberations about trade and justice since, if true, it would establish an important pro tanto reason in favor of trade. There are a number of reasons to be suspicious of the hypothesis, however. For one thing, the data and methods on which the trade‐growth‐poverty reduction claim is based are dubious – not just in the way that all data are dubious, but because the World Bank changed the way it measures poverty in the middle of the most common time series used to assess trade’s impact on poverty . There are conceptual issues as well. The equation of “development” with “increases in per capita income” has long been shunned by normatively oriented theorists, who emphasize “human development” as an important corrective to the focus on growth. Many things that make people better off, such as health and education, are very cheap in poor countries, meaning that significant development gains can cost relatively little and fail to register in aggregate income measures. In addition, aggregate income measures mask inequality, which evidence suggests has been growing rapidly both between and within countries, in the past several decades (APSR Task Force on Inequality, xx). Moreover, proponents of the view that trade reduces poverty tend to conflate liberalization with trade. That is, they tend to rely on trade dependency data (the proportion of trade to total GDP) in empirical studies linking trade to poverty reduction, but then call for trade liberalization – a set of neoliberal policy prescriptions recommending the lifting of capital controls and restrictions on foreign direct investment, the reduction or elimination of tariffs and subsidies, and so on – as a path to faster growth. That relationship (between liberalization and growth) is unproven, and some evidence suggests that opening to trade, without appropriate domestic reforms, will spur no growth or negative growth (UNRISD report 2011). Many of the developing countries that trade the most, and have reduced poverty the most, have not liberalized (cf. . [check cite] This empirical and conceptual uncertainty significantly increases the burdens of judgment in connection with arguments about the justice of trade. Those burdens are multiplied when we begin to consider the larger normative and conceptual questions that would be involved in assessing the justice of trade. One such question is, what is an economy for? Is it to lift up the poor and reduce suffering? Is it to provide everyone with equal opportunity? Or it is an arena in which people should be left free to transact with one another with minimal interference? A just trade regime would look very different on each of these views. Yet there would be disagreement within these views as well. If the economy aims to reduce suffering, should we promote trade – which many economists maintain reduces poverty – even if it makes many people worse off in the short run (imagine a share‐cropper put out of business by greater competition in agricultural products, which also has the effect of lowering food prices in a food‐
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importing country)? What constitutes equal opportunity in a global economy characterized by massive inequality and radically uneven development? What type and degree of interference is needed to maintain basic fairness and keep markets functioning properly? Yet more complications arise when we consider that – whatever one’s views on the institutions thesis – domestic institutions profoundly shape the impact of trade. If trade could help the poor, but does not because rent‐seeking or poorly‐designed domestic institutions undermine the potential benefits, is (some kind of) intervention warranted? If trade could – but doesn’t – benefit the poor, is it the responsibility of a trading partner to stop trading? What if doing so leaves people worse off than they would be under distorted trade? Should trade regimes be designed to benefit the poor – should there be a pro‐poor bias in trade? If so, how can this be justified to those who will be harmed by this bias? Given the empirical and normative uncertainty I have already pointed to, how confident can we be in any conclusions we reach about such questions? I could go on and on. The point is to emphasize that the burdens of judgment weigh quite heavily when we consider what justice in trade requires. There is very little consensus on the normative questions involved, including even the broad normative framework in which we should locate trade. There is tremendous empirical and conceptual uncertainty about the effects of trade and tremendous ambiguity concerning how we should apply principles to hard cases. In short, conclusions about trade and justice are likely to be partial and fragile at best. One objection to this argument might be that I have ignored an obvious and fairly uncontroversial account of justice in trade: fairness. It might be that trade is just when it is fair. Several prominent normative theorists have sketched accounts of fairness in trade (e.g., . Kapstein argues that self‐interested states concerned with international stability have good pragmatic reasons to negotiate agreements that all states, even poor and weak ones, find reasonably fair or just. He recommends trade policies based on “diffuse reciprocity,” in which all states have obligations and responsibilities, but concessions are based on economic size . In theory, he maintains, trade can be used as an instrument for creating an inclusive and participatory global economy that enhances the growth and welfare of each state – assuming governments take their responsibilities seriously. They are even entitled to seek help in providing effective social safety nets from the international community. Risse and Kurjanska offer a rather different view of fairness, one that emphasizes that people should get what they owed, and that they are owed things to which they have stringent claims . Their “weak Westphalian view” says that there are limits imposed by fairness on how the social costs of production can be determined. These 12
processes mustn’t harm other countries. Moreover, the effects of trade must be distributed in such a way that no negative rights are violated; otherwise, those who lose out in the process to trading partners have claims in fairness. World market prices of goods from other countries may, under certain conditions, give individuals claims in fairness to protection by their governments: if these prices negatively affect individuals’ interests and have arisen in ways that violate domestic social standards, there might be claims, though these must be weighed against the total economic interests in trade. Finally, trade policies must be devised in ways consistent with obligations to poor countries – meaning that prices have to be determined in ways that take effects on third parties into account . I have not done either of these interesting arguments justice, but I have probably said enough to indicate that fairness cannot escape the problems that arise in connection with justice. First, as these two accounts illustrate, the concept is not precise enough to generate a singular or critique of trade or set of recommendations. In addition, both accounts rely on the contested empirical and conceptual claims considered above. Further, there is no obvious way to reconcile or decide between these competing accounts of fairness. Moreover, in the case of Risse and Kurjanska, the notion of “harms” plays a crucial role – even though, as noted earlier, many harms are typically accepted as legitimate in the economic sphere. Assuming that failing to reject “stringent claims” is to wrong people, are we to assume that all of the harms they mention are wrongful? This would require, at a minimum, an account of these claims. Fairness, it seems, provides little help as a stand‐in for justice. My point is not to say that coherent accounts of fairness or justice in trade cannot be developed; indeed, both of the arguments critiqued here are well‐reasoned and plausible. The point is that they are necessarily highly inconclusive in light of the burdens of judgment. How is Trade Unjust? In this final section of the paper I want to poses a slightly different question: instead of asking what justice in trade would look like, I want to ask how trade is unjust? Despite superficial similarities, this question suggests a starkly different approach. This approach focuses on injustice, not justice, and we have reason to hope that the burdens of judgment in connection with injustice are substantially less. This approach focuses on specific instances of injustice and the patterns into which they fit; thus it does not rely on empirical or conceptual generalizations of the kind that plague attempts to determine justice in trade. Let me begin with an account of injustice in trade. Building on my earlier argument, I want to argue that trade is unjust when it is exploitative and when it is oppressive. Trade is exploitative when some parties take advantage of others: “An 13
exploitative transaction… is one that is actively entered into by the parties concerned, one whose terms are unfair when measured by the appropriate benchmark, and one whose unfairness results from an inequality of power between the exploiter and exploited” .5 Trade is oppressive when some parties wrongfully harm other parties; as a shorthand, we can think of trade as oppressive when it leads directly or predictably to human rights violations.6 Trade is unjust, in short, when it wrongs people. What about the harms people suffer in connection with trade? Are these not also unjust? As noted above, many harms experienced in the economic sphere are considered perfectly acceptable – or at least not wrongful – in the domestic context. Interestingly, when it comes to trade, many analysts regard essentially identical harms as unjust. Suppose that I work in the textile industry in a developing country. Though my industry produces goods cheaply, tariffs prevent the export of goods to developed countries. Or suppose that I am a subsistence farmer in a poor country. Openness to trade introduces a flood of cheap, imported food; as a result, I can no longer support myself by farming. The big question in these and countless other cases is not whether people are harmed by trade; clearly they are. It is whether they are wronged – and secondarily, why people tend to see wrongs in such cases when trade is involved, whereas they do not see harms in the analogous domestic cases. This is an interesting and complex puzzle, one concerning many facets of the nature and scope of our moral obligations. Unfortunately I cannot take up this question here, except to say that all of my domestic examples specified that no perfidy was involved. It might be that the examples just mentioned are actually examples of exploitative or oppressive trade. In the first case, we know that power asymmetries have blocked tariff reductions on textiles by the rich countries (a sector where poorer countries have a competitive advantage). In the second example, we know that a great deal of “cheap” food exported from rich countries is cheap because of the extensive subsidies it enjoys, such that I am put out of business and lose my livelihood not through free competition but through what amounts to discrimination. (It is worth noting that, as these examples suggest, my account of injustice can capture most of what is interesting and important in fairness arguments.) 5
Note that exploitation can leave exploited parties better off (i.e., not harmed), even though they are wronged: I threaten to put you out of business unless you agree to launder money for me, an activity that makes you significantly richer. Or in the context of trade: an exploitative trade deal might make country B better off than it would have been without trade, but still reflects the power asymmetry enjoyed by country A. 6
Unlike Mathias Risse, "Fairness in Trade I: Obligations from Trading and the Pauper‐Labor Argument," Politics, Philosophy, and Economics 6, no. 3 (2007)., I include all human rights in this requirement, not merely so‐called negative ones. 14
The advantage of focusing on wrongs – on exploitation and oppression – is that it obviates the need to wrestle with big, unwieldy, and ambiguous normative and empirical questions, as accounts of justice must do. Instead, questions about injustice direct us toward specific examples – and ultimately toward patterns – of injustice, to what Hurrell calls deformities in the global order cf. . Some of the best work of this kind is Pogge’s work on bribery and the resource and borrowing privileges. In this modality, his focus is on injustice – on ways in which existing rules, arrangements, and practices lead or contribute directly to wrongs. This focus on pathologies exemplifies the approach I am recommending here (it also contrasts rather sharply with his general and abstract claims about how the global order harms the poor). An approach focused on injustice, with its emphasis on exploitation and oppression, entails a critique of power and of inequalities in power. One recurring patters is that the agenda for trade is set by the rich countries. They push for trade deals and protections in areas that are important to them (to their economies, or to powerful constituencies within their economies) with little regard for how they will affect poorer or developing economies. They go so far as to do it literally behind closed doors, in the infamous “green room” that appears at every GATT meeting, presenting their latest agreements as faits accomplis to the poorer countries. As a result of such negotiating practices, we have no general agreement on agricultural products and subsidies, but an intellectual property regime (TRIPs) that could have been written by Hollywood and Big Pharma (and for all intents and purposes, was). This is a pattern of exploitation; of rich countries taking advantage of their market size/power to impose their will on the poorer countries. Note that it is unimportant, in analyzing the injustice in this arrangement, whether the poorer countries are better off under the WTO than they would be outside. It is unimportant whether trade in general helps or harms the poor or spurs growth. In this practice of trade negotiation, exploitation is rampant. This is an injustice that should cease, and should be compensated.7 Cases of oppression linked to trade are more complex – in part, because causal relationships again become an obstacle. In light of the importance of domestic institutions, through which trade’s effects are always mediated, it is tempting to say that oppression will usually result from a combination of global and domestic factors. Still, there are reasons to be suspicious that oppression may be commonplace in a generally exploitative trade regime. If power dynamics – rather than competitive advantage – explain patterns of market penetration and social marginalization that accompany them, there is a strong probability that the harms people experience as a result are wrongful 7
The question of how to compensate for injustices is one I cannot take up here, though obviously it is crucial to the larger account I am developing. 15
harms. Other cases are more blatant – practices connected with patenting of natural organisms border on theft, and the introduction of genetically modified seeds can drive even non‐participating farmers into poverty and ruin (see . Some injustice linked to trade can occur domestically as well. For instance, when the gains from trade are concentrated in the hands of a very few, those directly harmed by trade may well be exploited. “Off‐shoring” of jobs can be oppressive if the gains it generates are pocketed by corporate managers rather than shareholders.8 A social safety net – or the lack of one – might conceivably, in connection with a specific trade regime and policy, be oppressive. The notion that trade is consensual is sometimes introduced to excuse or negate claims of exploitation or oppression, as if consent wiped away the wrongs. Few people today agree with Hobbes that consent given with a sword to one’s neck is binding and legitimate. The trade equivalent – the Great White Fleet – is rarely seen today, though in some instances structural adjustment programs mandating liberalization amount to the same thing. Moreover, as argues, “voluntary” agreements are often subject to a sort of network power, through which the powerful solidify advantages by making an agreement excessively costly to remain outside of. Conclusion Much more could and should be said to develop this argument and to demonstrate, in much richer empirical detail, how the process of identifying injustice works. Still, I hope enough has been said to indicate the advantages of a focus on how trade is unjust. To restate the main point: trade is unjust when it is exploitative or oppressive. 8
Shareholders are often not seen as a sympathetic lot, but the pervasiveness of small shareholders forced to invest through pension schemes complicates things tremendously. 16
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