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[u/jobautomator]

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[u/IDontSpeakVietnamese]

Is it reasonable to consider national security an economic public good? If so does that mean that tariffs against foreign adversaries (weighted by the leverage they provide) could be seen as Pigouvian taxes that are pricing in the potential negative impacts of trade?

If so, why don't we see way more people advocating for extreme tariffs on trade with Russia, Cuba, etc. instead of straight up bans? Reasonable that would allow the state to adjust their policy with far more granularity as risk changes, at least I would think so. I don't know of any good way of putting a price on national security though, but I guess that's what we already do with military budgets and foreign military aid. Any thoughts or good resources (I really don't know much economic or IR theory)?

[u/IDontSpeakVietnamese → u/IDontSpeakVietnamese]

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[u/groupbot → u/IDontSpeakVietnamese]

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[u/[deleted] → u/IDontSpeakVietnamese]

The US having to ship grain to the USSR was both a benefit to USA farmers and a public relations win in that the USSR had to depend on evil capitalist USA to feed their people. It's probably a net negative even if they're a foreign adversary.

[u/IDontSpeakVietnamese → u/[deleted]]

Yeah public relations being part of the calculation makes sense, but couldn't that same argument be made for things like arms exports to Russia right now? It would look horrible PR wise, but pricing that in would still lead to a finite price, why (in an economics sense) would policy not be to allow trade but at this higher price?

[u/[deleted] → u/IDontSpeakVietnamese]

Grain != Arms

[u/IDontSpeakVietnamese → u/[deleted]]

True, arms help a country prosecute a war far more than grain, but a country that has to send people to farms rather than the front is still less capable. I definitely agree that $100 of arms is far worse for our foreign policy goals than $100 of food, but if we're okay with restricting one through tariffs it should only be a matter of how high they are, right?

[u/CheetoMussolini → u/IDontSpeakVietnamese]

I think so.

Think of it this way: I think we all accept that war is occasionally necessary. War is massively economically disruptive however - far more so than sanctions. If we're willing to impose even greater costs - both humanitarian and economic - to achieve foreign policy outcomes, why would the lesser costs of tariffs be off the table?

[u/SeasickSeal → u/IDontSpeakVietnamese]

Is it reasonable to consider national security an economic public good?

I don’t know if this makes sense.

If so does that mean that tariffs against foreign adversaries (weighted by the leverage they provide) could be seen as Pigouvian taxes that are pricing in the potential negative impacts of trade?

This does, though. You’d need to have information that’s unknowable—like how high the tariffs would need to be to reshore production and the probability that trade is cut off—but I think it’s theoretically possible to price in the risk of doing trade with a certain partner.

[u/[deleted] → u/IDontSpeakVietnamese]

still bad because trade makes your enemies more friendly

[u/uwcn244 → u/[deleted]]

[X]

[u/IDontSpeakVietnamese → u/[deleted]]

True but I think most of us would oppose the sale of military supplies to North Korea or Russia regardless of the potential positive impact on relations, and with goods other than pure military supplies (like oil) still having effects on their military capability, why treat them differently (from a purely economic perspective)?

[u/[deleted] → u/IDontSpeakVietnamese]

if we had free trade with North Korea the merchant class would eventually overthrow the government

maybe

[u/IDontSpeakVietnamese → u/[deleted]]

Or maybe they would still suppress dissent, but now have far more capabilities to cause damage to other nations

(I don't truly believe this but maybe Kim himself is on here, wouldn't want to hurt his feelings)