Economic Nationalism

The Enduring Allure of the Economic Fortress

There are certain patterns in human endeavor that, despite our best efforts at progress and enlightenment, seem to recur with an almost cyclical inevitability. Like the tides, they recede only to surge back onto the shore, often wearing slightly different costumes but carrying the same fundamental impulse. Economic nationalism is surely one such tide.

At its heart, economic nationalism is a simple, potent idea: a nation's economic interests should always, unequivocally, come first. It’s a philosophy that views the global marketplace not as a cooperative commons, but as a competitive arena where a country must aggressively champion its own industries, workers, and capital, often at the expense of international collaboration. Tools like tariffs, subsidies, and preferential trade deals become less about fostering mutual growth and more about constructing a protective economic fortress, ensuring domestic prosperity even if it means ruffling feathers abroad.

This isn't a modern invention. We can trace its lineage back through centuries. Think of the era of mercantilism, a dominant economic theory from the 16th to 18th centuries, where nations obsessed over accumulating gold and silver, viewing global wealth as a finite pie. The goal was to export as much as possible and import as little, thereby ensuring a favorable balance of trade and national enrichment. Adam Smith, in his seminal work, tried to persuade us that free trade offered a path to greater overall prosperity, but the appeal of "us first" has always been a powerful counter-narrative.

A stark, historical lesson in this impulse arrived with the Smoot-Hawley Tariff Act of 1930. In an attempt to protect American farmers and industries during the nascent stages of the Great Depression, the U.S. enacted steep tariffs on thousands of imported goods. What followed was a swift and devastating wave of retaliatory tariffs from other nations, collapsing international trade and arguably deepening and prolonging the global economic crisis. It was a potent, if painful, demonstration of how quickly the pursuit of national economic gain can devolve into a zero-sum game with widespread negative consequences.

Fast forward to today, and the headlines regarding President Trump’s recent threats of higher tariffs on South Korea, despite an existing trade deal, echo this ancient impulse with chilling clarity. Here is a close ally, a strategic partner, yet the language employed is one of dissatisfaction with the pace of their investment in the U.S. economy, a demand for more, or else. The trade agreement, ostensibly a framework for mutual benefit, is leveraged as a tool for national economic gain, a means to extract specific concessions. It illustrates a broader trend where the U.S., among other nations, views trade not just as commerce, but as an instrument of national power and a direct contributor to domestic well-being, even when that stance strains relationships with friends.

Why does this pattern persist? Perhaps it's the visceral appeal of immediate, tangible benefits for a domestic constituency, the political expediency of appearing tough on foreign competition. Or perhaps it's a deeper human tendency to seek control and security in an increasingly interconnected, yet unpredictable, world. The global economy, with its intricate supply chains and shifting competitive landscapes, can feel overwhelming. Erecting economic borders, however illusory, offers a comforting sense of agency.

So, as we observe this recurring drama, from mercantilist empires to modern trade disputes, one wonders: can nations ever truly balance the undeniable benefits of global economic integration and cooperation with the enduring, powerful impulse to prioritize their own economic fortresses, or are we forever destined to swing between these two poles, perpetually learning and re-learning the same hard lessons?