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Thursday, June 30, 2016

Who invented the single market?

The Custom House, New York, 1799, via Wikimedia Commons.
The first time a continent-wide bunch of independent countries decided to form a single-market customs union, more than three decades before the various German statelets and principalities started toying with the concept of the Zollverein in ca. 1819, was in North America in 1787.

Because as everybody knows the War of Independence was not fought on behalf of one nation but 13 nations, which as the Declaration says "are, and of right ought to be, free and independent States", note the careful deployment of the plural there. As the dust settled after the war they worked out their Articles of Confederation under that assumption, giving each full autonomy in matters of taxation, after the fashion of the Dutch United Provinces.

Only this system utterly failed in the face of the financial problems of the different states with their crippling war debts and angry cheated veterans. So they came up with the idea of a system of completely free trade among the several ex-colonies and a unified management of the states' trade with the outside, by a federal government to be set above all of them that would charge import duties on behalf of all of them, using the money for its various projects to establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to themselves and their Posterity with all the economies of scale and broad liberality of purpose they could apply to the project.

That, friends, is above all what the Constitution is and what its revolutionary content consisted of, assigning the fiscal supremacy in the states' affairs—debt and trade—to the faceless bureaucrats of a remote capital. And they knew it. Including opponents like that old fart Patrick Henry of Virginia, presciently aware that those bureaucrats would start a-regulatin' and a-reformin', and one day take away his, or his descendants', freedom to own human beings as their personal possessions. "Give me liberty [to keep slaves on my plantation] or give me death!" Conservatives have been hating and attempting to destroy the Constitution ever since, even when, in the later 20th century, they started affecting to care about it and claim it as their own (under the catchphrase of "states' rights" referring to the situation that the Constitution abolished).

There's a terrific piece in the Times by Amanda Taub today on the question of democracy in the European Union, arguing that there is plenty of democracy available in the European Parliament, even if the upper house or Council of the European Union is made up of members nominated by the various state governments (as the US Senate was until progressives finally got the 17th Amendment ratified in 1911). What the EU needs, she thinks, is to be stronger, in both directions: there needs to be more popular involvement in the parliamentary election process (turnout is almost as dismal as it is in US off-year elections) giving it more of a sense of a mandate, and there needs to be more power exerted from the top against parochial ideas of national sovereignty and in favor of the people, in which German interests don't weigh more than Greek ones, for example, or Hungarian xenophobia can't trump Swedish generosity.

Getting rid of England (not Scotland!) would likely be a positive force for the future of the Union in this direction, I imagine, if anybody could get the will together to do it. I think Europe's young people, mostly used to each other and bored and revolted by fusty old nationalisms, could.

[Note: A customs union was created by the Acts of Union between England and Scotland in 1706, but only after they had been sharing a king for a century and experimented with a brief customs union at the end of the Commonwealth period, from 1656 to 1660. I'm not letting this spoil my argument.]

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