World peace through world trade

Thomas J Watson Sr (picture IBM)

Apparently it is the 100th birthday of IBM, the American computer company, formed through a merger of the Tabulating Machine Company, the International Time Recording Company and the Computing Scale Company of America on 16 June 1911.

Its president during the 1930s, Thomas J Watson Sr, who turned it into the world’s largest company of its type by far, adopted the slogan “World Peace Through World Trade”, painting it in large letters outside his New York City headquarters.

If only things were as simple as that.

Norman Angell explained in the years before the first world war in “The Great Illusion” that economic integration had gone so far that war would cost more, much more, than it earned.  Armaments were not necessary in order to secure prosperity; in fact, their acquisition reduced it and not increased it.  There were better things to spend money on.

Sadly, nationalism turned out to be more seductive than that.  Trade was not enough.

It is necessary, though.  Lionel Robbins, in “Economic planning and international order” published in 1937, explained the intimate connection between free trade and peace, both requiring supranational institutions to enforce the law and prevent national governments from obstructing trade and fomenting aggression.

Peace through trade has been tried and found wanting: peace through law is the right approach.

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