British Corn Laws and Empire, the U.S. Free Trade Zone and the Eurozone

Posted by PITHOCRATES - November 29th, 2011

History 101

With the Royal Navy, the Steamship, the Railroad and the Telegraph, Great Britain Peacefully Ruled and Led the World

The British Corn Laws were on the books from 1815 to 1846.  To protect domestic cereal farmers from less expensive food imports.  By adding a tariff to these grain imports.  Increasing their price.  So they weren’t any cheaper than the domestically grown grain.  Interestingly it was the few great landowners who wanted these tariffs.  Not the people who had to buy the food.  For paying more for food meant they had less to spend on clothing and other things.

When it came to consumer prices the people were always for free trade.  Because whatever they earned it never seemed enough.  So paying more in taxes was never a good thing.  These wealthy landowners even put forth the argument that paying higher food prices meant higher wages.  In a feeble attempt to maintain these tariffs.  They said that manufacturers just wanted cheaper food so they could pay cheaper wages.  Because if food wasn’t that expensive their workers wouldn’t need as much pay.  And, of course, the greedy manufacturers would just pocket more profits.  Much like the greedy landowners were doing thanks to the Corn Laws.  But their greed was somehow different.

Well, free trade won out.  Eventually.  And they repealed the Corn Laws in 1846.  And, as expected, food prices plummeted.  Soon they imported more food than they grew.  Because it was cheaper.  And it freed up more money for use elsewhere in the economy.  Stimulating innovation and invention.  Taking the Industrial Revolution to new heights.  And raising the standard of living for all people.  Not just the wealthy landowners.  The British Empire reached its zenith in the 19th century.  After the defeat of Napoleon there was about a century of peace called the Pax Britannica.  Where Great Britain became the global policeman.  With the Royal Navy, the steamship, the railroad and the telegraph, Great Britain peacefully ruled and led the world.

The U.S. was a Large Free Trade Zone with a Common Currency, Language, People and Customs

The British were the most advanced nation in the 19th century world.  And the richest.  Her empire dominated trade.  Her rule of law and common currency made that trade efficient.  It was a giant free trade zone within her empire.  But it couldn’t last.  The cost of maintaining the empire, plus a world war, was just too much.  Her economic might faded.  While another rose.  In a former colony.  The United States.

The sun never set on the British Empire.  Because it was that big.  Reaching around the globe.  Connected by long lines of communication.  And an imperial British culture uniting different peoples.   Who knew different cultures, laws and money.  Whereas as the United States had all the advantages of empire (size and range of resources) without any of the disadvantages.  The U.S. was a large free trade zone with a common currency, language, people and customs.  The states comprising the U.S. were as big as countries in other parts of the world.  But trade could flow between any two states without custom duties, tariffs or even inspections.  It was truly free.

When the Industrial Revolution reached the United States, the economy took off and never looked back.  By the end of the 19th century she was challenging the British Empire.  And rapidly overtook her.  There was another global policeman in town.  All because of a giant free trade zone that was as big as a continent.

The ‘United States’ of Europe created the Eurozone and a Common Currency (the Euro) to Compete with the U.S.

The United States is such the perfect model of free market capitalism that Europe created the Eurozone and a common currency (the Euro) to compete with the U.S.  And it worked.  For awhile.

The ‘united states’ of Europe as a whole has a larger economy than the U.S.  But they have their problems.  For a common currency is only part of America’s success.  The U.S. is a united federation of states with one set of federal laws, language and culture for interstate commerce.  Something Europe doesn’t have.  And probably never will.  European countries have far too much history and culture.  And nationalism.  They will never unite politically.  Like the United States.  Or the British Empire, for that matter.

The key to the British Empire was that it was British.  One currency.  One language.  One set of laws.  One culture.  For interstate trade, at least.  Just like in the country that surpassed her.  The United States.  Still, there’s nothing wrong with being a smaller economic power than the U.S.  As long as you have free trade your people can enjoy a high standard of living.  Without the added responsibility of being the global policeman.

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