World War 2 prevented by free trade?

Its generally common understanding now that the things like the Smoot-Hawley tariff hike during the Great Depression made the international economic situation worse, especially at a time when everyone was raising tariffs to protect their domestic industries. However if internationally the opposite approach was taken could WW2 have been headed off by better policy preventing the rise of extremism in Europe and Asia? Would a free trade situation similar to what we have now have increased trade enough to stabilize the world economy?

wiking said:

Its generally common understanding now that the things like the Smoot-Hawley tariff hike during the Great Depression made the international economic situation worse, especially at a time when everyone was raising tariffs to protect their domestic industries. However if internationally the opposite approach was taken could WW2 have been headed off by better policy preventing the rise of extremism in Europe and Asia? Would a free trade situation similar to what we have now have increased trade enough to stabilize the world economy?

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I would say yes but in only in part.
For free trade you need both parties to agree on free trade not just one.
Lets say in 1929 their is international conference which freezes tariffs or even lowers them among the members. Then they would have to do with currency wars every country is allowed to devalue against gold by certain factor but not more.
That would help.

But would German participate? Japan?

Until of GATA tariffs were raising all over.

The UK and Germany before 1914 were the biggest trading partners with each other.

I don't see it happening.

The trade war made the situation worse, yes, but the real problem was systematic banking failures, combined with Governments cutting expenditure.

I'd note that Philip Snowden, UK Chancellor of the Exchequer from 1929 onwards was staunchly free trade, and that didn't help mitigate the Depression one bit.

There is a pretty big belief in right wing economic circles that free trade leads to peace. I believe it is unsubstantiated myth.

As previously stated, Germany and the UK were pretty big trade partners pre-WWI. I am pretty sure France and Germany were big trade partners at the same time. The US and Japan were obviously important trade partners leading up to WWII.

I think there is a PhD waiting for someone to do a rigorous study on the subject. I would bet their is little correlation between trade and conflict.

Biggest trade partner doesn't mean free trade. There can be trade even with high tariffs. Pre-WW1 having lower tariff barriers would have led to significantly higher overall economic growth and part of Fritz Fischer's flawed hypothesis was that Germany sought war to open up markets that it was shut out of by high tariffs or at least make up for them in Europe by force. Of course that leaves out the other issues Russo-German/Austrian issues in the Balkans that helped lead to war...
There was a theory in the 1980s, not sure if its been debunked, that the reason the Germans have been so peaceful after WW2 is that they finally were given access to a free trade system and prospered, effectively getting what they (partly) fought two WWs for.
http://www.amazon.com/German-Proble...8&qid=1401447045&sr=1-3&keywords=David+Calleo

wiking said:

Biggest trade partner doesn't mean free trade. There can be trade even with high tariffs. Pre-WW1 having lower tariff barriers would have led to significantly higher overall economic growth and part of Fritz Fischer's flawed hypothesis was that Germany sought war to open up markets that it was shut out of by high tariffs or at least make up for them in Europe by force. Of course that leaves out the other issues Russo-German/Austrian issues in the Balkans that helped lead to war...
There was a theory in the 1980s, not sure if its been debunked, that the reason the Germans have been so peaceful after WW2 is that they finally were given access to a free trade system and prospered, effectively getting what they (partly) fought two WWs for.
http://www.amazon.com/German-Proble...8&qid=1401447045&sr=1-3&keywords=David+Calleo

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It's a fair point. But short of absolute free trade, nations tend to use trade policy as a tool for foreign policy Russia/Ukraine now and Japan/US in the 1930s. Once that point is acknowledged, the limitations of the relationship between free trade and peace become somewhat evident. We can both be right and wrong here.

Dunning Kruger said:

There is a pretty big belief in right wing economic circles that free trade leads to peace. I believe it is unsubstantiated myth.

As previously stated, Germany and the UK were pretty big trade partners pre-WWI. I am pretty sure France and Germany were big trade partners at the same time. The US and Japan were obviously important trade partners leading up to WWII.

I think there is a PhD waiting for someone to do a rigorous study on the subject. I would bet their is little correlation between trade and conflict.

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The issue isn't with trade preventing war per see.

The idea is that the strangling of international trade made the depression worse and thus increased support for extremist politics and thus Fascist Germany and Japan.

Dunning Kruger said:

There is a pretty big belief in right wing economic circles that free trade leads to peace. I believe it is unsubstantiated myth.

As previously stated, Germany and the UK were pretty big trade partners pre-WWI. I am pretty sure France and Germany were big trade partners at the same time. The US and Japan were obviously important trade partners leading up to WWII.

I think there is a PhD waiting for someone to do a rigorous study on the subject. I would bet their is little correlation between trade and conflict.

Click to expand...

The articles I've read say that trade does help promote peace, but only if ideology isn't strong enough to override it (don't have a link at this time, through). It's ideology that caused the problem- peace would have made lots of money for everyone, but people value other things than money, and unfortunately for the early 20th century, they valued national pride and militarism more then economic progress at the time...

wiking said:

There was a theory in the 1980s, not sure if its been debunked, that the reason the Germans have been so peaceful after WW2 is that they finally were given access to a free trade system and prospered, effectively getting what they (partly) fought two WWs for.
http://www.amazon.com/German-Proble...8&qid=1401447045&sr=1-3&keywords=David+Calleo

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The reason Germany has been so peaceful since WWII is threefold:

- The Cold War created a bipolar world. You don't go to war with allies.
- Germany lacks both the military ability and the desire to have adventures, let alone compete with the superpowers.
- Organisations such as the EU and UN have bound Germany in close ties with other countries.

No need to invoke free trade.

Wow, everyone missed the point in the OP:

RousseauX said:

The issue isn't with trade preventing war per see.

The idea is that the strangling of international trade made the depression worse and thus increased support for extremist politics and thus Fascist Germany and Japan.

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If the Depression is somewhat better, it could easily stop Hitler's triumph. The rise of the Nazis to power in the chaotic German politics of the early 1930s was often very precarious at times, the butterfly affect alone of a different US trade policy could easily be enough to derail them. I think Germany would still be in for a rough time, as Smoot-Hawley did not cause the entire global depression, but something as insane and evil as Nazism could easily be prevented.

Emperor Julian said:

Wow, everyone missed the point in the OP:

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No we didn't.

Free Trade would not and (in the case of the UK) did not stop the Depression: you're dealing with a very minor component of a much larger problem. You need a different POD to stop it, and hence stop Hitler.

The last part is the important part I think:

"" Organisations such as the EU and UN have bound Germany in close ties with other countries.
"""

Looking at the roots of the Coal and Steel Union, it was a desire to prevent any more wars in Europe. The strategy was to tie France and Germany into a world of cooperation where it would not make sense at all to have any more conflicts.

Whether the additions of countries into EU will make it too big and too un-manageable is a good question. Also insofar as the new countries have other values and more structural problems.

That points to another 'fact' = Countries at the same level (more or less) have a chance. Too disparate and it will fail.

Did it then require the total devastation of Europe to see the light? maybe.

So, if it is not free trade which will be the issue but rather the political, economical, social and military cooperation governing 'peace', then a proto-EU could prevent another war.

Western Europe has been at peace and it is not likely that another war will break out in that part of the world. Eastern Europe - as in Russia, etc, is another thing all together.

IF France, Germany, Italy and Spain had come together in the early 1930's to form a power-bloc, I believe things could have been different.

BUT: That would have required a totally different set of leaders!

Ivan