ISA welcomed a distinguished guest to conclude our Liberalism in the Americas 2011-2012 lecture series, on 6 June 2012: Professor Victor Bulmer-Thomas, currently a Visiting Professorial Fellow at ISA, delivered a fascinating lecture on “Freedom to Trade, Free Trade and Laissez-Faire: Latin American Approaches to Economic Liberalism in the Nineteenth Century.” A video recording of the lecture and ensuing discussion is available to view on our youtube channel, and the full text of Professor Bulmer-Thomas’s article can be downloaded from the Liberalism in the Americas Collection in SAS-Space, our institutional repository. We thank the Economic History Society and the Society for Latin American Studies for sponsoring this lecture, which also acted as a plenary for our workshop on Economic Liberalism in the Americasthat took place earlier in the day.
Bulmer-Thomas’s lecture gave a broad-ranging overview and interpretation of Latin American approaches to international trade in the long nineteenth-century. He argued that “unrestricted free trade was seen as a distant goal by all but the most ideologically committed liberals and economic policy focused on much more limited objectives”. In the late eighteenth and early nineteenth century, the key objective was “freedom to trade” with any international partner, as opposed to the mercantilist system of the Spanish and Portuguese empires that restricted the number of ports open to trade, excluded the participation of foreign shipping, restricted intra-colonial trade, and granted royal trading monopolies. Between the 1770s and the 1820s, the colonial governments opened more ports to international trade, granted permission for colonial ports to trade with neutral ships, and lost the ability to enforce imperial monopolies. After independence, the newly independent states, as well as the remaining Spanish colonies of Cuba and Puerto Rico, operated under the “freedom to trade” principle, but stopped short of “free trade”, since commercial concessions were often extracted by trading partners, and tariffs and export duties were often high on the Latin American side of the exchange.
By the mid-to-late nineteenth century, however, a form of “free trade”, where partner trading countries ceased to enforce discrimatory policies on Latin American goods, had become the norm. Bulmer-Thomas explained that in the aftermath of independence, when the need for international recognition and international debts were high, important trading partners, including Great Britain, France,and Portugal, were able to extract special trade privileges from Latin American countries. But their ability to extract such concessions diminished as the nineteenth century progressed, especially as the international weight of the United States increased and affected the direction of trade policy. Again, this stopped short of being “laissez-faire”, since both Latin American countries and many of their trading partners continued to make considerable use of tariffs. Indeed many of the newly independent countries in Latin America raised tariffs from the levels that had operated while they were part of the Portuguese and Spanish empires: the disruption to economic infrastructure and fiscal systems caused by the independence wars meant that taxes on trade were often a vital source of revenue. Alejandra Irigoin’s paper in the Economic Liberalism in the Americas workshop that preceded Bulmer-Thomas’s lecture further suggested that many countries within Latin America had to rely on trade-based taxes because attempts to shift to a fiscal system based on direct taxation in the 1820s had failed.
Bulmer-Thomas concluded his lecture by considering other aspects of economic liberalism that our previous workshop had also considered, especially regarding the development – or not – of factor markets in labour, land and capital. In these areas, there was a degree of debate regarding the preferable level of state involvement in shaping land, labour, and capital markets as the best means of creating economic growth and development, although these debates did not always neatly fall along liberal and non-liberal lines. Bulmer-Thomas then answered a range of questions on the contradictions within economic liberalism; the liberal Vs illiberal nature of tariffs and contraband trading; the role of internal barriers to trade within federal states; the relationship between coerced labour and market forces; and the importance of commodities to Latin American economies.
You can listen to Bulmer-Thomas’s thoughts on these issues, as well as the lecture itself, on our youtube channel, and you can download the text of his talk in our Liberalism in the Americas SAS-Space collection. Please also join the discussion in the comments section below!