Sunday, 12 August 2012

The Political and Economic Aspects of Mercantilism - Brian Safran


                  In Power Versus Plenty as Objectives of Foreign Policy in the Seventeenth and Eighteenth Centuries, Jacob Viner examines the theoretical underpinnings of the economic doctrine known as mercantilism. Through his writings, he endeavors to discern the mercantilist’s conception of the relationship between “power,” or political might and “plenty,” or economic wealth (Viner 1948: 1). While it is commonly believed that the mercantilists viewed power as the “sole objective” of foreign relations, Viner turns to the historical record to determine the validity of this conception (Viner 1948: 14). Through careful analysis of available evidence, Viner endeavors to establish whether the mercantilists viewed power as the end-all of public policy, or whether they viewed wealth creation and accumulation as an equally and simultaneously important objective of policy-making. His findings suggest that the two concepts converge with the mercantilists having viewed wealth as a means to power, and power as a means to wealth. He ultimately concludes that mercantilist doctrine united both “power” and “plenty” as “proper ultimate ends of national policy” and that both ends are “fundamentally harmonious” (Viner 1948: 1, 10, 17).
            Viner’s understanding of mercantilism sheds light on a doctrine which can help explain the establishment of the modern-day international system. Since the Treaty of Westphalia in the seventeenth century, the world has become divided into sovereign nation-states, each seeking to advance its own interests and protect its populace. Although mercantilist doctrine developed on the heels of the age of imperialism- an age which saw the prominence of political power as a means of preventing the violent encroachment upon one’s territory by others- mercantilist scholars were nevertheless interested in trade as a source of economic growth not only for the purpose of advancing a nation’s political and security interests, but for the final objective of establishing economic welfare for its citizenry. For instance, in a 1903 text entitled The Growth of English Industry and Commerce in Modern Times, Vol. II, it was openly declared that “From the Revolution till the revolt of the colonies, the regulation of commerce was considered, not so much with reference to other elements of national power, or even in its bearing on revenue, but chiefly with a view to the promotion of industry” (Viner 1948: 3). Similarly, in the 1906 publication of The Wisdom of the Wise, it was argued that “In the pre-scientific days the end which men of affairs kept in view, when debating economic affairs, was clearly understood; the political power of the realm was the object they put before them” and that in modern times, men were no longer “so ready to engage in aggressive wars for the sake of commercial advantages, as Englishmen were in the eighteenth century” (Viner 1948: 3). Additionally, in an unsigned, obscure pamphlet dated 1754, it was argued that “Great Britain, of herself, has nothing to fight for, nothing to support, nothing to augment but her commerce” (Viner 1948: 14). Finally, in 1704, a minister of the Duke of Savoy observed that “the maritime powers were so attentive to their interests of trade and commerce, that, perhaps, they would… abandon the common interests of Europe” by discontinuing their effort to defeat France in a war then under way. (Viner 1948: 21) Thus, despite the commonplace belief that power was the sole objective of mercantilist endeavors in the seventeenth and eighteenth centuries, there exists an historical basis for a contradiction of this assumption.
In his article, Viner offers an explanation as to why the mercantilist scholars of his day had not previously endeavored to investigate the question of whether the doctrine supported the conclusion that wealth accumulation is a desirable end in itself. He argues that the economic historians who had advanced the power-centric view of mercantilism over the years were themselves staunch supporters of nationalism and supported the notion that the state is to take precedence over the individual. (Viner 1948: 4) He defines them as having been “hostile to nineteenth century liberalism and its revolt against the residues of mercantilist legislation” (Viner 1948: 4). Giving credence to the interests and pursuits of the liberal-minded bourgeoisie class whom they despised was something these scholars did not want to do. (Viner 1948: 4) Based on this interpretation, Viner is able to paint a different picture of mercantilism than was purported by the scholars of his time. In contradistinction to the power-centric view, he is able to analyze an economic doctrine objectively by considering the historical record without infusing his own political ideology.
Viner’s interpretation of mercantilism proffers a theory which can perhaps better explain the motivations behind state policy in the present day. An illustration of state behavior under Viner’s interpretation of mercantilism is the events that took place in Germany following World War II. After facing the reality of losing the war and having to rebuild an identity tarnished by the actions of the Nazi regime, Germany faced the prospect of heeding to the political subservience of the Allied powers, or choosing a route that would ultimately serve to diffuse its sovereignty and reduce its unilateral political power. In choosing the later route, Germany pursued integration with France initially through the European Coal and Steel Community, and later through the European Community, European Monetary System, and now the European Union. The steps taken by Germany toward supranational integration with a larger European continent have served to benefit Germany to the extent that it helped rebuild a war-torn state and promulgate a new German identity and wave of thought based on the pursuit of economic power. However, in doing so, Germany has ultimately had to give up a certain degree of its autonomy- and thus its political power- to its European neighbors. The pursuit of economic power has all but replaced Germany’s quest for undying political power, and the former has become an end in and of itself.
In Power Versus Plenty as Objectives of Foreign Policy in the Seventeenth and Eighteenth Centuries, Jacob Viner investigates the basis for the modern-day understanding of the doctrine of mercantilism. He finds that contrary to the prevailing views of economic historians, mercantilists viewed “power” and “plenty” as separate and distinctive goals of foreign policy. He argues that the lack of a rigorous investigation into the foundations of the theory served an ideological purpose for those scholars who sought to advance a core belief in nationalism. The doctrine of mercantilism as described by Viner can explain certain aspects of international cooperation in modern times that the previous, power-based conception of mercantilism could not. A case in point is Germany in the post-World War II era and its emphasis on the pursuit of national economic power through international coordination and European integration at the expense of its political autonomy. As the world becomes increasingly interdependent and economic cooperation continues to expand, it is probable that Viner’s view of mercantilism and its emphasis on the pursuit of both power as well as plenty will allow mercantilism a continuing applicability to contemporary global affairs.

Works Cited

Viner, Jacob. "Power Versus Plenty as Objectives of Foreign Policy in the Seventeenth
and Eighteen Centuries." World Politics 1.1 (1948): 1-29. JSTOR. Web. 16 Sept. 2009.

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