Free trade and mercantilist - Essay Example

So, while free trade is beneficent in its purest form, modern policymakers have hijacked the concept to serve the interests of select private businesses at the cost of smaller business enterprises and the majority of the electorate. (Dunkley, 2004, p.53) The rest of this essay will look into how free trade, despite strong arguments in its favor, has not always been adopted in economic policy making. It was by the start of 1970s that currents of change were detected in the global economic order, with nationalism and protectionism being replaced by neo-liberalism and free flow of capital.

But there were also concerns that this new economic paradigm can lead to excesses and decadence. For example, the unsavory side-effects of free trade in this period includes “the appearance of a nearly feral form of entrepreneurship in which black marketers, drug barons, arms merchants, rackets bosses, Mafiosi, and other profiteers were emerging as the economic and political leaders of the social transformations underway in their respective societies.” (Buchanan, 2000, p.1) These developments acted as a disincentive for a few governments to draw up free trade policies.

Another reason why free trade practices are not uniformly accepted is due to the effect it has on workers and consumers. Some believe that under this system, workers become helpless pawns of their capitalist masters, compelled to sell their labor power at sub-optimal costs. The only theoretical alternative they have to evading this exploitation is to become destitute, which is a far greater misery. Multi-national corporations (MNCs), which are the facade of free trade, are perceived as coercing citizens to unwillingly participate in the capitalist market system, while also leaving consumers with no choice but to buy their products.

(List, 1997, p.51) In the book titled Telling the Truth about History, author Joyce Appleby traces how MNCs came to be