The Rise of Trade and the Spread of War

In the modern world, the richest countries often have very limited natural resources (e.g., Japan). And often, resource rich countries are very poor because of protracted civil war (e.g., Congo-Kinshasa), misgovernment (e.g., Venezuela), or being stuck at the bottom of the value chain (the so-called Dutch Disease). It is still better to have abundant natural resources than to not have them. But there is a lot more to a modern economy than natural resource extraction. I think that prior to the industrial revolution it was rarer for a country blessed with rich natural resources to be poor. One extreme example of this is the division of Genghis Khan’s empire among his four sons. The eldest son, Jochi, received the area corresponding to Russia and Siberia. The state created by Jochi and his descendants is known to history as the Golden Horde. The Golden Horde was the least populous of the four sections, but it was seen as desirable because it had abundant natural resources, particularly furs. If given the choice today, I would certainly rather be Khan of China or the middle east than of Siberia and the Great Steppe. But back then, they don’t seem to have seen it that way.

So it seems fair to say that natural resource are less central to determining which regions are considered rich or poor in the modern world than they have been historically. And it also would seem to follow that starting a war for the purpose of stealing natural resources makes much less sense than it used to. But, though the role of natural resources in starting wars has diminished, the role of natural resources in expanding wars once they begin has increased.

In general, a pre-industrial army is not that hard to supply. You need food, clothing, wood, various widely available metals, and maybe saltpeter. There are some exceptions–I’ve seen speculation that the Late Bronze Age collapse was caused in part by an inability to find new sources of tin for making bronze after the tin mines in what is now Afghanistan stopped operating. But, in general and for the most part, modern nations need vastly more varied and geographically disbursed resources to fight wars. I notice this whenever I read about World War II. The German and Soviet leadership were constantly freaking out about access to chromium or phosphorus or tungsten or various other obscure elements of the periodic table. One of the major reasons Japan attacked Pearl Harbor was the Americans had subjected them to an embargo on oil exports, and they imported 80% of their oil from America. Prior to the invention of the internal combustion engine, a situation in which it made sense to the Japanese to attack the United States may just never have arisen. During World War I, Germany was cut off from deposits of guano (bird and bat droppings) from South America which it used to get fixed nitrogen for use in fertilizers and explosives. The German chemist Fritz Haber saved the day by having invented the Haber-Bosch process. But that was just luck.

It has become far more common for rich countries to import the majority of the food they consume from abroad (though there are ancient examples of this, like the role of Egypt as the breadbasket of Rome). Fossil fuel powered transportation makes it more economical to ship heavy items like food. And food imports seem to have been a crucial factor in the escalation of the world wars.

Germany’s strategy in WWI was to use submarines to blockade England and starve the English into surrendering and deprive them of supplies. (I don’t know why people always say “U-boats” in this context, it just means unterseebooten, i.e. submarines. I guess it is the same impulse as refusing to translate Führer into “leader”.) Unrestricted submarine warfare had the side effect of leading the Germans to sink ships carrying American passengers, which expanded the war. The Germans, for their part, also suffered from difficulty importing food. It was serious enough that the effects of the Entente blockade show up in graphs of the height of German children.

Graphs from Hunger in War and Peace by Mary Elizabeth Cox.

These days, lots of us have WWIII on the brain. But those concerned about the long-term future have additional reasons to think about great power war. The ill effects of a world war could easily be permanent.

I want to suggest a model according to which international trade in geographically concentrated natural resources increases the risk that a small war becomes a world war:

(1) Cheap international shipping and greater knowledge of how to use rare materials creates more demand for geographically concentrated natural resources in peacetime.

(2) Therefore, modern economies rely to an ever greater extent on imports that can not be insourced in an emergency.

(3) When war breaks out, access to some essential resources is lost. In the simplest case, this is because you were buying the resources from your adversary. But it could also be because countries are less interested in trading with belligerents or you are under blockade.

(4) The need for domestically unavailable natural resources spreads war further because if the resources cannot be bought, the only other options are doing without (which may mean accepting defeat) or stealing them from other countries that you attack.

The idea that commerce reduces the likelihood of war has a distinguished and ancient pedigree. The reasoning goes that familiarity borne of trade breeds international understanding, and that it is financially disastrous to start a war with your trading partners. That all sounds right to me. But if my argument is correct the doux commerce thesis is only half of the story. Yes, war between major countries is less likely to start in the first place if there is lots of international trade. But if war does start, it is more likely to spread until it engulfs the globe, because countries will be faced with the choice between death and expanding the war in order to plunder necessary resources.

Constantly putting out small wildfires reduces the number of small wildfires in the short run. In the long run, it increases the number of large wildfires because putting out small ones allows a vast supply of tinder to build up. In the same way, financial bailouts might reduce the acute severity of the normal business cycle while gradually contributing to a future catastrophic economic meltdown. And international trade might make small wars less numerous and world war more likely.

What happens if you don’t allow controlled burns (source).

Irrational Irrationality

If you assume that people are rational and self-interested, it is hard to explain why they vote. This is because the odds of being electorally decisive are always very low. A rational and self-interested actor would conclude that by voting he was wasting his time. One solution is to compromise on the assumption of self-interestedness. Because the altruistic upside of deciding an election is so much larger than the self-regarding upside, even a small probability of being electorally decisive can make voting rational if you are not purely self-interested.

Bryan Caplan suggested another way of resolving the paradox of voting, which he called “rational irrationality”. He said that in some situations epistemic rationality (i.e. rationality in the sense of correct reasoning) and instrumental rationality (rationality in the sense of correct decision-making, “rationality is winning”) can come apart from each other. It might be instrumentally rational for a baseball player who is past his prime to ignore that fact and somehow trick himself into believing he is still in his prime. Caplan’s model holds that we can understand much political action as instrumentally rational if we take the ends aimed at to be the psychological gratification of the political actors in question. This model also purports to explain why politics seems to melt people’s minds; when engaging in politics, according to Caplan, it is instrumentally rational to be epistemically irrational.

I feel this model is psychologically unrealistic. Can you just decide to believe things because you feel it would be gratifying? I certainly can’t. Presumably this is supposed to happen at some subconscious level–but that seems pretty hard to prove. It also seems inappropriate to totally separate epistemic and instrumental rationality in this way. In order to act appropriately, you need knowledge. Maybe you can add an epicycle about how people have a very good sense of when they can get away with suspending epistemic rationality vs when they can’t. But what is the mechanism, there?

But, bracket these doubts about rational irrationality in general. The applicability of the model to political elites when it comes to global catastrophic risks seems testable to me. That is because, while politicians and other important political actors are normally insulated from the consequences of their bad choices, this is much less true when it comes to global catastrophic risks. So, the rational irrationality model (at least as I understand it) predicts that when the self-regarding stakes get to be sufficiently high, political elites will shape up.

Does that sound right to you?
rational irrationality at work

We just had the worst pandemic in a century. As of right now, essentially zero public sector effort is being directed at preventing future pandemics. And various kinds of research with negligible benefits that poses a serious risk of accidentally causing future pandemics are being allowed to continue, despite the fact that even supposedly high security labs leak all the time. Whether or not COVID-19 itself came from a lab (though, for what it’s worth, I think it probably did), this doesn’t look very instrumentally rational to me. Politicians could die in a future pandemic, just like anybody else.

How about nuclear weapons? I think here the issue is not as blatantly obvious–but I have to say I’m not thrilled with the various governments of the world’s performance.

The Chinese people are not to be cowed by U.S. atomic blackmail. Our country has a population of 600 million and an area of 9,600,000 square kilometres. The United States cannot annihilate the Chinese nation with its small stack of atom bombs. Even if the U.S. atom bombs were so powerful that, when dropped on China, they would make a hole right through the earth, or even blow it up, that would hardly mean anything to the universe as a whole, though it might be a major event for the solar system.

Mao Zedong, a man whose rationality when it came to global catastrophic risks was at least open to question.

Besides rational irrationality, what other explanations are there for political elites’ failure to take catastrophic risks sufficiently seriously? A few popular ones are free-riding and bad values (in particular, non-zero discount rates). I think both of these explanations have their place. But I think the main explanation is probably something like: politicians just do not think in these terms. They are unaware of the relevant empirical facts. If they were aware, it would be a big break from their normal routines of thought and action to respond adequately to those facts. People like routine. These issues are not that widely thought about in our culture, especially compared with controversial political issues.

On top of that, thinking about these issues can be upsetting. I remember once seeing a bird with damaged wings. It couldn’t fly. When a group of people crowded around it, it was obviously scared, but it couldn’t fly away. So it turned and faced a wall. If it didn’t have to look at the people, it didn’t feel as scared, even though that obviously did not solve the underlying problem. I think human psychology also works this way.

Against the Fire

I think there are two legitimate purposes for historical essays:

(1) providing exposition of an idea or event, or

(2) making an argument with a clear thesis.

If records of an event are dispersed and hard to understand, writing an expository essay explaining what they say is valuable. If some idea is very complex or recondite, or only makes sense in the context of other ideas that are largely forgotten, exposition is equally appropriate. So, for example, it makes sense to write an essay explaining exactly what happened at Katyn Forest in 1940, or what the abbé Sieyès’s theory of political representation amounted to.

History doesn’t interpret itself, so there is also a place for thesis driven writing. This is where review articles on whether slavery was a necessary complement of capitalism come in, for example.

There’s more latitude for books because they are long enough to fulfill multiple functions. But a lot of history books basically fulfill the task of exposition on an ambitious scale; To Stand with the Nations of the World pretends to have a thesis but mostly it just (very successfully) explains what happened during the Meiji Restoration and compares that era of Japanese history to other times and places.

But a lot of historical writing doesn’t fall into category (1) or (2). It is neither genuinely expository nor genuinely argumentative. Usually, historical writing that is in neither category is bad. Without the discipline of argument or a clearly defined object of exposition, you get a kind of insight porn that throws around allusive lists of concurrent events and spurious chains of diachronic associations. This sort of writing ends up sounding like:

Harry Truman, Doris Day, Red China, Johnnie Ray, South Pacific, Walter Winchell, Joe DiMaggio, Joe McCarthy, Richard Nixon, Studebaker, television, North Korea, South Korea, Marilyn Monroe, Rosenbergs, H-bomb, Sugar Ray, Panmunjom, Brando, “The King and I”, and “The Catcher in the Rye,” Eisenhower, Vaccine, England’s got a new queen, Marciano, Liberace, Santayana…

The Horse Doesn’t Have to Come Before the Cart

I associate the phrase “the horse has to come before the cart” with a common political argument that I think is invalid. Once, I heard someone say that it would be desirable to have less traffic in big cities. However, he didn’t like the obvious measures that could be put in place to reduce traffic like congestion taxes or higher prices for parking. He thought that these things should not be done until effective mass transit systems were already in place. Similarly, I once saw someone say that, although she thought abortion was bad, abortion is a consequence of a culture of delayed family formation and (relative) free love. Changing the rules about abortion, her argument went, is undesirable until that culture is changed.

This is my read of the abstract form of the horse-cart argument:

(1) Something (call it X) is commonly done, but undesirable.

(2) The rules could be changed to punish or tax X.

(3) However, this would not change the circumstances beyond the rules that create demand for X.

Therefore, changing the rules to discourage X is undesirable until the circumstances are changed.

When laid out like this, the horse-cart argument seems pretty unconvincing. What I think it misses is that circumstances can change in response to new rules. If the costs of parking are raised, people might carpool. Private businesses might start running bus lines. Citizens might start to vote for mayoral candidates who promise to put in trains. If abortion were made illegal presumably people would price that in and begin to change their decision making. The culture is just the constellation of prevalent beliefs, preferences, and behaviors. Rule changes can obviously have unintended consequences. But the fact that cultural change is one requirement of changing something is by itself no argument against changing the rules. Changing the rules can cause cultural change.

It is true that changing the rules without (somehow) first changing the related cultural scaffolding will impose costs disproportionately on a specific group of people (those who live far from work and need to pay more for parking or move, say). But changing the culture before changing the rules would impose costs on a different group of people (those who now have to live near a loud and annoying train route, for example).

The cost of changing how you act is greater than the difference between the benefit of how you acted previously and how you will act going forward. If the rules change to discourage something that you were previously planning to do, you are likely to be worse off than if the new rules had always been in place. I believe the lawyerly term for this is a “reliance interest.” In 1967 Sweden switched from driving on the left (like Britain does) to driving on the right (like nearly every other country does). Although neither way of driving is inherently easier or harder, Swedes struggled to adapt to the change:

If Sweden had started by driving on the (forgive me) correct side of the road, this traffic jam could have been avoided. It is a mistake to count the costs of changing the rules without accounting for reliance interests.

But the horse-cart argument seems to go way beyond what simply recognizing the existence of reliance interests would warrant. And it is (almost by definition) harder to change organic circumstances than rules. So the horse-cart argument seems likely to function in practice as an argument for never changing anything.