Opponents of Free Trade

Opponents of Free Trade: The Nationalists

Among the first to oppose the economic ideas of Smith, as they related to trade, were the so-called nationalists. These were German economists in the main who believed that the individual's wealth was secondary to that of the state, and that the state should safeguard its own economic and political power by whatever means seemed expedient. The explanation for the rise of economic nationalism in the Germanic countries is not far to seek. First of all The Wealth of Nations grew out of English economic conditions and it was designed primarily for England. It naturally spoke of situations and propounded ideas which had little application to continental conditions. The reaction against Adam Smith in Germany especially should have been expected. Furthermore, the Central European nations were not so far advanced commercially and industrially as England. Germany was predominantly agricultural. An unfavorable geographic position had prevented the development of mercantile pursuits in Germany when the center of trade passed from the North Sea and Mediterranean to the Atlantic. The lack of political unity, and the accompanying petty jealousies of minor sovereigns hampered the growth of an extensive internal trade or common economic policy among the German states. Finally, a philosophical idealization of the all pervading influence of the state to which both Fichte and Hegel gave expression permeated German thought and allowed no development of individualism.