Neoliberalism and hawkishness

Does it make any sense to be optimistic and supportive of free trade and still support maintaining the world's most powerful air force and navy, things not particularly useful for our current conflicts? In other words, why do I want to trade with China (and other countries) but check its power? My response is somewhat rambling since I've never been asked this, and would probably be more coherent had someone else taken up the onerous burden of interrogating me.

Free trade is good for both "us" and "them" economically. Consequently, free trade does have some positive diplomatic effects - in addition to economic benefits, free trade is a diplomatic signal. Working through organizations like the WTO strengthens international institutions and multilateralism, thus reducing harsh feelings and anti-American sentiment - that whole "image" issue. With that apparent, why then would I still support the maintenance of instruments of traditional state warfare?

I don't believe the marginal effect of free trade is enough to push countries from "brink of war" to "peace" except in the very long run (very rich, liberal, democratic countries are less likely to fight each other, yes, and free trade can generally encourage the attitudes and institutions that promote the aforementioned things). WWI, after all, occurred despite very high levels of global economic integration.

It's important to note that not all wars are fought over economic issues. However, backsliding on economic agreements like free trade can still exacerbate things because of its value as a political signal and its inducement of political and economic volatility. Take the interwar period - the backsliding on free trade probably contributed to WWII to some degree, but economic autarky both encouraged and fed on radical political movements.

Also, there's the deterrence value - maintaining a globally active military and forging strategic partnerships discourages minor powers from fighting each other. Saudi Arabia and Iran in the Middle East, India, China and any of their regional rivals (including Taiwan), Russia and its neighbors spring to mind as well. Even if one country might not want to fight the US because of economic linkages or political incentives, it might still have an incentive to fight someone else.

Then of course there is the fear of shocks to the present international order. It is too soon to say whether the dystopian visions of conflict over natural resources will come true, but one never knows. I am not advocating invading other countries for their oil, but the US has a useful role as a balancer and peacekeeper as I have just mentioned.

While this post addresses the international stage in general, it addresses China in particular. One of the lines of argument specific to China is of China skeptics to lump all its faults together - political crimes, environmental damage, and poor working conditions, and consequently want to tie free trade to standards China is unlikely to accept. Such soft protectionism is unlikely to be useful in improving the lives of Chinese. In fact, by impoverishing China it would lessen the incentive to raise wages, improve labor standards, or clean up the environment. As for the argument that it is wrong to trade with a dictatorship, economic sanctions are useful for stopping specific policies, not for transforming societies. Economic sanctions did not make Iran, Cuba, North Korea, Burma, Iraq and others into liberal democracies. If anything, integrating autocratic countries into the global economy makes major social change more likely.

Maintaining policies that limit, say, arms trade with China are far more sensible than blanket policies that serve mainly to appease protectionist interests.