US President Donald Trump justifies the introduction of tariffs on steel imports with the protection of national security, as well as threats to raise tariffs on cars and imports from Mexico. "If you don't have steel, you don't have land," Trump said recently (this is just one example of his statements).
Trump's talks about national security seem absurd from the outside, but they raise difficult questions for the world trade system and also for the global management of the economy in a broad sense.
The most important task of global governance is contained in determining the boundary that separates the political sphere (in which nation states are free to do whatever they want) from the sphere of regulation through international agreements. The world economy has become extremely interdependent and therefore practically everything that one country does affects other countries. However, this indirect influence in itself is not a sufficient reason for limiting national autonomy. Take, for example, the state education system, the gasoline tax, or highway speed limits. Regulating these issues affects the country's trading partners. A higher level of professional habits of the population changes the comparative competitiveness of that country, which means that the possibilities of other countries in world trade also change. The gasoline tax and the speed limit affect the demand for oil, which means the price on world markets. Similar decisions are not regulated at the international level, and many would, rightly, consider such regulation absurd.
Canonical arguments in favor of global governance rest on two categories of problems. The first concerns the global common good (or harm): these are activities that bring convenience to the world as a whole, but little or no concrete benefit to the country itself. A key example of this is the control of gas emissions, the greenhouse effect. The second category of problems is the so-called policy based on the "destroy your neighbor" model. It is an action that brings economic benefits exclusively to that country, but to a degree that begins to harm others (the result is global inefficiency). A classic example of this is the creation of a cartel of producers of scarce raw materials with the aim of establishing monopoly prices for trading partners.
These are indisputable arguments in favor of global economic governance. But nowadays, among the issues that the authorities are preoccupied with, it is difficult to find one that would fall into the first or second category. Subsidies; industrial policy; Safety at Work; non-customs measures in the field of health care and social policy; poor quality of financial regulation; inappropriate (too economical) budget policy. All this can neither be called a global common good/harm, nor a policy based on the "destroy your neighbor" model.
Some of these measures can actually be called "destroy yourself" policy. Some are really useful for the country itself, but only because they eliminate real defects produced by the market or are aimed at solving completely justified social tasks, and not because they contribute to increasing the costs of other countries. Global governance is in a state of chaos because many political decisions gain international importance indirectly or as a result of political lobbies and not for real economic reasons.
See, for example, the national security argument as a justification for tariffs. If Trump's conclusions are baseless (as many believe), then the US economy will be the first to bear the costs of such a misguided approach. In other words, Trump's taxes are a "destroy yourself" policy. If, on the other hand, we proceed from the presumption of Trump's innocence, then such a decision would have to be accepted in the country as completely correct.
In fact, it is impossible to understand what it is really about before countries start applying similar measures. And in general, transferring more competences to an international body does not seem like a wise solution. Even if measures are taken, for example, the introduction of taxes to protect national security, fallible, democratic countries must have the right (this is a general rule) to make mistakes. It would be unreasonable to consolidate the power of the international bureaucracy in order to prevent countries from harming themselves, even if the situation is not unambiguous from the beginning. This would mean a dangerous precedent for other spheres of activity.
In the sphere of national security, the principles of the World Trade Organization (WTO) are rather vague and have mostly not been tested in practice so far. The text looks like a wide open door; it states: "Nothing in this Agreement shall be construed ... as an obstacle to any party to the agreement taking such measures as it deems necessary to protect the fundamental interests of its security." However, in a recent decision in a case not related to the US, the WTO took the position that it has the right to evaluate national decisions in this sphere and assess how appropriate they are. The US, as expected, criticized such a decision. Those who are non-enthusiasts about global governance must come to terms with the fact that most political mistakes in the modern world economy (for example, Trump's tariffs) are made because of problems at the national level and not because of a lack of international cooperation. Trump's tariffs are bad policy, not because they hurt other countries, but because they directly cost the US economy significantly.
Global mechanisms aimed at preventing similar domestic political mistakes should not be opposed. In addition, those mechanisms can be taken over by lobbyists, as well as political processes within the country, and then their democratic legitimacy is significantly less. In addition, external constraints can compound internal errors because they lead to the strengthening of certain groups of the population to the detriment of society as a whole.
The best we can count on is "global governance that spreads democracy". Unlike "global governance that expands globalization," global governance that expands democracy leaves most spheres of decision-making (those that cannot be classified as either a global commons or a "destroy your neighbor" policy) at the level of national regulation. Global control is limited by procedural requirements (transparency, accountability, participation of interested countries, use of scientific and economic evidence), which should increase the quality of democratic discussion within the country without prejudicing its final outcome.
It is questionable whether such a light version of global governance would change anything in the mistakes that Trump makes in the sphere of trade. But it would, at least, allow Trump (and other similar nativist politicians) to have no basis to constantly complain about the WTO and other international organizations allegedly trampling on national sovereignty.
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