On Tuesday afternoon, former U.K. Prime Minister Gordon Brown gave a lecture on the global economy in which he argued that the world is becoming ever more interconnected and that many problems will need to be solved through greater international cooperation ("Brown discusses global economy," May 16). While Brown's argument is certainly true with regards to some pressing issues, further centralization of political power isn't a wise idea in general.
The first part of Brown's argument is most certainly correct: "We are all part of an interdependent economy. What happens to us in one country affects all of us right across the world." This point was underscored yesterday at the economics department's weekly seminar, where University of Michigan economist Jing Zhang discussed the impact of Chinese productivity growth on living standards in other countries. The days of autarky and isolationism are long gone and are not coming back.
Furthermore, it is true that this interdependence necessitates increased international cooperation on certain issues. Greenhouse gas emissions from one country affect not just the polluting country but the entire planet. Likewise, the alleviation of extreme poverty is not and should not be the sole responsibility of the countries in which the world's poorest citizens are living.
However, in the interest of protecting individual liberties and for pragmatism's sake, I strenuously disagree that further transfers of power from local and state governments to national and international bodies is a wise course of action. It is often much more difficult for a government to infringe upon the rights and liberties of its citizens if those citizens are free to move to another jurisdiction. Thus, in the interest of protecting individual liberties, political powers should be put in the hands of local and state governments rather than national or international governing authorities as far as is reasonably possible.
Take health care, for instance. Obviously, there are many health-related issues that are best addressed nationally and internationally. Successfully combatting the spread of infectious and communicable diseases has often required significant international cooperation. Likewise, it often makes more sense for medical and scientific research to be funded by the federal rather than state governments, as a discovery made in one state will likely end up benefitting people in multiple states.
However, it is wrong to assume that health insurance is within the proper jurisdiction of the federal government. I have no problem with Massachusetts adopting an individual mandate or Vermont adopting a single-payer system. After all, if any of these states' residents object to either of these policies, then these residents can always move to New Hampshire. It is much more difficult, however, to move to another country if you object to a federal government policy.
The second problem with centralization of political power is more pragmatic sometimes a policy that is entirely appropriate for one place is not at all appropriate for another. The Eurozone's current monetary and financial mess is a case in point. For more than half a century, many European leaders have worked tirelessly to improve economic integration and international cooperation among different European countries. In many ways, this has been a good idea. I especially applaud the relative success of the European Common Market, which has greatly liberalized trade in goods and services within Europe, and the Schengen Area, allowing for the free migration of people throughout much of the continent.
However, the euro has undoubtedly been a disaster. With the enactment of a single currency, the countries using the euro left themselves susceptible to the kind of severe macroeconomic difficulties they are currently experiencing. Many economists on both sides of the Atlantic understood this possibility and thus recommended against the adoption of the single currency, yet the European political elites decided to forge ahead anyway. Ironically, Gordon Brown, who was the U.K.'s chancellor of the Exchequer in the early 2000s, clearly understood these potential problems, and he probably deserves much of the credit for keeping the U.K. from adopting the euro in the first place.
It's true that the countries of the world are becoming more interconnected and that there are many pressing issues that require increased international cooperation. However, we shouldn't, as a general rule, centralize ever more power in the hands of national and international bodies.
