The great intra-right debate between free-market orthodoxy and various strands of economic nationalism may be one of the most important ones for the future of the country and, indeed, the global economy. Which is why we are often frustrated by the tenor of that debate, featuring more light than heat, especially, we must say, on the free-market side.

Conservatives know this well in other contexts: in public debates, it is usually the insurgent side which is more familiar with its opponents’ arguments and which has had to hone its own arguments more sharply, while the incumbent consensus tends to be lazy with its rhetoric.

This debate deserves better. Which is why we heartily welcome a recent paper by Dr Samuel Gregg published by the American Institute for Economic Research, titled “A Free, Prosperous and Secure America: How Trade Liberalization Strengthens US National Security, and Economic Nationalism Undermines It.” Dr Gregg, the Friedrich Hayek Chair in Economics and Economic History at AEIR and a recent Bradley Prize winner, should need no introduction, and his paper takes seriously the arguments of economic nationalists, and chooses the most arduous terrain for his side: national security concerns related to trade.

This, in and of itself, is praiseworthy.

Gregg’s core thesis is that trade liberalization contributes to U.S. national security in two primary ways: by promoting economic growth that allows America to better resource its security needs, and by facilitating more peaceful relations between the U.S. and other nations. Conversely, he contends that economic nationalist policies weaken America’s economy and international relationships, ultimately compromising national security.

The paper acknowledges that tensions exist between free trade principles and national security imperatives. However, it maintains that most legitimate security concerns can be addressed without resorting to broad protectionist measures. Gregg argues that the economic costs of protectionism outweigh potential security benefits in most cases.

The paper is full of the standard arguments for trade (some might call them platitudes), but where it gets interesting is where it does address the specific concerns of economic nationalists, namely: supply chain vulnerabilities; the issue of dual-use technologies; the threat of foreigners buying strategic assets.

On supply chain vulnerabilities, Gregg cites research suggesting that reshoring supply chains does not necessarily improve resilience. He argues that trade openness can actually enhance adaptability to shocks by providing access to a wider range of suppliers and that a more liberalized economy will be more resilient to shocks and more adaptable.

Regarding dual-use technologies, the paper recognizes legitimate concerns about the transfer of critical technologies to potential adversaries. However, Gregg contends that it’s often impractical to prevent the spread of technologies with both civilian and military applications. He suggests focusing on monitoring and regulating truly critical technologies while emphasizing the importance of constant innovation.

The paper also addresses concerns about foreign investment in strategic U.S. assets. While acknowledging the need for scrutiny in sensitive sectors, Gregg warns against overly broad interpretations of national security that could deter beneficial foreign investment.

We hate a “both sides make good points” conclusion, but, well…both sides make good points. As the United States seems headed faster and faster into a Europe-style debt-financed welfare gerontocracy, it is important to emphasize the merits of a free market economy, and the link between national wealth and national power. Our own sense is that Dr Gregg is still a bit naïve about some threats to national security from trade, particularly when it comes to dual-use technologies such as AI and AI chips, and foreign investment in key sectors. Still, he must be praised for actually taking those concerns seriously and on their own terms, rather than deriding them with a snort, a handwave, and quotations from the Libertarian Catechism. Overall, an outstanding contribution to the debate.

Economic nationalists, ball’s in your court.