Free trade and Stephen Covey

I find it surprising that people who otherwise are in favor of free markets go in defensive mode when it comes to free trade. I have interacted with quite a few people (who are well educated) who support markets and competition but when it comes to trade some how their nationalist feelings get activated and they go into protective mode.

In my view this arises due to a mistrust and a narrow view of trade. Somehow buying goods from a foreign country is bad but selling goods to them is good. Somehow an Ambani making crores more is considered preferable to a Walmart making a few crores - what difference does it make to ordinary Indians on whether Walmart makes money or Reliance or Mittal or Tatas or Birlas?

In my view this mindset can be explained from an analogy borrowed from Stephen Covey's Seven Habits of Highly Effective People In that he had argued that humans have 3 states of being - dependence, independence and interdependence with each being a higher/more effective state of being as compared to its predecessor state.

The fact that at a personal level, interdependence is a higher level as compared to dependence or independence is fairly trivial and easily acceptable to everyone the problem comes when you extend it to countries and trade.

Interdependence is at the heart of free trade and most people miss this point. They look at trade purely from a narrow dependence vs independence angle (completely missing the interdependence angle). If you are not independent then you are dependent is how most people view things and hence they chase self sufficiency. Self sufficiency is a mirage and a costly one at that...

There is no point chasing self sufficiency just for the heck of it - not even in food or oil. We should stop viewing America or Europe from the old imperialist angle and be proud of the fact that they are also dependent on us just as we are dependent on them - making us interdependent and intensify our interdependedness...

That's if for now...