Joe Hockey, Australian ambassador to the United States, had a clear message during his lecture Thursday at Westminster College.
"Free trade represents the best of Western values," Hockey said.
Hockey delivered the annual Cherry-Price Leadership Lecture, titling his talk "The Sinews of Prosperity: In Defense of Free Trade." In keeping with the leadership theme, Hockey urged the U.S. government to resist its recent shift toward isolationist trade policies.
"History proves that economic isolationism is a precursor for war," he said.
Hockey explained that in the 1940s the United States was a world leader in developing free trade norms that benefit the global training system even to this day. That included becoming one of the first nations to sign on with the General Agreement on Tariffs and Trades (which was later succeeded by the World Trade Organization) in 1947. GATT promoted international trade by discouraging the use of tariffs and quotas between member nations.
"By having rules, we gained order and discipline which facilitated trade and prosperity," Hockey said.
The benefits of free trade are numerous, according to Hockey — participating nations get to enjoy quality goods at reasonable prices, and economies can specialize in what they excel in.
For example, Australia currently has fair trade agreements with about 70 percent of its trading partners. As a condition of one agreement, Australia had to stop subsidizing its automobile industry (which was only producing about one million vehicles per year at the time). Into the gap stepped South Korea, Japan and China, all eager to export cars to Australia. Meanwhile, Australia's healthy elder care industry is making inroads with China's aging population.
According to Hockey, the United States' historic enthusiastic participation in global trade is also why he can name 20 American companies off the top of his head, but can't do the same for France.
"Today, trade represents 30 percent of the U.S. economy," Hockey said. "One in five U.S. jobs relies on the global trade. Now more than ever, the U.S. should be leading the world in the debate (on trade)."
Instead, the United States withdrew from the Trans-Pacific Partnership in 2017. The nation also failed to join the Asian Infrastructure Investment Bank, a development bank aiming to foster infrastructure development in the Asia-Pacific region. The 74 current members and 26 prospective members of the bank include both American allies and rivals, from Canada and Australia to Russia and China.
"If you abdicate leadership you rarely get it back," Hockey said. "So the U.S. must not allow itself to walk away from its trade leadership role; otherwise, it will inevitably pay a very significant economic price."
Then there's President Donald Trump's trade war with China, in which Trump has imposed tariffs on hundreds of billions of dollars worth of Chinese goods. Trump has stated objections to China's handling of international intellectual property, its currency and the trade surplus it holds over the U.S.
Hockey said he's sympathetic to Trump's choice to impose the tariffs.
"As a security measure, the tariffs were Trump's call," he said. "We support U.S. efforts to ensure China plays by the rules in protecting intellectual property."
He also condemned China's choice to subsidize its farmers, artificially suppressing global prices of crops such as wheat and rice.
However, he said, tariffs and quotas aren't a long-term solution — they're ultimately more of a burden on U.S. citizens than a deterrent for China.
"Stopping trade with China is the worst-possible response," he said. "We need to encourage China to head a different direction.
He encouraged measures such as bringing World Trade Organization cases against bad actors instead.
"I find the debate on free and fair trade baffling," Hockey said. "Being open to trade made America great in the first place; it will keep you great."