Pax Economica and Its Discontents

“Too early to say,” answered Chinese Premier Zhou Enlai in response to a question from Henry Kissinger sometime in the early 1970s about the historical impact of the student protests in Paris of 1968.¹ A popular, if alas apocryphal twist on this reported encounter has led to a much-repeated anecdote: that what the Chinese statesman was saying to his American counterpart, on the eve of their détente, was that it was still too soon to assess the world-historical impact of the French Revolution.²

Fifty years on, is it still “too early to say” about 1968—or indeed 1789?

According to some eschatologies, it may be constitutively, and thus perennially too soon to conclude anything, at least up to the very “end of history.” But for more mundane purposes, the year 2025 seems an apt one to reflect on the shifts in world order taking place within a system that, to put it roughly, came out of 1789 and was given its current inflection around 1968. Our present form of economic globalization emerged out of the imbalances and realignments of the late 1960s, with their social and geopolitical convulsions including anti-war agitation, decolonization, radical student protests, and the rise of the New Left and its associated social movements. These convulsions reflected the end of one era—the immediate post-war generation—and ushered in the next, a period of rapid social change and economic liberalization often called “neoliberal.”³ They did so in a system that had its constitutive foundations in what we can call “1789”—a “modern” system of nation-states predicated on popular, sometimes revolutionary, legitimation, which became generalized with post-war decolonization to cover most of the world.

The major motor of this system was, geoeconomically, the open American economy. This was true both during the immediate decades of the post-war Bretton Woods arrangement, when the United States was the lead global exporter, and during the increasing financialization following the collapse of what is sometimes called the “first” Bretton Woods in the early 1970s. With the growing economic liberalization of that era, and especially after the end of the Cold War, the role of the United States in the global economy was transformed. It led in innovation and some vanguard sectors while progressively offshoring established industries to overseas trading partners. But the global role of the dollar persisted in new form—as a managed or “dirty” float rather than formal peg—and the U.S. economy both deindustrialized and financialized accordingly. These changes transformed it into the international consumer and lender of last resort as well as the major supplier of (debt-financed) global public goods.

Today, however, the capacity of the United States to absorb global trade surpluses and the stability of the dollar in the face of ever-greater dollar-denominated debt seem newly in question. The worldwide tariffs imposed at the start of President Trump’s second term consolidated the gradual pullback from unrestrained economic globalization over the last three administrations, albeit in a chaotic and perhaps self-undermining manner. The global role of the dollar as the world’s de facto reserve currency is now being questioned in Washington and elsewhere.⁴

If the open American economy was the motor of post-war order, its anchor was American military power, used first to hold together the “West” in a Cold War alliance, and then briefly unrivaled until the recent rise of China as a “near-peer competitor.”⁵ If the unipolar world after the end of the Cold War saw a proliferation of “forever wars”—humanitarian interventions that involved ongoing occupation or management of foreign territory—the emerging multipolar world of today threatens a return to major conflicts.⁶ 2025 was the third year of Russia’s full-scale invasion of Ukraine—not a war, according to the Kremlin, but a “special military operation”—and the second year of a multi-theater conflict between Israel and Iran and its regional allies and proxies. Meanwhile, in the South China Sea, Chinese President Xi Jinping has reportedly instructed his military leadership to be prepared to invade Taiwan by 2027.⁷ It is perhaps unnecessary to add that, just as the Russian invasion of Ukraine brought major disruptions to global commercial and financial integration, the closure of the Straits of Hormuz, through which a fifth of the world’s oil travels, or war in the South China Sea, which sees an estimated fifth to a third of all global traffic, would have devastating effects on world commerce. Even more crucial is what would happen to military and retail electronics production everywhere given Taiwan’s lock on advanced semiconductor fabrication.

It is difficult even to catalog all the shifts occurring at present, let alone understand their causes and connections. But on at least one broad view, what we are seeing is a breakdown of the “neoliberal” global economic order, or, more pointedly, of the post-war “American empire,” considering the ways in which U.S. economic, diplomatic, and military power interrelate and coalesce. Claims to that effect are now too numerous to canvass. But in the midst of this chorus, it is worth recalling how few major public figures over the last generation, especially in the United States and western Europe—whether in government, academia, or media—have warned of fundamental instability in the geopolitical and geoeconomic foundations of the present world order. With the first election of President Donald Trump in 2016, and then especially following the Russian invasion of Ukraine, commentators began to discuss threats to the “post-war liberal international order” and thereafter to “democracy” itself.⁸ But if we are now facing the “end” of the “American empire”—less dramatically, of the post-war order that the United States superintended—then it seems to have come on very fast, and with strikingly little by way of sustained public conversation about what it portends.

I.

How did we arrive at this combination of geopolitical breakdown and programmatic aphasia? It is not only that major figures in government and academia, at least in the United States, have generally failed to take seriously the risks of fundamental shifts in world order—for example, the return of great power rivalry and “hot” wars, the end of the dollar as the anchor of world commerce, or the collapse of democratic norms in even core liberal democracies. Worse, until very recently, they generally doubled down on a utopian vision of international peace through commercial integration that I have diagnosed elsewhere (and criticized) as a “world-historical gamble.”⁹

The gamble was that economic integration or commercial liberalization—often together called “free trade”—would play a pacifying role in international relations. The claim goes back at least to Montesquieu in the eighteenth century, who coined the term doux commerce or “sweet commerce” and discussed its attendant political benefits.¹⁰ The idea that free trade leads to peace comes in several versions, often left undistinguished or not sufficiently parsed. It has nevertheless, in the academy, generated a small specialist literature in trying to assess the claim, usually with ambivalent or skeptical conclusions.¹¹ In this review, I will similarly question this claim, which I think is mistaken on several grounds, while trying to contextualize its historical prominence and understand what we might take from it in light of our present predicament.

The broad idea, even if underspecified from an analytic point of view, was ideologically central to first British and later American global economic hegemony. As such, it has had a major constructive role legally and institutionally across the British nineteenth century and again in the post-war American-led world. And in the post-Cold War context of unrivaled American military and economic hegemony, the idea that the globalization of what was basically an American model of state-economy relations would pacify the world had tremendous and continuing influence. The vision presupposed in the shift from the post-war General Agreement on Tariffs and Trade (GATT) to the post-Cold War World Trade Organization (WTO) was what the director-general of the WTO from 1999 to 2002, Mike Moore, called a “world without walls.”¹² As the walls are now coming up once again around the world, in many cases literally, it may prove increasingly hard to recall that earlier optimism of the post-Cold War 1990s.

To the extent that such optimism came from mere hope—or hubris—what ideas or visions sustained it? Here, as often, the New York Times opinion writer Thomas Friedman serves as a useful diagnostic tool, tracking the regnant high theories of Washington, decade by decade, in his own homespun and mass-retailed renderings.¹³ His best-selling 1999 book, The Lexus and the Olive Tree offered a paean to post-Cold War economic globalization, and a folk version of the commercial peace theories that have circulated in the European world since the eighteenth century. What he called the “Golden Arches” theory proposed: “No two countries that both had McDonald’s had fought a war against each other since each got its McDonald’s.”¹⁴ Friedman’s proposition was that war would be avoided between countries folded into the globalized consumer culture of the postwar United States—what political theorist Benjamin Barber, in the early 1990s, called “McWorld” (and counterpoised to “Jihad”).¹⁵ The Golden Arches Theory was soon after repudiated by the NATO bombing of Yugoslavia, as well as several times thereafter, but it is less interesting as an empirical law than as a popular iteration of longstanding commercial peace theory.

Friedman later proposed another theory of commercial peace in his 2005 bestseller, The World Is Flat, focused on globalized production rather than the spread of American consumer culture across borders. His new idea was the “Dell Theory of Conflict Prevention,” which he offered as an update to his McDonald’s theory (which “has held up pretty well,” he claimed), noting that he did so with “tongue slightly in cheek.”¹⁶ Friedman’s “Dell Theory” stipulates that “No two countries that are both part of a major global supply chain, like Dell’s, will ever fight a war against each other as long as they are both part of the same global supply chain.”¹⁷ Friedman propounded the Dell Theory to tell “a larger story of geopolitics in the flat world,” meaning the contemporary world in which national differences had been “flattened” out by the force of transnational commerce.¹⁸

As commentators have noted, the Dell Theory failed during the Russian invasion of Crimea in 2014, less than a decade later, which was in retrospect the first major crack in the geopolitical order of the post-Cold War. But, again, Friedman’s updated folk theory of commercial peace is less interesting for present purposes as an empirical prediction or law-like regularity than for what it reveals about American visions of international order at the height of globalization.¹⁹ Similarly, we can imagine what an updated theory along these lines might have looked like if Friedman’s focus had shifted to the (again, American-led) globalization of “Web 2.0” after 2010. Here, he might have tracked a social media giant—say, Facebook or Instagram or X (formerly known as Twitter), and suggested that military conflicts are reduced or eliminated between countries whose people come to use the same technology platforms for sharing text and images. Of course, the idea that the global spread of social media has made a law-like contribution to international peace would seem to strain all credulity: our politicians now take to these platforms to boast of successful military strikes on other countries. Not even Thomas Friedman has been tempted to declare an “X (formerly known as Twitter) Theory of Conflict Prevention,” even though digital sharing across borders was a staple of the earlier optimism about 1990s-style globalization.

Indeed, the claim that the spread of ideas across borders would prove pacifying was a mainstay of “Enlightenment” thought with a long afterlife in liberal societies. The American-led globalization of the 1990s celebrated the alleged creative power of border-crossing imaginaries upending the closed and antiquated order of nation-states (excepting, perhaps, the United States, usually considered the apogee of such openness). Across much of his writing, one of Friedman’s touchstones has been precisely this contest between an open global future and a closed national past, with nationalism represented as an anachronism and the future as necessarily post-national, given the border-crossing tendency of commerce, ideas, culture, or technology—that is, the “flat” world. So why should the “X (formerly known as Twitter) Theory of Conflict Prevention” not have joined the pantheon of cosmopolitan peace theories as an update to the cherished Cold War conceit that “rock ‘n’ roll and blue jeans” brought down the Soviet Union?

There is no need to accept Thomas Friedman as a cipher-scribe for the post-Cold War elite since the same message was broadcast from the halls of government. In 2001, not long after the terrorist attacks on the World Trade Center in New York, China acceded to the WTO with bipartisan enthusiasm in the United States. Here is U.S. President Bill Clinton in 2000, his final year in office, pushing for Chinese accession to the WTO: “By joining the W.T.O., China is not simply agreeing to import more of our products; it is agreeing to import one of democracy’s most cherished values: economic freedom…. [S]ooner or later, [the Chinese government] will find that the genie of freedom will not go back into the bottle.”²⁰ In October 2001, just ahead of Chinese accession that December, British Prime Minister Tony Blair told the Labour Party Conference that globalization was simply a “fact” and that “in trade, the problem is not there’s too much of it; on the contrary there’s too little of it.”²¹ The following June, UN Secretary General Kofi Annan, while receiving an award in Moscow, claimed that “arguing against globalization is like arguing against the law of gravity.”²²

All this enthusiasm did not remain mere rhetoric. The elite self-understanding of the 1990s as the culmination or high-point of human civilization, a natural outcome of liberty, the “end of history,” and so on, was quickly given institutional force. The American post-Cold War victory dance produced a WTO that encompassed not only all the former GATT members, but eventually all the erstwhile Cold War antagonists too, once China joined in 2001 and then finally Russia, in 2011—shortly before its first invasion of Ukraine. A neoliberal development program dubbed the “Washington Consensus” became a kind of global civilizational script, and was soon after joined by a confident view of border-crossing technology and its benefits. “The Internet” was even nominated for the Nobel Peace Prize in the year 2010—and then again in 2011—just before its cannibalization and degradation by the platform giants of so-called Web 2.0.

During this reputed “end of history,” boosters for the newly globalized world would, in effect, renew the question asked a century and a half earlier by French writer and diplomat François-René de Chateaubriand in 1841:

When steam power will be perfected, when, together with telegraphy and railways, it will have made distances disappear, it will not only be commodities which travel, but also ideas which will have wings. When fiscal and commercial barriers will have been abolished between different states, as they have already been between the provinces of the same state; when different countries, in daily relations, tend toward the unity of peoples, how will you be able to revive the old mode of separation?²³

II.

Friedman may have had “tongue slightly in cheek” when presenting his Dell Theory of commercial peace, but the epigraph he chose to preface this key chapter of The World Is Flat was neither playful innuendo, nor corny coinage, but stentorian and unembarrassed dogmatism. “Free Trade is God’s diplomacy,” declared the nineteenth-century politician and manufacturer, Richard Cobden.²⁴ “There is no other certain way of uniting people in the bonds of peace.”²⁵

Cobden reported having made this famous remark to none other than the French dictator, Napoleon III, at one of their early meetings in 1857. This “Prince-President” recently turned Emperor was, Cobden wrote to a fellow advocate of Free Trade, “very ill-informed on the subject,” but nevertheless “an excellent listener.”²⁶ Cobden’s crusade for Anglo-French commercial entente eventually resulted in the Cobden-Chevalier Treaty of 1860. If Free Trade was God’s diplomacy, Cobden was his diplomat.

Perhaps only in the middle of the nineteenth century—and when representing Great Britain—could one have believed in Pax Economica so confidently, at least until the American hegemony that followed the Cold War. Cobden was resolute in his assumption that the Free Trade pursued by his “Anti-Corn Law League” would displace interstate violence in the organization of world order, and he was eager to tell anyone who would listen, including Napoleon III. He frequently insisted that his advocacy for free trade was not owing to his own self-interest, even though he represented a manufacturing class that had much to gain from cheaper food imports and new markets for British industrial exports. Instead, it was humanitarianism: “Free Trade would have the tendency to unite mankind in the bonds of peace, and it was that, more than any pecuniary consideration” which he claimed motivated him.²⁷

Richard Cobden, and free-trade advocates following him, form the subject of Marc-William Palen’s recent book, Pax Economica, published by Princeton University Press in 2024.²⁸ From the title, one might have expected a study of commercial peace arguments in international relations or perhaps a history of international economic integration under British and later American hegemony. But as clarified by the subtitle—“Left-Wing Visions of a Free Trade World”—Palen’s particular interest is in what he characterizes as “left-wing” claims to this effect, which he counterposes to “economic nationalism,” and its tendencies—mercantilism, imperialism, and militarism. The difficulty with the book comes with the figures and arguments that are supposed to fall within this particular delineation and how—even on a capacious reading—we are supposed to understand free trade arguments as “left-wing.”

Palen’s anchor is clear enough: the Anti-Corn Law League and “Manchester liberalism,” which in foreign policy was sometimes called “Cobdenism.” Whether Cobdenism in foreign policy has ever held sway anywhere is debatable; domestically, it had influence as a kind of establishment opposition in Britain so long as the Corn Laws lasted. It then dissipated quickly once the Corn Laws were abolished. Cobden fought in vain in the 1850s to defend Russia and China from what he viewed as British aggression in the Crimean War and the Opium Wars—and lost his parliamentary seat as a result.

But Cobden’s own campaigns are of less interest to Palen than the afterlife of Cobdenism in later thinkers, pressure groups, and activist networks—some of them, it must be said, fairly obscure and even quixotic in their aims and pronouncements. The cast of characters he considers include Cobden and other members of the British Anti-Corn Law League, to which he then allies Marx and some socialists, before discussing various feminist, Christian, and anti-colonial agitators who thought free trade would undo militarism, chauvinism, or national pride. But what makes for a “left-wing” argument for commercial peace—and what is too “right-wing” to be included—seems largely based on Palen’s own intuitions and can alas be hard to track or reconstruct, even for someone familiar with the relevant intellectual and institutional history. Accordingly, what we should take away from this particular arrangement of the historical materials can be hard to discern.

The book’s key figures are mostly drawn from the Anglophone world, and they start out with some political power, as when allied with the British capitalist class in bringing down the Corn Laws and opening up the world to British commerce. But as the book progresses, its “left-wing” free trade advocates become increasingly utopian and disconnected from the actual economic liberalization pushed by British and then American power. For example, Palen gives billing to residual suffragist and liberal organizations formed during the League of Nations era, some of them hanging on into the post-Cold War 1990s—the “Women’s International League for Peace and Freedom,” the “World Alliance for International Friendship through the Churches,” and so on—while sidelining free trade advocates such as Friedrich Hayek, or contemporary American neoliberals, who are coded as “right-wing” and therefore not a proper fit for his story.²⁹ Palen nevertheless includes Marx and other socialists who supported free trade only contingently—as part of the path to the revolutionary overthrow of capitalism—perhaps because they are deemed “left-wing.”³⁰

But can you write a history of ideas about and advocacy for the Pax Economica that starts with Cobden—and even takes in Marx—while excluding Thomas Friedman (or, for that matter, Kissinger in China)? Palen excludes American neoliberalism and its boosters, like Friedman, from his narrative; using the same “left-wing” filter, he must exclude, too, the affiliated tradition of European “ordoliberalism,” which Quinn Slobodian and other historians have shown was central to post-war economic integration, both in what became the European Union and on the global stage with the transformation of the GATT into the WTO.³¹ So while the contemporary world is—or at least, was, up to roughly the first Trump presidency—economically “freer” (meaning, more integrated) than ever before, Palen must remain equivocal on whether it has been free in the relevant (i.e., “left-wing”) sense, which remains hard to track without a broader assessment.

The arguments that Palen canvasses range from the claim that free trade will generate peace through the democratizing effects of international commerce to discussions of the reorganization of domestic political economies in the face of international competition to arguments about the decline of militarism and imperialism in the face of open markets for raw materials. The book attempts to connect these sometimes disparate argumentative and ideological threads—blending together what have been distinguished as “commercial,” “liberal” and “capitalist” peace theories—to offer a unified vision of doux commerce across the British and American-led orders of the nineteenth and twentieth centuries. But the internal coherence Palen wishes to identify must also exclude—because it is meant to serve as an alternative to—the actual history of most economic liberalization, including current justifications for globalization that draw on precisely the same argumentative traditions that he sometimes defends and sometimes exiles from his story of commercial peace.

This is a tricky feat to pull off, and Palen’s choices appear motivated as much by his own presumptions as by a straightforward rendering of the historical materials. Again, Friedrich Hayek is largely excluded from consideration as a “right-wing” free-trade advocate, with Palen appropriately criticizing his support for the Chilean dictator Augusto Pinochet.³² But Richard Cobden’s greatest foreign policy success was helping to recruit the French emperor, Napoleon III, to the British cause of free trade, thereby setting off (however unwittingly) the economic liberalization of continental Europe through a series of interlinked “most-favored nation” clauses in preexisting trade treaties.³³ Evidently, Cobden’s support for a dictatorial coup d’état on behalf of free trade did not put him beyond the “left-wing” pale, so it is unclear why Hayek should have been. Pinochet was a familiar kind of liberal authoritarian, and such figures tend to like free trade (as the “Chicago Boys” behind his economic agenda attest). Cobden’s “excellent listener” did too.

While Hayek at least makes it into Palen’s history, if only to be discounted as “right-wing,” Thomas Friedman is left out altogether, even though it is difficult to conceive a more Cobdenite figure writing today. Indeed, Cobden and Friedman have played remarkably similar apologetic roles in their respective imperiums. It is easy to imagine the two having afternoon tea near Westminster or—to shift the country and the century—a “power breakfast” in New York or Washington. So where is the Golden Arches or the Dell Theory of Peace in this history of Cobdenism’s afterlives? On the other side of the ledger, Palen is keen to recruit Marx and Keynes to his cause. But his treatment of them can come off as one-sided in emphasizing those features of their thought that conform to a “left-wing” commercial peace vision while sidelining their arguments in favor of the political control of commerce.³⁴

Institutionally, Palen’s history can also be hard to track. His characterization of the Bretton Woods and the post-war GATT as initially approximating a Pax Economica before being betrayed by great power rivalry would seem to apply no less to several other federative movements (including for European federation) that he treats positively, even while overlooking the ways that the current European Union, for example, violates key tenets of an idealized neo-Cobdenism (given its growing militarism and securitized borders). More generally, there is an obvious sense in which the neoliberal Pax Americana was—while it lasted—as institutionally realized a version of the Pax Economica as has ever been seen, and was of course justified in these very terms. It is unsurprising, for example, that the poster-child for international neoliberalism, the WTO, was so often promoted—and surely not always disingenuously—in terms of international peace, cooperation, and the gradual withering away of (irrational) nationalism.³⁵

One would have assumed that institutionally, and not only ideologically, the neoliberal order of the last few decades offered Palen some of his best arguments. But Palen wants to discount the institutions and ideas of contemporary globalization as marred by “anti-democratic free-trade ideas and policies among conservative political elites” (Palen, p. 192). He thus focuses instead on unrealized possibilities in the immediate aftermath of the Bretton Woods conference, which he claims were undermined not only by early Cold War rivalry but also by third-world decolonization and its economic developmentalism. So his history ends up being, by the mid-twentieth century, almost entirely utopian, focused on small peace groups and networks for Fair Trade and “alter-globalization” wedged alongside—however awkward the fit—the unrealized push for fuller European integration and world federalism (Palen, Ch. 6).³⁶

Further examples could be adduced, but we can already diagnose the underlying difficulty. “Left-wing arguments for a free trade world” cannot be institutionalized without ceasing to be “left-wing” (in the purity of their abstraction from power politics). Moreover, to the extent that they are institutionalized, they cannot be used to support “free trade” because sustaining trade flows always requires a significant regulatory apparatus. Indeed, the problem can be generalized beyond any specifically “left-wing” commitment as one that affects all anti-statist ideals of global market society. Markets are the legal constructions of states. This means that the state—and its coercive features—cannot be assumed away in order to deliver a pacific world of commerce removed from political power. The deepest difficulty for the free trade advocates Palen canvasses—and this would apply equally to the figures he excludes, such as Thomas Friedman and other neoliberals—is that the global market is a construction of the modern state, and so international commerce depends foundationally on a national politics it is unable to subsume or replace.

A libertarian ideal that imagined otherwise was, of course, central to the hopes of “Manchester liberalism.” But its constant repudiation in the real world of politics (and, derivatively, economics) for the last hundred and fifty years means that Pax Economica must remain a utopian fantasy of a perfected market beyond the state, and anyway cannot be maintained on strictly “left-wing” commitments if these must include—as Palen’s neo-Cobdenism does—anti-nationalism and pacifism. Richard Cobden may not have grasped this contradiction in 1850, flush with victory over the aristocracy and its tariff privileges. However, since he believed that “Free Trade is God’s diplomacy,” it may not have mattered much to him anyway (so long as God played his part). But the year is now 2025, and there are few real Cobdenites left. There were few enough left already in 1865, the year of the great free trader’s death.

III.

Over the last three centuries, arguments for free trade have cropped up in a variety of liberal, radical, and revolutionary agendas, as well as many “right-wing” ones, and across a variety of historical contexts. From the middle of the eighteenth century, claims concerning Montesquieu’s “sweet commerce” have been mobilized in diverse and sometimes contradictory ways: with anti-nationalist intent, as when pushing against national boundaries, and pro-nationalist intent, as when campaigning for independence from colonial empires; as a pro-capitalist agenda aimed at undermining the political control of commerce, and an anti-capitalist agenda, with socialists hoping to hasten capitalism to its self-inflicted demise; as part of a mission civilisatrice favoring Western models of social organization, but also as an equalizer of world civilizations against Western domination; and so on. In the midst of this tumult, Palen set out to identify something like a coherent “left-wing” tradition of free-trade pacifism. But to the extent that there is a coherent Pax Economica tradition at all—such that it could make sense to talk about liberals, socialists, Marxists, feminists, Christians, and anti-colonial revolutionaries all supporting free trade in the service of peace—it can only be a very broad one, with many points of internal dissension and disagreement, some so significant as to threaten the coherence of any “school”-like ascription.

In terms of historiography, it would be straightforward enough to track the claims of the Manchester school and its immediate successors, including the tradition of Cobdenism in foreign policy, as other historians have done.³⁷ But to posit a continuing commercial peace tradition in geoeconomic thought, down to the present, requires admitting many ongoing contests, partial realizations, reversals, and realignments. In this respect, we should perhaps approach the problem of commercial peace theories genealogically, asking who said what, when, and in which contexts (thereby setting the stage for the next set of discussions), rather than analytically, as if “free trade” or “international peace” meant something comparable across all the varying policy contexts of two centuries of Anglo-American commercial and geopolitical hegemony. What “free trade” itself means cannot be determined in the abstract since the idea of what is “free” presupposes a particular form of state-market relation that has shifted over the centuries, and has no natural or enduring form.³⁸ Indeed, the very idea that there is a commercial “economy” that could be “free” from state control—yet somehow still law-like in its regularities and its harmonization of individual self-interest and collective benefit—was itself a relatively new conceit when the Manchester liberals made it the center of their utopian program.³⁹ The fact that so many economists still maintain this belief is a déformation professionnelle the rest of us would do well to pass over in an embarrassed silence—people really do believe the most extraordinary things—were it not a continuing drumbeat in public discourse.⁴⁰

Genealogically, all these discussions of commerce and peace have their fons et origo in the transformation of the understanding of markets and states that began toward the end of the seventeenth century, crystallizing in the tradition of “modern” (i.e., Protestant) natural law theory following Grotius, and then with influential extensions into the French intellectual scene.⁴¹ This is considerably before Palen begins his account, and even a few generations before Montesquieu introduced his mellifluous but fatefully underdetermined phrase, doux commerce. What does the history of Pax Economica look like if we recognize that Montesquieu was not its originator, and that Cobden—a latecomer and popularizer—came only in its middle, and that Thomas Friedman marked its apogee?

Only a few highlights can be sketched here, but it is worth noting them by way of corrective. The story begins not in industrializing Britain, as is so often posited, but in the French ancien régime, where laissez-faire ideology arose as a stay against the centralizing administrative program of the Sun King, Louis XIV.⁴² It continued as a French story about laissez-faire and its attendant political benefits, with England serving as unwitting inspiration (and threat) for French reformers across the eighteenth century. The explicitly theological dimension to laissez-faire arguments from their first Jansenist articulation persisted in the providentialism of free trade ideology ever after. Adam Smith’s “invisible hand” was the invisible hand of God, as the more devout post-Smithian economists, including Richard Cobden himself, well understood.⁴³

The framework for what we now call “economics” emerged from this providentialist modern natural law theory. The reformed laws of property and contract that stood behind commercial competition (at home and abroad) were divine commands, and following them would lead to an optimal order vouchsafed by God, nature, and reason. A crucial turning point in the institutionalization of this economic imaginary came in the early 1760s, when the first “economists”—we call them Physiocrats but they called themselves économistes—convinced the French King Louis XV to liberalize the international trade in grain. An “Edit du Roi” of 1764 established for the first time the “free [and complete] competition in [this commerce] [grain] … so conformable to the order established by divine providence, and to the views of humanity which ought to animate all Sovereigns.”⁴⁴ The resulting French debate over the liberalization of grain persisted through the 1760s and 1770s and set the terms for later iterations, including in Britain during the Anti-Corn Law League agitation.⁴⁵ For example, in the inaugural issue of The League, published September 30, 1843, the editors proclaimed their wish to rally the British people to “the immediate, total, and final overthrow of the monopoly in human food,” exhorting them to struggle against tariffs “till the impious laws of man be supplanted by the laws of nature, the whole world opened to our industry, and trade declared free as the winds of heaven.”⁴⁶

After both successes and disappointments in the court politics of the ancien régime, many of the French économistes later sat in the revolutionary National Constituent Assembly. These members of the bourgeoisie were “left-wing” in the original sense of 1789—sitting on the left side of the assembly with clerical and other elites facing them on the right—and the British nineteenth-century reformers whom Palen tracks were their direct ideological descendants. This tradition of (border-crossing) bourgeois radicalism may be identified by a persistent Physiocratic commitment, which the leader of the économistes, Francois Quesnay, believed was nothing but the logical extension of natural law: that economic competition would produce the best possible world as part of God’s plan for humanity (“so conformable to the order established by divine Providence,” as Quesnay’s king, Louis XV, put it).⁴⁷ Free trade was at the heart of God’s plan, and following it would eliminate violence, illegitimate hierarchy, and corruption, at home and abroad. These sins would be rectified once economic reason finally ruled, and the state committed itself to laissez faire, laissez passer. A Pax Economica is in this sense just the international corollary of the collective benefit that allegedly comes once enlightened self-interest is made the foundation of the social order.

IV.

In terms of legal institutions, it is worth observing that modern international economic law emerged from precisely this ideological matrix. The Anglo-French “Eden-Rayneval Treaty” of 1786 was in key respects the first modern bilateral trade treaty, pushed by the économistes after nearly a century of wars between rival alliances centered on Britain and France: the War of the Spanish Succession (1701–1714), the War of the Austrian Succession (1740–1748), the Seven Year’s War (1757–1763), and the Anglo-French War (1778–1783).⁴⁸ Montesquieu’s coinage of doux commerce came in his Esprit des Lois of 1748, at the conclusion of one of these wars and only a few years before the next.

These were the world’s first wars conducted on a global and commercial terrain. The War of Austrian Succession (1740–1748) had just been fought among all the major military—and commercial—powers of Europe, with the unhappy peace of the Treaty of Aix-la-Chappelle imposed after a British blockade at a moment of perilous French finances. The Seven Years’ War that soon followed (1756–1763) similarly involved all the major European powers, and was fought on a global stage, with theatres of combat in Europe, the Caribbean, the North American mainland, the Indian subcontinent, and elsewhere. The Treaty of Paris in 1763 established Britain as the preeminent European naval, commercial, and imperial power. But it was not an invulnerable one, and just as France had lost Quebec to the British in 1763—traded away to redeem sugar-rich Dominique—the British would soon lose most of their North American colonies. French support before and during the American Revolution led to another war, the Anglo-French War (1778–1783), which ended British control of what became the United States, while adding to the ruinous debt that would soon push France into financial crisis and revolution.

If doux commerce was what the Physiocratic architects of the 1786 Anglo-French Commercial Treaty had hoped to achieve after all this fighting, their disappointment was not long in coming.⁴⁹ The French Revolution that began in earnest in 1789 saw war erupt between precisely the trading partners they had hoped to peaceably entangle through international commerce. The French Revolutionary Wars lasted, in some form, from 1792 down to the final defeat of Napoleon in 1815. Taken as a whole, the century stretching from the death of Louis XIV in 1715 all the way to Waterloo may be mischaracterized if we focus on seemingly discrete flare-ups—the years of hot wars and the treaties that ended them—since each set the stage for the next episode of globalized conflict between the same powers in the same basic alignments. This century of fighting may be grasped more accurately as a continuing Anglo-French war, the “second Hundred Years’ War,” as historians have called it.⁵⁰ More generally, and beyond these precise hundred years, the period from the beginning of the Sun King’s wars in 1689 through to the victory of Wellington’s British-led coalition in 1815 can be seen as a “long” eighteenth century with a pattern of continual conflict among the most advanced and commercial European powers, ending with the global ascendency of Britain over post-revolutionary France. The new arrangement would then last for a further century—but only that.

It is thus striking to see Montesquieu theorizing peace through commerce near the dead-center of a hundred years of global war between the world’s major commercial powers and worth reemphasizing that the engine of “great power conflict” in these years was the rivalry between trading partners, which were also the most modern nation-states of Europe and the architects of what would later be called the “new imperialism.” But it is worth observing, too, how routine war was everywhere else as well. Conflict was not only endemic between the rival commercial empires of Britain and France, but within and around all the old agrarian-bureaucratic empires as they began their centuries-long collapse and conversion into modern nation-states: in Russia, China, the Ottoman Empire, Austro-Hungary, India, Persia, and beyond.

It was this world of unending war that the Swiss-French political writer Benjamin Constant hoped would come to an end with the spread of the modern “spirit of commerce.”⁵¹ Counterpoised was an anachronistic “spirit of conquest” that he famously associated with the revolutionary effort to recover ancient politics in modern conditions. After the fall of Napoleon, the Manchester liberals followed Constant (though without his subtlety or hard-won experience) in proposing “Free Trade” as a solution to the world’s ills. Through their activism, Cobdenism emerged as a program for doux commerce suitable to British imperial and commercial ascendency—and was quickly discarded once that was no longer the case. Out of these zealous years of Free Trade advocacy, only the Economist magazine (one of the icons of Palen’s book) still survives, always willing to speak its particular brand of truth to power and thus uniquely suited to airport bookstores.⁵²

The next hundred years, from the final capture of Napoleon to the assassination of Archduke Ferdinand, is even now sometimes called the Pax Britannica. It saw a notable absence of “great power conflict,” though a wide proliferation of those smaller “forever wars” that no empire seems able (or at least willing) to do without. Britain ruled the waves, and was the main promoter of free trade. As the “engine-house” of the globe, it needed foreign market access and overseas investment opportunities to recycle the vast surpluses its (briefly) unrivalled industrial revolution produced. And if we discount colonial conquests, imperial military rivalry, “small” wars, and so on, perhaps the world was at last enjoying a modernized Pax Deorum, a successor (even too precisely) of the Roman original. It is perhaps worth noting in this review for the American Journal of International Law that it was the British nineteenth century that oversaw the semantic and substantive transformation of the jus gentium or “Law of Nations” into “International Law,” taught to peacemakers then in much the same form it is taught to law students in the United States today.⁵³

Pulvis es et in pulverem reverteris. From the mass grave at Waterloo called the “Lion’s Mound” (a mound of unidentified corpses) to the poppies of Flanders Fields is today but an hour’s drive through the bucolic and blood-soaked Belgian countryside. The regime thus bookended lasted a mere century—a century of international law. What then followed was a two-episode, three-decade global conflagration among the world’s major military and trading powers, which established the United States, not Germany, as the next anchor of the British-built system of world commerce. Thus arrived our present era, which President John F. Kennedy said famously, six months before his assassination in 1963, he hoped would be “Not a Pax Americana enforced on the world by American weapons of war … [but a] genuine peace, the kind of peace that makes life on earth worth living, the kind that enables men and nations to grow and to hope and to build a better life for their children—not merely peace for Americans but peace for all men and women—not merely peace in our time but peace for all time.”⁵⁴ Kennedy said nothing about free trade as a route to peace. He did claim, in closing, that the “United States, as the world knows, will never start a war.”⁵⁵ The Soviet Premier Nikita Khrushchev had his full speech translated and published in Pravda.

V.

As a regulative ideal and in actual practice, the Pax Americana seems to be spluttering out in 2025. Western Europe is rearming against Russia as naval drills proceed in the South China Sea. American politicians now muse publicly about colonizing Greenland—and even Mars. Is American hegemony going the way of the earlier Pax Britannica, and what does “free trade” have to do with any of this? At this perilous moment, should we double-down on so-called “left-wing” arguments for economic globalization, hoping they will work out differently this time?

In thinking through these questions, we should remember that an alternative account of the relation of commerce to peace from that of Thomas Friedman and other neo-Cobdenites has been available since at least the interwar period, once the economic globalization of the nineteenth century destroyed itself. It was made famous in Karl Polanyi’s The Great Transformation of 1944, which claimed that economic liberalism did not ultimately prevent war but helped cause it. On this view, the only durable path to international peace comes through taming—not inflaming—competitive market relations. The social-democratic state that could achieve Polanyi’s ideal of “freedom in a complex society” could construct durable international alliances for peace. Polanyi consistently opposed not only the ersatz realism of fascism but also the naïve idealism of economic liberalism.⁵⁶

Ironically, because Polanyi analyzed the contingent “long peace” of the nineteenth century as an artifact of British commercial hegemony, he has been conscripted occasionally into the cause of “capitalist peace theory” by commentators who happened upon the first chapter or two of his book, but failed to read the rest. Indeed, while the title of Polanyi’s first chapter—“The Hundred Years’ Peace”—may mislead the quick reader, its import is clear enough. The economic globalization of British-led capitalism in the century from Waterloo to the First World War was only contingently peaceful and ultimately proved self-undermining. As was once well understood, Polanyi saw the outbreak of the “Great War” as intimately tied to the global spread of economic liberalism in the nineteenth century, which “disembedded” markets from society and thereby generated reaction, fascism, and world war.⁵⁷ Economic liberalism treated land, labor, and capital—the classical “factors of production”—as if they could be allocated through the market, but Polanyi argued that these were only “fictitious commodities,” which in fact depended on non-market modes for their maintenance and renewal. Left to an unregulated market, “land” (i.e., natural resources) would quickly degrade—witness ecological destruction today—while unregulated capital markets invited financial crisis, and unregulated labor markets undermined the health and lives of the human beings treated merely as inputs to production. More generally, the extension of market logic beyond a sequestered and limited domain of commercial transaction undermines “society,” inviting broader conflicts of many kinds.

Polanyi was obviously not a believer in the thesis that free trade leads to peace, at least not in any perdurable rather than contingent way. Rather, unregulated commerce had led to war—after an initially profitable peace—because commerce cannot generalize itself as a form of social relations without contradiction. Only a regime of “embedded” markets, which he associated with post-war social democracy and the advent of the welfare state, had a chance of ensuring international peace under modern conditions—just as only these forms of state could deliver “freedom in a complex society.” In other words, Cobdenism was not only a utopia, but a dangerous one.

Polanyi was far from alone in this kind of assessment. The collapse of the Pax Britannica into the abyss of war and depression prompted a general reckoning among the more thoughtful figures of the interwar era. Whether or not commercial competition had necessarily inflamed military competition—thereby contributing directly to the Great War—it was at least clear by its end that all the commercial interdependencies wrought over the course of the nineteenth century had failed to stop it. As John Maynard Keynes put it with characteristic understatement, a decade before Polanyi’s book was published, and a half decade before the Second World War broke out: “the age of economic internationalism was not particularly successful in avoiding war; and if its friends retort, that the imperfection of its success never gave it a fair chance, it is reasonable to point out that a greater success is scarcely probable in the coming years.”⁵⁸

Economic internationalism would nevertheless be given another chance, however unwittingly, by Keynes’s wartime effort to construct an alternative to the failing British empire. While the Bretton Woods institutions laid the groundwork for today’s global economic order, what is notable about their inaugural design, at least, is how suspicious they were of unregulated market forces. The imperative of reducing high wartime tariffs among post-war allies and of organizing international finance around the dollar, not the pound, did not mean giving up on the role of the state. On the contrary, as studies of the “embedded liberalism” of the first post-war decades have made clear, the economic liberalization of that era combined growing international openness among allies with a strong role for the state in policies for employment, development, and security.⁵⁹

How this regime of “embedded liberalism” became the “neoliberalism” of recent decades is a subject of ongoing scholarly discussion, but the ideological persistence of economic providentialism has surely played a part.⁶⁰ Among the eighteenth-century ideas that still haunt us, the claim that free trade leads to peace has been one of the most persistent. Reduced to an empirical claim, it is hard to specify precisely, let alone credit. What does “free trade” consist in—or “peace”? War after war among the world’s leading trading partners would seem to be history’s answer to this conceit of commercial society, unless it is reduced to an impossible utopia of commerce without politics, which can never be repudiated because it will never be seen. That utopia captures precisely the “left-wing” version of doux commerce still urged on us, in Palen’s telling, by a motley crew of social activists and libertarian journalists in these fading days of the Pax Americana.

Even beyond the utopian “left wing” version, however, the association between free trade and peace seems too deeply ingrained, perhaps too profitable, to be repudiated by the mere fact of repeated historical tragedy. It can be dislodged, displaced for a generation, but seems always available to be rediscovered as an excuse for renewed commerce. Perhaps it is too central to modern self-understanding, and to the conceits of “natural man,” governed only by his own reasoned interest and God’s generic natural laws. Whatever the cause, new paeans to doux commerce keep coming, right up to the point that the bombs start falling between trading partners: from Norman Angell’s prediction on the eve of the First World War that Germany would never attack Britain, given its cross-border investments, to Thomas Friedman’s Dell Theory of international peace through global supply chains.⁶¹ Even after the bombs, the claim may reappear, suitably chastened, in the unprovable counterfactual that perhaps fewer bombs fell because of the benevolent constraints of commercial interdependence.

True believers aside, doux commerce has sometimes been part of the “grand strategy” of a leading commercial power—a geopolitical gamble, however misunderstood as such, perhaps later functioning as a default mode of elite thought and action (as during the last generation of the American ascendency).⁶² But as a geopolitical strategy, it is always open to sudden reversal, should the hegemon that benefitted from—and had thus been willing to secure—an orderly world of commerce come to reevaluate its stance. In light of the present American predicament, we ought to acknowledge the prescience of Thomas Friedman, writing in 2005, at the height of that globalist optimism which he himself epitomized:⁶³

To all the forces … that are still holding back the flattening of the world, or could actually reverse the process, one has to add a more traditional threat, and that is an outbreak of a good, old-fashioned, world-shaking, economy-destroying war. It could be China deciding once and for all to eliminate Taiwan as an independent state; or North Korea, out of fear or insanity, using one of its nuclear weapons against South Korea or Japan; or Israel and a soon-to-be-nuclear Iran going at each other; or India and Pakistan finally nuking it out.

Friedman spotted most of the continuing threats to a world of commercial peace, though notably missing Russian revanchism. He then went on to hope that “these classic geopolitical threats might be moderated or influenced by the new forms of collaboration fostered and demanded by the flat world—particularly supply-chaining.”⁶⁴

We are now, two decades later, in a position to assess otherwise. The “flatter” world of today seems more, not less, bellicose than the world of 2005, particularly if we take into account the renewed possibility of great power conflict and the return of war to areas once thought freed of it, including continental Europe. These are fights, after all, among the supply-chained.

But we can nevertheless conclude with Friedman that “[t]he interaction between old-time threats (like China versus Taiwan) and just-in-time supply chains (like China plus Taiwan) will be a rich source of study for the field of international relations in the early twenty-first century.”⁶⁵ A rich source of study indeed. If past is prologue, then out of the wreckage of our “flat world,” some future commentator will claim the Pax Sinica as the latest vindication of commercial peace theory. Perhaps, by then, there will even be an American colony planted on Mars, and so the Pax Economica can be declared interplanetary: free trade confirmed at last as the natural law of the cosmos.