And of the works of the authors themselves

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Luiz Felipe Bruzzi Curi_Danilo Barolo Martins de Lima

in order to strengthen his opposition to the Free Trade 

Agreement of 1935.

The idea of national economy, as Wagner conceived 

it, was embedded in a theoretical line of argumentation 

conducive to qualifications of the free trade principle 

and to the recognition of protectionism as an important 

category. Book III of the Grundlegung was dedicated 

to the topic “Economy and national economy”. The 

definitions presented by Wagner may help to understand 

the appropriation of the concept by Simonsen in the 

speech delivered in 1935.

[The national economy] is the set, considered 

as closed totality, of the individual, 

independent economies articulated by labor 

and related to each other, according to a 

regulation established by law (economic 

and administrative law). This articulation is 

possible within a people organized in a state 

(or confederation) or within an economic 

dominion resulting from rules established 

at the level of States (“Zollverein”): it is 

an organic combination and not merely 

a mechanical juxtaposition of individual 

economies. 

(WAGNER, 

1909

 [

1876

], pp. 

14

-

15

)

Following this definition, Wagner sketched a typology 

of the development of these national economies. The 

formation of a national economy would be concluded 

after a human group had gone through successive 

evolutionary stages: race, kind (gens, in French), tribe 

and, at the end, nation (Volk, in German in the French 

edition). In these stages prior to nation, the national 

economy existed only in embryonic form: it begins to 

exist in fact when “personal relations are replaced by 

economic ones”. (

WAGNER

, 1909 [1876], p. 20).

Wagner recognized that, because of the differences 

in the natural constitution of countries, there is an 

international division of labor based on nature and that 

from this fact one could derive arguments favorable 

to free trade. He mentioned furthermore that in the 

National System Friedrich List had registered the 

advantages of the exchange of commodities between 

temperate zones and the tropics. Wagner (1909 [1876], 

p. 33-34) stated, however, that the thesis that free trade 

is a natural necessity is sometimes exaggerated. The 

expansion of “useful plants” and domestic animals by 

human civilization through many different countries 

across the globe was, according to Wagner, a proof that 

natural factors are not the absolute determinants of the 

kind of economic activity carried out in each country.

International trade of mineral ores was another 

niche of the international market in which climatic 

aspects were not so central as it could be imagined. 

According to Wagner (1909 [1876], pp. 35-36), the circulation 

of carbon derivates and metals did not depend only on 

the geographical availability of these resources, but was 

rather a result of the access to technical improvements, 

of the national legislations and their enforcement. This 

way, the international market for mineral ores would be 

more subject to historical movements, reflected in the 

adequacy of the techniques employed, than the market 

for goods produced in conformity with the “climatic 

monopoly”, i.e. those commodities requiring very specific 

natural conditions to be produced.

Wagner also dealt with the differences in the stage 

of economic development among nations as possible 

causes for international trade to be advantageous. The 

disparities of development levels – different nations 

could be in distinct “typical phases” of economic 

evolution – could be rooted in natural factors, as well 

---

Roberto Simonsen and the Brazil-U.S. Trade Agreement of 1935 

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488

in the typical characters of populations (cultural or 

racial aspects). These international dissimilarities could 

result in “natural” and relatively persistent trends in 

international trade. However, this circulation of goods 

was also subject to significant historical movements. As 

Wagner argued, the development of a foreign economy 

could result in hindrances for the development of another 

economy, domestically. These domestic regressions 

could be concealed by increases in the absolute volume 

of international trade, caused by improvements in 

transportation, for example. The historical cases 

mentioned by Wagner were North America after  

the Civil War and Europe after the shift towards 

protectionism (tariffs on agricultural imports),  

by the end of the 19

th

 century.

Wagner’s point was to qualify the idea that the 

different characteristics of nations would necessarily 

be an engine for the growth of the world economy, by 

means of the expansion of international trade. If, as it 

happened in the mentioned cases, the differences and 

conflicts among distinct nations resulted in protectionist 

measures being adopted, there would be actually no gains 

coming from international trade, even though improved 

means of transportation gave the impression of a more 

integrated, hence more prosperous, world economy.

Radical free trade theory does not give due 

consideration, in its attempt to defend the 

absolute justice of free exchange policies for 

every country and at every moment, to the 

purely relative character of the justifications 

for the existence of a universal [commercially 

integrated] economy, based on the different 

levels of development of national economies. 

(WAGNER, 

1909

 [

1876

], p. 

37

)

An important fact presented by Wagner, which also 

challenges the idea that commercial integration among 

different countries is necessarily positive, was the existence 

of continental domestic economies. In this sense, trade 

between England and certain parts of the United States 

could be equivalent to territorial exchanges between 

Massachusetts and Iowa. The globally positive character 

of international trade, as assumed by laissez faire ideology, 

had to be questioned, according to Wagner: the Napoleonic 

system of trade treaties, for example, was certainly more 

favorable to France than to the rest of Europe.

The separation between producer and consumer, 

the dependency on foreign political factors (as in the 

case of the cotton famine in England, a result of the 

American Civil War), the danger of external dependency 

on strategic items such as staple foods, the uncertainty 

involved in transporting goods in international waters or 

across foreign countries, the replacement of traditional 

industries by exporting sectors (as in the case of ancient 

Asian civilizations) – all these aspects were conducive 

to considerations about the eventual harmful effects 

of international commercial integration. Moreover, 

economies too dependent on their trade balance would 

have to settle imbalances by practicing more competitive 

prices, obtained by means of lower wages. This would 

harm the purchasing power of domestic masses.

Wagner concluded his reasoning about the national 

economy with the distinction between the national 

and the cosmopolitan points of view. The ways to 

address economic and social issues – such as trade, the 

military, the labor question, industrial and agricultural 

development – would vary, according to the point of 

view adopted. But in the end the national aspects should 

prevail. In Wagner’s words: 

---