« Heresy of the week: An in/out referendum will not solve all of our problems | Main | Never mind the Middle East, it’s time to start worrying about the Far East »

7 January 2013

The Falklands, the Cato Institute and the difference between conservatives and libertarians

Cristina Kirchner, Argentina’s, ahem, colourful President, is up to her old tricks again – asserting her country’s claim to the Falklands by placing an advert in the Guardian (where else?).

It is easy to laugh at this latest stunt, but Kirchner’s campaign is raising the profile of the Falklands dispute and encouraging commentators in other countries to regard it as an unresolved rather than a settled matter.

One example is an article by Steve Hanke on the Cato Institute website. Based in Washington, the Cato Institute is America’s leading libertarian think tank – and a major influence on the Republican Party. It is unclear whether Hanke’s argument on the Falklands is taken seriously in US foreign policy circles, but it certainly provides an insight into the libertarian mindset:

  • “Before we have more nationalistic posturing, sanctions, protracted skirmishes, a new war, and only then a ‘solution,’ let’s move the Falklands dispute out of what is mucha teología (many theological arguments) territory, try to think creatively and design market-based treaties applicable to dangerous disputed territories... For the Falklands, the governments of the United Kingdom and Argentina would agree that those Falklanders who were qualified to vote would be allowed to do so in a referendum. The referendum would allow the settlers — who are English-speaking and English by custom, institutions and loyalties — to vote on whether they prefer the status quo, or whether they would agree (‘yes’) to an Argentine take-over. A super-majority ‘yes’ vote, of say 80%, would be required by the Falklanders to allow Argentina to claim sovereignty.”

Leaving aside Hanke’s overblown fears of a “new war” (and his description of the Falklanders as “settlers”) his proposal for a referendum is entirely reasonable – indeed the Falklands government is planning to hold a referendum in March of this year. However, Hanke proposes a bizarre libertarian twist on the idea: 

  • “This is where markets come in. The Falklanders would have to be compensated by Argentina. The referendum would be designed so that Argentina could offer a cash incentive. Before the referendum, Argentina would deposit an amount (let’s say USD $500,000) in escrow, in Swiss bank accounts for every man, woman and child who had proven their Falklands residence prior to the referendum.
  • “If the referendum went in Argentina’s favor… then the funds in escrow would be transferred and Argentina’s unambiguous sovereignty over the Falklands would be established. Argentina’s cost, in this hypothetical, would be about USD $1.6 billion.”

One hardly knows where to begin when presented with this kind of market fundamentalism. One could ask whether the British government would be allowed put in a counter-offer – or indeed any other government. And what about the families of the 255 British servicemen who were killed during the Falklands war, how much would they get? But by asking such questions, we engage with the underlying argument instead of what we should do – which is reject it as fundamentally flawed.

Though Hanke is good enough to recognise that the Falklanders are “English [he means British] by custom, institutions and loyalties” he appears to view such loyalty as a commodity, one that can be traded like pork bellies and coffee beans.

Well, that’s all very libertarian – but, for conservatives, some things just aren’t for sale.


You must be logged in using Intense Debate, Wordpress, Twitter or Facebook to comment.

Register to get The Deep End delivered to your inbox.