


Luther is, as he usually is whenever he writes about anything maritime, completely correct to argue that the Coast Guard should buy readily available ships on the international market to accomplish its mission rather than wait for domestically produced ships.
One common argument against international trade is the national-defense argument. Countries need to produce certain goods vital to defense on their own, the argument goes, so government should block international trade in those goods.
There are limited cases in which that is true. Defense is genuinely different from other industries in that, within one country, the government is properly the only buyer in the market, and consumer sovereignty doesn’t apply in the same way it does elsewhere.
What many who cite the national-defense exception miss is that it’s very unfortunate that ordinary market principles aren’t applicable in defense. The defense industry is prone to cost overruns and delays in the absence of reliable and meaningful price signals. But we rightly don’t want to have competing domestic militaries bidding against each other for weapons, so we have to tolerate some inefficiency and government spending to get the job done.
The goal, then, should be to limit these exceptions as much as possible, not create more of them. The military already does this in many respects. The military buys lots of stuff that isn’t weapons, and it buys that stuff from companies that mostly serve private customers. We don’t need protectionism for office supplies or food because the military buys lots of office supplies and food.
The example Luther gives is illustrative. The Coast Guard needs an icebreaker. It can’t buy one at a reasonable price or on a reasonable timeline from an American shipbuilder. It can buy one from a foreign commercial shipbuilder for one-fifth the cost, and it could have done so nine years ago. How is the U.S. national defense enhanced by paying five times as much for the promise of an icebreaker in the future than it could pay for an actual icebreaker now?
“Better a decent ship today than the perfect ship never,” Luther writes. And better a foreign built ship that exists than a domestically built one that does not.