6

THE SKILLS OF FOREIGN TRADE

And command thou the people, saying, Ye are to pass through the coast of your brethren the children of Esau, which dwell in Seir; and they shall be afraid of you: take ye good heed unto yourselves therefore: Meddle not with them; for I will not give you of their land, no, not so much as a footbreadth; because I have given mount Seir unto Esau for a possession. Ye shall buy meat of them for money, that ye may eat; and ye shall also buy water of them for money, that ye may drink (Deut. 2:4-6).

The theocentric principle of this law is God as the sovereign Owner who allocates national lands as He sees fit. He has placed boundaries around certain nations. This land law regarding Israel's wilderness wandering was based on a broader principle of justice: the prohibition against theft. Israel was told not to seek another inheritance besides the land of Canaan. Esau's land was listed as off-limits; so was Moab's (v. 9). Israel had no legal claim to any other nation's inheritance besides Canaan's. To have set their eyes on any land but Canaan would have been a violation of the tenth commandment, the command against covetousness.

God told them to buy meat and drink with money. They had been given money by the Egyptians. Israel had gained the inheritance of many of Egypt's firstborn sons, who had all perished on Passover night. Israel had been capitalized by the Egyptians, who had illegally held them in bondage. Even after the capital losses imposed by Moses after the golden calf incident (Ex. 32:20), Israelites still had money.

Money has been defined as the most marketable commodity.(1) It has the widest market of all commodities. Wherever men go, there are other men who want to exchange more specialized goods and services for money, the less specialized good. Money is the most liquid asset. This means that it can be exchanged for other valuable assets rapidly without advertising costs and with no discount.

Money is an ideal form of wealth for men on the move. It is readily transportable, easily divisible, and has a high value in relation to its volume and weight. Money was what Israel needed for a 40-year march through the wilderness. Had there been no other nations to trade with, money would have done them far less good, since men cannot eat money. But men can surely eat the things that money can buy, and there were many cultures along Israel's journey with one thing in common: a desire for more money.

 

Voluntary Trade

Because the Israelites had money, they could trade with those foreigners along the way who had meat and drink for sale. In the wilderness, meat and drink were in short supply. The Israelites possessed money, but they could not eat their money. On the other hand, the nations they passed by had meat and drink. Pre-exodus Egypt had been the richest kingdom in the region around Sinai. Now the Israelites possessed much of the transportable wealth of Egypt. A series of mutually profitable exchanges became possible. The nations had what Israelites wanted, and vice versa.

The Israelites possessed an advantage: the nations were afraid of them (Deut. 2:4). Israel had just defeated Egypt. They had crossed the Red Sea miraculously. This was a demonstration of supernatural power that threw fear into the hearts of the Edomites. But God warned Israel not to use force to extract wealth from Edom. He told them to be peaceable people, for other nations lawfully possessed their own inheritances. There were legal boundaries around their possessions.

This made trade a major source of increased wealth for the Israelites. Israelites would give up money, which was of low value to them, in exchange for meat and drink. Giving up money for consumer goods meant the de-capitalization of Israel's distant future. But men live in the present; they must eat and drink in the present. God allowed them to make the decision: money as part of the inheritance for the next generation vs. meat and drink in the present.

Israelites were not to place their hope in money. They were also not to place their hope in any military conquest other than in or around the land of Canaan. So, with respect to portable wealth, those who gave up money for meat and drink were more present-oriented than those Israelites who refused to trade. They became spenders rather than savers. They valued the pleasures of meat and drink more than they valued their money. They knew that the next generation would conquer Canaan. At that future point, the spoils of Egypt would be rendered relatively less valuable. It was productive real estate that would then be valuable, for it would produce wealth for the whole nation.

The spoils of Egypt became the means of immediate gratification for some Israelites. The value to them of meat and drink in the present far outweighed the discounted future value of money. Money could not be invested at high rates of return by a nation wandering in the wilderness. It would not compound for entrepreneurs. The Israelites of the exodus generation knew they would not be allowed to spend their money in the Promised Land. What good was money to them? It was either a means of buying pleasure in the present or a means of transferring an inheritance to their children. But their children had been guaranteed an inheritance in Canaan. So, why not spend money?

Money was less valuable to the exodus generation than meat and water. Meat and water were less valuable to some Edomites than money. Because each participant in an exchange values what the other has more than what he has, both of them can increase their satisfaction by a voluntary exchange. God told Moses to instruct the nation that from now on, and for the next four decades, voluntary exchange would be the only lawful avenue of their wealth-generating activities with other societies. They had to learn to prosper through peaceful exchange. Violence should not become a means of increasing the nation's wealth.

This set a pattern for post-conquest relations with the nations around Israel. Israel restrained itself when it possessed what appeared to be a military advantage. Israel would not have retained an advantage, had they violated the boundaries that God had placed around the nations, but the nations did not know this. Israel had to rely on trade to get what it wanted. This must have made an impression on the nations in the region. If anyone wanted access to the wealth of Israel, he could gain it by offering an Israelite an advantage. The Israelites were ready to trade. They were not in the empire-building business. They were in the "let's make a deal" business.

This forced wealth-seeking Israelites to become skilled bargainers. They could not rely on military force to gain what they wanted. They had to learn self-restraint. Weak nations must do this of necessity. Strong nations are wise to do this. The example of Switzerland is over five centuries old. That nation displays a ferocious determination to defend its territory from military invasion, yet displays complete neutrality outside its borders. It is an armed camp internally and a disarmed sales force externally. A banker defends his bank's vault. He also makes visitors welcome when they come to deposit money or borrow at rates profitable to the bank. Switzerland has become the banker for the world's central banks.(2)

 

A Matter of Positioning

Israel gained a reputation in the wilderness for trading rather than fighting. This was probably what lured Arad, Sihon, and Og into suicidal attacks on Israel just prior to the conquest of Canaan. Those powerful kings assumed that trade-seeking Israel could not defend herself. They were wrong. Israel was about to become the most battle-hardened military force in the region. But for almost four decades, Israel had positioned herself as a non-violent trading nation, a wandering people without a home base. Trading nations that gain the reputation of being unwilling to fight become vulnerable to aggressive nations that prefer conquest to trade.(3) This was not Israel's condition, but it appeared to be Israel's condition immediately prior to the first battles of the conquest.

After the conquest, Israel allowed foreigners to live inside her borders. The rule of law did not discriminate against foreigners who lived inside non-Levitical walled cities. They could buy and sell homes and leave an inheritance to their children (Lev. 25:29-30). Furthermore, one law governed all traders (Ex. 12:49). This was unheard of in the ancient Near East. In all other societies, the cities' gods were local. If you did not have legal access to the religious rites of these local gods, you had no legal standing. These rites excluded foreigners and women.(4) But Israel's God was a cosmic God. His transcendent authority was not dependent on geography. So, Israel became a place where all people could seek freedom from arbitrary civil government and legal protection for their property.

This positioned Israel as a trading nation. Israel welcomed traders as no other Near Eastern nation did. But this positioning had begun prior to the conquest. When Israel had no homeland, she sought no nation's wealth through conquest. Similarly, when Israel gained a homeland, she was commanded by God to seek no foreign national's wealth through oppression. In both instances, Israel gained wealth through trade. Israel extended the division of labor by abandoning force. She tempted the best and the brightest wealth-seekers from other societies to share their skills and information voluntarily through trade.

Israel for centuries was a nation located on important trade routes. With access to the Mediterranean, Israel was one of a handful of neutral trading nations that operated outside of the jurisdiction of the great land-based empires: Egyptian, Hittite, and Babylonian.(5) But a successful trade route is more than a matter of geography. It is also a matter of legal protection. From its days in the wilderness, Israel began building its reputation as a nation conducive to foreign trade. Revere writes of the coastal trade city: "Its main function was to guarantee neutrality. Continuity of the supply of goods was essential, since it could not be expected that traders -- under the difficult conditions of archaic long distance travel -- would come to an outlying place unless they knew for certain that a safe exchange of goods was possible. The presence of a strong military power on the spot would unfailingly frighten them away. Political neutrality, guarantee of supplies, protection of the lives and property of strangers had to be assured before trade could start. A prior understanding between the corporate parties was therefore needed, usually based on regular treaties. Such an understanding, no doubt, would include facilities for disembarking, lading, portage, storage, grading of goods and the fixing of equivalencies backed by the coastal authority. Without this mechanism of the port of trade, there could be no regular trading."(6)

God's prohibition against the multiplication of horses by the king was unquestionably part of this arrangement (Deut. 17:16). The presence of a large offensive army -- an army with chariots or cavalry -- would send mixed signals to the land-based empires that used the coastal port cities as foreign trade centers. A safe, innocuous coastal nation was not bothered by the great empires until well into the eighth century B.C., when Assyria began its conquests.(7) The empires avoided establishing cities in the coastal areas, possibly because trading cities might have opened these closed societies to new ideas and an uncontrolled wealth. Foreigners were kept at a distance through the use of neutral coastal ports and State-authorized caravans to and from those ports.

Positioning is very important in establishing a market. When men think of a particular good or service, they think of the product, company, or nation that supplies the best known (best positioned) item. Israel's positioning under God's law was as a nation where voluntarism brought wealth to all market participants, including foreigners. Wealth flows into those nations in which property is protected and contracts are enforced impartially. God established "no trespassing" boundaries around other nations' assets as well as neighbors' assets. When it came to protecting private property, with the exceptions of rural land and the homes of Levites in Levitical cities (Lev. 25:32-33), "otherhood" in Israel was not different judicially than "brotherhood." This judicial condition is the mark of a trading nation.


Conclusion

From the beginning of their wandering in the wilderness, the Israelites knew that they were not allowed to take land from the non-Amorite cities in the region. Those cities were the lawful possession of others. God honored the property rights of other nations that worshipped false gods. Even though these nations were afraid of Israel, they were not to be exploited. Israel was not to take advantage of them. Instead, the Israelites were told to trade for whatever they wanted from those nations. Voluntarism rather than military strength was to be the basis of gaining ownership of other nations' goods.

This was supposed to set the pattern for Israel's future economic dealings with foreign nations. Without the threat of violence facing them, other nations would come to regard Israel as a place to do business. If they wanted to benefit from Israel's productivity, they could bargain with Israelites. Without fear of confiscation, they could bring something valuable into Israel in search of a trading partner. Their property would be protected by Israelite law and custom. This safe haven for private property irrespective of national origin would make Israel a cross-roads for profit-seeking foreign traders. Egyptians could seek out Israelites or Babylonians or Hittites to do business. Israel could become one of the neutral, independent, coastal nations that served the great empires as common centers of trade.

God would soon give Israel the geographical location that could make the nation a foreign trade center. But first, He imposed a law that favored foreign nations: the protection of their property. By honoring this law prior to the conquest of Canaan, Israel would mark itself as a nation where private property was safe. Israel would become known as a trading nation rather than an aggressor nation. This reputation would position Israel as a regional trade center, bringing income from foreign traders seeking opportunities. This was part of God's program of foreign missions through law: "Keep therefore and do them; for this is your wisdom and your understanding in the sight of the nations, which shall hear all these statutes, and say, Surely this great nation is a wise and understanding people. For what nation is there so great, who hath God so nigh unto them, as the LORD our God is in all things that we call upon him for? And what nation is there so great, that hath statutes and judgments so righteous as all this law, which I set before you this day?" (Deut. 4:6-8).

Footnotes:

1. Ludwig von Mises, The Theory of Money and Credit (2nd ed.; New Haven, Connecticut: Yale University Press, 1953), p. 32. The first German edition was published in 1912.

2. The Bank for International Settlements is headquartered in Basle. This is the central banks' clearing house, the central bankers' central bank.

3. This is why Switzerland has had to maintain itself as an armed camp to defend its autonomy and neutrality. The Swiss avoid a reputation for softness.

4. Fustel de Coulanges, The Ancient City: A Study on the Religion, Laws, and Institutions of Greece and Rome (Garden City, New York: Doubleday Anchor, [1864] 1955), Book II, Chapter VIII.

5. Robert B. Revere, "`No Man's Coast': Ports of Trade in the Eastern Mediterranean," in Trade and Market in the Early Empires: Economies in History and Theory, edited by Karl Polanyi, Conrad M. Arensberg, and Harry W. Peterson (Chicago: Regnery, [1957] 1971), ch. 4.

6. Ibid., p. 52. Mosaic law was adamant about the evil of false weights and measures (Lev. 19:35-36; Deut. 25:13; 25:15; Prov. 11:1; Prov. 20:23).

7. Ibid., p. 58.

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