Using the CIL wrecks the US’s competitive advantage.

Most issues addressed by the body of CIL that developed during its classical period (up through the 19th Century) can be characterized as symmetric: you protect my diplomats, and I’ll protect yours. Let’s call this type of exchange “identical performance reciprocity.” This is Friedmann’s law of coordination, and it is easier to make, and to enforce, if everyone has symmetric interests.27

However, identical performance reciprocity leaves no room for diverse preferences or comparative advantage. In more modern times, with the development of the need for an international law of cooperation, it makes perfect sense in many areas for states to make reciprocal commitments that involve different performances by each state (let’s call this “diverse performance reciprocity”). States have varying preferences, and varying comparative advantage in regulation. For example, you reduce your carbon emissions and I will reduce my tariff on computers from 30% to 10% in exchange for State B reducing its tariff on bananas from 25% to 20%. Or perhaps State A wants State B to provide greater protection to intellectual property rights. Both are types of diverse performance reciprocity. As compared with identical performance reciprocity, diverse performance reciprocity responds to the fact that different states have different situations, different capabilities, and different preferences.

CIL seems unable efficiently to encompass diverse performance reciprocity. Therefore, under CIL, the set of possible international legal transactions is excessively constrained: only in-kind barter is possible, not a market of exchange. There have been examples of diplomatic conferences in which package deals of newly “agreed” CIL have been developed,28 but this is an unusual occurrence, and would be limited to topics within those addressed at the diplomatic conference.

Diverse performance reciprocity is akin to a side payment, in which a kind of package deal is constructed that might not be possible without assembling a set of concessions that will sufficiently reciprocate. “With all side payments prohibited, there is no assurance that collective action will be taken in the most productive way.”29 So, CIL is a blunt instrument indeed.

On the other hand, it might be argued that specific reciprocity in forming a particular arrangement is unnecessary—that Keohane’s concept of diffuse reciprocity (which might be understood as an extreme form of diverse performance reciprocity) can induce transactions even where a particular transaction is one-sided, because the loser will anticipate future transactions in which reciprocity will be evened out. This requires a relatively long horizon and a high level of trust. And perhaps it is true that for smaller transactions, perhaps where the amount at stake if the counterparties defect is small, diffuse reciprocity would be satisfactory. However, if the amount at stake is sufficient, it would be more likely that states would anticipate non-compliance by their partner, and decline to comply themselves. Cooperation may thus unravel.

A related problem to that of insufficient heterogeneous reciprocity is the tendency of CIL to be universal. The drive to universality limits the ability to establish more narrowly-tailored reciprocity among sub-universal groups of states.