Year in Review: 2012 in US Trade Reform

Romney's weak economic nationalism didn't turn out to be strong enough to win over a recession-weary electorate that still blamed Bush for the economic crisis that Obama seemed to be handling, if at an unsatisfyingly slow pace.
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US Republican Presidential candidate Mitt Romney holds a rally in Englewood, Colorado, November 3, 2012. AFP PHOTO/Emmanuel DUNAND (Photo credit should read EMMANUEL DUNAND/AFP/Getty Images)
US Republican Presidential candidate Mitt Romney holds a rally in Englewood, Colorado, November 3, 2012. AFP PHOTO/Emmanuel DUNAND (Photo credit should read EMMANUEL DUNAND/AFP/Getty Images)

Previously negotiated U.S. free trade agreements went into effect with Korea in March, Colombia in May, and Panama in October.

President Obama continued to push for the unpopular Trans-Pacific Partnership.

He also continued to refuse to designate China a currency manipulator, despite his Treasury Department's own economists verifying the truth of this allegation yet again. China's currency continued to slowly rise, though not nearly enough to eliminate the problem.

The major Republican candidates for president ran the gamut in terms of the trade positions they expounded during the primaries.

Disgraced former House Speaker Newt Gingrich ran as a Thomas Friedman-style trade globalist who had learned nothing since his ignominious departure from the House in 1999, as did Texas Gov. Rick Perry.

Black businessman Herman Cain was less naive, but ultimately contradictory. He grasped China's seriousness as an economic rival and the reality of Chinese cheating in trade, but proposed remedies, like turning to the WTO and more American growth, that have already failed.

Neo-puritan ex-senator Rick Santorum of Pennsylvania emitted a promising whiff of economic populism and Catholic economic paternalism, but ultimately didn't back up these impulses with real policy proposals.

Libertarian congressman Ron Paul, for decades a unstable cocktail of profundity and nonsense, offered a bundle of disingenuous ideas. For example, he opposed NAFTA because "it's not real free trade" while supporting an idealistic vision of "real" free trade that would never happen in the real world.

The best candidate on trade issues was unquestionably the minor player Buddy Roemer, a former Louisiana governor who staked his chances on a return to the economic nationalism of Teddy Roosevelt. Eloquently matching that previous Republican president's protectionism and denunciations of irresponsible plutocracy, he was rewarded by about five percent of public support in his best polls.

The eventual nominee, Mitt Romney, signaled early on that he was going to play the China hawk on trade issues. But while he was consistent with this line, he was also fairly timid about it, promising not much more than a crackdown on currency manipulation. Whether this moderation signified shallowness of conviction, or the disciplined promises of someone who actually intends to keep them, was impossible to tell. Still, he did openly threaten a tariff if China failed to heel, an important Rubicon no major candidate had previously crossed.

During both the primaries and the general election, Romney was repeatedly tarred with the outsourcing he had supposedly been party to during his business career with the private-equity firm Bain Capital. But in fairness, outsourcing was far too general a trend to legitimately attach to him personally, as opposed to the entire rest of the American business community during the period in question.

Combined with his similarly moderate turn against immigration, particularly on the flashpoint issue of amnesty, Romney's overall approach amounted to a kind of "soft economic nationalism" aimed at blunting international pressure on American wages. Whether he sincerely intended to live up to it if elected was, of course, a matter of debate, as his record in office as governor proved little either way.

His puzzling trade positions included a refusal to endorse the existing China currency bill. His spokespersons insisted that this was "to keep his options open," and it may well simply have been a way of avoiding a fight with his own party's Congressional leadership (which opposes the bill) until actually elected. Or it may have been a sign of a lack of commitment on the issue -- something we will now never know.

In the end, Romney's main campaign argument against Obama mainly came down simply to the weak economy. His weak economic nationalism didn't turn out to be strong enough to win over a recession-weary electorate that still blamed George W. Bush for the economic crisis that President Obama seemed to be handling, if at an unsatisfyingly slow pace.

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