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Trade Policy: Bush Missed Big Political Opportunity
AmericanEconomicAlert.org ^ | Monday, November 15, 2004 | Alan Tonelson

Posted on 11/15/2004 8:15:15 AM PST by Willie Green

For education and discussion only. Not for commercial use.

Any close election is bound to be followed by bursts of Monday morning quarterbacking. Even by this standard, however, the 2004 presidential race looks like a monument to missed opportunities on both sides.

The morning right after the election, my friend Ted Bush, who worked on trade issues for retiring Illinois Democratic Congressman William Lipinski, focused on his party´s contender, John Kerry. Had Kerry blown Ohio because of wimpy positions on trade and jobs issues?

After all, Ted noted, the initial exit polls showed that economic and jobs issues were number one for more Ohio voters (24 percent) than any other category. Yet despite that state´s massive recent job manufacturing job loss and George Bush´s clear enthusiasm for outsourcing-focused trade agreements, fully 17 percent of these economy-minded Ohioans voted for the president – representing four percent of the state´s total vote.

If Kerry had come out strongly and convincingly against the president´s trade record, and won half those votes, Ted Bush reasons, the Buckeye State and the White House could well be his.

Of course, even nail-biter elections rarely hinge on a single, discreet factor. Could Kerry really have run as a rip-roaring economic nationalist, or anything close? Could he have held on to his Wall Street money? His George Soros money? At the same time, do the Ohio exit polls suggest that the Democrats should have nominated former House Minority Leader Dick Gephardt for president? Was he or someone with a big reputation as a trade policy critic, ironically, more electable than Kerry? And in hindsight, should Gephardt himself have hit the trade issue harder and earlier in his campaign, instead of trying to reinvent himself as a health care maven?

And then there was Kerry´s running mate, John Edwards, who ignored globalization issues during his few years in the Senate, but at least faked concern effectively during the primaries. Did his success in places like Wisconsin foreshadow a winning message for the Democrats? No one knows for sure. What we do know for sure is that he Democratic party´s free trade wing has just lost its second straight race for the White House, and didn´t do so hot in Congress, either.

Still, however close the Ohio vote, the 2004 Missed Opportunity Award should go to President Bush. Yes, we know – he won. And who can argue with success? If it ain´t broke, don´t fix it, etc. Yet the real story of the 2004 White House race is how the President snatched a respectable but close win from the jaws of a thumping, history-making triumph.

Indeed, early after the 2000 squeaker, Bush´s political guru Karl Rove thought that he could create a permanent Republican majority coalition at the presidential level. Bush´s soaring popularity after 9-11 and Republican successes in the 2002 Congressional races signaled that the goal was within reach.

The biggest obstacles to Rove´s plan seem obvious today – the violent aftermath of Saddam Hussein´s overthrow, and Rove´s own apparent decision to respond mainly by boosting conservative voter turnout. But abundant evidence indicates that Bush could have widened his margin considerably with some meaningful departures from the outsourcing-focused trade strategy he has so aggressively pursued.

Look at it this way. From a “gotcha,” debating-point perspective, after Saddam´s fall, nearly everything that could have gone wrong in Iraq did, ranging from continuing casualties to missing weapons of mass destruction, to the prisoner abuse scandal, to the fact that Washington wound up charging its main Iraqi exile ally with spying for Iran. Yet the exit polls showed that the electorate still supported the decision to go to war by 51-47 percent – even though by 52-43 percent these same voters thought the war is going badly.

Moreover, the President ran against one of the most off-putting candidates served up by American politics since, well, the last Democratic nominee, Al Gore. Worse, Kerry was a classic Senate show horse with few significant legislative accomplishments despite 20 years in Congress.

And although polls throughout the campaign showed strong opposition to Bush-style trade deals and grave concern about jobs and living standards especially in industrial battleground states, the president stimulated the economy effectively enough to keep the headline data satisfactory. Thus, the issue was all but marginalized.

One fascinating piece of evidence: For all the focus on Values Voters, one of their most important characteristics seems to be economic satisfaction. Fully 44 percent of these voters consider their family´s financial situation to be better now than four years ago, at the start of Bush´s term. Forty percent reported that their situation is the same, and only 15 percent perceived deterioration.    

In addition, however important it is that Bush only narrowly won industrial Ohio, it is at least as important that he only narrowly lost three other big industrial states – Michigan (by 51-48 percent) Pennsylvania (by 51-49 percent), and Wisconsin (by 50-49 percent). Michigan, of course, is suffering 6.8 percent unemployment these days.

Democratic pollster Stan Greenberg – a Clintonite who throughout the 1990s doubted that trade realism or fair trade would become a major vote-getter – has all but acknowledged Bush-ism´s potential appeal to working Americans. Won over by his leadership on national security issues, Greenberg contended, “downscale America, starting with rural voters and cascading with older, blue-collar America, shifted to Bush” during the campaign´s last ten days, including some union voters.

But just as Kerry prevented himself from coming off as a decisive war-time leader because of his muddled Iraq position, Bush has prevented himself from coming off as a true working families advocate because of his almost unwavering support for globalization policies that inevitably produce a net loss of good jobs and a consequent decline in wages. Indeed, Bush has often seemed determined to go out of his way to hammer working Americans and the domestic businesses that have employed them.

Leave aside Bush´s support for steel tariffs (which he lifted as soon as possible) and for limiting some apparel imports. Except for the Australia free trade agreement, the president´s trade liberalization agenda has focused tightly on third world countries incapable of becoming major net new markets for U.S. exports, but amply capable of becoming major suppliers to the U.S. market. Examples include Central America and the Dominican Republic, Vietnam, Thailand, Morocco and, most recently, Haiti.

Bush has also refused to sanction China for its clear exchange-rate protectionism, largely because U.S. multinational companies that export from China benefit from an artificially cheap currency. In fact, he has dismissed Congressional, union, and business demands for currency action with undisguised contempt. For good measure, his trade representative, Robert Zoellick, rejected in mere hours a detailed union brief seeking an investigation of how China´s unquestioned repression of workers functions as a trade barrier.

The president responded to the ongoing crisis in U.S. manufacturing by placing a new junior bureaucrat in the Commerce Department, and issuing a report that (a) endorsed more trade Business as Usual and (b) claimed that tax and regulatory cuts could restore America´s industrial competitiveness against China and other penny-wage countries. Perhaps worst of all, this avowedly national security-minded administration has fought ferociously Congressional efforts to make sure that the U.S. military avoids excessive dependence on foreign suppliers.

On the immigration front, the president has struggled to keep alive his plans for relaxing rules against illegal immigration and enabling illegal aliens to become legal guest workers. Talk about a pre-9-11 mindset! Didn´t immigrants who came to America legally have something to do with those airliners that crashed into the World Trade Center and the Pentagon? And who can forget the February, 2004  statements of Bush´s chief White House economic advisor, Gregory Mankiw, who insisted that the outsourcing of high tech and professional services jobs is just like any other type of trade, and by definition benefits the country in the long run?

And yet the president still came within a whisker of capturing the entire industrial Midwest (except for Illinois). Imagine what he could have done had he reached out to America´s deeply patriotic and socially conservative blue-collar workers – who during the 1980s were commonly called Reagan Democrats. He could have transformed American politics as completely and as enduringly as William McKinley in 1896 or Franklin Roosevelt in 1932. Even better, he could have done so without alienating most of his Big Business support. What were they going to do? Support the tax-and regulation-happy Democrats? And of course, realistic trade policies can help the entire debt-strapped economy avoid the dollar crash that seems so likely to ruin the second Bush term.

Instead, the president gave workers, along with domestic industry, the back of his hand, scraped by in his reelection campaign, and set himself up for an economic fall that could dwarf his father´s. Who knew that allergies to the Vision Thing run in families?

Alan Tonelson is a Research Fellow at the U.S. Business & Industry Educational Foundation and the author of The Race to the Bottom: Why a Worldwide Worker Surplus and Uncontrolled Free Trade are Sinking American Living Standards (Westview Press).


TOPICS: Business/Economy; Culture/Society; Editorial; Foreign Affairs; Government; Politics/Elections
KEYWORDS: eeyore; globalism; joebtfsplk; protectionism; repenttheendisnigh; sackclothandashes; thebusheconomy; trade; wearedoomed; worldworkersparty

1 posted on 11/15/2004 8:15:15 AM PST by Willie Green
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To: AAABEST; afraidfortherepublic; A. Pole; arete; billbears; Digger; DoughtyOne; ex-snook; ...

ping


2 posted on 11/15/2004 8:15:56 AM PST by Willie Green
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To: Willie Green
So, if Kerry would've proposed tariffs on imports he would have beat Bush?
3 posted on 11/15/2004 8:24:07 AM PST by 12 Gauge Mossberg (I Approved This Posting - Paid For By Mossberg, Inc.)
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To: 12 Gauge Mossberg

No. Kerry was so pathetic that, if Bush had been a true conservative and done that, he would've won in a landslide.


4 posted on 11/15/2004 8:48:32 AM PST by Willie Green
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To: Willie Green

Bush and Kerry are one on exporting both factories and the dollars to buy America. It is lose-lose. The election was fought over gay marriages.


5 posted on 11/15/2004 9:34:57 AM PST by ex-snook (Moral values - The GOP must now walk the talk - no excuses.)
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To: Willie Green

bump


6 posted on 11/15/2004 9:41:01 AM PST by AuntB (Most provisional ballots are from voters not eligible to vote!!! Ask a poll worker!)
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To: Willie Green

Both parties agreed to leave these issues off the debates because both parties have destructive plans for our sovereignty.


7 posted on 11/15/2004 10:18:38 AM PST by MissAmericanPie
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To: Willie Green

FWIW, the Wisconsin Senate race was won by a Democrat who voted against NAFTA and PNTR/Red China.

The Pubbie candidate, whose positions reflected GWB's except that the Pubbie was 100% pro-life, ran 10% behind Bush in the vote counts.


8 posted on 11/15/2004 11:03:17 AM PST by ninenot (Minister of Membership, TomasTorquemadaGentlemen'sClub)
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To: Willie Green

Thanks for the post. Remember that Arlen Specter barely eked out a primary victory over Pat Toomey, if Toomey had hammered this issue he would have crushed Specter. I don't know where Toomey actually stands on the issue.


9 posted on 11/15/2004 5:16:46 PM PST by fallujah-nuker (In the WTO America is like the guy who gets traded around the cell block for Marlboro's.)
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To: Willie Green

Strange how this conflicts so strongly with all the other post election wrap ups coming out of Ohio.


10 posted on 11/15/2004 5:20:47 PM PST by CWOJackson
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