The two principal candidates for the presidency are in remarkable agreement on the issue of trade, both generally committed to free trade, to a continuation of the opposition to protectionism that was a hallmark of the Reagan Administration and to full support of the new round of negotiations in Geneva on revising the General Agreement on Tariffs and Trade. That is encouraging.
This coincidence of policy between the two major presidential candidates contrasts with the campaign of four years ago when Walter Mondale pursued some protection-oriented rhetoric.
There are nuances of difference that have stirred some concerns, however. When the ludicrously protectionist textile bill was being rushed through Congress with overwhelming bipartisan support, Vice President George Bush spoke in opposition, a constructive initiative on his part, while Gov. Michael S. Dukakis chose silence.
Both Bush and Dukakis, in their eagerness for electoral votes in the pivotal rust-belt states, have made one regrettable commitment to protection, supporting an extension of the five-year steel import-quota program when it expires next year. The program was intended solely to buy time for American steelmakers to modernize; as a result elements of the industry already are competing well in world markets.
Both Bush and Dukakis appear committed to making American industry more competitive, with programs including larger federal investments in job training and in research and development. Under President Reagan, the federal research dollar has shifted substantially from the civilian sector into the military sector, weakening competitiveness in the vital world civilian market place.
Yet the support of both for extended steel import quotas demonstrates how hard it is to wean uncompetitive industries from special protection.
Both campaigns, eager for California’s electoral votes, have rushed to embrace the unfair trading case brought by American rice millers against Japan. A more appropriate response from the man who will be deciding this case as the next President would have been a new commitment to negotiating rice, as now agreed, as part of the GATT talks in Geneva. Fair trade between two trading partners must be judged in the total context, not on the basis of a single product or commodity.
Sen. Lloyd Bentsen (D-Texas), presumably speaking for his running mate, has accused the Reagan-Bush Administration of not having a trade policy. This criticism was repeated most recently when the August trade figures reflected a disappointing increase in the trade deficit. It is not a fair charge. Bentsen has argued that the Omnibus Trade Bill that he helped push through Congress earlier this year is a model. In fact, it was a flawed bill, which won bipartisan support because of a coincidence of many special-interest pressures, and was signed by President Reagan. Bentsen played an important role in stripping some of the more outrageous elements from the bill. But among the flaws that were not corrected was a limitation on presidential discretion that will haunt the next President. Reagan gave strong leadership to the U.S.-Canadian free-trade agreement now awaiting Canadian approval. It was Reagan who rescued the nation from the defective textile bill with his veto. Those are not symptoms of a vacuum in trade policy. Indeed, the free trading climate Reagan encouraged played a part in the export growth that continued even when imports soared in August, the last month for which figures have been released.
It is to the credit of both Bush and Dukakis that each has resisted the temptation to demagogue trade issues for political advantage in the campaign. That will disappoint those who have preferred protection to modernization and competitiveness. But it bodes well for the American economy and its ability to meet the challenges of the next four years, assuring, regardless of who wins in November, continuity of Reagan’s constructive trade policy.