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In Choosing Baker, Bush Weds Economics to Diplomacy

<i> Robert E. Hunter is the director of European studies at the Center for Strategic and International Studies, Washington</i>

Within hours of his election, George Bush took steps that acknowledged the key demands that an unrelenting world will impose on him. By directing conciliatory remarks toward Congress and naming James A. Baker III to be the secretary of state, Bush tacitly recognized that, in 1989, economic issues will be critical to U.S. foreign policy.

Most newly elected Presidents talk of building bridges to Congress. For Bush it is crucial. The Democrats, angered by Michael Dukakis’ poor performance as a candidate but buoyed by their gains in both houses of Congress, see a mandate to take on Bush in shaping the economy.

Bush’s prompt dubbing of Baker sent other signals far and wide. It underscored his intent to be an active President in foreign policy, in marked contrast to Ronald Reagan’s start eight years ago. A plus is Baker’s most recent government experience as secretary of the Treasury, where he earned high marks for the political acumen that is critical to success in global economic policy. Dealing with a familiar figure who has a grasp of their dilemmas will relieve the anxiety of allies in Europe and East Asia.

Bush will thus have Baker at his side when Britain’s prime minister, Margaret Thatcher, arrives next week to inspect the new American leader on behalf of her European colleagues. In many past transitions these allies have worried most about the Americans’ military commitments and policies toward the Soviets. This time economics is at the top of the agenda--especially a reduction of the U.S. deficits and a revitalizing of the U.S. global economic leadership. Baker’s presence will be immensely reassuring.

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This first act must be followed by the setting of clear priorities in foreign affairs, priorities critical both to restoring America’s position and to keeping the new President from being overwhelmed. Gaining control of the budget must be uppermost, symbolizing presidential leadership to both domestic and foreign audiences. Bush would be smart to convene a budget summit with congressional leaders, preferably before Inauguration Day.

Two sets of high-level meetings among the allies are already on the card. In April the North Atlantic Treaty Organization will mark its 40th anniversary; in July, in France, the industrial-state democracies will hold their annual economic summit.

Yet this NATO-first approach has a weakness. Bush (along with Dukakis) pledged to get the allies to pay more for Western defense. That notion is politically popular in the United States, but European governments reject it, foreshadowing a U.S.-European confrontation that would be an inauspicious start to a new Administration. Thus Bush must precede any NATO meeting with a firm start on resolving broader allied economic problems. These include not just U.S. deficits but also European (and Japanese) trade barriers, the threat of protectionism, the European Community’s consolidation in 1992 and common concerns like Third World debt. Indeed, the debt crisis sweeping northward could be the central challenge of 1989.

If Bush shows that he has ideas on resolving these problems, he can avoid becoming mired in a NATO burden-sharing squabble--or in a parallel disagreement with Japan--and can act on a more important agenda: reassessing security threats and responses in Europe, devising a means for deciding which allies should pay for what military capability, and beginning to chart an East-West diplomatic course to match the initiatives of Mikhail S. Gorbachev. Bush might also abandon the U.S. effort to cajole Japan into increasing its defense spending--a prospect that produces high anxiety in Asia--and focus on an increased Japanese role in providing “security” through economic assistance.

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Starting with a Western agenda--economics followed by security--is critical if Bush is to deal effectively with the Soviet Union. Thus there should be no superpower summit until the Western work is well under way; in his first press conference as President-elect, Bush showed admirable caution about rushing to meet Gorbachev.

The Soviet challenge to Bush will come on the heels of his inauguration on three fronts: arms control, Angola and Afghanistan. The first will test his ingenuity in competing for influence in Western Europe, the second will test his negotiating ability, the third his craft and steadfastness in holding the Soviets to the February, 1989, timetable for completing their troop withdrawals. If he is wise, on Jan. 21 he will pick up U.S.-Soviet policy where Ronald Reagan left off the day before. The confidence of allies, political support at home and the possibility of creating a more stable East-West relationship all argue for this prudent course.

Beyond these major commitments of time and energy, which are central to America’s global future for the next several years, Bush cannot avoid decisions on two other issues: how deeply to be involved in Arab-Israeli peacemaking, and what to do about Central America. On the former, he should appoint a special emissary to begin the painstaking work of finding an Arab negotiating partner for Israel, a drawn-out process with uncertain prospects and ever-present risks of disaster.

On Central America, the peril lies in Bush’s being sucked into the Nicaraguan quagmire that engulfed both Reagan and Congress. The new President will be well advised to begin a systematic and deliberate effort to find an alternative to the Contra scheme that will ensure the security and development of the region. Returning to the sterile and unproductive debates of recent years cannot be in his interest or the nation’s.


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