I gave a lot of thought this weekend to what candidates on both sides of the political aisle would support trade and economic policy that would most further Spend Management principles -- in the United States and beyond. And what I discovered is a bit scary, in fact. The majority of candidates running for the Democratic and Republican nominations do not favor free trade, but would prefer to see as they term it, "fair trade" or "smart trade". Loyal Spend Matters readers know my views on fair trade -- at least when it comes to coffee and filling up a grocery store shopping cart. And on the national political stage, I feel the same way about the concept. Put differently, when you hear the words "fair trade," duck and run as the dollar accelerates its slide. Or, perhaps, free fall is a better way to describe what will happen to the US currency if a "fair trade" or "smart trade" candidate makes his way into office.
On the Democratic side of the aisle, the leading candidates which scare me most from a trade policy standpoint are John Edwards and Barack Obama. On Obama's site, you can read protectionist rhetoric noting that he believes "NAFTA and its potential were oversold to the American people," among other isolationist rantings. Edwards is even worse, suggesting "smart trade" policies are the way to go -- but these would be anything but. That is, unless you’re a card-carrying semi-skilled factory worker making twice or more the true market rate for your labor. From a trade policy standpoint, the Republicans that scare me the most are Mike Huckabee and Ron Paul (Paul, especially, infuriates me because he masquerades as a libertarian -- which he clearly is not if you read up on his views on trade). Clearly, both are competing for the same isolationist votes as Edwards and Obama. The only difference being that Republican anti-traders probably spend more time in church and less in protest rallies or complaining about uneven wealth distribution (which is about the only difference I can detect). At the end of the day, populism will always be populism.
Eliminating these protectionists leaves us with a number of candidates that I believe would take a pro-trade approach to global economic policy. Among these, Hilary Clinton, who has remained somewhat silent on trade policy -- she has to in order to get the nomination from her parties left wing -- would most likely adopt similar pro-trade, debt reduction stances that her husband deployed in office. Even though Clinton -- like Romney -- is often criticized as standing for nothing other than what her aides tell her, I reckon she stands for quite a bit on trade and economics. She just can't say it yet.
On the Republican side, John McCain is the candidate that I support the most from a Spend Management perspective. After all, how can you not respect a candidate who once remarked that: "Ninety-five percent of the world's customers lie outside our borders and we need to be at the table when the rules for access to those markets are written. To do so, the U.S. should engage in multilateral, regional and bilateral efforts to reduce barriers to trade, level the global playing field and build effective enforcement of global trading rules." Amen, Senator. In the defense of a few other Republican candidates, I also believe that Mitt Romney and Rudy Giuliani would adopt a free trading plank if they get the nod.
In this post, I defined very narrowly what a Spend Management candidate should stand for. Certainly, promoting free trade globally should be the first priority. But paying down the US debt is a strong second (which I'm sure the EU and China would second). In the national debt area, I have no endorsements yet. But let's hope that regardless of who gets the nomination in either party -- and who ultimately takes the oath of office -- that they treat paying down the national debt as a non-partisan issue. Incidentally, for all you political junkies in the audience, it was Bill Clinton, not Reagan or Bush 1 or Bush 2, who focused on debt reduction as a key economic priority.
- Jason Busch