Why the Battle for Ohio Is All About China

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In this swing state, the central message of both the Obama and Romney campaigns is the same: I'm tough on China, and he's not.

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Reuters

DAYTON, Ohio -- From where you sit, the presidential campaign may look like a grand referendum on different visions for the future of the American economy. But in this pivotal swing state, it's all about China.

President Obama and his challenger, Mitt Romney, are engaged in an escalating battle of China-bashing bluster in their Ohio ads and campaign appearances. Campaigning here on Tuesday, Romney took a detour from his stump speech to blast China for "cheating" by holding down the value of its currency and allowing intellectual property theft. He vowed to "stop it in its tracks," though he didn't say how he planned to do that. Obama came to Ohio last week to announce the filing of the administration's latest complaint against Beijing at the World Trade Organization, this one charging China with subsidizing auto-part exports, and the president can be expected to pick up the theme again when he campaigns here Wednesday.

Turning on the TV in my hotel room here, I immediately saw ads from both Romney and Obama hitting the China theme -- a Romney ad accusing Obama of costing American jobs because he refuses to "stand up to China," and an Obama ad saying Romney had "never stood up to China." All but one of the presidential campaign ads I saw on Ohio network TV were China-themed.

Clearly, the campaigns have decided this is an effective message here. It plays on Midwestern voters' anxieties about the loss of manufacturing jobs to outsourcing and foreign competition. But there's reason to believe that neither man is as tough as his talk when it comes to cracking down on China economically -- and for good reason. Aggressively protectionist policies might please some Rust Belt voters in theory, but most economists think a U.S.-China trade war would be a disaster for the world economy, and it wouldn't bring Ohio's jobs back. The campaign rhetoric on China appears to be just that -- the most craven sort of pandering, with little merit and less credibility.

Here's how the political fight over China breaks down.

What are they arguing about? The candidates' arguments are interchangeable and boil down to a simple claim: I'm tough on China, and my opponent is soft on China.

Obama points to the trade cases he's brought at the WTO as evidence his administration is not putting up with China's shenanigans. Meanwhile, he attacks Romney for the fact that Bain Capital invested in companies that shipped jobs overseas -- frequently referring to Romney as an "outsourcing pioneer," a claim that is thinly founded at best -- and the investments in China that showed up in Romney's recently released tax return. "Even today, part of Romney's fortune is invested in China," the Obama attack ad says.

Romney says he would take immediate action against China by formally labeling it a currency manipulator, and points to Obama's failure to do so as a major failing. "Seven times Obama could have taken action. Seven times he said no," Romney's ad says, referring to a Treasury Department report that is issued semiannually. Romney also counters Obama's outsourcing attack by pointing to federal money that has gone to foreign-based projects, calling Obama the "outsourcer-in-chief."

Why are they hammering this so hard? It works. Ohio is dotted with shuttered factories, testament to a bygone era in the American economy; meanwhile, new factories seem to spring up hourly across the Chinese landscape. They're not unrelated developments, as labor is cheaper in China and more expensive in the U.S., but it's also the case that voters need a scapegoat for their economic ills. China's currency manipulation and the resulting massive trade imbalance are real problems, though the trade deficit has eased somewhat recently. At Romney's rally in Dayton, I spoke to several Republican voters who blamed Obama for American jobs going to China.

"It's very popular to beat up on China -- it's something that very much crosses party lines," says David B. Cohen, a political science professor at the University of Akron. "Union folks have always felt that China was engaging in unfair practices and therefore we couldn't compete, and the Republican owners of those companies also believed something similar." One political science study found voter angst over outsourcing can be potent enough to swing an election.

Should we believe any of it? The problem with all this posturing is that while the challenges China poses to the U.S. economy are clear, the solutions are not. Both candidates seem to realize this -- their prescriptions quickly get hazy once you scratch the surface. And that's probably for the best, as economists say taking a really tough line against China would likely do more harm than good, destabilizing the world economy and harming the U.S. in the process.

Both Obama and Romney are clearly proponents of free trade. Obama has signed a number of new free-trade agreements, some of them proposed by his predecessor; beyond the WTO complaints, he's mostly taken a conciliatory, diplomatic line toward China, and he hasn't proposed to go further in a potential second term than the incremental steps he's taken in his first. Romney, meanwhile, prefaced his anti-China spiel on Tuesday with a riff about the virtues of trade, and in his economic plan he promises to take many of the same free-trade actions Obama has already taken. And while Romney talks constantly about his plan to label China a currency manipulator, you never hear him go into what would happen next -- the volleys of escalating tariffs that would ensue. Romney's big-money donors, many of whom, like Sheldon Adelson, have interests in China, don't believe he's serious about undertaking a full-scale trade war, or they wouldn't be able to sleep at night.

So while Ohio voters will keep hearing a lot of bluster on China in the coming weeks, they probably shouldn't put much too stock in it. When it comes to China, both an Obama and a Romney presidency would likely be more bark than bite.

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Molly Ball is a staff writer covering national politics at The Atlantic.

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