The Executive's Local Constituencies

After Reagan's foreign aid bill passed, his incentives to help the textile industry were essentially over. Just as Oatley predicted, he eventually acted in the national interest; repealing many quotas negotiated into the MFA as soon as China protested and threatened retaliation.(16) However, this move served to anger the same senators that had originally pushed for a more restrictive MFA, and they once again ratcheted up a campaign to align the president's interests with those of South Carolina. Senators Helms and Thurmond put the president under severe pressure to impose countervailing duties upon China, then the largest importer of textiles into the United States. This time, rather than trying to kill specific legislation, the senators threatened not to help Reagan's re-election campaign in South Carolina (In retrospect, he probably didn't need it against Mondale). In this way, the Senators grouped the president's re-election bid in with their own, making the interests of the state of South Carolina crucial to all of their political futures.(17) The logic behind Reagan's decision to impose countervailing duties was clearly influenced by regional interest groups, "The American Textile Manufacturers Institute's petition requesting the duties [had] the backing of powerful Southern Republicans, and White House aides [feared] that dismissing it could have repercussions in next year's election."(18)

Essentially Reagan had just cut a deal with the South Carolina senators, he would help them get re-elected if they did the same for him. Eventually, these duties found their way to the House floor in the form of the Textile and Apparel Trade Enforcement Act. What made this act particularly interesting though was the way that it bound the president politically not just to South Carolina, but forced him to support protectionism for several industries. Suddenly the president was following exactly the same logic that Oatley predicts a legislator will follow. In order to pass a piece of legislation he viewed as crucial to his re-election, he was logrolling to appease lots of legislators. The final version of the bill included not just protections for the textile industry but measures designed to garner political favor all across the United States, protecting shoes, roses, and cars among hundreds of other goods.(19)

Once again, Oatley's theory that the president will attempt to maximize national welfare would be correct if he perceived that it would be good for the national economy as a whole. However, economic advisors had told the president that introducing countervailing duties in the middle of the fiscal year would have large impacts on American businesses and consumers. One advisor argued, "The regulation would strand $500 million worth of foreign-made textiles and apparel that American companies have already ordered. That would cause substantial financial difficulties for retailers and other businesses, as well as apparel shortages and price increases of up to 20 percent for consumers."(20)

Thus the president was motivated by domestic political considerations to fall victim to the same sort of legislative tactics that the RTAA and the remarkably similar Tariffs and Trade Act had been designed to rectify. Rather than attempting to stop protectionism in order to promote national welfare, the president was trading protections with legislators when he knew that it was bad for his national constituency. Clearly, the American political process still had incentives built in for the executive to act like a legislator. Reagan too was also partially motivated by the Electoral College to pursue protectionist policy in order to win votes in Southern states, which at the time were not seen as being an easy victory for Republicans.

Be Sure to Continue to Page 6 of "The Executive's Local Constituencies".