Why Romney Sounds Like a Confused Banker

Military analysis.
Sept. 26 2012 5:50 PM

A Tale of Two Speeches

Obama sounded like a president. Romney sounded confused.

Mitt Romney speaks at the Clinton Global Initiative meeting on Tuesday in New York City.
Mitt Romney addresses the Clinton Global Initiative meeting on Tuesday in New York.

Photo by Mario Tama/Getty Images.

An odd thing happened Tuesday: Both presidential candidates gave major speeches on foreign policy, a rarity in an election dominated almost entirely by domestic issues.

This much was revealed by the competing addresses: Barack Obama’s, to the U.N. General Assembly, was a speech worthy of a president; Mitt Romney’s, at the Clinton Global Initiative, was the pep talk of a provincial banker who’s perplexed that the rest of the world just doesn’t get with the program.

Romney’s premise was that, for all “our passion for charity,” foreign aid doesn’t work: The money often gets funneled to corrupt governments, and even when it doesn’t, the poor countries stay poor. Better, he said, to focus on boosting private investment and promoting free enterprise.


In one sense, the point is obvious, so much so that I can’t think of a single senior Obama official who would disagree. Romney implicitly acknowledged this when he noted that “82 percent of the resources that flow to developing nations come from the private sector, not the government sector,” up from 30 percent several decades ago.

The major flaw in Romney’s speech is that it presents foreign aid and private investment as either/or propositions, when in fact they serve two distinct functions.

Even Romney acknowledged that foreign aid has two “quite legitimate” objectives: humanitarian assistance and the promotion of U.S. security interests. Though Romney didn’t say so, the former often abets the latter. For instance, in 2004, international polls showed that Muslims’ support for Osama Bin Laden sharply declined after the United States helped victims of the tsunami in Indonesia, whose population is mostly Muslim.

It is true that, over the long haul, foreign aid can go only so far. The major obstacles in many countries, especially in the Middle East, are the lack of jobs for young men and the absence of institutions to lure and sustain private investment.

Romney’s proposal is to link foreign aid and private investment, but it’s not at all clear how this would work. Here is how he described his plan in the Clinton Global Initiative speech:

To foster work and enterprise in the Middle East and other developing countries, I will initiate something I’ll call Prosperity Pacts. Working with the private sector, the program will identify the barriers to investment and trade and entrepreneurship and entrepreneurialism in developing countries. And in exchange for removing those barriers and opening markets to U.S. investment and trade, developing nations will receive U.S. assistance packages focused on developing the institutions of liberty, the rule of law and property rights.

Here’s the mystery: Why does Romney think the leaders of such countries want our advice on liberty, law, and property rights, much less that they would view this advice as the reward for opening up their markets to U.S. companies? The proposition is especially doubtful, given that other powers, for instance China, are willing to invest without regard to a country’s commitment to political pluralism or the rule of law.

Romney’s underlying point has some validity: that as a country opens itself up to the world, it not only imports goods and services; it also, over time, tends to absorb (though often fitfully and unevenly) the values and ideas from these other parts of the world as well. But he doesn’t seem to recognize that this subtler transaction cannot be imposed as part of the deal; it takes time to emerge, and does so, if at all, with local twists and flavors that can’t be anticipated and might not be to our advantage.

The unstated premise of Romney’s plan is that the leaders and people in these countries want to be like us, to the point where they’d even drop their trade barriers in exchange for America’s instruction.



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