Multitasking in individuals is controversial. Some people glory in their professed ability to juggle multiple chores simultaneously. Others deny that anyone can do full justice to two things at once, much less three or four. Whatever the truth, a more mindful approach to life’s problems can be more fulfilling and less stressful for individuals. As Peter Drucker advised: Do one thing at a time, and do first things first.
In political life, though, multitasking is the only approach to solving complex problems. There are few, if any, silver bullets. Simple measures hardly ever suffice to resolve multidimensional problems. Instead, the challenge for strategists is to organize different approaches into a coherent, effective solution – even if they appear on the surface to be contradictory or even incompatible.
The raging debate over currency misalignment is a case in point. Some advise that the problem is multilateral and must be dealt with by and through multilateral institutions. Others stress the bilateral dimension of the problem and focus on how the United States can gin up enough pressure to persuade recalcitrants such as China to conform with the multilaterally agreed rules they violate. Still others insist that the US must rely on steps within its own power. Of those, some are ready to take any measure – say an across-the-board import tariff – regardless of its legal defensibility or the economic and political consequences. Another faction, to which I have always belonged, insists that the US must stick to the legal high ground, enforcing its legitimate rights under the WTO as the most effective way to resolve the problem without setting off a trade war. My experience as a trade negotiator tells me that the application of countervailing duties to counteract currency subsidies when they cause injury to a particular industry is the starting point for an effective strategy.
These three dimensions of action are not as contradictory as some would have it. Rather, they are complementary – three sides to a stable triangle of policy. In the end, what’s needed is reform of multilateral institutions and enforcement mechanisms that clearly have failed over the past decade. A step in that direction would be one or more bilateral understandings that ease the immediate imbalances imperiling the US and the global economy. Legal action under our WTO-consistent trade laws is the only way to bring some of the key countries to the negotiating table.
Unilateral action is the only way to get the process started. Bilateral agreements are the only way to make substantial progress over the medium term. Multilateral reform is the only solution over the longer run. One element without the other two is unlikely to succeed; all three together constitute an intelligent multitasking strategy.
Secretary Geithner opened the door this week to collaboration between the administration and the Congress on the vexatious currency problem. If they will conceive their strategy in these terms, there is a good chance of success. It’s a truly global issue, so the whole world will be watching.