On the campaign trail four years ago, then Sen. Barack Obama said he would be tough on China.
Now he says he has been tough on China, prompted to say so by Republican presidential candidate Mitt Romney, who has said "on day one," if he were elected president he would declare China a currency manipulator."
There was, in fact, some fine print in that sound bite.
Romney added "if necessary," The New York Times observed.
The Times reports that the Chinese currency, the renminbi, has risen in value by 11 percent since Obama took office and that much of that has to do with adjustments for inflation. In fits and spurts, prices at the consumer level in China have risen faster than they have in the United States over the past three years, which effectively takes some of the wind out of China's currency policy.
In addition, China has a habit of under-reporting its inflation figures, which means the effective value of the renminbi is likely more than can be verified.
It makes a robust sound bite for a candidate to declare he will cross swords with the country that might be said stole millions of U.S. manufacturing jobs.
In an ironic twist, it is U.S. unions that are pressing President Obama to take China to task for unfairly subsidizing its industries, while Wall Street, ostensibly a Republican stronghold, is making less noise about China's currency policy.
True enough, the Obama administration has missed several chances to declare China a currency manipulator, relying instead on filing cases against China one by one at the World Trade Organization.
But the difference there is enormous. Should the U.S. Treasury Department declare a country a currency manipulator, Congress can impose a host of trade restrictions on the currency culprit. This could lead to a full scale trade war.
Ask candidate Romney if he was prepared to declare China currency manipulator and the answer is yes "if necessary, " but ask him if he favors a full scale trade war with China and the answer would be no. Wall Street is not in favor of a slug-fest with China and after a painfully slow economic recovery that is still on wobbly legs, there can't be three economists on the planet who believe a trade war would be productive now.
Is there good reason for declaring China a currency manipulator? Cornell University economist Eswar Prasad, an expert in China's international influence, says that ship has sailed. "Romney's vow to label China a currency manipulator is not supported by recent economic data," he told the Times.
One can even make the argument that China's currency manipulations were good for the global economy, at least temporarily.
China was one of the few countries that avoided an economic collapse during the global financial meltdown that began in 2008. As such, economists around the world looked to China to, essentially, pull every other country out of the muck -- like the last heavyweight anchor to a tug-of-war team, while everyone else was taking a swim.
Even U.S. Federal Reserve Chairman Ben Bernanke declared that China would lead everyone else out of the morass.
It turns out, China's economy was certainly affected by the downturn -- it just took longer for China to feel the heat.
On the other hand, imagine the depth of the economic downturn had China not tried to stabilize its economy?
Here's where the difference may lie: Romney says he can reach across the aisle to carve out a new financial regulatory system, healthcare and a clearer tax code. President Obama, however, has reached across the aisle, metaphorically speaking, on the international stage, putting pressure on China without sparking international mayhem.
Various leaders in Europe and the head of the International Monetary Fund have picked up on Obama's position of not rocking the boat too much, but pressing to re-balance the equation, pushing China to do more to stimulate domestic spending and encourage U.S. exports.
That's where Romney wants to go. He just wants to use strong-arm tactics, while Obama is relying on international pressure to get the job done.
In international markets, the Nikkei 225 index in Japan added 2 percent, while the Shanghai composite index in China gained 1.24 percent. The Hang Seng index in Hong Kong rose 0.48 percent, while the Sensex in India climbed 0.97 percent.
The S&P/ASX 200 in Australia added 0.69 percent.
In midday trading in Europe, the FTSE 100 index in Britain shed 0.12 percent, while the DAX 30 in Germany added 0.14 percent. The CAC 40 in France shed 0.44 percent, while the Stoxx Europe 600 dropped 0.24 percent.