ABSTRACT

Alliance relations were becoming more pervasive in 2001: but just how persuasive would soon be tested in the next trade dispute. If the US was a central component of the Howard government’s management of risk in foreign policy then it was necessary to display cause for its choice. Reciprocity was required for mediation to be effective domestically. US imposition of safeguard measures for its steel industry in 2002 provided an opportunity to analyse how the Coalition’s threat mediation could operate with a change of Administration in the US, with a refocus on the interlinking of trade and security issues, and importantly with its direct linking to US commercial interests. In this way, the government’s bargaining would move beyond the culturally enclosed approach deployed in its previous disputes. As the steel tariff dispute speaks of the primacy of US domestic politics in the bilateral relationship, an explanation of the relevant US domestic politics is significant in determining how much leeway any Australian government might have in implementing its brand of threat mediation in foreign policy.