The following CNBC guest blog is from Dan Steinbock, research director of International Business at India China and America Institute (USA), and visiting fellow at Shanghai Institutes for International Studies (China) and in the EU-Center (Singapore).
As the national conventions loom ahead, economic issues dominate the U.S. 2012 presidential elections. But it is the return of the neoconservatives that will overshadow the discourse on foreign policy - and China.
In the U.S. 2012 election, both the Democrats and the Republicans support the Obama administration's 2011 strategic pivot toward the Pacific region, which has escalated military deployments in the area and includes efforts for a new regional trade pact that does not involve China.
President Obama came into office seeking a competitive and cooperative relationship with China. In 2009, his administration launched the U.S.-China Strategic and Economic Dialogue for an expanded dialogue of trade, security and other issues. Nonetheless, the president has criticized China on its currency policies. Pirated and counterfeit goods have also been a source of contention. (Read More: China Rescues Tiny Firm, Shows Debt Crisis Building)
Until recently, the platforms of the two campaigns did not look that different in terms of foreign policy, national security and the policy toward China. But that was then.
The Neoconservative Return
When the Romney campaign released its initial roster of foreign policy advisers in October 2011, Romney gave a vocal but thin defense of American exceptionalism. However, the speech made him vulnerable in both domestic economic policy and foreign policy. (Read More: Romney Now Joins the "Drill Baby, Drill" Gang)
Romney's campaign is predicated on the idea that, as a successful businessman, he knows how to revive the U.S. economy. However, the speech recommended increasing the number of warships far more than the Navy itself asked for, boosting the size of the military by 100,000 troops, placing a missile defense system in Europe and stationing two aircraft carriers near Iran.
Essentially, Romney vowed to increase the military's budget by an astounding $2.1 trillion over the next decade, which contradicts the goals of his economic policy. The execution would contribute to America's massive debt, which is now close to $16 billion.
Seven of ten of Romney's foreign policy advisers used to work for President George W. Bush. Unsurprisingly, critics of this foreign policy vision have already dubbed it the "more enemies, fewer friends" doctrine. It is reminiscent of the Bush unilateralism.
After being branded as too liberal by conservative GOP activists during the 2008 campaign, Romney opted for an alignment with the neoconservative hawks to protect his right flank. He may have succeeded too well.
Republican Foreign Policy Divide
Not only are many from the neoconservative wing of the party, but they are also eager supporters of the emerging containment policy against China.
Romney promotes a U.S. policy toward China that advocates strong military capability in the Pacific, deepening cooperation with India and other regional allies, a strong defense of human rights, and "incentivizing" China to pursue more accommodative trade policies.
In an October 2011 Republican debate he said that he would issue an executive order declaring China a currency manipulator on his first day of his presidency, unless China "changes its ways."
Last June, the case of Chen Guangcheng split Romney's foreign policy team, which was swept by sharp disputes. Evan A. Feigenbaum, a co-chairman of Mr. Romney's Asia-Pacific working group and a former State Department official, favored a "more calibrated approach." In contrast, Aaron L. Friedberg, another co-chairman and Vice President Dick Cheney's national security aide, argued for a more aggressive response.
After the split, the moderates of the Romney team remain concerned that the old neo-conservative "Cheney-ites" will win out moderate voices.
Recently, Romney's running mate Paul Ryan, too, has begun to criticize China as a currency manipulator, speaking out against the country's trade policies with sharp rhetoric. And yet, in 2010, when the House voted on the Currency Reform Fair Trade Act (which would have imposed tariffs on China), Ryan was among those who opposed the measure.
The Romney team also includes a number of neocons who continue to believe that just as the Iraq War was necessary so is the containment of China, including Eric Edelman, a top official at the Pentagon under Bush, who has forcefully spoken for the AirSea Battle Plan in the South China Seas - a doctrine that Vice Chairman of the Joint Chiefs of Staff General James Cartwright has criticized for "demonizing China."
It's the Economy
Despite a huge demand for a middle-of-the-road Republican campaign, the conservative gaffes of the nominees and the return of the neoconservatives in Republican foreign policy may risk the success of the Romney-Ryan ticket.
Instead of renewing the foundation of Republican foreign policy - a goal that many party loyalists would seem to support - the goal of Romney's team appears to be to reframe the Bush unilateralism.
Ryan may deliver the conservatives and the Tea Party. But to win the presidency, Romney will need the support of the independent voters who are fiscally conservative but social moderates.
During the Republican primaries, the campaign of Jon Huntsman, former ambassador to China, advocated "a more judicious approach toward foreign entanglements." Huntsman advisers included realist Republicans, such as former George H.W. Bush national security adviser Brent Scowcroft, former Deputy Secretary of State Richard Armitage and Council on Foreign Relations chair Richard Haass.
After the rapid rise and decline of the Huntsman campaign, Romney may have been right in calculating that to win the nomination, he had to veer right. But what may be good for the Republican right may not be supported by the American voter.
According to polls, almost 90 percent of Americans will choose the next U.S. president on the basis of four priorities issues: jobs, budget deficit, health care and social security.
Neither Iraq nor China figures in this list of priorities.
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