After Soviet Menace, Americans Need an Enemy, and Japan Fills the Bill

EDWARD N. LUTTWAK

December 30, 1991|By EDWARD N. LUTTWAK

WASHINGTON — Washington. -- When President Bush was preparing in August for his visit to Japan, the State Department's ''talking points'' for his meeting with the Japanese prime minister stressed the importance of the ''U.S.-Japan partnership'' in confronting the great issues of the time, starting with the breakup of the Soviet Union.

U.S.-Japan economic tensions were dismissed as minor irritants. Indeed, the president was prepared to state that U.S.-Japan relations should not be ''monopolized'' by mere commercial disputes.

Then came the surprise defeat of the president's candidate in the U.S. Senate race in Pennsylvania and Mr. Bush's abrupt postponement of the Pacific tour. As soon as planning began for the rescheduled visit, starting Jan. 7, it became difficult to structure the president's attitude.

If he did what the diplomats desired -- speak on the new ''partnership'' and geopolitical issues -- the visit would be a political disaster at home. If he heeded his political advisers -- loudly demand that the Japanese open markets -- the visit would be a diplomatic disaster.

A brilliant tactical solution was found. The president would take Lee Iacocca and some 19 other business leaders with him, leaving it to them to do the shouting, while Bush could act ''presidentially'' by concentrating on his favorite geopolitical questions.

Unfortunately, there is no such brilliant solution to the underlying problem of U.S.-Japan relations. Fundamental strategic change is required. The economic tensions that began in the 1960s, mainly over Japanese textile exports, are now much deeper and broader.

When the United States was preoccupied with its great struggle against communism and Japan was an increasingly valuable ally, economic disputes between the two were regarded as basically unimportant by U.S. officials and public.

True, Japan exported more and more, while reluctantly importing few U.S. goods. True, Japanese banks and investors expected to operate freely in the United States, while Japanese bureaucrats schemed to keep out foreign banks and investors. All this counted for much less than the role of Japan as a base for U.S. military power.

This was the ''friction'' stage in U.S.-Japan relations, which lasted until the late 1980s. The word friction is an engineering term, describing the minor surface interference that can occur even in a well-designed mechanism. Usually, it is enough to apply some oil.

A great deal of oil was poured on U.S.-Japan relations. American presidents and Japanese prime ministers regularly met to proclaim that progress toward liberalizing the Japanese economy had been achieved and more was in the offing. Thus was established a pattern of deception on both sides.

In Washington, it was increasingly understood that Japanese economic policy is largely controlled by the Ministry of International Trade and Industry and Ministry of Finance bureaucrats, along with big-business colleagues.

U.S. presidents acted ignorant of this, urging Japanese prime ministers to make promises they couldn't keep. The prime ministers lacked the courage to admit their powers were limited. The result was an accumulation of American resentments over broken promises.

While the Cold War lasted, the consequent hostility was almost fully suppressed but not forgotten. But the friction theory of U.S.-Japan relations was collapsing. The failure of the huge devaluation of the dollar in 1985 to narrow the trade gap showed that the problem was not just frictional. The machine was not working.

Enter a new theory of U.S.-Japan relations: There were ''structural impediments'' blocking the proper workings of supply and demand. The offending ''parts'' would have to be cut out.

The goal of the Structural Impediments Initiative talks was to persuade the Japanese to change a variety of regulations, bureaucratic habits and business customs while ceasing to protect rice farmers and small shopkeepers. In other words, to solve the trade imbalance caused by the relentless export drive of a few corporations, the way of life of millions of ordinary Japanese would have to be disrupted.

If Japanese politics were more democratic, the concept would have been rejected at birth. As it was, the structural-impediment talks have the support of Japanese big business and bureaucratic allies. They can blame American pressure for overcoming restrictions they want to abolish.

Ironically, while the damage to people-to-people relations was certain, most experts believed the negotiations would not lead to much improvement in the trade balance.

This stage in U.S.-Japan relations might have lasted longer but for the August coup in Moscow against Mikhail S. Gorbachev. Had Mr. Gorbachev's policy of slow change under Communist Party control continued, the Soviet threat that unified the United States and Japan would have continued to ebb gradually. The slow progress of the structural-impediment talks might have been sufficient.

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