Trade war is a lose-lose proposition

June 28, 1995|By Georgie Anne Geyer

Tokyo -- WITH THIS week's deadline for applying U.S. sanctions against Japan, I have the admittedly unworthy feeling that, were I an old-fashioned mother, I would gladly paddle them both.

My own country I would make sit in the corner watching interminable Kabuki theater and eating nothing but raw fish and sea kelp for two days. The Japanese? I would take them to the changing of the guard at Arlington National Cemetery and make them sing "God Bless America" 35 times -- once for each year of the U.S.-Japan security treaty.

What a shame that permissive child-raising is still in vogue!

The fight that should climax this week is ostensibly over the export of Japanese luxury cars to America. It seems that, of America's $66 billion trade deficit with Japan last year, fully 60 percent of that (or more than $36 billion) was in auto trade. So, for months, the Clinton administration has marked June 28 as the date it would impose a 100 percent tariff on Japanese luxury cars, thus effectively destroying billions of dollars of trade between the two.

But the only thing to happen so far is that the conflict has put the valuable U.S.-Japan relationship seriously at risk -- and all for issues that reek much more of ambition than of trade.

From the American side, negotiators can indeed say that there are trade imbalances -- and that Japan often overdoes its vaunted unique cultural characteristics. But the Japanese market has also been systematically opening since the far more discreet -- and successful -- pressures applied by both the Reagan and Bush administrations.

Indeed, as Hisahiko Otionsapan, one of Japan's best foreign-policy analysts and former head of the defense agency, told me: "During the Republican administrations, when we had the Structural Impediment Initiative talks on trade, the Japanese welcomed the liberalization they forced. We liberalized and we gained.

"The new administration came in, and they want numerical targets [Japan promising to purchase a certain amount of American auto parts]. No economy can support this. It is managed trade. And so now even our economists and businessmen are all alienated."

On the philosophical side, Japanese economists argue that the American trade deficit is far more due to America's chronic budget deficit and its inadequate saving rate than to auto trade. Most of all, they are unrelievedly mad at the way they, a foremost ally, are being treated.

"In Japan, there is a new type of frustration mounting," said Hitoshi Tanaka, director of policy coordination in the foreign ministry, when I visited him in these tense days. "We are just fed up with these straightforward American pressures and one-sided unilateral measures."

If there is no agreement this week, he said, "We will immediately ask for a panel in the World Trade Organization" (which could make an "objective" judgment). "Why didn't all of us go to the WTO in the beginning? Because the U.S. has its own law."

What he really means is that Japan thinks the United States is acting like a law unto itself. U.S. Trade Representative Mickey Kantor deliberately bypassed the WTO with the Clinton administration's legalistic attitude of "So sue me!" -- even though that organization was recently formed with U.S. support.

Additionally, many officials and journalists here are convinced that President Clinton started this trade war with Japan in order to win support in sensitive auto states, including Michigan and Ohio; that Japan's weak coalition government is afraid to give in on anything for fear of crumbling; and that Japan's trade negotiator is clearly using the negotiations for an eventual run for the prime ministership. Here is a sad and even shameful picture of parochial interests dictating the potential dissolution of the industrialized world's most crucial bilateral relationship.

This is a symbolic year. This summer we celebrate the 50th anniversary of the end of World War II in the Pacific -- this new Japan was the healthy child of its own defeat. This June, we observe the 35th anniversary of the security treaty between the two former enemies; that treaty has formed a great era of peace in the Pacific. We also celebrate the 50th anniversary of the founding of the U.N. and the 45th of the start of the Korean war.

America's and Japan's unique relationship has never, since World War II, been one of simple convenience. There has always been a welcome cloak of principle and revival about it. This present moment shows how much of that spirit has been decimated. Instead of using this as a time for moral renewal of both nations, the two countries are mired in this parochial trade conflict with its potential for still more poison between the two peoples.

The Clinton administration says that no one dies in trade wars. But relationships do.

Georgie Anne Geyer is a syndicated columnist.

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