Fixing The Dollar And Trade With Japan
Regarding "Advice to Japan: Start importing more" (Editorials, Apr. 24), do you honestly believe the Japanese would buy many of Detroit's cars, given a choice? Even Americans were deserting them in droves before Japan was forced to accept "voluntary quotas."
Can you name one First World country that prefers U.S. cars over their own? Demonizing Japan won't cure the dollar disease when U.S. national debt as a percentage of gross domestic product has doubled in the past 15 years and seems destined to double once more by the turn of the century.
America's dollar crisis is neither a yen crisis nor a mark crisis nor an import crisis. It's a deficit crisis. Unless the U.S. halts its de facto devaluation of the greenback, it won't long be the key global reserve currency. Many Asian central banks are already converting some dollar reserves to yen. How long before the rest of the world does the same?
Wow! The solution to the chronic U.S.-Japan trade imbalance is autos. Since two-thirds of the trade deficit is in cars and parts, you argue that it's time to make the Japanese buy more American-made cars and parts.
Decades of politely "jawboning" Japan to open its markets simply hasn't worked. While continuing an open-market policy with the vast majority of our trading partners who play fair, it's time to show the Japanese that we're serious. Let's put a blanket tariff of 1% on all Japanese imports and an additional 1% each six months until the trade between the two nations is roughly in balance.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.