A YEAR ago the Bush administration, with Congress urging it on, fired a shot across Japan's bow. It put Japan on its ``Super 301'' list of countries engaged in unfair trade practices. This official censure of Japan (along with Brazil and India) set in motion a process that eventually could have resulted in retaliatory trade sanctions. But when the administration this spring issued the annual Super 301 listing, Japan was no longer included. (Brazil was off, too; only India, which has adopted aggressively nationalistic trade practices, is named.) Looking at the US trade deficit with Japan, still about $50 billion a year, some members of Congress are dismayed that Japan was given a reprieve.Skip to next paragraph
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But special trade representative Carla Hills defends the decision. She points to recent market-opening agreements with Tokyo on commercial satellites, supercomputers, and forest products, three industries that were prominently noted last year. Also, the US and Japan have reached an interim agreement on changes in their respective economies each country will undertake as a result of the Structural Impediments Initiative talks.
Despite the continued carping - some would say Japan-bashing - in Congress, the administration was right to reward Japan for its cooperation in resolving some key differences. There will continue to be major trade disputes between Washington and Tokyo. But US-Japanese trade relations are on a constructive course, and it would have been foolish to put a chill back into the air with a Super 301 branding that Tokyo would have found humiliating.
Super 301 may be a useful trade weapon for the US to hold in reserve, but it should be used sparingly. When President Bush, in his meeting with Prime Minister Kaifu in Palm Springs a few months ago, requested Japan's help in resolving a mutual problem, he probably made more headway than arm-twisting or jawboning could have achieved.
Most analysts of the US trade deficit acknowledge that the biggest causes are domestic. Mrs. Hills should continue her firm bargaining with Tokyo. But Tokyo didn't create the US budget deficit, its education woes, or the cracks in its competitiveness.