Bush in Japan: Enduring Lessons

By , Richard Feinberg and Peter Hakim of the Inter-American Dialogue write regularly on global economics.

WHITE House protestations aside, no one in either the United States or Japanese governments was - or should be - very happy about the outcome of George Bush's Tokyo trip.

Envisioned as a mission of goodwill to celebrate a growing partnership between the world's two greatest economic powers, the trip, America's first major foray into post-cold-war economic diplomacy, degenerated into an embarrassing squabble over minor trade matters. It is crucial to try to understand what went wrong and why, if we are to do a better job of advancing US interests in the future.

First, the country needs to discard cold-war patterns of thought and action. Military rivals look into zero-sum games. But among economic competitors, there are always areas of mutually beneficial agreement. Cooperation among economic partners can never be taken for granted, and must always be accompanied by hard bargaining. But common ground can be found that will bolster economic prosperity in both nations.

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At the same time, unlike nuclear stalemates and armed conflicts, economic challenges rarely lend themselves to dramatic once-and-for-all breakthroughs. Instead of test-bans, cease-fires, and unconditional surrenders, progress in economics is incremental, the product of prolonged give-and-take. President Bush had no chance of pulling off a quick turnabout in US-Japan trade links, and he and his advisers should never have created any such expectations.

In this brave new world of economics, the real enemy will sometimes be ourselves. US as well as Japanese consumers have good reasons to prefer Toyotas to Chryslers, and these have more to do with failures in American management and engineering than with "unfair" Japanese trade practices.

Second, we surely need to define our national economic interests, but we must realize that this is a difficult task given the size and complexity of our economy. Some things that are good for General Motors are also good for the US, but not all things at all times. It is a puzzle why Bush and his advisers decided to turn the spotlight on overpaid executives from a declining industry, rather than showing off our more dynamic business sectors - in telecommunications, computers, and finance, for example.

Third, the US government has to get organized to deal effectively with international economic issues. The Commerce Department was appropriately assigned a lead responsibility for the president's visit, but the Treasury Department and the US Trade Representative's office should have been more prominently involved. If they had, the automobile companies might have been kept off of center stage. And the entire visit might have been given the kind of strategic purpose warranted by the meeting of two economic superpowers.

FINALLY, we need to better understand the relationship between foreign and domestic policy in the post-cold-war world. The bitter fact is that military strength now carries less weight in international affairs. The respect we command abroad and our ability to shape world events will depend more on our economic strength at home, on the conditions of our cities and our farms, and on the quality of our schools and hospitals.

At the same time, the US needs strong and effective cooperation from other countries - Japan most of all. The US and Japan are understandably suspicious of one another, and it will require a great deal of persistent effort on both sides to forge truly productive ties.

Bush wasted the opportunity of his recent visit by so blatantly seeking short-term domestic political advantage. In the end, he and the country lost on both the international and domestic fronts.

We still have a long way to go to adjust our diplomacy to the "new world order." We have to show greater tolerance and patience for the gradualism that characterizes economic change, and the subtle give and take of trade negotiations. US officials have to find the right balance between today's electoral calculations and tomorrow's international economic advantages.

These are a few lessons our public and private leaders should draw from the Tokyo debacle, if the US is to navigate in a world with no single Big Enemy but many tough competitors.

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