Who gains, who loses, if US lowers gate on Japanese cars?
Washington — Who gets helped, and who gets hurt, when the United States erects barriers against imports from another land? That question, basically, lies at the root of the dispute over Japanese car imports, which -- in the view of the United Automobile Workers (UAW) -- have cost thousands of US auto workers their jobs.
"There is no US threat [of import restraints], even implicit, to the Japanese , if they refuse to limit their car exports.
"US officials have told the Japanese that import restraints would not solve the structural problems of the US car industry."
That, less than two months ago, was the unequivocal position of a senior White House official, who said import curbs on Japanese cars would hurt, rather than help, Americans in general.
Shutting out Japanese cars, said the official, would not add to the number of small cars available here, since US makers already produce all they can.
He ticked off two negative effects of import curbs:
* Inflation might be boosted, if Detroit automakers took advantage of less foreign competition to raise their prices.
* Gasoline consumption would increase, if buyers were denied a plentiful supply of small, fuel-efficient cars.
By 1983, according to the White House trade office, headed by former Florida Gov. Reubin Askew, the US will provide a 5 million unit yearly market for small cars, of which American makers will only be able to produce 2.5 million.
This would leave 2.5 million to be filled by foreign suppliers, mainly Japanese. Currently Japan ships nearly 2 million cars yearly to the United States.
President Carter, under great pressure from US carmakers and the UAW -- and against the background of hundreds of thousands of jobless automobile and other workers -- has asked the International Trade Commission (ITC) to decide as quickly as possible how much damage Japanese car imports are doing to the United States.
Suppose the ITC finds "serious injury," and recommends curbs of one kind or another on the Hondas, Toyotas, and Datsuns flooding into the US?
Mr. Carter, having asked for a quick decision, would find it hard not to accede to curbs, just before a presidential election in a recession year.
Until now, the President has held out against import barriers, agreeing with his trade advisers that such restraints do more harm than good.
A possible compromise would be negotiation of a so-called "orderly marketing agreement" (OMA) with the Japanese, whereby the latter would agree voluntarily to limit their car shipments to the US.
American manufacturers of shoes, color TV sets, textiles, steel, and some other industries are similarly shielded from foreign competition in various ways.
Despite these protections, the thrust of the Carter administration has been for more, not less, free trade in the world, on the grounds that protectionism boomerangs. When the United States, or any other nation, puts up barriers to protect domestic industries, affected nations tend to retaliate with trade restrictions of their own.