US once again weighs price of foreign ownership. FOREIGN INVESTMENT

A traditional Japanese temple once graced an island in the middle of Jackson Park on Chicago's South Side. A gift from the Mikado, it was burned down by vandals in World War II. Hidenori Yamaguchi keeps pictures of it in his office overlooking the 30-story building that his company, North America Taisei, is helping develop here.

Taisei built the temple for the 1893 Columbian Exposition. The new skyscraper is the company's second project in Chicago. ``It took us 100 years,'' says Mr. Yamaguchi, advising patience to US investors looking to break into Japanese markets.

Indeed, foreign investment in the United States, spurred by promising markets and - usually - political stability, is nothing new.

The US has been a debtor nation for much of its history. In 1914 it was the greatest debtor in the world. By some counts, now it is again.

In the 19th century, foreign investment in canals and railroads helped develop the US. But today, debate over rising foreign investment revolves around how its effects compare with that earlier period, whether current concern is a new xenophobia, and how US investments are treated abroad.

In the earlier debtor period around the turn of the century, the US generally ran trade surpluses and was governed by the gold standard, says Mira Wilkins, a professor of economics at Florida International University.

Queens College-City University of New York economist Michael Edelstein, who has studied the history of foreign investment, says that today, by contrast, budget and trade deficits keep interest rates up while monetary policy tries to keep the dollar low, attracting both portfolio and direct investment.

Foreign direct investment in manufacturing is now reaching the peak it held at the start of World War I, says Douglas Woodward, a University of South Carolina economist and author of a forthcoming book, ``The New Competitors: How Foreign Investors are Changing the US Economy.''

``As far as I can tell we peaked in manufacturing at 7 to 8 percent of our assets, and right now our manufacturing assets are over 10 percent foreign-controlled,'' Mr. Woodward adds. He says foreign capital has also contributed to mega-takeover efforts in the US.

Some statistics from the past may make Americans wonder what the fuss is about now, says Dr. Wilkins, who has researched an extensive history of the issue. In 1803, 56 percent of the federal debt was held abroad. By contrast, an estimated 15 percent of federal debt notes are held by foreigners today.

She also says those earlier figures underestimated direct foreign investment. But at the time, the US was a cash-starved nation with a rapidly growing economy and population.

Today, says former Colorado Gov. Richard Lamm, who has been outspoken on the issue, ``Foreign borrowing here in the 1800s equaled new wealth. In the 1980s, it equals new consumption.''

Historically, there has always been negative reaction to foreign investment, although today the US is more internationalist than before.

One of Chicago's most colorful mayors, ``Big Bill'' Thompson, captured City Hall by campaigning against British financiers and royalty in the 1920s.

In the 1980s, June Collier founded the Alabama-based Citizens Against Foreign Control of America partly because of her experience in the auto-parts industry. ``I have just opened a plant in Mexico, which is ridiculous, but it's either that or not stay in business,'' she says. ``I've had to do that because of foreign competition.''

To what degree American workers, technology and capital are displaced or strengthened by foreign investment is still in dispute. But when the first car recently rolled off the Chrysler-Mitsubishi plant in Normal, Ill., beaming US workers literally sang songs of praise.

Kathy Krause, a California Assembly staff member, notes that despite grave concern about growing Japanese real-estate investment in the US, a recent legislative hearing turned up little evidence of harmful results.

Some researchers and officials have raised the issue of whether the current uproar over foreign investment, like a previous one in the 1970s involving the Arabs, is motivated by prejudice.

They point to the case last year of Fairchild Semiconductor, which was almost bought by a Japanese company. Resistance from US officials blocked the deal. Fairchild was already owned by a French company.

Some defense analysts say Japan does not have the same legal safeguards against espionage as other US allies have. And there is the issue of reciprocity: What is required of American investors abroad. US investment in other countries remains huge, its influence great.

``There are numerous countries in Europe and elsewhere that have much more extensive screening and restrictions than we do,'' says John Howard of the US Chamber of Commerce.

American regulations in areas such as banking have in the past allowed the foreign investors certain advantages. But Japanese embassy spokesman Toshiyuki Takano says, ``We have no restrictions as such in Japan, with a few exceptions ... we are trying to liberalize and make free the investment in financial markets.''

Japan made $14.7 billion in direct investments in the US in 1987 compared to American direct investments of $938 million in Japan, according to its government's figures.

Former US Commerce Department official Clyde Prestowitz Jr., says Japan uses both formal and informal ways to screen and guide foreign investment to build its economic power.

He says the US now needs to adopt a similar system to adjust to its new role as a debtor nation in the global economy.

Tomorrow: Regulating and monitoring foreign investment.

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