Bringing the US-Japan Relationship Into Sync
THE recent Clinton-Miyazawa summit in Washington should have inspired a cartoon showing the two leaders peering through the same telescope - but from opposite ends. The United States is intently focused on the foreground and wants Japan's action now on specific trade and investment openings; Japan, at the other end, views the horizon and sees the possibility of new, long-range cooperation in global problem-solving with the US.
These opposite approaches to our "most important bilateral relationship - bar none" (former US Ambassador to Japan Mike Mansfield's old maxim) are illustrated by two recent reports that went almost unnoticed in the American media.
The first, released in December by a distinguished group of Japanese businessmen and scholars led by former Ambassador to Washington Yoshio Okawara, dwelt mostly on macroeconomic issues between the two countries. It also contained recommendations for global cooperation between them. The report proposes the establishment of three bilateral councils and forums to plan for a vastly expanded partnership for the 21st century.
A very different report was released almost simultaneously by the American Chamber of Commerce in Japan. It spells out precisely what actions Japan should take now to open its markets further to US exports and investment. While giving greater credit to Japan than does President Clinton, this white paper concludes that "years of protection ... coupled with export-driven strategies, have shaped a business environment inherently unfavorable to foreign firms ... aggressive actions ... are needed to effect ne cessary changes in business policies and practices to make them more transparent and consistent with those of other industrialized countries."
The report points to "exclusionary business relationships" hindering American automotive, flat glass, insurance, and semiconductor industries; incompatibility of certain Japanese standards, regulations, and testing practices with internationally recognized ones; the limited government market share the US has gained for computers, supercomputers, and software, despite agreements to boost opportunities; continuing "buy Japanese" attitudes and opaque decisionmaking processes that constrain US construction f irms and caused US Trade Representative Mickey Kantor recently to warn of new sanctions.
The Okawara Report urges much greater US-Japan policy cooperation on the environment, democratization and disarmament, and on such issues as AIDS, refugees, population, education, and the promotion of basic technologies. New high-level talks are recommended to discuss "trade, industrial structure and inter-industry cooperation, macropolicy and finance, agriculture, competition policy, investment and the international trade system."
In one glance at an issue the Tokyo American Chamber also mentions, the report urges strict enforcement of Japan's fair trade and anti-monopoly laws.
The Clinton-Miyazawa talks lasted three and a half hours with no interpreting (and were preceded by probably the lengthiest pre-conference internal briefing on Japan any president has ever received). And while more than half of the talks actually dealt with nontrade issues, the media in both countries saw the meeting as essentially a tough disagreement over the widening trade gap. US briefers did nothing to correct that impression.
The US has every reason to be exasperated with Japan's trade barriers. We should expect the Japanese to take seriously the analyses and recommendations they have received from those who should know the situation best - the American businessmen in Japan (who, by the way, urge the Clinton administration and Congress to eschew protectionist measures). These executives are strongly supported by Japan's major newspapers, which in commenting on the Miyazawa visit, urged Japan to "open its markets further," "re move remaining trade barriers," and "make its market more transparent." (Tokyo's press was unanimous, however, in supporting Prime Minister Kiichi Miyazawa's and the US Tokyo Chamber's opposition to the US call for market-share targets.)
But at the same time, the US would be making a serious mistake to zero in too exclusively on trade complaints, passing up the tremendous benefit we could obtain from the long-term, global cooperation proposed by Ambassador Okawara and Mr. Miyazawa. The "name of the game" is not only economics, as some in the White House suggest. Our "cold-war partnership" with Japan may be "outdated" as Mr. Clinton declares; but there will be little partnership left at all if we dispense with all the "soft stuff" and squ eeze the entire relationship down to the $5 billion to $10 billion shrinkage of the trade gap that experts estimate would occur if all of Japan's trade barriers disappeared tomorrow.
OUR Asian friends remain concerned over security in the region. Many of them believe China could be the next major threat. Or Japan could be, if the US fails to find a way to share responsibility for "international peace and security in the Far East," to quote from the far-from-outdated 1960 US-Japan Treaty of Mutual Cooperation and Security. The world, especially nations in Asia, does not want to see the US and Japan, which together account for 40 percent of the global gross national product, become emb roiled in an increasingly bitter trade war.
The Clinton-Miyazawa meeting suggests a relationship seriously out of sync, with more trouble ahead if the US pursues only more trade concessions and the Japanese respond by suggesting more committees to study the 21st century.
In its interagency Japan study currently under way, the Clinton administration must regain a vision of the global forest, while still urging more focus on removal of individual trees - the remaining trade obstacles. The Japanese are correct to propose bold plans for a new partnership with the US. But can these plans and the US cooperation they would need receive the attention they deserve in Washington without much more positive responses from Japan on trade and investment issues? These should not be con ditional on each other; we should attack the micro and macro, the bilateral and global, simultaneously. But the hard, political fact is that the administration may not be able to get all fired up about a new, global partnership with Japan while it is still gnashing teeth over the $50 billion trade deficit and barriers that even the Japanese press believes should have fallen years ago.
There are lessons here for both countries: If the US wants more and faster trade concessions from Japan, it must help the Japanese "feel" - a crucially important word in Japanese - that they are gaining something precious in return, namely, the prospect of a new and comprehensive global partnership with the US, one bringing to their rocky, narrow shores a new form of 21st-century security.
But if such a thoroughly up-to-date US-Japan combination is to develop, Japan must propose more concrete microeconomic measures on trade and investment than Miyazawa offered in Washington.
For the July meeting of the seven leading industrial nations in Tokyo, both leaders should avoid telescopes and try to share the same vision of our future together, both the immediate and long-term. Action on issues currently before us and on larger global troubles ahead will be essential for the prosperity and security of both countries, indeed of the world.