Let’s Tell the World: We’re Not Trade Patsies Anymore

I have to commend President Reagan for his “chip shot” at Tokyo a few weeks ago, because it took guts and a special kind of wisdom to go against all the free-trade ideals that he holds so dear.

But the Japanese finally pushed a little too hard and reneged on one promise too many, so the President told them that they have to pay a price.

It’s a small price, though, not a big one. The $300 million worth of Japanese imports covered amounts to only about 0.33% of their annual shipments to us. That’s a little over one day’s exports, or about 7 1/2 boat-loads of cars.

That’s not much of a fine when you consider that they’ve had the free run of our market while ignoring both the rules and the spirit of free trade, except when it suited their own purposes. They’ve been running red lights and stop signs all over town for years, and we finally hit them with a $2 parking ticket. They’ve got nothing to squawk about.

I hope that the President’s action tells the whole world that we’re not going to be trade patsies anymore. It’s time to start charging admission to our market, and the price of a ticket is a little fairness and a little reciprocity.

There isn’t much of either when we’re running deficits with 17 of our 20 largest trade partners. Oh, we have small surpluses with Holland, Belgium and Australia, but after those countries we have to rely on such lush and lucrative markets as Paraguay, Greenland and (are you ready for this?) the Falkland Islands! We even had surpluses with the Soviet Union, Vietnam and Libya last year, believe it or not. But we’ve had trouble selling much of anything to our friends.

So I’m not worried that our little chip shot will start a trade war, unless the Japanese have all suddenly gone insane. But I am concerned that this little slap on the wrist has caused so much overreaction in Japan (where they can dish it out but they sure can’t take it) and in the news media that it will kill the chances of any meaningful congressional action on trade this year. And without a strong trade bill to back it up, the President’s action won’t have much long-term effect.

Even before the President acted, the House and the Senate seemed to be competing to see which one could write the weaker trade measure. Everybody agrees that there will be a bill, but the idea of putting some teeth into it scares them in Washington.

Mostly they’re afraid of being called “protectionists.” A politician would rather be called a pervert than a protectionist. One politician getting tagged with the “protectionist” label right now is Rep. Richard A. Gephardt of Missouri, and it’s a bum rap.

Last year Gephardt introduced an amendment that would have finally taken action against countries like Japan, Taiwan and South Korea that have built up huge trade surpluses with the United States through unfair trade practices. It was hooted down as one of the most wildly protectionist bills since Smoot-Hawley. The Administration even called it “kamikaze legislation.” (I love that!)

I sure don’t think that Gephardt has gone off the deep end. All that his legislation would do is set a goal to reduce our big deficits with Japan and a few other countries by a modest 10% a year for four years. It would direct the President to enforce sanctions against any of our super-surplus trading partners who won’t go along with it, but it would leave him plenty of room to avoid enforcing the sanctions if he felt that they wouldn’t be in the national interest.

A 10% reduction for the next four years seems pretty reasonable to me, considering that our deficit with Japan has gone up by 30% a year for the last six years.

Gephardt’s measure is the minimum that we need in a trade bill. Anything less could be worse than no bill at all, and we would be back to “talk and ship, talk and ship.”

At the very least, we need a bill that does three things: Caps our deficits with the super-surplus countries immediately, sets firm goals to take those deficits down by a substantial percentage each year until we get somewhere close to a reasonable trade balance again, and uses firm sanctions--not promises or good intentions or negotiations--to enforce the goals that we set.

If the President can get over his fear of sanctions, so can Congress. There seems to be a bunch of Rambos in Washington when it comes to dealing with the Soviets or the Sandinistas, but when a couple of million American jobs are at stake, they become conscientious objectors.

Some Democrats may be drooling at the prospect of running against Ronald Reagan’s trade deficits. But, for all its faults, the Administration has brought the dollar into a more sensible relationship with the Japanese yen. And it has at least fired a shot across the bow with its chip sanctions. So far Congress has done nothing about the problem.

If the latest polls that I’ve seen are right, the public wants Congress to show a little moxie. A toothless trade bill this year would tell everybody--the people in the Far East and the voters here at home--that Washington is still hiding from the issue.