America’s Import Addiction : The latest trade figures are better. But we’re still hooked on foreign goods.

PEPPER PIKE, Ohio —  The once-depressed Rust Belt region around Cleveland is rebounding visibly these days, and Laura Rosenbaum and David Mortenson--a thirtysomething, two-income, white-collar couple--are back on a buying spree.

During the past 18 months, the comfortably heeled suburbanites have acquired a new car, an exercise machine, new bedroom furniture, a food processor, a computer, a briefcase and chic new eye frames--just to mention a few of the items.

But not everything they have bought will benefit the Cleveland area’s resurging economy--or even that of the United States. The car is from West Germany, the food processor from France, the briefcase from Thailand and the glasses from Austria. Even the computer, ostensibly U.S.-made, contains components from Southeast Asia.

“I wouldn’t have the foggiest idea where they were made, nor do I care,” said Mortenson, who runs a chain of fast-food stores in the Cleveland area, drawing a nod of agreement from his wife. “We’re really in the generation that’s beyond worrying about that.”

The Cleveland-area couple aren’t alone. Americans everywhere have become far more dependent upon--even addicted to--imports over the past few years.

David C. Lund, a Commerce Department economist, estimates that imports’ share of what Americans buy has soared from 12.8% in 1970 to 22% today, with only scant indications of slowing. In dollar terms, import volume has doubled to a projected $475 billion in 1989 from $244 billion in 1982.

Imports actually bring some economic benefits. They can offer lower prices and higher quality for American consumers. Imports of capital goods--the equipment that American business uses for manufacturing--have been rising particularly sharply, and they should boost domestic production.

But over the years, competition from imports has also ravaged some industries.

The current flood of overseas goods has defied the devaluation of the dollar since 1985, which has made imports more expensive compared to American-made goods. If the dollar had remained at its 1985 level, Japanese products would now be only half as expensive as they are.

And imports have continued to increase in volume despite the recent slowdown in U.S. economic growth, which might have dampened overall demand for both domestic and imported goods. Although the Commerce Department reported Thursday that imports fell a sharp 3.9% in September, they had soared 5% the previous month, and analysts expect import levels to continue to rise more than they fall.

Alfred E. Eckes, a member of the U.S. International Trade Commission, which monitors the flow of trade, said import buying has “ratcheted up” to a new, seemingly immovable proportion. “We’re in a new era,” Eckes proclaimed.

“All the indications point to continuing competition even beyond what has occurred so far,” said John K. Ryans, a Kent State University economist who advises several Ohio firms. “If people thought import competition was rough in the 1980s, wait until you see the 1990s.”

Fortunately for the U.S. trade balance, exports have risen even faster than imports during the past two years. But some analysts fear that exports will not be able to keep growing fast enough to prevent the trade deficit from edging back up.

Mototada Kikkawa of Columbia University’s Center on Japanese Economy and Business warns that with America’s export capacity already strained to the hilt, the push to cut the trade deficit “has to bump up against the wall . . . as long as imports remain persistently high.”

New forecasts by the Treasury Department predict that further improvement in the U.S. trade stance “is at best likely to be very modest” and “the possibility of deterioration . . . next year cannot be excluded.”

Some economists find a silver lining in the import surge. David Richardson of the University of Wisconsin argues that consumers are benefiting from lower prices and, in many cases, better goods.

Imports are competing most heavily in old-line manufactured goods that “we should be pleased to be moving out of,” Richardson contends. Import competition “has invited us to increase our skill level.”

In the capital goods sector, imports now command 41% of the U.S. market, nearly double the 23% of 1982. These imports, Richardson points out, actually boost the U.S. economy’s productive capacity.

But critics of the trend point out that it also means a continued drain of traditional U.S. jobs--often with serious short-term economic pain in the affected industries.

America’s capital goods industries “have been devastated” by import competition, complains Pat Choate, Washington-based vice president for policy analysis at TRW Inc. “We really have sacrificed a lot.”

Columbia University’s Kikkawa points out that imports of machinery and transportation equipment alone since the early 1980s have risen almost as much as the entire U.S. trade deficit. “Once, these were America’s representative export industries,” he noted.

Some analysts also fret that the United States has become so dependent upon imports that it would not be able to obtain important components--from machine tools and microchips to portions of fighter plane wings--in case of a war or even a limited conflict.

Depending on overseas suppliers “could sap the technological competition of U.S. weaponry” and “could disrupt the flow of materiel” to combat forces, warns a study by the Washington-based Center for Strategic and International Studies.

Imports’ gains in the consumer goods field have been far more visible and, in some cases, even more devastating to domestic manufacturers.

Foreigners’ share of the overall U.S. consumer goods market has held relatively steady, rising from 13.8% in 1982 to a peak of 16.3% in 1985 before slipping to 14.7% now. But for some consumer products, import penetration has grown sharply. The market share for imports has tripled during the decade, for example, for toys, apparel and musical instruments.

Joseph Buzalewski, manager of Academy Music Co. in Cleveland Heights, has seen that phenomenon close up. His store provides instruments for the Cleveland Symphony and several local schools.

Until the 1960s, Buzalewski says, virtually all the band instruments that Academy carried were U.S.-made. Then Japan started making guitars--”junk at first, but gradually their quality improved.” Later, Japan branched out into pianos, woodwinds and electronic keyboards.

South Korea and Taiwan joined the bandwagon in the 1970s and 1980s, first with cheap guitars and, more recently, with quality instruments of other kinds. Now, even China is getting into the act. “It’s a shame,” Buzalewski says, “but that’s the way it is.”

Columbia University’s Kikkawa cites a litany of reasons for the shift:

* The high value of the U.S. dollar in the early 1980s made imports far more competitive in price than they had been, providing sufficient profits to enable foreigners to set up the distribution centers and service networks needed to gain a strong foothold in the U.S. market.

* Partly because of the lack of competition earlier, many U.S. firms had become fat and lazy, burdened by high labor and materials costs and low productivity. In far too many cases, the quality of U.S. goods was low.

* At the same time, newly industrializing countries such as South Korea, Taiwan and Brazil were developing the ability to produce far more sophisticated goods, from quality steel components to autos, airplanes and even computers.

* U.S. firms, caught in a squeeze, began shopping overseas for cheaper materials and components. In some cases, they moved entire production lines to new plants abroad to take advantage of lower labor costs there.

* Deregulation also helped open new U.S. markets for foreign firms, particularly in consumer electronics. Throughout most of the 1970s, for example, only 2% of the nation’s telephone equipment was made abroad. Today, after deregulation, it is up to 18%.

* Finally, the American economy grew far more rapidly than those of Europe and Japan during most of the early 1980s, turning the United States into a huge economic vacuum cleaner that sucked in imports from all over the world.

To be sure, at least some of the fierce competition from imports that American firms experienced in the early 1980s has abated somewhat--either because the dollar’s decline has made imports too costly or because U.S. firms have improved their quality.

Joel D. Marx, a medical equipment distributor here, recalled that “imports were all over” the U.S. market during the early 1980s but have retreated substantially since the dollar began falling in 1985. “The only thing they’re competitive on now is rubber gloves,” he said.

Sven Langmack, a kitchen equipment maker, said that since late 1985 his firm has “gotten back” most of the customers that it had lost earlier to imports. “We even sell to the Japanese,” he said.

But studies under way by Washington economist Catherine L. Mann show that the impact of the declining dollar has been felt mostly by consumer goods. Imports of capital goods have continued virtually unabated.

Many buyers have found that kicking the import habit is not easy. Many of the most popular consumer electronics products--from radios to videocassette recorders--are not even made in the United States. And in many cases, brands with American names either are made overseas or contain major components that are manufactured abroad.

William Stokey, a spade-drill manufacturer in the nearby town of Dover, says his firm bought a piece of Pratt & Whitney machinery a few years ago specifically because it was an old-line American brand name, only to find that it was made in Japan.

Joseph Funnell, a trouble-shooter for the telephone company in Cleveland, finds the same problem with consumer purchases. “You may think something is American-made, but you’re liable to find out that it’s not,” he says.

As a result of the experiences of the early 1980s, some U.S. manufacturers may have lost substantial numbers of customers to foreign suppliers for the long haul.

Donald Wright, a Cleveland-area machine shop owner, started buying Japanese-made machine tools in the early 1980s. The Japanese had begun to deliver their products within 10 days after they were ordered. By contrast, U.S. firms required a lead time of 2 1/2 years.

Last May, Wright bought an expensive new lathe, and he again picked a Japanese brand. “To be honest, we didn’t even look at a U.S. supplier,” he says. “When something works, you don’t shop around to change.”

As Kent State’s Ryans points out, many American firms that either began buying overseas or moved their production facilities abroad during the high-dollar days of the early 1980s are unlikely to switch back soon. Such decisions, he says, “are long-term things.”

Malachi Mixon III, who heads a firm in Elyria, Ohio, that makes medical equipment, says that 10 years ago he “didn’t buy anything abroad” because he could get it all here--at the quality and price that he wanted.

But today, while he still prefers to buy from local suppliers, Mixon has a buyer “traveling all over the world”--to Colombia, Taiwan, China and Japan--to shop for lower-cost items because “it’s necessary to help stay competitive.”

Bringing about the policies to remedy this “will be far harder to accomplish than many analysts imagine,” Kikkawa says.

Harald B. Malmgren, a Washington-based trade consultant, points out that the move by Japanese manufacturers to set up U.S. production facilities is beginning to cut into import sales in the United States.

But even in the Cleveland area, attitudes toward buying imports are changing.

“My father had this feeling that it was better to . . . buy American, but my impression being in Cleveland today is that people don’t care anymore,” Laura Rosenbaum said. “Those days are past.”