GROWING U.S.--JAPANESE TENSIONS : More Japanese Leaders Say Their Country Is at Fault : * Trade: Sony’s chairman is the latest to call for his country’s firms to play by the same rules as the rest of the world.

While Japanese leaders’ recent wave of America bashing has gotten most of the headlines in America, those same leaders have quietly turned their guns on their own country to suggest that Japan is causing problems in the world and needs to change.

Even Prime Minister Kiichi Miyazawa, who stunned Americans Monday by suggesting that U.S. workers may have lost their work ethic, last month called for Japan to change its priorities. In his opening speech to parliament, Miyazawa urged his country “to shift from a producer-oriented society to one with a priority on consumers and ordinary citizens and from an emphasis on efficiency to fuller consideration of fairness.”

Akio Morita, who as the flamboyant chairman of Sony Corp. and vice chairman of the powerful business organization Keidanren is one of Japan’s most outspoken and influential opinion leaders, has made the most dramatic about-face. The man who was once one of America’s harshest critics recently blasted Japan for playing “its own version of the free trade game.”

In an article this month in Bungei Shunju, a respected monthly, Morita warned that unless Japanese companies start paying their workers more, reduce working hours, raise dividends and become more environmentally responsible, other countries, which are “at the limit of their patience,” could shut the Japanese out of their markets.

According to one newspaper report, a pre-publication version of the Morita article, which argued that Japanese management style is “dangerous,” was sent to Miyazawa for his perusal--suggesting that it had the prime minister’s endorsement.

Morita’s admission may have a significant impact on the debate in America over how to answer the challenge from industrial Japan. He may have unknowingly provided ammunition for Western critics who argue that Japanese companies have an unfair advantage over American firms and that some form of protectionist measures may be necessary to reduce Japan’s chronic global trade surplus, expected to be more than $100 billion this year.

One senior Western diplomat suggested that Morita’s views could give American negotiators something to build on in upcoming bilateral talks as the two nations discuss ways in which to make Japan’s business environment more compatible with that of the West.

Others believe that Morita may be nudging the Japanese to see the reality at home. An extended slump in the Japanese stock market is making it impossible for companies to raise money and may force them to treat their investors better.

Nevertheless, “this (Morita’s article) undercuts the argument of those who say Japan is a free market,” says Chalmers Johnson, a political science professor at UC San Diego. “Here is the guru of the establishment in Japan saying we (the Japanese) don’t play by (market) rules. We can screw our workers, our subcontractors and our investors.”

Optimists believe that Morita’s stance could be a harbinger of change in Japan. “Morita is suddenly changing (Japan’s) story,” says Norman Neuriter, vice president of Texas Instruments Asia Ltd. “He puts in more palatable form for local consumption the kind of thing (French Prime Minister Edith) Cresson has been saying more harshly.”

Morita’s message has already won over many of Japan’s overworked young managers. “I would love to have more money and more vacation time,” said a young manager at Nikko Securities. “Our companies need to change their philosophy a little to allow a little more instant gratification.”

Japanese leaders have been saying for decades that business should change its “economic animal” image and pay more attention to quality of life. The Labor Ministry has been pushing companies to reduce work hours, for example, and the Ministry of Finance has been urging companies to boost dividends in the interest of small investors.

Neither ministry has had much success. Japanese still work substantially longer hours than their Western counterparts, and dividends remain at half the level of Western companies.

While a sharp rise in the value of the yen has made Japanese salaries appear comparatively good, many Japanese say they feel poor because prices for housing, food and necessities are astronomically high.

Business is resisting efforts to change a system that has made Japan competitive, however. Takeshi Nagano, chairman of the Japan Federation of Employers’ Assns., denounced Morita’s statements at a recent press conference. He argued that Japanese companies’ ability to invest a large share of their income in research and new factories has sustained economic growth.

Nevertheless, Morita’s conversion to the progressive cause is a significant admission by Japan’s leading internationalist that the nation could be in trouble if it doesn’t change. Morita drew attention two years ago when he called on Japan to show backbone and stand up to America in the book he co-authored called “The Japan That Can Say No.” Then, he was arguing that it was America that was the odd man out and had to clean up its act.

Morita wrote that he changed his mind after visiting Europe and discovering that it was Japan, not America, that was the odd man out.

After the trip, he said, he realized that Japan’s approach of focusing on market share at the expense of earnings was “forcing Western companies to cry out: ‘Japan is unfair,’ and ‘They are choking us.’ ” He concluded that “from a political and social perspective, there is no debate--the Japanese way is simply not accepted.”

One of the first changes likely to come out of Japan--higher prices--may make competitors smile but could be unpopular with the American public. Morita’s call for Japanese companies to price their products more in line with their research and capital investment costs has been relatively well received by his colleagues.

Shoji Sakuma, vice president at Matsushita Electric Industrial Co., said Matsushita hopes to earn more from its research by selling higher priced products. “We used to think that rice cookers had to be less than $160,” he said. “Now we find consumers are willing to pay $400 for a product that makes better rice.”

But even if Japanese companies make more money with higher prices, they may not change their habit of investing heavily in new factories, squeezing subcontractors and scrimping on dividends.

The fundamental problem, said Iwao Nakatani of Hitotsubashi University, is a system of cross-shareholdings in which companies own each others’ shares with the implicit understanding that they won’t sell them. Such holders may control up to 70% of a company’s stock, enabling the company to invest with little concern for immediate returns.

While many in Japan argue that it is important for other industrial nations to have similar systems to avoid conflict, not all believe that America is the most appropriate model with its short-term management style and frequent mergers and acquisitions. “Who should take the leadership, whose standards should we get close to?” asked Naohiro Amaya, a former vice minister of the Ministry of International Trade and industry.

In the absence of answers to such questions, Japan’s instinctive response remains not to change the structures that create such pressures but to use “administrative guidance” to try to put pressure on the companies to limit exports, a major source of bilateral friction.

Toyota Motor Co. has long been criticized by the government and fellow auto makers for continuing to expand production in Japan at a time when the market here is shrinking. It is also continuing to expand its U.S. market share while other firms are holding back.

“Unless Toyota changes its expansionist policy, Japan itself will die,” a senior government official was quoted as saying in the Nihon Keizai Shimbun, a Japanese business daily. “Unless Toyota changes its management style, the government should change Toyota.”