Fresh perspectives on the challenge the American economy faces from trade imbalances A especially with the Japanese 7 were provided in recent statements by two members of Congress. “U S. trade with Japan is lopsided.” declared Sen. Paul Tsongas. D-Mass “There is reason for alarm because the Japanese are beating us in many areas and beating us badAnd Rep. Eldon Rudd. R-Ariz. said itis time the U.S. “stops exporting jobs overseas ” He claimed that “in our overzealous support of the theory of free trade. we have contributed materially to enemployment. the root cause of our recesStatements by both lawmakers appeared in the Congressional Record Tsongas’ remarks. from an address before the Business Center of New England. were read into the Record by Sen John Glenn. D-Ohio, who called the issue “critical.” Quoting Library of Congress estimates. Rudd said that in 1981 American autoworkers and allied industries lost t9fi.B50 full-time jobs as the direct result of import car sales. “Of the 2.325.235 foreign-built automobiles sold in the U.S. that year. l B58 913 came from Japan which represents a greater share of the market for Japanese imports than in’19B0.f’ While acknowledging other factors. Rudd said the principal reason the Japanese can undersell the American manufacturer “is because they contribute less than 1 percent of their GNF to defense” Japan enjoys the protection of the U.S. nuclear umbrella. he said. “American workers and business pay for this. .If Japan were to tax her industries sufficiently to pay its fair share of defense costs. three would be a dramatic increase in the price of Japanese products sold on the American market.” Many European countries put a quota on Japanese imports and their automobiles are banned entirely in some markets. according to Rudd. “We should offer the Japanese an opportunity to pay their full share of defense rtlsts ff they refuse. we should sharply restrict the importation of their products ” Tsongas said there is mounting trade imbalance with Japan “at the expense of the U.S ” Japan accounts for 23 percent of the television sets. lll percent of the cameras. 50 percent of the radios and 90 percent of the motorcycles. “l have a recurring fear that I will find a made-inslapan label on the next American flagl see in a variety store.” he added Steel imports also should be mentioned. For years the domestic steel industry has charged unfair competion from overseas suppliers. Tsongasi figures. as they relate to Japan. spotlight an alarming ecalation of the problem The U.S.Japanese trade imbalance ballooned to $10 billion in l9b0. $18 billion in 1981. and is forecast at $25 billion this year Rejecting protecttonism as the solution. the senator said the U.S. must work to end unfair trade practices in Japan and other nations. at the same time correcting its own weaknesses He advocated a more cooperative and less confrontational spirit by labor and management to boost lagging productivity. sharp expansion of U.S. investment in research and development; stepped-up training for the “high technology” age with more engineers and scientists; more negotiation and less litigation by business and government in settling disputes; increased savings to generate greater investment in American industry; and a redoubled national effort to expand exports. Obviously the challenge is both urgent and difficult. Rudd and Tsongas have made some good points. Other ideas should be invited and debated lmmediate steps llegislative and otherwisel to eliminate unfair trade practices and develop a more positive national exports strategy appear to be overdue. The process may be slow and time is of the essence. But given A-rnerica’s natural resources. ingenuity.,and industrial know-how, the effort can pay off with long strides at the world marketplace.