Greed, Power and Industrial Policy
on Opposite Sides of the Pacific
© 1985 by Steven Schlossstein
296 pages, Congdon & Weed
(Source notes, Bibliography, Index)
ISBN 0-312-92824-6 (St. Martin's Press)
"Foreign trade is a war in which each party seeks to extract wealth from the other." - Honda Rimei, 18th-century Tokugawa philosopher
Until 1970, America had not run a merchandise trade deficit in 50 years. Since 1973, our nation's cumulative trade deficit has soared to more than $300 billion. Last year, our deficit with Japan alone totaled more than $20 billion. While Washington has worried about beef, oranges, and tobacco — low value-added exports that barely make a dent in the deficit — the Japanese have captured our lucrative markets for everything from automobiles and steel to machine tools and computer chips.
In Trade War, Japan expert Steve Schlossstein goes behind the scenes to document this decline in America's international competitiveness and to explore the dramatic cultural differences between the two countries that have inevitably led to friction.
He interviews such key figures as MITI's house theorist Amaya Naohiro and Edward Denison, our own Dean of Productivity, and analyzes that elusive concept called industrial policy — from its origins in 19th-century Japan and its remarkable postwar successes, to its American proponents today.
Schlossstein also asks the unavoidable question: without a coordinated industrial policy of our own, doesn't America run the risk of becoming a second-class industrial power?
Irreverent, immensely readable, and laced with anecdotes from the author's own extensive experience in the Far East, Trade War offers some pessimistic thoughts on letting Ůfree market forcesÓ decide this nation's economic fate. Schlossstein suggests the basic elements that should be incorporated into any coherent American industrial policy. His conclusions are based on examples drawn from our own corporate success stories, and they give us hope for the future. His message: We can do it, too.