Knee-jerk reaction to trying times
p. 21 · Read in the full issue
IT began when President George Bush threw up on Japanese Prime Minister Kiichi Miyazawa and collapsed at his feet a dramatic symbol, many analysts noted, for the beleaguered American superpower which found itself begging for trade favours from the Japanese economic powerhouse.
Now international trade, particularly with Japan, has become one of the key issues in this year’s US presidential
election.
The repercussions could hit like a tidal wave across the South Pacific.
While President Bush and his leading challenger from the Democratic Party, Ar kansas Governor Bill Clinton, espouse the continuation of free trade, their leading rivals are pushing a tougher line against nations like Japan which are seen to be exploiting an unfair imbalance in export/import regu lations.
Australia and other regional nations have already been caught in the crossfire of a limited trade war between Europe and the United States.
If the protectionist mood catches on during this year’s US election and the GATT talks 3n formalising open international trade continue to founder, smaller countries will
Ind that more exports are locked out of more big markets.
Fears that such an issue can overheat during the emotive dimate of American political campaigning first arose during ;he last presidential election in 1988.
Then a leading Democratic congressman, Richard Gephardt, won an upset victory in an early round of voting n the mid-west state of lowa.
His triumph followed the airing of his TV campaign idvertisement which claimed that the South Korean-made Hyundai car would cost 548,000 if the US had the same import estrictions as South Korea. Gephardt also proposed that the JS enact legislation to force Japan and Korea to open their narkets to US products.
Even though Gephardt was a Democrat and thus more raditionally expected to be favoured by the Australian Labor [overnment than George Bush, a Republican, Canberra’s officials were clearly relieved when Gephardt’s campaign tailed a few w r eeks later during voting in the north-eastern state if New Hampshire. Bush, a free trader, won the election.
Gephardt, who is not running for president this time around, las noted that the issue of international trade has now made . much greater impact on the American electorate, which is eeling from a stubborn recession and increasing unemploy nent.
Polling has shown that voters are worried that the US has »een too complacent about its trade woes and the export of American jobs overseas.
How far voters can be motivated by the issue will be tested a New Hampshire in February the same state where Uchard Gephardt saw his hard-hitting message die. Back then, Hampshire was enjoying an economic boom. These days
Washington
it is gripped by soaring unemployment.
Clyde Prestowitz, the head of the Economic Strategy Institute in Washington, believes that if the hard-line candidates do well in New Hampshire, “the trade issue can become the major, decisive part of the (presidential) campaign.”
One of Bush’s Republican rivals, Patrick Buchanan, railed against the failure of the President’s trip to Tokyo, saying it was time to put “America First”.
The Japanese want to “seize our markets, they target our industries, and they attempt to bring them down and take them over. And that’s the way they see the world,” Buchanan said.
A leading Democratic candidate, Senator Bob Kerrey of Nebraska, has vowed to “tell the Japanese if we can’t sell in their market, they can’t sell in ours.” His TV spot pummelling this theme was produced by the same people who did Richard Gephardt in 1988.
Recovered from his embarrassing influenza bout, George Bush has campaigned against the latest tide of trade hostility warning against the “siren call of protectionism” which he said would cost thousands of jobs and turn the nation’s recession into a repeat of the Great Depression.
But even he has been susceptible to the nation’s darkening economic mood, which is why he went to Japan crying “jobs, jobs, jobs” instead of maintaining a loftier, and less vulnerable, diplomatic mission.
His main Democratic rival, Bill Clinton, who so far leads the Democratic field, has also been toughening his criticism of Japan’s market restrictions.
In fact, Japan-bashing has become almost as popular as Bush-bashing among the Democrats.
“If you’re sick and tired of seeing your country on the defensive, if you’re as sick as the president was at the banquet and the display he put on at that trade mission, and if you think your country can compete and win, then I’m your candidate,” said Governor Clinton.
“If I got the same trade deal with Japan that George Bush got, I’d get sick too,” said Democrat Tom Harkin.
“George Bush (was) in Japan begging them to wait another seven days before they take us over,” said Democrat Paul Tsongas.
The good news is that while polls show that voters arc concerned about the US trade performance and increasingly agitated about the role of international tariffs unfairly hurting US exports, most also share the blame with poor American management and products.
After all, until recently US car-makers did not even change the side of the steering wheel for Japanese drivers.
But officials in our region have cause for apprehension the frenzy and desperation of election campaigns can whip up blind emotion and tilt the political agenda against American free traders. In a trans-Pacific trade war, the fallout would inevitably hurt our markets. □