Reconcilable Differences? The United States-Japan Economic Conflict
Reviewed by Richard N. Cooper
Despite the title, this book is mostly on Japan; it contains some discussion of U.S. macroeconomic policy, but nothing on U.S. trade policy and practices. There is much fascinating detail on the Japanese market and fine, even-handed analysis of issues raised in the U.S. policy debate on how to deal with Japan, on both macroeconomic policy and sectoral trade issues. The book offers a balanced strategy for the two governments to manage the relationship; it skillfully knocks down the worst ideas on the U.S. side. Inexplicably, however, it endorses "voluntary import expansion" with quantitative targets as a second-best component of a broader strategy without exploring fully the dangers of such a move for the world economy by the world's leading trade country, and without explaining clearly how ordinary Americans would benefit. In short, the authors fall into the current U.S. habit of assuming that the frustrations of some American firms in selling to Japan represent a serious problem for national policy, even if the remedy would put at risk more fundamental American economic or other interests. Nonetheless, this is a thoughtful, fact-filled book on a highly topical issue.
