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Trump or Biden, Japan likely to face harsh demands in trade talks

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By Junko Horiuchi

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This analysis is flawed. Japanese carmakers have too many factories and parts suppliers in the US that employ too many people to warrant Japan being pushed like that. Jobs are the most important service or product politicians want.

Trump has failed completely to deliver manufacturing back to the US.

6 ( +17 / -11 )

It looks like Americans are bored with Trump. He failed dealing with corona. Anyway, old powers of America impressed me very much. I am afraid America will lose clout in relation to China. China will continue their expansion in this area. Xi won.

-10 ( +10 / -20 )

USA will continue to grant favorable access to the American market in exchange for support of its foreign policy. Next topic.

17 ( +17 / -0 )

Japan has nothing to worry about. Trade issues will be as they always have been, give a little, take a litte. Greater diplomatic and strategic relations under the new US Administration will overshadow trade issues.

8 ( +17 / -9 )

"Trump has failed completely to deliver manufacturing back to the US."

It is difficult to undo outsourcing over several decades in just a few years. Just on example is, the U.S.–China Relations Act of 2000. Bill Clinton signed that trade agreement that send all medication manufacturing to China in just one to two years. Now the US is 100% dependent on China for those medications and vitamins. Also in just three years, that same trade deal created a 124 billion trade deficit with the US. It is better to have balance trade (which Trump is promoting) that is good for both countries and not just one-sided trade deals.

-1 ( +10 / -11 )

You'd be crazy to opt for Biden.

-15 ( +10 / -25 )

Japan will get the most favorable deals with the USA regardless of whether Trump or Biden win. Japan is a jobs creator for so many Americans.

China, on the other hand, steals American jobs, and can expect further tariffs and pull-out of US companies. Companies like Apple, GM, Boeing etc should be told in no uncertain terms to stop doing business in China.

7 ( +10 / -3 )

American companies sent manufacturing to China and other countries to reduce their costs by 90% and are responsible for abandoning American workers. "Clinton" didn't do it.

11 ( +19 / -8 )

It just goes to figure that both current and IF a Biden win are out of touch with reality and trade deals. Japan has markets inside the US that hire Americans and keeps the balance with auto and the manufacturing of its parts to supply the autos well within the US. As for opening a market, it will have to be making US companies cut their greedy internal over rated profits and be fair when offering to send US made goods into Japan, designed to benefit the consumer in Japan. Many of the US products while worthy of buying are just too simply large to accommodate in a tiny residence held by many consumers in Japan. What's the point of driving a monster truck on a regular avg road in Japan? Why didn't the US bring US manufacturing jobs to Japan as Japan did to make products with the quality and sellable to the public in each country. The Tohoku region is a prime example with rich land space but not utilized. There are many products that could be made inside Japan creating jobs yet are US goods but sold inside Japan as if they were made in the US saving thousands in costs due to shipping. Instead the Name brands that most know of are not made in the US at all nor in Japan aside a La Z Boy..but then again, you have a recliner that eats up half the space inside a Japanese living room that is used as dining and living area.

2 ( +5 / -3 )

Japanese economy will continue to shrink. It is not Japan America can make money even if America pushes Japan to import more from U.S. They cannot expect much. It is China they can make more money. They know about it.

0 ( +4 / -4 )

when you get everything you want from a country for years without opening up your economy to them, and have half you GDP dependent on that country, yes they will start demanding fair trade.

1 ( +6 / -5 )

Voting down a comment of truth is silly. Trump has not delivered more manufacturing jobs. The Wall Street Journal just published an article documenting that truth.

-2 ( +11 / -13 )

@Peter

American companies sent manufacturing to China and other countries to reduce their costs by 90% and are responsible for abandoning American workers. "Clinton" didn't do it.

I agree somewhat with you but I would say that American companies, with the assistance of both political parties in the U.S. are responsible for sending massive amounts of jobs overseas and damaging the middle class forever.

One of the biggest issues in the U.S. is that Congress and Senators and their staff are allowed to lobby on behalf of foreign governments when they retire.

With respect to Japan; Japanese companies have significant manufacturing in the US.

8 ( +11 / -3 )

You'd be crazy to opt for Trump.

3 ( +9 / -6 )

A vote for Biden means as with his former boss more capitulation and apologizing and China...well, that opens up a whole new can of dirty worms.

-3 ( +7 / -10 )

I would rather the US focus on India and SE Asian countries.

8 ( +9 / -1 )

Don't know which is worse, an utter childish lunatic or a weakling with one foot in the grave.

Pathetic situation.

0 ( +8 / -8 )

Peter Neill Trump has failed completely to deliver manufacturing back to the US......Trump has not delivered more manufacturing jobs

This partisan narrative you’ve been peddling has already been debunked.

https://www.marketwatch.com/story/manufacturing-employment-in-the-us-is-at-the-same-level-of-69-years-ago-2019-01-04

0 ( +5 / -5 )

Biden will side with China, he's the much worse choice for Japan.

0 ( +8 / -8 )

Many of the US products while worthy of buying are just too simply large to accommodate in a tiny residence held by many consumers in Japan. What's the point of driving a monster truck on a regular avg road in Japan? 

Costco is selling the large products you are talking of and are selling. Alphard is not super smaller than the

monster trucks or hummer yet Alphard and Vellfire are selling well here. There are are many inner and residential or farm roads here that even two opposing Keis cannot pass but that has not stopped people from buying regular cars.

As for opening a market, it will have to be making US companies cut their greedy internal over rated profits and be fair when offering to send US made goods into Japan, designed to benefit the consumer in Japan.

The cost of foreign products here are not determined by exporting companies but rather by the Japanese importer and retailers. Putting the blame on American companies is strange, if you live you and have been to

a supermarket you would have realised the price of imported fruits, rice, beef, cheese, butter, foreign cars with the exception of wine are way more expensive than in their home markets.

It is crystal clear than all the trade deals and reduction in tariffs hasn't translated to reduction in prices.

Crude oil was minus -37USD for a barrel in May, meaning crude dealers were given free crude and cash

yet there was never anytime that the price of gas dropped. Everywhere that capitalism is practiced there is

greed and not limited to American companies. And it is the place of the government to regulate prices and ensure there is competition so that the normal consumer doesn't overly pay.

0 ( +3 / -3 )

American companies sent manufacturing to China and other countries to reduce their costs by 90% and are responsible for abandoning American workers. "Clinton" didn't do it.

It was both; the govt had to pass free trade agreements to make it possible for them to reimport their outsourced products at a lower cost. NAFTA was terrible for the American worker; Ross Perot tried to warn people but the media and Democrats just made fun of him, and potentially blackmailed him when he started to rise in the polls, hence his bizarre disappearance.

0 ( +4 / -4 )

Harsh demands?

1985 Plaza Accord crippled Japan's economy for the past 4 decades.

Japan still hasn't recovered, while at the same time helping the country who forced us to sign it by buying their bonds, buying untested overpriced weapons, opening factories employing millions of Americans, good paying jobs.

Japan for decades has been the only Ally to pay the most money, over 75% of the total cost for U.S. Soldiers station there.

Vietnam War, Korean War you used Japanese land and bases to support your Asian wars... Does that count?

Japan supposed to be the shield and America the spear(your words). Does that count?

You at over 5000 miles safe distance, protected by the Pacific Ocean, while Japan will be the one taking all the hits, All the damage! (The Shield). Does that count?

You crippled Japan militarily by forcing us to sign Article 9 and become Pacifist, herbivor, weak. Does that count?

Who's negotiating for Japan? People who only know how to lose apparently. I'm sure America will get everything they ask for.

2 ( +5 / -3 )

It is better to have balance trade (which Trump is promoting) that is good for both countries and not just one-sided trade deals.

yet 4yrs in a Chinese trade war, covid19 the US deficit with China is still expected to be over 350billion in 2020

https://www.census.gov/foreign-trade/balance/c5700.html

if its not China itll be another cheaper asian country, cambodia, Vietnam, Indonesia, Burma Thailand etc etc

0 ( +0 / -0 )

"Trump would most likely continue to fully deploy unilateral actions and punitive tariffs to correct trade deficits, which he sees as evil," Sugawara said.

"Biden, meanwhile, is expected to first focus on raising the competitiveness of domestic industries, making trade talks with Japan a substantially low priority on the policy agenda," he said.

Perfect comparison, between a narcissistic caveman (Trumpy), and a real decent president (Biden)..

Trump and fascist GOP are America's cancer.

> Biden will side with China, he's the much worse

choice for Japan.

You just repeat Trumpy's fake hate rhetoric

2 ( +4 / -2 )

monster trucks or hummer yet Alphard and Vellfire are selling well here. There are are many inner and residential or farm roads here that even two opposing Keis cannot pass but that has not stopped people from buying regular cars.

I drive an Alphard, a hybrid one. It gets about 11km/l. I doubt many US 7 seaters get within 30% of that. The larger the car you drive, the more fuel economy matters, for your pocket and not just the environment. I have 3 kids, go camping with a roof box, and sometimes need to collect or carry bikes, but I have no particular need for a bigger vehicle like those in the States.

You can buy US pork in Japan, which is banned in the EU due to I think its antibiotics. US beef too of course. Once you get past rice and dairy, I'm not sure how many agricultural trade barriers actually exist. I think some of it is just political grandstanding and US politicians getting the US public to blame other countries.

3 ( +4 / -1 )

How is it that European car manufacturers have managed to establish a presence in the Japanese market while the US manufacturers have failed for decades? The EU said that markets would open or Japanese cars would be subject to tariffs, and then they made a commitment to entering this market. In my city there are BMW, Alpha Romeo, Fiat, Jaguar, Maserati, Audi, VW, Volvo and one Jeep dealership. The US regularly issues threats, but its car manufacturers have not committed, and have few (no) products suited to this market that can compete with local or EU products.

3 ( +3 / -0 )

Biden or Trump. American dominance over Japan is guaranteed and will be expanded, regardless.

Trump is the man of commerce and protectionism. He scores a huge victory through forcing Shinzo Abe to sign a trade deal that focuses on the agriculture, and this victory indirectly helps Vietnamese agriculture to gain access into Japan. Farmers, the core base of LDP, are crying and weeping because they are now unable to compete against agricultural behemoths of the world. For example, Wagyu ranchers are no way can compete against American ranchers who has both the supply strength and technological strength to easily replicate the Wagyu if given the chance. It was an agricultural win for Trump, and many LDP bureaucrats were very angry at Abe for accepting this decision. If Trump wins again, he will press on Japan to completely deindustrialize to transfer jobs from Japan to the US soils, and Japan's transformation into a service economy will be complete as the Reaganite faction of LDP intends (Abe's friends).

Biden is the man of neoliberalism and free trade equity capitalism. Trump only focuses on the physical products/tangible trade, while Biden and Obama were and are the men of equity and tech. Biden doesn't think that manufacturing jobs or the "good old days" of 1950s are possible. He thinks the high tech future with the freedom of investment and equities is real. Japan will maintain the dominance of an exporting powerhouse in East Asia under Biden with nothing changed as ReasonandWisdomNippon have stated. However, Biden will finish what Obama started - the deconstruction of Japanese corporate protectionism and Keiretsu model. Obama started the campaign with the sanctions against Yakuza, which severely depower the Keiretsus because they rely on the Yakuzas to circumvent overseas profits back-and-forth between Japan and the world. Japan Inc can no longer use accounting tricks and bureaucratic magic to hide their low financial status and launder real profits away from the foreign shareholders. Obama later made many commendable efforts to foster foreign shareholder activism in Japan and South Korea but it is still lenient at best, thanks to the domestic government's opposition and secret help of China. If Biden wins, he will continue the efforts of Obama to force the corporate Japan to internationalize and open for foreign investors. No Japanese capitalism with Nihon socialist characteristics!

In both worlds, Japan will be again forced by the American overlords to give up certain perks. In both worlds, Japan is still damned by the USA.

USA will continue to grant favorable access to the American market in exchange for support of its foreign policy. Next topic.

Pretty much the whole story, but you should add that one must constantly buy US treasuries and bonds with the financed trade surpluses. Japan may rake record high trade surpluses with the USA every year but they are all spent to buy American treasuries and bonds. Technically, the money never left the USA.

Harsh demands?

1985 Plaza Accord crippled Japan's economy for the past 4 decades.

Japan still hasn't recovered, while at the same time helping the country who forced us to sign it by buying their bonds, buying untested overpriced weapons, opening factories employing millions of Americans, good paying jobs.

Japan for decades has been the only Ally to pay the most money, over 75% of the total cost for U.S. Soldiers station there.

Vietnam War, Korean War you used Japanese land and bases to support your Asian wars... Does that count?

Japan supposed to be the shield and America the spear(your words). Does that count?

You at over 5000 miles safe distance, protected by the Pacific Ocean, while Japan will be the one taking all the hits, All the damage! (The Shield). Does that count?

You crippled Japan militarily by forcing us to sign Article 9 and become Pacifist, herbivor, weak. Does that count?

Who's negotiating for Japan? People who only know how to lose apparently. I'm sure America will get everything they ask for.

The systematic destruction of Japan Socialist Party and weakening of Japan Communist Party are the biggest factors for those following reasons that you addressed. Both parties were seeking an interdependence (soon independence) from the USA, not dependence. They were seeking to improve ties with the USSR and China, which the USSR intended to give Japan back a few islands, and the USA sabotaged the whole secret deal.

LDP cronies, sided with the USA, ruined the whole future of Japan through destroying labor unions, accepting unequal deals with the USA, and consolidating an one-party rule. Many people thought that Otoya Yamaguchi is a hero for saving Japan from Communism because he killed a leader of Japanese socialists. He never realized that his action has cemented the extension of American dominance over Japanese civilization. Japan is now so reliant on the USA that a pull from the USA means the collapse of Japan.

Even if the Article 9 is abolished, I don't have faith much in Japanese military leadership because they will always bend to the Pentagon in the end. Funny thing is that the US Defense industry wants the Article 9, created by American Democrats - most of the US Defense Industry are Republican, to be abolished in Japan, so they can sell more weapons in Japan and force Japan paying more the American endless wars.

With respect to Japan; Japanese companies have significant manufacturing in the US.

Unfortunately, it is a forced term on the Plaza Accord. The USA forced Japan to deindustrialize in the own country, so the American workers can get jobs and the Pentagon can sleep safely without thinking of Japanese threats.

5 ( +9 / -4 )

Naw, localizing design and production had nothing to do with the Plaza Accord. It was a financial decision - think global; act local.

0 ( +1 / -1 )

@Peter Neil American companies sent manufacturing to China and other countries to reduce their costs by 90% and are responsible for abandoning American workers. "Clinton" didn't do it.

Government policy is what can take down or put up all the boundaries. Clinton got China into the World Trade Organization (WTO) which opened up the floodgates for US and world businesses to do business in China. Clinton was one of key players in creating a massive exodus of US outsourcing to China.

Here is a couple of articles on the subject from Wall Street Journal and The Atlantic.

https://www.wsj.com/articles/when-the-world-opened-the-gates-of-china-1532701482

https://www.theatlantic.com/international/archive/2018/08/china-trump-trade-united-states/567526/

2 ( +4 / -2 )

Bass4funk: “A vote for Biden means as with his former boss more capitulation and apologizing and China...well, that opens up a whole new can of dirty worms.”

no, a vote for Biden means working constructively with China, instead of Trump fawning over its leader and losing a trade war, all the while as Trump makes secret deals for him and family, like Ivanka, and holds secret bank accounts there.

more importantly, with Trump in love with NK’s Kim, it means a bigger threat to Japan, who can only sit and make hollow promises to the people on NK as Trump legitimizes them and their nuclear efforts.

-1 ( +6 / -7 )

smithinjapan

Trump .................................. and holds secret bank accounts there.

When you have business' in a country its often usual and normal to have a bank account in that country ,

a n d it was even explained the account was opend and closed long before he became president.

Some prefer to listen to the fake news or the dribble instead of reality .

But then many do not understand much about much .

-2 ( +3 / -5 )

This partisan narrative you’ve been peddling has already been debunked.

https://www.marketwatch.com/story/manufacturing-employment-in-the-us-is-at-the-same-level-of-69-years-ago-2019-01-04

OMG, what nonsense. The same number of manufacturing jobs as 1969?! There's 130 million more people in the US now than in 1969.

3 ( +6 / -3 )

Japan apparently has no cards to play in the talks

Japan done screwed up. What's up with that?

If Biden wins, he may consider the possibility of rejoining the TPP

No surprise there, as that agreement sucks for the U.S. which is why Trump got us out of it. Heck, even HRC was against it in the end.

0 ( +3 / -3 )

Actually there is nothing left for globalists to take away

oh wait, the health insurance market remains appetizing

for the American Health Insurance Companies.

1 ( +2 / -1 )

Charge rent for the 3.5% of Japanese land America occupies and offset this to the tariff charges.

-2 ( +1 / -3 )

Joe BlowToday  10:09 am JST

Biden will side with China, he's the much worse choice for Japan.

This is October of 2020. No American of any political party will "side with China".

2 ( +3 / -1 )

Since Biden is not delusional, he will be much, much easier to negotiate with.

1 ( +2 / -1 )

Government policy is what can take down or put up all the boundaries. Clinton got China into the World Trade Organization (WTO) which opened up the floodgates for US and world businesses to do business in China. Clinton was one of key players in creating a massive exodus of US outsourcing to China.

I disagree. The Clinton administration came to realize in the course of a very contentious trade war with Japan (remember that one ?) that it was the bonds sold to finance the US budget deficit that was handing Japan and other US trade partners the means to perpetuate the US trade deficit. You have read my analysis elsewhere so I won't repeat it here (see the article on Trumps trade were elsewhere in J-T for the full version). This was a large part of why the Clinton Administration worked so hard to achieve small budget surpluses during their last two years in office. It was true then as it is true now that the only way the US will ever cure its trade deficit is to run balanced budgets or preferably small surpluses for a very long time. In 1999 and 2000 the US was on it's way but the next administration immediately instituted a big tax cut and ballooned the budget deficit once again.

You also ignore the received wisdom of that era that what was then called "engagement" with China would slowly change it and make it more democratic and capitalist. Based on experience with the end of military rule in Taiwan and South Korea the US and other western nations sincerely believed China too would slowly come around and democratize. And as late as the Presidency of Hu Jintao this indeed seemed to be happening. if you recall the next to the last Peoples Congress under Hu had a lengthy and serious discussion about allowing private land ownership and there were small scale local experiments with competitive elections for town and village political offices. It really looked promising. But Hu's successor Xi Jinping is almost Mao incarnate and now nothing good seems possible with China. It is a completely different world regarding China than it was 20-25 years ago.

0 ( +0 / -0 )

This is October of 2020. No American of any political party will "side with China".

Exactly right. And it ignores how many Democratic politicians have parents who came to the US from Hong Kong and Taiwan. These politicians are not supporters of China and are not fooled by their rhetoric. If anything they are more resolutely anti-CCP than most.

0 ( +0 / -0 )

OMG, what nonsense. The same number of manufacturing jobs as 1969?! There's 130 million more people in the US now than in 1969.

69 years ago, 1969 eh! Your maths is as dodgy as the easily disproven falsehoods you’ve been peddling. And while it’s true that America’s population is a whole lot more than 1969, let alone 1951, the figures eloquently attest to the success of the Commander in Chief’s efforts in reversing decades of betrayal.

0 ( +0 / -0 )

Some of you still don't get it. Chinese companies did not build cheap plastic crap on spec, ship it to LA and hope someone bought it.

American companies like Walmart went to China, abandoned US manufacturing to get product for 90% cost reduction and continued to sell in America at the same retail price, reaping huge profits for decades.

If some other mythical rich country came to US to build something, US companies would do it willingly.

US government policies? You're kidding, right? You're just too wrapped into the myth. It was and is nothing but American greed and now laziness. You walk into any graduate level STEM classroom and there isn't an American in sight.

The truth stings a little, but man up to it. American companies and consumers build the China of today and continue to do it. No one is bringing any manufacturing back to the US.

1 ( +1 / -0 )

For the past three decades, mainstream Democrats have tied their fates to the twin mantras of free trade and globalization, which have cost millions of jobs and many thousands of factories. Bill Clinton campaigned for and signed NAFTA in 1993. He also negotiated and signed the agreement that created the World Trade Organization in 1994. And he negotiated the agreement that resulted in China’s entry into the World Trade Organization in 2001. Barack Obama negotiated and campaigned for the failed Trans-Pacific Partnership agreement. It is time for progressives to own and reject these failed policies.

-1 ( +0 / -1 )

I can vividly recall occasions in the 1990s when the California trade delegation would show up at a big international trade conference in Tokyo with their California Rice exhibit and in very short order the California delegation would be ordered out of the country, with Japanese officials sniffing that California has nothing to teach Japan about growing rice. Aside from the fact that CalRose is about the best rice grown anywhere in the world, the price was a fraction of Japanese rice. Credit laser leveled fields, minimal water use (only 20 cm of water), aerial planting, and mechanical harvesting. I can also remember the Japanese refusing to sell the bandwidth necessary for Qualcomm based cellphone technology to operate in Japan. It wasn't all about the west abusing Japan as some here will claim. Japan tried it's darnedest to keep foreign products out.

0 ( +0 / -0 )

It is time for progressives to own and reject these failed policies.

The failure isn't advocacy of free trade. That goes back to Adam Smith (before US independence from Britain ) and David Ricardo. There isn't a reputable economist alive who doesn't acknowledge that free trade is preferable to tariffs and subsidies, which only reward inefficiency, lack of innovation and sheer laziness. What you ignore is the root cause of the trade deficit. It is the US budget deficit and resulting national debt. In a true free trade regime long term trade imbalances are not possible. A trades with B, C and D. A buys more from the other than it sells them so it runs a trade deficit. When that happens, As currency starts to pile up in B, C and D because A is paying them more of their currency than it is receiving in return for goods sold to the others. Money is like any other commodity. As currency is in surplus and will loose value while the currencies of B, C and D which are now in short supply rise in value. As it does, As goods become cheaper in trade while the goods from B,C and D become more expensive. Now, with As goods cheaper in trade they are able to sell more while fewer of B, C and Ds more expensive goods are sold to A. This is how free trade is supposed to work to keep trade in balance.

But, oh look, A also runs a big current accounts deficit and sells bonds to finance this debt. B, C and D realize that if they buy bonds from A, they can use up their excess of As currency and in this way, there is no surplus of As currency in the global market. As currency does not lose value, B, C and Ds currencies to not rise in value and the terms of trade remain unfavorable to A and favorable to B, C and D. This perpetuates As trade deficit.

As long as the US runs budget deficits it will have trade deficits. Period. Full stop. The US created this problem and only the US can cure it. Period. No amount of tariffs will solve the problem. No amount of bad mounting allies and adversaries will reduce the overall trade deficit. Only by running balanced budgets, or better yet small budget surpluses will the US reduce its trade deficit

Btw, Mr. Clinton understood this as a result of the trade war with Japan and Japan's threat to sell of their holdings of US treasuries (right on national TV by the Prime Minister no less !). It was that crisis that forced the Treasury Dept. to do the analysis and from then on the Clinton Administration understood that it was the budget deficit that was giving it's trade partners the leverage to perpetuate the trade imbalance. And if you notice it was the last two years of the Clinton administration where the US ran two consecutive years of small surpluses, 1999 and 2000. The US also reduced the overall budget deficit from 69% of GDP to 59% of GDP over the course of the Clinton administration, mostly by growing GDP. Of course the next President immediately cut taxes and ran the deficit up.

-1 ( +0 / -1 )

Read this to disabuse yourself of the notion that cutting the budget deficit was something close to the hearts of Democrats back in the late 90s and nothing to do with the Gingrich led Republicans who controlled Congress, putting the Democrats on notice that their free spending ways were oh you tee.

https://www.cato.org/publications/commentary/no-bill-clinton-didnt-balance-budget

0 ( +0 / -0 )

Read this to disabuse yourself of the notion that cutting the budget deficit was something close to the hearts of Democrats back in the late 90s and nothing to do with the Gingrich led Republicans who controlled Congress, putting the Democrats on notice that their free spending ways were oh you tee.

There is some truth in that but not the complete truth. I am an economist and followed the trade war in real time. International trade and monetary policy are my passion. Nothing CATO publishes is completely honest. Nothing. Their, cough cough, "analyses" are always slanted. As an economist I never reference them as they are not considered to be a reliable source of unbiased information. You would be savaged by your peers citing anything they produce, and doing so would discredit your own work. The fact is I followed this as it was happening as an economist and have my own opinion based on what I saw. The threat by the Japanese PM to sell off Japan's holdings of US T-Bills, which at the time were proportionally larger than today, was eye-poppingly bold. He did it right on national TV! However the US Treasury department and other outside economists modeled what would happen and decided the outcome would be worse for Japan than for the US. The US at that point basically told the Japanese to go ahead and sell them. We dare you. Apparently the Japanese must have done their own analysis and reached a conclusion similar to what the rest of us reached and they backed down. But that experience informed the Clinton administration of the dangers inherent in the budget deficit in terms of the US foreign trade position.

The fact is that nobody in either party is publicly discussing the relationship between the budget deficit and the trade deficit. Most politicians appear to be oblivious to the relationship but I suspect many do but won't talk about it in public. Many of our foreign counterparts understand it clearly as buying us treasuries is often the price nations must pay for a "free trade" agreement with the US. The US bends nations over to buy those treasuries so the US can run budget deficits and the US taxpayer can get off cheap. The US doesn't tell their people this but everyone else knows it. Then the US frequently accuses other trade partners of "dumping" when it is in fact the US that is deliberately and knowingly altering the terms of trade to make the other nation's currency undervalued. This is why there is often such outrage when the US files a dumping claim. It seems like everyone but the people in the US can see the obvious games the US plays.

0 ( +0 / -0 )

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