Opinion pieces and speeches by EPI staff and associates.
THIS PIECE APPEARED IN THE IDAHO STATESMAN ON OCTOBER 11, 1998.
Who’s Japan bashing now?
by Jeff Faux
A few years ago, newspapers around the nation ran a photo of American autoworkers smashing the windshield of a Japanese car with sledgehammers. It was a vivid symbol of the protest against the flood of auto imports that had led to the loss of tens of thousands of American jobs.
Washington policymakers, Wall street investors and editorial writers immediately called the autoworkers “Japan-bashers,” insisting that they had no one to blame but themselves for not having cut their wages and worked harder to compete in the global economy.
Actually, the autoworkers weren’t criticizing Japan so much as Washington’s trade policies that had overvalued the dollar and opened up our markets without requiring the Japanese to reciprocate. Nevertheless, they were roundly condemned as xenophobic, and ill mannered.
Now the shoe is on the other foot. US policymakers and pundits loudly blame the continuing global crisis on the Japanese reluctance to inflate their economy so they can import more goods from their depressed neighbors. Hardly a day goes by without a statement from the President, his Treasury Secretary or an editorial writer bashing the Japanese for their slowness to force their debt-ridden banks into bankruptcy, expand their investments in Asia and cut taxes.
Slow growth in Japan has contributed to the world’s financial problems. But Japan-bashing by the US policy elite has become a convenient scapegoat to divert attention from their own near-sighted policies, which are at the root cause of the current crisis.
After all, the US government, pressured by the financial industry, has systematically promoted the de-regulation of credit markets, resulting in the speculative booms and depressing busts in country after country.
The US government engineered the bailout of Mexico’s creditors in 1995, signaling to global banks that we would rescue them from the downside risks of their mistakes.
The US government encouraged the International Monetary Fund to force borrowing countries to depress their economies with high interest rates in order to maintain confidence in the world’s investors
The US government hyped “emerging” third world economies to investors, ignoring the crony-ridden reality behind authoritarian leaders’ professed commitments to capitalism.
And the US government rejected Japan’s early warnings of economic trouble, brushing aside Japan’s proposal to put together a $100 billion fund for Asian financial relief as a presumptuous intrusion on our prerogatives as the world’s superpower.
But, it has been a lot easier to blame the Japanese than to admit that our own policies haven’t been working, and take the responsibility for changing them.
Thus, it turns out that how our leaders feel about criticizing Japan depends on whose ox is getting gored. Bashing the Japanese seems to be politically correct when the Wall Street to Washington financial crowd needs a scapegoat, but not when the blue-collar America needs a job.
[ POSTED TO VIEWPOINTS ON FEBRUARY 22 ]
Jeff Faux is the co-founder and president of EPI. His latest book is “The Party’s Not Over: A New Vision for the Democrats.”