ustxtxb_obs_1987_07_31_50_00007-00000_000.pdf

PLASTICS The free advice you get at a cocktail party is usually worth about what you paid for it At Futura, the advice is free, but the results can be invaluable. Our friendly account representatives are trained to help you through the toughest print job and they’re backed by years of experienced, professional service. Call us at 442-7836 for a prompt quote on your next project yes Owned and Managed COMMUNICATIONS, INC. AUSTIN, TEXAS 1714 S. Congress 442-7836 Data Processing Typesetting Printing Mailing of counterposing “free-traders” to “protectionists.” This austere conceptual model is not, of course, a pure figment of someone’s imagination. Both free-traders and protectionists in the relevant, simple, senses really exist, and have weighed in during recent trade debates. The map of Democratic voting on the Gephardt amendment suggests, for example, that dominant business interests in certain high-technology centers and parts of the oil industry in Texas and Oklahoma; in of New York, California and Illinois; most of the Farm Belt; and some states with powerful multinationally oriented business communities, such as Georgia \(which also has a large agricultural free-trading views. And if a similarly revealing map of protectionist sentiment among congressional Republicans were available \(for complex reasons of partisanship, the Republican votes in favor of the Gepit would undoubtedly show the impact of textile manufacturers in the Southeast; shoes, steel and other heavy industries in the Northeast and Midwest; and raisers of livestock and certain agricultural interests in other congressional districts. For analyzing business support for the Gephardt amendment, however, the traditional free-trade/protection model is inadequate. It fails to distinguish two other sorts of firms that now exercise a major influence on the debate over trade. The first of these consists of multinationals and exporters in sectors such as computers, aerospace, construction and telecommunications. They have a history of successful operations abroad and are anxious to maintain their position. Their businesses, however, happen to be in product lines that the Japanese \(or the Koreans, or the Taiwanese, or to control, in many cases for reasons of high economic strategy, through an intricate and interlocking set of public and private policy measures. The second consists of firms \(almost always capital-intensive enterprises, since persisting partisan differences in regard to labor policy put most labor, that are increasingly fearful that they may not make it in the world economy of the 1990’s without a national “industrial policy.” Both of these kinds of businesses are threatened by the current Reagan trade policy, and both were conspicuously in evidence during the lobbying for the Gephardt amendment. Formally committed to protection for textiles, steel and probably some other sectors at the time he took office, President Reagan has pursued a fairly complex strategy in regard to international trade. Powerful sectors hurt by foreign competition, such as steel and autos, have been awarded very substantial protective barriers of various sorts. But while appeasing these sectors, the Administration has sought to hold the line elsewhere. It has exalted free trade as a principle, and, cheered on by the financial community and by many successful U.S. multinationals, has fiercely resisted pressures to curb trade with Japan and other Pacific Rim countries that export massively into the American home market. For American multinationals and exporters that want to crack the Japanese market, however, the administration’s policy toward the Japanese is a problem. To these firms, the Japanese , reluctance to do business looks more and more like a carefully calculated strategy to weaken them and elevate the position of Japan Inc. After, in some cases, literally years of negotiating with meager results, many have become increasingly convinced that the United States cannot go on as it has. As a number of recent business school and foreign policy analysts have hinted to wide public applause by business figures in this sector, it is time for the United States to try something dramatic perhaps, some almost seem to imply, a diplomatic equivalent of Matthew Perry’s famous expedition to Japan, which originally opened that country to the West under threat of naval bombardment. To this ‘sort of business concern, the Reagan administration’s comparatively amiable policy to the Japanese appears increasingly irrational and dangerous. Similarly, U.S. firms that fear they cannot survive without a rather more boisterous industrial policy than the laissez-faire Reagan administration is likely to countenance cannot sit still, either. For firms of this latter sort, such as Chrysler, which supported Rep. Gephardt’s efforts, the trade bill is perhaps chiefly interesting as a way to help protect the U.S. home market, and as a bridge to a more activist economic policy. The big winners under the Gephardt amendment, however, are likely to be enterprises of the first type, those seeking to open foreign markets, particularly in Japan. A prime example is Monsanto, headquartered in St. Louis \(the city Gephardt’s congressional dis THE TEXAS OBSERVER 7