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US-Japan Fighter Deal

THE squabble between Washington and Tokyo over whether to proceed with the FSX concerns more than just a new jet. It has to do with the economic and military relationship between the two countries. And its outcome could affect such relations into the next century. Some background: Japan decided it needed a new fighter and began plans to build one itself. US and European competitors hoped to sell ``off-the-shelf'' models, but the Japanese hung tough. Eventually, the Pentagon worked out a deal in which the countries would jointly develop the FSX, based on a current US Air Force fighter, the F-16. The US would get 40 percent of prototype production business and technology would be shared by both sides.

The Commerce Department and a number of lawmakers began to suspect that Uncle Sam was being taken to the cleaners - that the Japanese would take advantage of US technology to build its own commercial aircraft industry, and that the US trade deficit with Japan ($55 billion last year) would get worse as a result.

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President Bush this week said he is for the deal, but with some safeguards: firmer restrictions on use of US technology, more assurance that the US will benefit from Japanese technology, and an in-writing guarantee that General Dynamics will produce 40 percent of the planes (not just prototypes).

The Japanese are squawking over Bush's ``yes, but'' to the deal. But the President's caution is warranted, given (1) the fact that Japanese military technology generally lags behind the US, and (2) the understandable desire of Mitsubishi Heavy Industries and Japan's Defense Agency to keep all the business it can for itself.

With the new national security focus on Asia (including the future of US bases in the Philippines), the US military relationship with Japan is very important.

But just as important is the trade relationship, which must be adjusted - without protectionism - to bring down that $55 billion US shortfall. The Japanese are noted for being tough negotiators. George Bush should be too.

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