SHOULD the United States do more to defend the dollar? Has Japan done enough to try to devalue the yen, which threatens to disrupt its own and other economies? These questions remain unanswered even after US Treasury Secretary Robert Rubin and Japanese Finance Minister Masayoshi Takemura met face to face to discuss the currency problem during an Asian economic summit in Indonesia last weekend.
In the US, the currency crisis is being seen more as Japan's problem with a ''strong yen'' and not as an American problem with a ''weak dollar.'' The value of the yen against the dollar has increased about 20 percent since the beginning of the year. Early last week the dollar dipped briefly to a previously unthinkable postwar record low of 80.15 yen. If the dollar's value stays in the low 80s, or sinks lower, it will put irresistible upward pressure on the price of popular imported manufactured goods from Japan, such as automobiles and consumer electronics.
But so far the US is not suffering. Currencies of the two largest trading partners of the US, neighboring Canada and Mexico, have actually decreased in value against the dollar. The US economy, though running a big trade deficit with Japan, remains strong. Unemployment is low, inflation is still in check, and the stock market is exploring record highs. In theory, US exports to Japan will become more attractive, if long-standing trade barriers in Japan can be broken down.
Americans should not think they can enjoy a bit of grief for an economic rival whose success has seemed to come at the expense of US workers. The days of narrow economic nationalism are over. The US, and the world, needs a healthy Japanese economy.
Clearly, Japan must do more to help itself. A drop in its discount rate from 1.75 percent to 1 percent has been the only substantive move its government has announced so far. Setting numerical goals for a reduction in the Japanese trade surplus -- a move sought by the US -- has been anathema for Japanese politicians. But it should get a serious hearing now.
It is a difficult time for Japan, hit recently with the Kobe earthquake and the subway poison-gas attacks. But despite substantive trade disagreements with Japan, the US must never forget its best future lies in mutual economic success.