Carter under pressure to ask Japan to cut back on car exports to US
With a confidential report from a six weeks' study of Japanese automobile imports, President Carter goes to Tokyo Tuesday (July 8) where he is expected to ask for a voluntary restriction of car exports to the United States.
The trip is a ceremonial one to attend a memorial service for the late Japanese Prime Minister Masayoshi Ohira. But during his 21-hour stay in Tokyo Mr. Carter will also meet Chinese Premier Hua Guofeng. And he will tell Japanese authorities about the 300,000 or more US automobile workers believed to be out of jobs because of the car slump in Detroit. There is growing pressure on him to do something about Japanese imports.
Protectionism is in the air in Washington. The automobile industry is following Mr. Carter's sudden trip to Tokyo with avid interest, and there is a rumor that he may make an announcement there. It is understood that he will urge voluntary Japanese restrictions on car exports to head off possible stronger moves in Congress. There are two sides to the situation, however, for the National Automobile Dealers Association notes that many American car agencies depend on Japanese, German, and other small car sales for profits.
Ten years ago only 3.8 percent of US car sales were Japanese imports; in 1979 it was 16.6 percent, and today it is believed to be over 25 percent.
US unemployment is around 8 million, the Labor Department announces, up from 6.3 million in February. Department officials warn that the slight statistical dip in unemployment last month was an "aberration," and that the figure seems heading higher.
Walter Heller, economic adviser to Presidents Kennedy and Johnson, recently forecast an unemployment rate of 9 percent before the current recession ends; the rate is currently about 7.7 percent. A private forecasting service, Data Resources Inc., forecasts a figure of 8.8 percent in the fourth quarter of this year and 9 percent in the early months of 1981.
Former British Prime Minister Edward Heath, a key figure in the so-called Brandt Report on developing nations, testified here last month that there is an "urgent problem of growing protectionism" in the industrialized countries. The global slump, combined with overextension of loans to poor countries, he said, has put the world economy in a dangerous situation.
On June 17, 1930, President Hoover signed the Smoot-Hawley Tariff, America's answer at the time to imports which took US jobs at the start of the Great Depression. Most historians agree that the action 50 years ago was a mistake, precipitating a world tariff war.
President Carter has a delicate task at present, with two political conventions shortly, a cry to protect US jobs, and a visit to Japan where he is almost certain to ask for voluntary restrictions on small car exports.