Reagan driven to cut Japanese auto imports
All signs point toward fewer Japanese cars entering the United States in the future, which means that some Americans will win and others will lose. President Reagan is under compelling pressure -- from Congress as well as the automobile industry -- somehow to persuade the Japanese to reduce the number of cars they send to eager American buyers.
With imports so far this year running above the 1.9 million unit pace of 1980 , critics want the number of Hondas, Toyotas, Datsuns, and other Japanese makes cut by several hundred thousand, at least.
American consumers would suffer, experts agree, because Japanese cars would cost more and so would domestic models, if Detroit followed earlier practice and boosted sticker prices under cover of this protection.
Beleaguered US carmakers, by contrast, would gain a bit of time to woo American buyers into showrooms to buy their own smaller, more fuel-efficient cars.
Thursday Mr. Reagan met with his Cabinet-level automotive task force, which -- after long and divisive internal debates -- is due to make recommendations to the President.
"If [Reagan] decides to do nothing," said Rep. James R. Jones (D) of Oklahoma , chairman of the House Budget Committee, "Congress by fall will pass a bill invoking restraint, putting some kind of limits on imports -- a bill which the President either must sign or veto."
Everyone on the President's task force, Even those who favor voluntary restraints, is believed to oppose mandatory import curbs decreed by Congress.
To head off such curbs -- which might inch the US and Japan into the beginnings of a trade war -- the White House wants the Japanese government, under Reagan's nudging, to compel Japan's mighty car producers to cut back on their US shipments.
A warning that even such voluntary restraint might lead to a trade war comes to President Reagan from the West German minister of economics, Count Otto Lambsdorff.
"If you start restraining imports," Count Lambsdorff told White House officials, "it is very hard to stop. It would be a first step in the wrong direction."
Already Italy, France, and Britain in varying ways restrict the import of Japanese cars. West Germany does not.
But Lambsdorff said, according to a White House source, that US voluntary curbs would impel the Europeans to seek similar restraints, to prevent Japanese cars originally destined for Americans from coming to Europe.
THis, in Lambsdorff's view, could lead to a nibbling away of free-trade principle hammered out by noncommunist nations and embodied in the Multilateral Trade Negotiations, ratified by Congress.
Meanwhile, according to a top Reagan administration official, mixed signals have come from Tokyo. A statement from the Japanese minister of international trade favoring a slowdown of car shipments to the US appeared later to be contradicted by the foreign minister.
"The Japanese," said a senior US trade official, "clearly don't know their own mind."
Because Japan imports almost all of its oil and other raw materials, plus huge quantities of food, the Japanese depend on a booming tide of exports to meet import bills.
Even so, the Japanese balance of payments is running deeply in the red, which makes it hard for the Japanese government to order firms to sell less to major markets like the United States.
Amid all the turmoil, it seems increasingly clear that President Reagan -- to avoid formal quotas or tariffs -- will persuade the Japanese to slow down their car sales to the US.
"The shame of it is," said a top Reagan official, "that reducing the inflow by 300,000 cars or so may take the heat off the domestic industry to do other things it should, to take corrective steps."
Reagan is expected to press US automakers -- in return for limited protection -- to go further and faster than so far indicated in restructuring the industry to regain a competitive edge.
Already, workers at Chrysler have agreed to pay cuts. Workers at Ford, and possibly General Motors, may b e asked to do the same.