Japan's One-Way Trade Policy Clunks U.S. Automakers

Posted by scapozzola on 01/18/2010

In 2009, when the U.S. began to formulate a “Cash for Clunkers” program, Congresswoman Betty Sutton (D-Ohio) proposed that any such legislation extend only to cars produced in North America.  Overseas automakers quickly responded in an uproar, and the $3 billion U.S. program was instead made open to all fuel-efficient cars, no matter their country of origin.  Unfortunately, the Japanese government recently adopted its own Cash for Clunkers program and not a single car from the Detroit Three was made eligible under the Japanese plan.  This is a stunning slap-in-the-face to U.S. lawmakers who had worked to make sure the U.S. clunkers program was open to foreign automakers. In response, Congress is now pressing the Japanese government to open up its version of the "cash for clunkers" program to buyers of U.S. cars.  And in addition to negative reaction from trade critics such as Sen. Debbie Stabenow (D-MI) and Rep. Betty Sutton (D-OH), 40 members of the pro-trade New Democrat Coalition are sending a letter  to Japan's U.S. ambassador, Ichiro Fujisaki, urging the country to reverse course. Additionally, House Ways and Means Trade Subcommittee Chairman Sander M. Levin (D-MI) has announced that the Trade Subcommittee will hold a hearing on barriers to U.S. auto imports in the Japanese and South Korean markets.  The bottom line is reciprocity.  The United States remains the most open market in the world, as evidenced quite unfortunately by a roughly $700 billion annual trade deficit.  The U.S. continues to play by the rules of world trade, and simply put, expects other countries to do so in return.

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