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From: buzy@quads.uchicago.edu (Len Buzyna) Subject: Does America say Yes to Japan Message-ID: <1992Dec5.023139.16824@midway.uchicago.edu> Date: Sat, 5 Dec 1992 02:31:39 GMT Organization: University of Chicago Computing Organizations Lines: 822

This has been an immensely popular and requested paper about Japan at my (and many other) sites. A new edition has come out which you may find interesting. -Len ----------------------------------- (JAPANYES; From Internet FTP: monu6.cc.monash.edu.au in: pub/nihongo) (This contains both sections concatenated.)

Japanyes; THE SECOND EDITION;

The following article, JAPANYES, (2nd edition) comes from FTP site monu6.cc.monash.edu.au. The most recent version is in pub/nihongo.

This paper was written by: Louis Leclerc; lleclerc@nyx.cs.du.edu

Please send him any corrections or additions to this paper.

NOTE: This is a rather long but fascinating paper on how Japan Inc. functions. For a former free-trader like myself, it has shaken some of my beliefs to the very core. It will open your eyes a little, it will disturb you, and it will quite possibly lead you to ask some serious questions about the future of the United States of America as a world-leader. Reading this, IMHO, is well worth the effort.

The level of detail and the overall gist is documented in many well-known, albeit difficult to read, books (see appendix). The author's prime service to us is the distillation of this information into a (relatively) brief synopsis.

Tom Mathes tom-mathes@email.sps.mot.com

--------------- In the 2nd edition, typographical and content errors/omissions were corrected, sections re-organized for better flow and less relevant sections were deleted/condensed to make room for new material (the entire file must be under 100K to fit through email gateways). Japanese names were removed to protect their anonymity.

Sections significantly expanded/added in the 2nd edition: DISCRIMINATION TRUE, BUT ONLY ON THE SURFACE IT'S NOT ALL JAPAN'S FAULT CONCLUSION COMPANY LISTING (many new names)

Sections deleted/condensed in the 2nd edition: WHERE IT ALL BEGINS (combined with BUSINESS IS WAR) DEBT, AMERICA'S SUPERWEAPON OF SELF DESTRUCTION (important, but less relevant)

------------------------------------------------------------------------- (ed112992)

Second Edition

D O E S A M E R I C A S A Y Y E S T O J A P A N ?

(A M E R I C A W A N I H O N N I "H A I" T O I U K A)

There are many misconceptions about Japan and its miraculous success in the post-war era. While staying in Japan in mid 1992, I tried to look at Japan's seemingly miraculous success with the hope to understand it so that maybe we could apply some of their plan in our own country. "What makes Japan so good?", "How did they get from a third world country to be the richest in the world so quickly?" are common questions asked in America. Today, I will try to answer with examples, at least partially, these questions.

Going to Japan, I expected to see a very efficient country from which America could learn in order to regain her former prosperity. During my trip, the reality began to sink in that what is really happening was quite different from expectations and in some ways quite disturbing. The Japanese have a very different approach to doing business than we do. This paper will elaborate, justify and try to show what is happening and why it is important that this be understood here in America.

Don't be afraid to question what you read here as I am confident that if you research the points yourself (hopefully by going to Japan to see for yourself or reading materials on the topic), you will find the points made in this paper to be truthful.

THE "JAPAN PROBLEM":

Some claims echoed in America which are commonly dismissed as "Japan Bashing" statements, surprisingly turn out to be true upon investigation. The following statements may seem brash right now, but their meanings will become clearer in the explanations and examples that follow.

It seems that Japan is in some kind of economic war against us. Their objective is for them to win and for us to lose. Through the use of cartels, price fixing, government-corporate 'anti-foreigner' tactics as well as adversarial trade and predation strategies, Japan is destroying much of America's strategic industries, standard of living and military strength. These actions are also destroying the jobs of ordinary American people. As a result, the greatest transfer of wealth in the history of the world from one country to an other is happening right now, from the United States, to Japan. As well, Japan is today, the largest holder of net foreign assets in the world.

Those who study these types of topics know that economic wars can be even more devastating to a country's long term future than conventional wars. Japan is organized to fight, uses a tactical strategy and has a fundamental plan. America's economic strategy is in disarray and there is no plan. As a result, America is losing the economic war by default.

IN THE BEGINNING, THE TV CARTEL:

A very famous example of Japanese national government and corporate coordination to take over a foreign industry is that of the Japanese TV cartel, first set up in the 1960's. This is how Japan took the free-world TV industry away from the United States. PBS Frontline did an excellent documentary on this called "Coming From Japan", (see Appendix for how to get transcript via Internet).

In the 1960's, the Matsushita Industrial Electric Company, Sanyo, Toshiba and others formed a TV cartel in Japan. They got US TV technology from the giants in the industry (Zenith, RCA, Quasar) in the following way. The Japanese government prohibited US made TVs from being sold in Japan. Instead, they insisted that the technology be licensed to Japanese manufacturing companies rather than importing (still often the case today in Japan). The US companies thinking they could still make money this way, agreed to these terms which enabled the Japanese companies to acquire the technology on how to build TVs.

The above Japanese companies, with tacit approval from the Japanese government, set up a cartel to inflate TV prices in Japan in order to turn around and use the money to sell below cost TVs in America. This was to drive US makers out of the American and world markets. US TV makers went bankrupt or left the industry as they could no longer fund research to continue making improved and high quality TVs. They could not compete with the artificially low Japanese TV prices in America and were forbidden to enter the Japanese market to take advantage of the high prices there. Hence, the US makers could not make money. Furthermore, secret deals, illegal under US trade law, were set up by Japanese TV makers and US retailers such as Sears and Woolworths to sell the TVs under store brand names. As a result, once famous brands such as Sylvania, Quasar, Admiral, Philco and RCA have vanished or are foreign/Japanese owned. Zenith is the only remaining US TV maker today. No US companies make VCRs although they were an American invention.

In the 1980's the Japanese applied this same strategy to the machine tool industry and now completely dominate that industry as well (a point well made at a machine tool exhibition I visited in Tokyo). Before that was motorcycles and computer memory chips (the US tried to retaliate but failed as our companies couldn't organize with each other during the now famous 'dram shortages' a few years ago). It will be happening again with major and smaller kitchen/washing appliances and telecommunications equipment during the 1990s. It has already happened with liquid crystal computer displays where the Japanese today have 100% market share (these were also invented in the USA).

DISPELLING SOME STATISTICS:

Several misleading claims are made in the media about how the trade situation today with Japan is fine. These will now be dispelled. One claim states that Japan is opening its market because it has increased imports by 9% in 1986-87 and 18% in 1988. This is a half truth because Japanese exports during the same period increased by much more than that. In other words, the trade gap got bigger, not smaller between Japan and its trading partners.

An other false claim, most often made by Japanese trade representatives, states that it is naturally expected and ok that Japan has a trade surplus with America. This is because if every Japanese bought $100 of goods from America, and every American bought $100 worth of goods from Japan, an imbalance would occur in Japan's favor as there are twice as many Americans as Japanese in the world.

In the real world though, this is not ok, and cannot happen for very long without serious consequences. To see more clearly this picture, imagine a world with 2 countries, one with 100 citizens, and an other with 1 citizen, you. Each person has $200 to their name. Every year you buy $100 of goods from the other country, and each of their citizens buys $100 of goods from your country. If you work out this example, you will see that in a little over 2 years, you will have accumulated all of the money in the world and the other country will be penniless. This is the current state of affairs between Japan and its trading partners. Although things are actually occurring more slowly, this is the trend.

POLITENESS AND CODED LANGUAGES, A BACKGROUND:

Japanese communicate with each other and the outside world a bit differently than we do. This is often a cause for misunderstanding between our two peoples, so it will be clarified below.

Because Japan was a communal society, a way of speaking in a way not to directly offend the other person (who they still had to live close to after a discussion had finished) has developed over time. There is even a Japanese word, called 'Tatemae,' which refers to this kind of phrase. These kinds of phrases are a type of 'lie' in order to be polite. Often, when Japanese use words like 'goal' or 'difficult' in reference to a request you make, this is tatemae.

Some recent examples from the evening news will make this point clear. Recently, George Bush went to Japan to open the Japanese market to US goods and to get the Japanese to use more US made car parts in the cars they sell to America. After he left, the Japanese Prime Minister said the agreement they reached was 'a difficult goal'. This is Tatemae code for 'we have no intention of meeting your demand'. But of course, the Japanese PM would not say this directly to George Bush, who is president of America. This would be extremely impolite and Mr. Miyazawa could never say such a thing directly to an individual of such prestige. The Japanese PM is thus in a difficult position. This is an occasion for Tatemae. Foreigners (especially Americans) who aren't used to Tatemae have extreme difficulty to understand its usage. Later, when the 'promise' is broken, Americans often end up thinking they were lied to by the Japanese when this was never the case. Really, the Americans were supposed to pick up on the Japanese polite refusal, but failed to because they took what the Japanese said literally.

As an other example, an agreement was reached where Japan would allow more US made computer chips to be sold in Japanese products. Recently, the Japanese have said this goal would be 'difficult' to reach. This is code for 'we will renege on the agreement'. If you know about Tatemae, it is much easier to know what the Japanese really plan on doing when faced with a politically difficult position as well as what they might be trying to say when they talk on television.

Finally, a claim is often made by cornered Japanese officials that "Japan is at a crossroads" and the problems described in this article are being resolved today. "The Japanese market is opening, but it takes time and Americans must be patient for Japan to succeed at this difficult task." Japan has been saying this for the last 20 years.

SHAME AND HONOR IN BUSINESS:

Japanese people operate on a system of shame and honor (or the appearance of it anyways). This developed due to the fact that so many people must live peacefully in crowded conditions. When something does go wrong, there is a lot of shame on the individual responsible. If the failure was bad enough, he may commit suicide (a practice dating back to when Samurai committed suicide in front of their superiors when they were responsible for a major failure). Some major public figure commits suicide out of shame at least once a year in Tokyo.

For example, while I was there, the CEO of Toyo Rubber (they operate as B.F. Goodrich here in America) committed suicide by jumping in front of the train because company profits were poor this year. A couple years back, after a train wreck in which some people died, the manager responsible for the whole affair also committed suicide.

An interesting side note to this case is the existence of laws discouraging suicide by jumping in front of trains in Japan. These demonstrate the 'group' orientation of this society. The government has laws to fine the jumper's surviving family members based on how much disruption to service was caused by the suicide of the now dead family member. Apparently, the intent of the laws is to force the jumper to think about the harm they will do to their family by choosing the train as a means of suicide, hoping they will instead choose other means to end their life and minimize service disruptions. In practice though, these fines are hardly ever enforced.

DISCRIMINATION:

Although the Japanese are individually are very polite people, Japan is a very racist country, maybe even more so than we are. The common name for foreigners is 'gaijin' in Japan. This is a racial slur somewhat in the way 'nigger' refers to a black person in America. There is however a polite form of this word, 'gaikokujin', which means literally 'outsider country person'.

When you enter a rental agency to rent an apartment (the only way to get an apartment in Tokyo), some of the rental books say on the cover 'no gaijin'. If you are a gaijin, you cannot rent anything in these books. This type of practice seems to be very widespread.

As an example of how deeply this goes, one may look at the now famous Konishiki affair of last summer. Konishiki was the best sumo wrestler in all of Japan. However, he was an American (Hawaiian). The overseers of Japanese sumo continuously denied him the title of 'Yokozuna' (sort of an entry into the Japanese sumo Hall of Fame for grand champions like Konishiki). Konishiki won title after title, but was still refused. When pressed, the overseers claimed that the holder of the Yokozuna title must possess 'hinkaku', a special kind of 'Japanese grace'. They also claimed that it was impossible for a non Japanese to be capable of possessing hinkaku. As a result, Konishiki was refused the honor of the Yokozuna title. In the end, he never became Yokozuna (and neither has any other foreigner in the history of the sport).

Discrimination does not extend only to foreigners. Looking through any major newspaper, you will see ads which ask for Japanese only (no foreigners), men only, young women only, or people of a certain age. Discrimination doesn't seem to be illegal in Japan. A law does exist however stating that it is a Japanese 'goal' not to have discrimination (hint:this is Tatemae). This 'anti- discrimination' goal/law does not seem to be enforced in any way. Races are ranked in a kind of social order in Japan, first are Japanese, then white people, other asians, then all other races besides black people, who are last.

The government is sometimes a partner in racism and discrimination. There exists an 'unclean' sect of Japanese society who are referred to as 'Burakumin'. They are a particular sect who's ancestors had an 'unclean' religious history. A small square on the top corner of the Japanese birth certificate is filled in if a person is a Burakumin, or is blank if they are not. This is used by the government and the companies to deny Burakumin people good jobs and advancement during their careers.

There exists an other dark side to government sponsored racism, dating from World War II, which exists even to this day. During the war, many Koreans were forcibly taken to Japan, made 'Japanese citizens' and enslaved, or forced to serve in the Japanese Imperial Army. Upon the end of the war, Japan revoked Japanese citizenship from these people and their children. Unlike other Japanese, they lost all rights to military pensions and healthcare (even for injuries suffered while fighting for Japan in the war). As a result, today these people live in Japan, but are stateless, have no passport and cannot travel outside of Japan. The Japanese government considers these people (and even their descendants who were in fact born in Japan) to be foreigners. It is 'difficult' for many of these people to get Japanese citizenship as Japan has no diplomatic ties with North Korea. One requirement is that they must abandon their real names and choose Japanese sounding ones (a requirement made on most people seeking Japanese citizenship). Needless to say, the number of people accepted as Japanese citizens or as immigrants to Japan is very very small in number each year. Some claim that Japan sees it as an advantage to maintain a racially pure society as it is less 'disruptive' to social order.

THE DISTRIBUTION SYSTEM, WHY FOREIGNERS ARE SET UP TO FAIL IN JAPAN:

An extensive hierarchy of small distributers and shops exists in Japan which hinders the distribution of foreign goods. When Americans say the Japanese distribution system is 'difficult', 'byzantine' or 'complex', this is what they are referring to. In reality, the Japanese distribution system is fixed. This is why it is so difficult and complicated for the foreigner to succeed in.

Japan, being a communal society, follows a strict code of loyalty. Shopkeepers have loyalty to their suppliers and customers. They all have loyalty to the nation, Japan. Undoing this arrangement that brought the country and its companies so much wealth and power via the entry of foreign goods would be disruptive to this system of loyalty. This is one reason it is so difficult for a foreigner to enter the Japanese market. There are higher forces at work too though:

How important this was became very clear when I befriended a Japanese government worker. He explained to me how the system worked and why a foreigner cannot usually circumvent it. I suggested the following proposal as an example. The discussion went something like this:

I can sell high quality made in USA GE refrigerators and Hoover vacuums at a much cheaper price in Japan that Toshiba and Sanyo can (this is in fact true). I want to start a business. I go to Japan, but no store will carry my products because I am a 'gaijin' (foreigner), and my products are foreign. Doing so would anger the domestic suppliers of these distributers who may hold some of the shop's loans or offer them favorable payment plans.

I decide then, I will set up my own company in Japan, open a shop and sell the appliances myself since no Japanese store will do so for me. The government worker said 'You can't because you are a foreigner. Foreigners cannot own companies in Japan'. This is in fact true. It is this government practice which keeps foreign business ventures in the control of the Japanese (and hence why they tend not to succeed). It is also the reason there are so many 'joint ventures' between a Japanese company and a foreign one to enter the Japanese market. Otherwise, the foreigner is forbidden to enter, or later set up to fail.

So, anyway to get around this law, I told him that I will open the business in my Japanese wife's name, so now a Japanese owns the company. He said 'you will still fail because as you find success in the market with your inexpensive American goods, the other vendors will get angry at you. They will politely ask you to raise your prices to that of the Japanese made goods so the system doesn't get disrupted'. I, of course, replied that I would refuse to do this as its not in the interest of my customers. He replied 'then the vendors and the Japanese companies (such as Toshiba, Mitsubishi and other appliance makers) will complain to the government. The government will then prevent you (subtly though as free competition is 'the law' in Japan) from operating your business successfully or profitably. New building permits for your stores will be delayed for months for no reason. Business license paperwork will get misfiled or lost without explanation causing you legal hardship. Goods will be delayed unloading off your ships for 'too busy customs officials' or 'lost somewhere on the pier for 6 weeks' making you miss delivery deadlines and angering your customers...' Such 'subtle' persuasion is how you are brought into line in Japan.

True-life examples of this abound. Here are a few:

This is exactly what was done when a foreign garment manufacturer tried to sell their clothing in that country (threatening the domestic garment industry). Customs delayed unloading of the goods until enough of the summer season had passed making the summer fashion clothing unsaleable. Making foreign farm produce which competes against domestic Japanese produce wait on ships long enough to rot or not be appetizing to the consumer is an other practice.

The Feb 10, 1992 of Time Magazine describes how a US lamp manufacturing company encountered also exactly this problem. It took them 9 months to get lamps off the ship sitting in the harbor and into retail stores in Japan after customs, and other government agencies stalled and stalled (which cost this particular company lots of money).

Many anti-foreign goods laws are often written in the form of 'protection' to the consumer. These are applied discretionarily and are really written to prevent or make it expensive/slow/impossible for foreign goods to enter the Japanese market. For example, one well known Japanese tactic is the use of only one or two 'inspectors' who are responsible for 'inspecting' every single one of an importer's products entering Japan (ie. bicycles or cars). As every item must be individually 'inspected' (ie. ridden or driven) very carefully and one at a time, this takes very very long to do (one never knows how long). This causes enormous delays and costs the importer lots of money as well as preventing timely delivery to the customer. Competing Japanese domestic goods are often exempted from these 'consumer protection' laws as inspection is 'done at the factory by the manufacturer'.

Of some other more famous 'consumer protection 'laws, one for many years banned US beef from Japan because 'Japanese intestines were the wrong length and couldn't digest US beef which is too hard'. An other banned european skiis because the snow in Japan was 'different'. US made towels were banned because the fibers were 'too rough' for Japanese ears, which are 'softer' than ours. All foreign rice is banned for 'national security'. Rice in Japan as a consequence, is the most expensive in the world.

Finally, as an example of the no-foreign ownership rule, the recent baseball team fiasco comes to mind: Nintendo recently bought the Seattle Mariners Pro Baseball team. It is in great irony that it is illegal under Japanese law for an American to buy (very lucrative) Japanese Pro baseball teams (from ABC News Nightline).

THE BUSINESS CARTEL, KEIRETSU:

Let us go now to a primer on Japanese business organization. Almost all the significant companies in Japan are aligned into one of about 6 keiretsu or business 'groupings'. These are loosely linked 'super-corporations' for lack of a better term. Most of the Japanese companies whose brands we know and love here in North America are in these keK;netsus. These keiretsus have been around a very long time (before WWII) dating back to feudal-like family run trading houses. Mitsubishi and Mitsui are two of the more famous ones. Famous companies like Nissan, Toshiba, Sumitomo Bank are all in keiretsus. The keiretsus were disbanded by U.S. forces during the occupation because it was feared they could one day be dangerous to America. However, upon departure of U.S. occupying troops from Japan, the ex-member companies rejoined each other to reconstitute the keiretsus which had previously been disbanded.

Here is why this is so important. Each of these keiretsus have under them, member companies who operate in each of the major critical business areas. These are: banking, distribution, steel making, heavy manufacturing and electronics. Mitsubishi Bank, Mitsubishi Electric Corp, Mitsubishi Heavy Industries and a wide array of other Mitsubishi companies (several hundred) making all kinds of other things are in a keiretsu. (Mitsubishi is unusual as most of their operations have the same name). Each of the companies in the keiretsu are independent and very specialized in what they do in all senses of the word except for loyalty. Imagine a keiretsu is something like a college fraternity, but for companies. Their individual independence is what keeps things from getting too big and out of control, yet they can make a united front for issues important to the national or keiretsu effort.

To make the point, a car company and electronics company in the same keiretsu have a long term relationship to help each other, for example to make a really fancy computer control system for cars, or to make special lift-loaders for the computer company's factory. If you walk into a Japanese transplant auto assembly plant in the United States, you will find that the equipment from the stamping presses to the forklifts are Japanese brands, even if it is more expensive (in the short run) to do this. This is national and keiretsu loyalty at work.

Every Keiretsu has a bank. This is the heart of the keiretsu. The bank is like a national central bank, but for the keiretsu. The bank takes money from winning operations and gives it to new ventures in the keiretsu without the red tape that a bank would usually give before lending to a new start up venture. Having a bank who is in fact a part of your company means they will be fiercely loyal, understand your business and not call your loans for silly reasons like US banks do. This is much more efficient than the way America does banking and lets companies join forces to use their capital much more effectively than the US can.

This is also why buying a Japanese product may put buyers of that product out of a job, even if they work in a different industry. They take the profits from the product that person bought, shift it through the keiretsu bank to develop, invest in and dump products into the industry or market that person now works in, and put them out of a job. See the telecommunications example at the end of this paper for how this works in practice.

COMMAND AND CONTROL:

Japan's business effort is directed by the powerful Ministry of International Technology and Industry (MITI). It decides national strategic industrial policy and determines with the corporations, which industries to target, enter, exit, take over...etc. This is where Japan's 'united front' when entering a market is co-ordinated from. This is also why you often see several Japanese companies entering a particular market at the same time (ie. TVs, and more recently, luxury cars). By acting in unison, the companies, banks and government can attack and overrun a foreign industry with a much bigger 'punch' then had they done so separately. It also enables strategic moves which countries like America cannot do as American business efforts are not co-ordinated in any kind of way.

In fact, such moves are illegal for US companies under antitrust laws from the 1930s. This puts us at an enormous disadvantage against US Japanese rivals as it is legal for example for Ford and Mazda to join forces, but not for Ford and GM to do so. The US antitrust laws were written at a time when US companies were the most powerful in the world. This is not true anymore and hurts America greatly as US firms struggle in the world marketplace against large foreign firms who are able to join their forces to defeat America's companies.

THE PROTECTED HOME MARKET...JAPAN'S LAUNCH PAD TO THE WORLD:

Japan has a protected home market which serves a very important purpose to the country and the national business effort. The home market is for trying out new products, copying and improving foreign designs, getting capital (through price gouging) without fear of foreign companies entering and ruining the game.

An unwritten rule is that there is no real competition in the Japanese home market between Japanese companies which are also strategic exporters. Real competition occurs in foreign markets outside Japan. The home market is a 'safe' market where these companies can experiment with their products, improve upon them, and fix problems with out fear of any real foreign competition capitalizing on their blunders (a luxury our own companies do not have in America). For example, SONY and Mazda did or had done this frequently within Japan. The scheme works as follows and is the critical reason why a Japanese company can enter almost any world market or industry from scratch and overrun it so quickly:

Imagine Sony comes out with a new type cassette player which is very small. It breaks often because the small plastic gears inside are of low quality and wear out (this was true, actually). This machine though, is only sold within Japan. Only in the future when it is perfected will it be sold to the outside world. Now lets imagine GE is the dominant manufacturer in this market worldwide. They want to sell their player in Japan (which is better than SONY's) but can't because they are forbidden for all the reasons mentioned in this article. Sony fixes their gear problems, tests it in the home market (this is one reason why the latest Japanese products hit the Japanese market at least 6 months before anywhere else) and later exports it abroad. Sony maintains its good reputation in America as their player works well (the US customer never got a machine with the defective gears). Sony sells this player at 3/4's the cost to make it in order to increase their market share and drive GE out of the cassette player business. Sony doesn't go bankrupt doing this because they can sell players in Japan at twice the cost to make them and hence cover their losses in America. Because GE is forbidden to sell in Japan, and can't make money at home in America because Japanese players sold there are too cheap, they surrender and lose market share. GE asks the US government for help but is refused. Later when this is exposed, GE is accused of 'whining' and 'not trying hard enough to enter the Japanese market' by the Japanese Prime Minister.

Now, imagine the reverse situation. GE also makes a machine that is poor quality in its home market of America (this was also true). The Japanese then enter unimpeded, dump their perfected goods here and drive GE out of the market. As you can see, whenever a US company makes a mistake in the home market, it suffers greatly, but when a Japanese company does in their home market, they don't suffer so much. Hence, even if the American company is more efficient and generally of higher quality, the Japanese companies will ultimately defeat the US competition. This is true even if the US companies make fewer and smaller mistakes over the same period of time because the US company gets hurt for a mistake in the home market, but the Japanese one does not. For example, Japanese car companies have also come out with disasters comparable to the 'exploding Ford Pinto'. But by using their protected market for experimentation and improvement, they are able to resolve problems like this before they arrive on our shores. Our car companies have no such luxury and hence suffer the consequences each time they make a mistake. This is an other reason why the Japanese protected/non competitive home market is so important to their success.

The non-competitive home market serves an other important function to Japanese industry. Smaller/weaker Japanese companies are allowed to survive because it is possible they may some day have a 'winner' which would be good for Japan (this actually happened to Mazda with the Miata and other recent offerings in their foreign markets). If the company were bankrupt though, they could not come up with 'winners' sometime in the future. Its better to let the weak competitors survive in Japanese market in the hopes they become strong someday. Because of laws restricting foreign ownership as well as 'cross-holding' agreements between the Japanese companies, there is very little risk a non-Japanese company could take over these weaker players and enter the Japanese market. Unfortunately, the same protection is not bestowed among America's promising small companies who are easily taken over by major Japanese players who want their technology.

The no-home-competition point is ironic, because some newspaper reporters who don't understand the Japanese economy write quotes like "there are 7 car companies in Japan (a country with 1/2 the population of America) therefore the car industry must be extremely competitive in Japan". The truth is that there are 7 car companies in Japan because there is almost *NO* competition in the home market. This is why their market shares in Japan are stable. They are basically fixed. If there were competition, the strong players like Toyota and Nissan would have absorbed or bankrupted their less powerful rivals like Mazda and Daihatsu long ago.

WHAT IS DUMPING AND WHY IS IT BAD:

A New York Times writer last year wrote in his commentary that Japanese companies are foolish because they practice 'dumping' (selling their products here for a price lower than it costs to make them), and that he hopes they continue as it benefits the American consumer. His article is misguided and shows why it is so difficult to understand why Japanese business practices are so dangerous to America.

Some Americans think buying dumped products is good. This happens because they don't see the real costs to themselves which are not on the low sticker price. These costs turn out to be higher to the buyer than the savings on the product price (otherwise the Japanese would not be dumping... ...there's no such thing as the deal that's too good to be true). The key is that this cost is indirect but very real nevertheless. It turns up somewhere else than at the checkout counter and is how Japan profits by 'dumping'.

The cost to America (and the benefit to Japan) turns up in the long term. This is why it is not seen so easily. It turns up in America as unemployment, closed factories and reduced national strength as US companies cannot compete against this practice. Japan's factories run, their people get jobs and later on Japan makes much more profit than it originally cost to do the dumping. Japan can do dumping by raising prices in the home Japanese market to pay for dumping in America. US companies don't have this luxury as the US market is open to the outside world and prices cannot be artificially raised to pay for dumping elsewhere.

ECONOMIC STRATEGY, WHAT IT ALL MEANS:

Many people ask, what is a national industrial strategy. Some people claim it is a form of socialism or communism. Nothing could be further from the truth. Again, the best explanation is by example.

A few years ago Japanese industry co-ordinated a successful attack to take over the entire world commercial supply of LCD computer screens by selling them at 1/3 the price to make them, (PBS Frontline, "Losing the war with Japan") and waiting for the small US upstarts who invented them to go bankrupt. As a result, today all LCD screens in any non military computer in the world are made in Japan. This is a very strategic component because it will be used in portable computers, medical imaging equipment, videophones, HDTV, touch sensitive visual programmable refrigerators and stereos..etc.

If you are a non Japanese maker of any of the above items, this is very bad for you, because you will have to go to the Japanese to buy these screens to put into your product (say a portable PC computer). However, the Japanese companies also want to make these products too (entering your industry is part of their long term strategic plan (which is 200 years long)). As a result, they want to make you uncompetitive. They do this by selling these screens to you at a price higher than they sell the same screens to Japanese PC makers (which might even be the same company as the screen maker). They can do this because they have destroyed the US competition. You are forced to go to them if you want these screens.

You need these screens though so your PCs can compete with the Japanese PCs which will be on the market soon, so you must buy them as there is no other supply. This means though, that your PCs are more expensive then the Japanese ones because you are paying more for your critical components than the Japanese companies are paying. ...You lose...

Besides offering to sell you the screen at some ridiculously high price, the Japanese will often offer to manufacture your entire product at a reasonable price and put your name on it. For example, some of the Mac Powerbook portable computers are not Macs at all, but really SONYs. Most portable PC computers today are made in Japan for the above reasons (even if they have American brand names on them).

This type of deal is really nice for Japan because it gives the Japanese companies the rest of the technology to make your product (besides the strategic component). This also makes you dependant on them for all your manufacturing (because your factory is now closed, your workers unemployed and new ones too hard to train quickly). Finally, your Japanese supplier can bypass you entirely at a future date and sell the computers they make for you, but with their own name on them. They do this in the factory your sales helped them to build in the first place. Mitsubishi did this to Chrysler with cars, first it was the Eagle Talon, then later the Mitsubishi Eclipse....both cars are identical, but really Mitsubishi's.

The LCD screen monopoly is what enables Japanese companies to have such a large market share in portable PCs which use these screens yet almost no market share in desktop PC computers (which don't need these screens). Japan hasn't been able to take over the desktop PC market because its still advancing too quickly and they have no monopoly on any critical components in these machines. As a result, this industry can still belong to America. America is able to hold on rapidly advancing industries through innovation, but Japan cannot. This is because by the time Japan copies a foreign design, it is already obsolete. Japan has poor luck trying to hit a moving industrial target and will usually miss. So long as an industry moves fast enough, and the Japanese don't succeed in taking hold of some critical component of that industry, the US will be able to hang on to it until it slows down or matures, then the Japanese can successfully take it over.

By focusing on taking over markets like LCD screens, critical computer chips, high precision machining, and auto manufacturing, Japan has significantly reduced America's ability to make these things in time of national need. Japan lost World War II because they had a poor manufacturing base (they had to stockpile for 4 years before starting World War II). They have learned very well from that mistake, which now America is making.

This example shows why something like LCD screens are a strategic component and why Japan needs to dominate this industry. This is what is meant by a famous Japanese phrase: 'Business is War'. Key markets overlooking industries are like peaks overlooking cities. The strategy in a business war and economic war is the same, and the outcome is the same. Domestic factories are gone because the industry has been killed economically (rather than being bombed), workers are out of a job, and the target country has much less power and safety in the world. It is like a real war, but less bloody.

THE ECONOMIC WAR, A SUMMARY OF THE GLOBAL PLAN:

Free world trade is a good thing for all countries. Generally, countries raising protectionist barriers against each other is very bad. This in fact, helped cause the 1929 depression. What is happening now though is worse. Although some will tell you that the US and Japan are practicing free bilateral trade, this is not true. Today, Japan and America have basically a one-way trade relationship. Japan closes their market towards us, but we don't towards them.

Some say that Japan has a national strategy to control economically, what it could not get militarily 50 years ago. An impulsive claim perhaps. But, today, I am not so sure.

Some may think that only America is having trade problems with Japan right now. This is not true. Most other industrial countries in the world are in the same predicament. Today, Japan has a huge trade surplus not only with America, but with almost every other country in the world it trades with. This happens when Japan buys less in products from other countries than the other countries buy from Japan. This is bad because it means Japan takes money out of America's economy and uses it for their own purposes (such as buying our real estate, or companies).

Japan's trade surplus is no accident. It is not the result of Japanese efficiency, American laziness or anything else the Japanese government officials may tell you on the TV. The real cause is this: Japan trade patterns are not bi-directional in the common sense where two countries buy each others exports and a happy state of affairs results. Japanese policy is to intentionally use foreign cash profits not to buy a foreign country's exportable products, but rather its capital assets like companies, real-estate and art, while preventing the other countries from doing the same thing in Japan. This enables Japan to get wealthy and powerful extremely quickly while still being more inefficient and averse to business risk than its trading partners. When 'whiners and Japan bashers' claim Japan is 'cheating', the following is what they are trying to say. Here is an explanation of how it works.

-->Defense:

There is a three tier economic defense which the Japanese use. First is a set of laws which severely restrict/prevent foreign ownership and control of Japanese companies and assets in Japan. As a consequence, GM must sell their cars through Isuzu and Ford through Mazda. Chrysler doesn't sell many cars in Japan. Long ago Ford used to have a large market share in Japan but the government closed their operations and forced them out of the country. Today, foreigners typically cannot own Japanese companies, especially those in strategic industries such as manufacturing and technology. It is because of these laws and regulations that you hear about so many 'joint' ventures between US and Japanese companies, where the venture is intended to help the US company penetrate the 'difficult' Japanese market. These joint ventures really enable the Japanese companies to get foreign technology without having to invent it themselves. The foreign company gets only a token market share in the Japanese market in return.

It was in this way Japan learned from the US companies how to make TV's in the 1960's. More recently, the Japanese government recently forced Texas Instruments to join a venture with SONY, where SONY got technology in exchange for TI being able to sell some of their products in Japan.

The second defense mechanism is the wide 'cross holding' of stock shares between the companies in Japan. This basically works by having the Japanese companies print up lots of shares and exchanging equal values of these shares with other Japanese companies. This is very cheap for the companies there to do. As these shares are never given up or sold, they are effectively taken out of circulation. Because companies own such a large percentage of each others shares, it is impossible for a foreign firm or individual to accumulate enough shares (51%) to take over a Japanese company. As a result, a foreign takeover of a major Japanese company has never occured.

A side note of all this is that Japanese companies are able to think long term because they don't have to answer to stock holders at the annual shareholders meeting. Because so many shares are cross held, private shareholders tend to be not so significant in number and hence not a threat to the board. This is why US companies must worry about short term performance so much, often at the expense of wiser long term decisions. Japanese companies do not have to worry about this, so they tend to invest much more in the future than we do and hence are much more successful.

The final defense system is a well set up structure of government laws, behaviour and corporate co-operation which prevent foreign companies who get around the first defense system from succeeding to make money by selling products in Japan. The government delays foreign entry of goods through lots of intentional customs and other regulatory snafu's as well as red tape designed to hinder a foreign company to the point it becomes non competitive in the Japanese market place.

-->Offense:

The offensive strategy is also a three tiered system. Firstly, government (through the powerful Ministry of International Technology and Industry) and corporations co-ordinate and select targeted strategic industries which they want to enter, or take over.

Secondly, they obtain the basic technology (often from the current foreign firms in the industry), then copy and improve upon it. They do trials, have failures and make further improvements in the Japanese home market which is protected against encroachment by foreign firms which may be already established in the rest of the world within that particular industry.

The final and most critical stage in the offensive system is the practice of product dumping in order to gain market share overseas. Japanese companies will initially export a product overseas at a price usually lower than it costs to make it. The same product is usually sold in Japan at a higher price so the Japanese company doesn't go bankrupt. This lets the Japanese companies increase their marketshare as foreign buyers tend to buy the lowest price quality product. This places stress on non-Japanese competition. Sometimes the foreign competition is a well deserved target (ie. poor quality US autos), but more often they are not. Once the foreign competition has given up, or has been sufficiently weakened and the Japanese dominate that industry, they bring the prices to a level reflecting cost of manufacture and development and move on to the next market they want to take over. Using this technique, the Japanese can enter and take over in a short while, almost any industry they choose no matter how unrelated (which they have done). Their system is virtually foolproof as long as you have trading partners and individual consumers who tolerate or don't understand the dynamics of what's really happening.

It should be noted that raising the price of a good within Japan in order to pay for dumping in the foreign country is becoming less and less prevalent as the Japanese companies today have enough cash to finance dumping in the foreign country strictly from cash reserves. Once they have wiped out the foreign competition, the profits start to roll in.

In some ways this is America's fault as Japan has taken advantage of the open US market, as well as America's tolerance to Japan's closed market in order to help them rebuild their country after WWII. Ironically, America's best scientists and engineers are working for military projects, whereas Japan's are working on commercial ventures, where the war is actually being waged.

SUCCESS DOESN'T ALWAYS COME THE FIRST TIME:

Sometimes, the Japanese will fail at first to enter a market. For example, the Japanese auto companies entered, and retreated from the US auto market several times before making their successful onslaught. During the intervals that they were not so active in the US market, they were learning from their mistakes, improving, refining and testing their products in their protected home market, preparing to enter the US market again at a later time, which ultimately they did.

This strategy is still used today. For example, recently the Hitachi company, a major Japanese telecommunications maker announced it was withdrawing from the US telephone switching market (large specialized computers used by telephone companies to make your phones work). It would be foolish on the part of the US telecommunications makers to believe that they have defeated Hitachi (some actually believe they have) because telecommunications is a Japanese government designated target strategic industry and Hitachi will most certainly be in it in the future (as they have for 40 years). As happened in the auto industry, Hitachi is at home right now refining and improving their products based on what they learned from their last campaign in America. They will be back stronger than before. I know this because I saw some of their new and upcoming products when I was Japan. Once their improvements are complete and proven in the home market, they will re-enter the US market, possibly surprising America's domestic makers.

INNOVATION:

A serious problem, which the Japanese themselves have acknowledged, is the lack of originality and innovation. This is quite notable when you look at their companies' histories. The Toshiba company in Tokyo has a big science center with a time line of its history on a wall. On it were its achievements. It read something like 'transistor imported into Japan 1950, manufactured here in 1953', 'teletype imported 1931, manufactured here 1935'...etc. There were no inventions, only refinements. Hitachi, NTT (the telephone company), Nissan and Matsushita had similar 'timelines' in their centers with quotes like above.

This happens because inventing means failure (for a time at least) and no guarantee of success. Because the Japanese cannot be seen to fail (this is shameful and very bad in Japan), they do not invent. As their companies become more powerful, I wondered who would be around to make the discoveries like xerography, the transistor and LCD TV (all invented in USA). I found two Japanese government sponsored organizations in Japan with the task of short circuiting this problem.

One, the Technology Transfer Institute, specializes in finding small companies around the world with new technology and helping Japanese firms buy the technology. If the Japanese firm wants it but can't buy it, they sometimes steal it by patenting similar items copied from the foreign company's original and then intimidating/bankrupting the small company through a blizzard of legal action. If the company is publicly traded, or the owner wants to sell, the company is bought outright by the Japanese. America, unlike Japan, makes no effort to protect its strategic companies from foreign takeover. Imagine your small company and its patents versus the attorney war chest of Mitsubishi Industrial Company.

This is actually what happened to Fusion Systems, a small American firm which invented and patented a new way to get spray paint to stick on pop cans (PBS Frontline, "American Game, Japanese Rules"). Mitsubishi bought one of this firm's machines and came out a few months later with one of their own. The small firm sued. Mitsubishi then made many small modifications to the machine (not improvements, just voluminous iterative changes), patented all of them and sued the US company many times over (for each patent). Mitsubishi just waited for Fusion Systems to run out of money defending them all (and offered to drop the cases if the small company sold them the rights to the machine).

If Japan can't get technology this way, they get it free from public foreign research. A Japanese institution exists which is called the 'Japan Research Foundation'. It actually does no research, but translates foreign research papers into Japanese for the Japanese companies to use.

A major reason for getting foreign research this way is that Japanese universities themselves don't do much research. Their equipment is extremely outdated (in contrast to corporate labs). These schools are literally straight out of the third world (possibly the last physical part of the third world still in Japan). University is a place for students to drink and party before joining a company, often for life. At the University of Tokyo, the most prestigious university in all of Japan, the buildings are in extreme state of disrepair. Stench of raw sewage permeates and leaks down the hallways of the buildings and the (often drunk) students live in extreme squalor. Academics did not seem to be taken seriously by the students who were too busy drinking or playing sports. The libraries were almost devoid of students. Some buildings like the Library for American Studies were very nice, but many others were in shambles. Half of all the windows in many of the buildings were broken and glass was strewn about the floors. There were no working safety/fire control systems. Electricity wires were hanging exposed in hallways and lighting was not functioning (for many years it seemed) in parts of buildings. Old gas stoves were running unattended in kitchens with cardboard covering broken windows. Piles of garbage and wrecked cars were strewn about the campus and behind buildings. Nothing had been painted or cleaned in about 20 years. The grass hadn't been cut in a very long time and had reached full height. Cats and other creatures lived in some of the buildings. The school swimming pool was a filthy algead mess. If this seems unbelievable, one can get off at Todai-komaba station in Tokyo and go see for themselves. This is all the more surprising as the rest of the country is so rich and modern, more so than most parts of America today.

There is an important reason for all of this. In the world, universities typically do research to advance learning and science for the world. This is extremely expensive to fund, and is a lousy way for a country to get the most value for its money, so Japan does not do this. The Japanese government makes no effort to seriously support its universities. Furthermore, unlike their US counterparts, Japanese companies give no money to universities. This does not mean that Japan does not value basic university research. Quite to the contrary. It is far cheaper to let the other countries' schools and governments do and pay for basic research (which is published openly to the world) and to simply translate and read their papers.

Japanese research money and results stays in the corporate and government labs, where it may be kept secret from the foreign countries, which are the enemy in the economic war. Japan does do research (lots of it actually), but not for public dissemination and world advancement. Research is done to gain advantage over their rivals. Last year, the Toshiba Company alone spent more on research than was spent (privately and publicly) in all the country of Canada. This is the fundamental reason why Japan refuses to fund universities and diverts it to corporate research instead. It is something we must understand.

Ironically, it may not be a weakness of theirs that their universities are so awful. If they know that they can get research from America for free, they are smart to put their money in their private and company labs instead; where they can use it against US companies in order to defeat them.

In spite of all this, Japanese workers still get an excellent education. This is because education up to (but not including) university is very good and extremely well funded. In great contrast to the universities, the elementary, secondary and tertiary schools are very well stocked with the best of equipment, facilities and teachers. They are as nice as anything in America. Furthermore, highly specialized training programs are provided to newly hired workers when they join their companies. This makes up for the weakness of the Japanese university system.

A further point to this, companies do not to give grants to charities (nor universities). Corporate citizenry doesn't not exist in Japan in the way we know it here. This is why it is extremely rare to find Japanese corporate run foundations in Japan or America. This is also why it is extremely unusual to see for example, a PBS program sponsored by a Japanese company (though recently, this is changing for the US branches of Japanese firms as they learn how important Americans relate charity to a company's image).

JAPANESE PEOPLE AND THE MARKET:

The Japanese people are extremely kind and polite, don't go stealing things out of each other's houses nor do they go shooting each other as much as Americans do. They are however naive about the forces in their world around them (a point which probably can also be made about America's own citizens). There is little individual thought nor questioning of the government and companies, which is very dangerous. This is compounded by the fact that 1 political party (the LDP) has ruled the country ever since it has had a democratic constitution. Results of this include the fact that many cartels operate in the country yet no one seems to notice this occurs. Many Japanese aren't even aware that foreign countries make the same products that Japanese companies make. Formally, Japan has laws against cartels, but they are not enforced. Only one major cartel group has been prosecuted in the last 15 years (plastic wrap companies), and this was only after a lot of pressure from the United States. As America's power in the world diminishes, so will its ability to exert such pressure.

Ordinary Japanese don't have much idea of why they can't buy foreign goods at reasonable prices in their stores. When I asked Japanese people why they don't buy American (or other foreign goods), they often say because they can't find them, or they are much too expensive. This is true.

Foreign goods are often impossible to buy at any price and are usually very expensive when found. For example, I looked for, but found no Korean products at all in Japan even though this country is very close to Japan on the map (1000 miles max distance). Because Korea has little political influence, it cannot pressure Japan to allow their products in. As a consequence Korea cannot sell their products in Japan even though they make many of the same types of high quality electronics and automotive goods the Japanese make, but at a lower price. US (and other foreign products) which must face a Japanese domestic maker are also extremely hard to find in Japan. Even the American flags in the Tokyo-Shinjuku Mitsukoshi department store were made in Japan.

I realized that Japanese people would buy American goods if they could when I told them the prices of US and Japanese goods in America. I used some of the examples in this paper to try to explain why there was 'Japan bashing' in America. I also happened to have a US newspaper, so I showed them product prices of US and Japanese goods in America. I took them out into their shops and proved the differences to them. When I finished, they were shocked at what I had just shown them. Japanese goods are sometimes cheaper in America than in Japan and non Japanese goods are much more expensive in Japan than they should be, especially if the goods are in an industry targeted by the Japanese companies and government.

For example, the major Japanese appliance manufacturers are planning to enter the US market for appliances (refrigerators, stoves, vacuums) in the 1990's. In a major Hiroshima appliance store (the only store I could find any foreign appliances), I saw a GE refrigerator selling for $3000 (US). This was a very low end model you could buy here in America for about $600. The Toshiba right next to it was a high end model and sold for $2500. It is these Japanese cartel tactics which lead ordinary Japanese people to believe that US goods are inferior and overpriced. In America, Japanese made Sears brand refrigerators similar to the Toshiba sold for about $1000. This didn't seem right to me. The government and more elite business people I spoke with already knew about these points and acknowledged that they could see it was a 'problem' for America.

ESCALATOR DOLLS AND OFFICE LADIES:

An escalator doll is a young women in her 20's who stands by the escalator all day and welcomes you to the floor of the store or office building. She says goodbye and thank you when you leave. You find these at Mitsukoshi (the classiest department store I've ever walked into), the Toyota main showroom in Tokyo, the government offices and the corporation offices (Sony, Toshiba, Nissan..). Other women serve as temporary labor to bear the bumps generated by the economic cycle. It is these people (and foreigners) who get laid off in order to permit a system of lifetime employment for the Japanese males. Escalator dolls (and their counterparts within corporate offices, 'Office Ladies') must often sign a contract with the employer stating that they will quit when they reach the age of 25. The true purpose of these girls (besides serving tea and welcoming guests) is to be marriage material for the men, who are at work for such long hours that they have difficulty to find women on their own.

Young women in Japan are typically expected to marry by 25 years old. A well known quote in Japan makes the point bluntly: "Single women are like Christmas cake, after the 25th, useless, so they go for 1/2 price." Marrying by 25 is important. If a women is nearing 25 and can't find a mate, chances are she will have a pre-arranged wedding to an eligible bachelor set up by the parents.

I sometimes wonder how much of a willingness to change the system exists in Japan, even among the women themselves. While there, I met one Japanese woman who went to university in America and studied Political Science. I asked her what she thought of the way Japan treated their women. She didn't see a problem. In her opinion, women should stay at home as it leads to family stability and enables the husband to concentrate on his work and not family affairs. I asked her where she was working. She works at a Japanese company as a tea server (office lady). 'What would you like to do at your job in the future', I asked. She replied 'they told me that if I did a good job now, I could be a secretary in a few years and file things'. This person has a university degree.

In Japan, the percentage of women who are managers of men is much lower than in America. Furthermore, women typically don't hold any positions of importance. They are more like office decoration or marriage material for the men. It may also surprise you, but almost all women in Japanese companies, regardless of professional status or level in the organization are required to prepare and serve tea daily for the men as part of their daily chores.

"BUSINESS IS WAR":

This is a well known quote in Japan. It may be surprising, but this has more meaning to the Japanese than you may first think. The word 'business man' in Japanese translates literally into English as 'Company Soldier'. Japanese businessmen do not have pictures of their family or loved ones at the office because they 'do not mix family with battle'. When a Japanese man joins a company, he usually does so for life. His first allegiance and loyalty is to this company and his team. His family, if he has one, is secondary in importance. It should be noted that this philosophy does not begin when one joins a Japanese company. It begins much earlier in life; in elementary school:

While I was in Japan, I went to an elementary school to see Japanese students participate in their 'Olympic Sports Day'. This event though, was quite unusual. There were no individual activities, and the theme of the day was extremely militaristic in nature. There were two main teams, the red and white teams symbolizing the country's national colors. They had big banners, taiko (battle) drums which the team leader beat on while chanting the team slogan. Contests were set up such that if one person made an error in the competition, the whole team would suffer. Rewards, and failure were shared among all members of the team. Stress and peer pressure were very high, as they are for most Japanese throughout their lifetimes. Before the competition, everyone on the teams sang the school anthem louder and more clearly than I ever heard any anthem sung here in America. Their diligence and effort were quite remarkable.

What we call individuality in America is called deviation (be it in school, or at work) in Japan. It is not tolerated nor tried very much. (In fact, kids who's hair is not black enough get it dyed so as not to get in trouble at school by the teacher). Anyone with an 'outsider's' mind is rejected by the others, even by the teacher. A consequence resulting from this fact appears when families who have lived outside Japan for a few years return to the country. These people have a lot of trouble being accepted and integrating back into Japanese society.

'Peer stresses' in Japan are very strong. Many kids can't take it and commit suicide before reaching university age. Many Japanese suffer from a wide variety of stress related nervous ticks and twitches (if you ride the subway in Tokyo and look at the other riders, you will notice this very readily).

MILITARISM:

In the book 'Japan that can say no! (to America)', by Akio Morita (CEO of SONY) and Shintaro Ishihara (an influential parliament member), the authors state that Japan has under development the world's most advanced military jet because American made planes are not suitable for Japanese terrain, which is 'different' because it has mountains. I also learned about one Japanese who quit the Fujitsu company partially because they were working on a nuclear weapons research project and didn't feel a Japanese company should be involved in such work. In Japan, Fujitsu has built at least 2 nuclear breeder reactors (such reactors often are used to enrich plutonium for nuclear weapons). The Japanese claim however, that they are for peaceful purposes. Hopefully this is so.

The military mindset even extends to city planning. Most streets in Tokyo have no names in order to 'confuse the enemy' in the event Japan was ever to be invaded again. The US Army did name many of the streets during the occupation, but these were removed by the Japanese shortly after US occupying forces left the country.

There also exists a well funded extremist nationalist movement in Japan which posts large posters at most major intersections and subway stations in Tokyo calling for restoration of the emperor as ruler and re-militarization of the country. Every day in the business and shopping areas of the city, vans drive around with huge loudspeakers blaring nationalistic music and making the above demands. Apparently, the older Japanese ignore this, aware of the west's generosity after the war, but feelings of the younger people who don't have the memories of Japan's dark past are more uncertain. What is happening today in Germany may be a foreshadowing of things to come.

This may seem implausible at first, but not after one looks at Japanese elementary students' textbooks. In the texts, the sections about World War II are extremely distorted. In these books, Japan is played out as the victim to world aggression and the atrocities of the Japanese Imperial Army are not mentioned anywhere. The massive US aid to rebuild Japan after the war is mentioned on only one line which went "America provided Japan with some help". Japan's postwar success is credited only to the hardworking values of its people (partially true), and not to US aid for reconstruction of its industries (paid for by American tax payers), free access to the US market, and US tolerance of Japan's closed market. After reading these books, one is lead to believe that WWII was America's fault. It is hoped that the younger Japanese learn what really happened before their parents grow old and die, or America and Japan may face new misunderstanding and confrontation in the future.

EFFICIENCY:

Japan is perceived by the outside world to be an efficient country. In actuality, Japan is a very inefficient country. The subway people count change out of tin plates. The valuable intellectual resource of women is wasted by giving them only the most menial jobs such as 'escalator dolls' and tea servers. The farming system is one of the most inefficient you will find in the modern world. Because of this inefficiency, there are a lot of people employed on the farms who otherwise may not have a job. Although this is an inefficient use of people and resources, it helps maintain a low unemployment rate. The protected domestic market keeps all this from collapsing. As a result Japan can be inefficient, yet still be rich. It is now per-capita, the richest industrialized country in the world (and is expected to be the richest absolutely by the year 2000, surpassing America). It may surprise many people, but the most efficient country in the world is the United States, not Japan. Japan ranks a bit of the way down. In manufacturing though, they are best in the world.

TRUE, BUT ONLY ON THE SURFACE:

it is claimed that Japanese transplant factories in the USA are good for America and create jobs. Although a Japanese transplant factory may be good for the town which gets it, its bad for the country as a whole. Japanese factories opened here tend to be only assembly plants. This is important because most of the value of manufactured products resides in the research and development of machine tools, plastics, technology as well as the manufacture of parts which make up that product. There is little value in assembling pre-made parts together to make a final product. Parts machining and manufacturing (and those jobs) is typically done in Japan, with the finished parts being shipped to the US for final assembly. This is true even for Japanese products 'made in USA' like the famous 'US made Honda Accord'. As a result, when a Japanese auto plant opens in the US; for every 1 job created, an other 4 are lost (in the parts and high tech sectors of US industry). Hence, the true consequences are bad for America as we lose the technology on how to make advanced manufactured components. Final assembly of Japanese auto parts is pretty low tech and also doesn't keep money in America. Final assembly only adds about $700 to the price of a car. This is the only money which stays here when you buy a 'US made' Japanese car. The costs of paying for welfare and unemployment for unemployed US engineers and parts maker employees are much much higher and later wind up on American's tax bills.

An other claim goes that "America is successful in Japan and one only has to look at Mcdonald's, Disneyland and others to see America's success". These are not 'American successes' in Japan because in reality, these are Japanese owned franchise companies. Their appearance is American, but their ownership, production and management is Japanese. A very small token number of foreign companies are allowed to have a presence in Japan (ie. Toys-R-Us, P&G, BMW, Kodak, IBM), but their overall market share is kept quite small via the means described in this paper.

EXAMPLE, HOW ALL THIS WORKS TOGETHER:

Buying a Japanese product, even in an industry unrelated to yours can cause you to lose your job! This is much more likely than one may think. Many otherwise smart people do not understand this so I will explain it with the following true example:

AT&T is a large US telecommunications manufacturer that is well placed in the world market and hence pays its employees very well. Many of them like to buy Hondas, Acuras, Mitsubishis and Toyotas. Most of these Japanese companies are in one of the 6 or so keiretsus in Japan.

MITI and Japanese industry have publicly declared the world telecommunications manufacturing industry to be a Japanese national priority (target). As a result, they have planned and are starting to execute a strategy to enter and to become the major player (today, they are a very minor force) in the telecommunications industry during the 1990s. In fact, they have a plan to wire every house in Japan with fiber optic cable within the next 10-15 years in order to perfect making fiber and its associated communications hardware.

Japan will have to spend money to research and develop their new telecommunications equipment. This will be very expensive and they will need the help of the keiretsu banks to do it. Where do the banks get this money? From their biggest export of course, automobile sales. This means that although AT&T managers and engineers only bought cars, they are helping fund Toshiba's, NEC's, Hitachi's and Matsushita's effort to put them out of a job.

Imagine one of AT&T's engineers recently bought a new Honda automobile. One day, that engineer loses his job due to fierce Japanese competition in the telecommunications industry, get into his Honda, go home, yet never ever equate the two events!

Let's continue this example a little further to summarize this paper The Japanese want to enter a new industry, telecommunications. Based on previous experience, this is how they are likely to do it.

Firstly, telecommunications in the future will be based on something called digital technology. This will enable those picture-phones you used to see on Star-Trek to be a reality. Fiber optic cable and data transmission are very important to do this too. This is why they want to get good at making fiber optic cable by making and putting fiber cable all over their entire country.

Today, the Japanese are lousy at making high quality major telecommunications equipment that your telephone company would buy. In the world market though, there is lots of money to be made in this, which right now AT&T mostly gets. Because Japan doesn't know how to make good telecom equipment, they will need to do three things:

>1) get some good telecom equipment so they can copy it and improve it.

>2) pick a very strategic but simple niche market in the industry and take it over completely (ie. dumping) to get a foothold so they can use it as an anchor to increase the market share in telecommunications (same strategy as the LCD screens example above).

>3) start small.

It turns out they have already started to do these things. For (1), they promised some US big name telecom makers that they might get a piece of the Japanese telecommunications market in return for a small sale of their best equipment to the Japanese national telephone company. AT&T and other North American firms fell for this scheme (maybe the laid off TV maker executives went to work for AT&T). AT&T sold them one copy of their most advanced equipment for a promise from the Japanese to 'possibly' buy many more. This is foolish as AT&T has just let a country which has made a public declaration to be the world leader in telecommunications get a copy of their best equipment. AT&T's equipment will get copied and show up as Japanese brands a few years from now. Perhaps AT&T doesn't understand that Japanese phone companies and Japanese manufacturers work together to defeat foreign firms like AT&T. Hence, selling equipment to a Japanese phone company is not much different from selling it to a competing Japanese manufacturer.

For (2), Japan already has acquired two main strategic industries. Firstly, as you know they have 100% market share in the small LCD screens that the new picture phones and tele-computers/tele-bank machines will use. If AT&T wants to make a picturephone, they have to get the screen from their competition who also makes these phones (which I saw when I was Japan). Imagine the laptop computer example above all over again. This is an other reason why these small LCD screens are so strategic. Secondly, Japan has made an effort to be the best and cheapest (via dumping) at making a highly specialized component of fiber optic transmission systems which America uses in its network. Now Japan's salesmen talk to almost every phone company in the world to sell them this part. Now on his future visits, he can use his existing contacts to sell them other things Japan will soon be making.

For (3), you probably have already seen what's going on when you go shopping. Panasonic, Murata, Fujitsu and others all make very fancy electronic phones. They also make small telephone switching equipment (like AT&T's smaller products). Eventually, these will get bigger and bigger until they make the bread and butter items of AT&T. This is the same strategy they used to enter the car market too. They started with motorcycles, moved to cheap cars, then to trucks, then to sports cars, then to luxury cars. Today we know the results. Again, this is also true with TVs, first they made black and whites, then color TVs. Today the TV in your house is most likely Japanese (even if its a store brand). This was an industry which America had 100% market share about 25 years ago. This is what is likely to happen to telecommunications too.

ITS NOT ALL JAPAN'S FAULT:

American's behavior when trying to do business in Japan is not what it should be. After seeing how some American firms operate there, it is little wonder our success rate is often so poor. For example, something of an annoyance (and also advantage) to the Japanese is American business people working in Japan who don't speak Japanese, or know nothing about the country they are dealing with. These included some trade representatives from an Oregon company, some people from Boeing whom I met at a Nissan factory, and some from the Government of Wisconsin at a machine tools fair trying to attract Japanese industry to their state.

The group of businessmen I met from the Oregon company I met in Roppongi (an entertainment district in Tokyo). These people were a disgrace to American industry and opened my eyes to why the Japanese are able to take advantage of us in business. Firstly, these men spoke no Japanese at all (so they couldn't understand what their opponents at the negotiating table were saying) and knew nothing about the culture. They asked me what it was like to be a 'gringo' in Japan. It seemed that they thought the business adversaries they were negotiating against in Japan were running some 2 peso Mexican hot dog factory. My conversation with them was a real eye opener to many of America's problems when dealing with the Japanese in business.

At least their company didn't send a women to do their negotiating. This would have been a mistake of huge proportions. Japanese corporations and businessmen typically treat any company who sends a woman with ridicule. Its one of the best ways to lose a contract. Although Americans may dislike Japanese sexism, Japan is fast becoming the world's economic power which means they get to make the rules, not us. This is part of the price Americans pay for buying all those Toyotas and Sonys for so many years. As Japanese industrial influence spreads throughout the world, more of this type of treatment of women by Japanese companies will take place (as many women working in Japanese transplant companies in the US can attest).

The very presence of the trade group from Wisconsin at machine tools fair is the result of a very foolish, self destructive and shortsighted US practice which will now be explained. With so many jobs leaving America (due to many of the above Japanese tactics), some states have decided to go to Japan to try to attract Japanese companies to their state. Because America (unlike almost all other industrialized countries) doesn't co-ordinate or regulate this in any way, what happens is that states get played off against each other by Japanese companies and the Japanese government. The state which gives the most tax breaks or contributes the most money to build the plant gets the plant. This is probably good for the winning state in the short run, but is much worse for the country as a whole (and that state) in the long run.

Here's why: What this leads to is Japanese companies opening US branch plants paid for by the US taxpayer and which pay little or no taxes themselves. With many states doing this to each other to 'win' a few jobs, everyone winds up losing. This is because after each state has 'won' a plant from some other state, the final tally shows that no one state has gained any jobs from any other state (or very little anyways), yet every state is short lots of tax money which must be made up by placing more taxes on individuals, or US businesses (who must now compete against the American state subsidized Japanese businesses). The only winner in all of this is Japan who gets property tax free factories and in worse cases plants which we the taxpayer, sometimes pay to partially build through government grants. The Honda Accord plant in Marysville, Ohio was a result of this practice. Japanese companies producing out of tax free plants are also at an advantage to defeat US companies, who must pay taxes. Ultimately, this practice makes America lose, not gain, jobs (see above section 'assembly plants') and pay more taxes. This very topic is the subject of many sick jokes in Tokyo about America's greed and foolishness today.

An other problem (and the subject of other good jokes in Tokyo) lies within our federal government. There has been much talk recently about 'foreign agents'. These are very high level Federal public servants and elected members Americans sent to Washington to represent them, who go work in the U.S. Federal government for a short time, make contacts in the government or trade department, then betray the country by selling themselves out as representatives to foreign interests. These people were our front line trade negotiators, staff members, trade attorneys, elected officials and have the inside knowledge the foreign interests need to circumvent our trade laws, defeat our companies and find out what our confidential future trade laws are likely to be. These people sell themselves to the other side in order that they may personally get rich through the resulting huge amounts of 'blood money' as they use their contacts they made while serving the public, in order to betray America. The amount of money involved is in the millions of dollars per person. Some are delayed bribes which are paid after public service is completed for favors done while in public office. Often, these people start representing foreign interests within weeks of quitting their government job. The book 'Agents of Influence' (1991) by Pat Choate, contains the foreign agents list, a thorough explanation of how this scam works, and how this is obliterating our status as a rich industrial country. The book also explains very well the point made on the Nov 27, 1992 edition of ABC's 20/20 (which did a segment on this problem) about how the Japanese are way way ahead of everyone else in paying bribe money and how we have lost billions of dollars and hundreds of thousands of jobs as a result of this small handful of people willing to sell out their country and their kids for cash.

As can be seen, America has many problems which are not the fault of the Japanese, but are of our own doing. Japanese work as a team much better than we do. They struggle together to save their companies when in need (versus jumping ship, staging strikes like the recent ones at GM, or selling out to foreign interests). They don't pay their CEO's millions while driving their companies into the ground. They also realize that management and workers are not each other's enemy. The competition is the enemy. No war was ever won with internal conflict and the same goes for this one. Labor strikes (no matter how justified) and management selfishness and shortsightedness are not the answer to our problems. Co-operation and a common vision is the only solution.

One only has to look at the social and economic troubles today in countries like Britain (which years ago in its time, was also the richest and most powerful in the world) to see our destiny if we continue in our erroneous and divisive ways. They failed to take action in time and suffered the consequences. They were once the world's most powerful economy. They too thought that any damage to their economy would have profound impact to the world, and hence, thought they were safe as the rest of world would not let anything bad happen to the British economy. They were wrong. People saying this today about the US economy are also wrong. Britain's economic power diminished gradually and unnoticeably, such that today, what happens in the Britain is not so important to the world global economy. They are now a minor player and now have a much lower standard of living. Our economic power is now in decline, following the 'British pattern' which occured many years ago. We will suffer their fate if we don't change.

CONCLUSION:

The article is not meant as an affront to the ordinary Japanese people (to whom nothing is held against). Like most conflicts, it is the ordinary people who get caught in the middle and wind up suffering. The same, unfortunately, is true for this conflict. This paper is not about them, but is about their companies and their government policies.

America's citizens have failed to realize that Japan practices a different kind of trade than America does. Japan practices adversarial trade, where the goal is to wipe out the foreign countries' industries in order to dominate them entirely. For the Japanese, business is in every sense of the word, like war. Americans who buy Japanese goods, unknowingly help them reach this goal. The Japanese (and other countries such as Korea and Taiwan who have adopted Japanese style business practices) are not our economic allies, they are our competitors and they are dangerous to us.

America often complains that Japan must change its ways to become more like us. This is not true as America is not number one anymore. It is not a request we can make. Today, the tables are turned. This time, America will have to change its ways to become more like the Japanese. Japan will likely surpass the United States to become the world's leading economic, technological and manufacturing nation by the end of this decade, even though it has only 1/2 the population of America. History has pointed out every time, that the richest and most economically powerful country in the world, ultimately becomes the strongest militarily. We have to realize this and be prepared to accept it, or we have to do something about it. Japan will not have to change their ways to become like us, as tomorrow they will wield the power, not us.

This article by:

lleclerc@nyx.cs.du.edu

Louis Leclerc P.O. Box 453 Jackman, Maine 04945-0453 USA

Please send me any corrections or omissions and this article will be updated. The most recent version of this article (JAPANYES) is kept at FTP site: monu6.cc.monash.edu.au (login: anonymous), in directory pub/nihongo

This article is copyright (1992) under the laws of the United States of America. However, I hereby give permission that it be distributed widely and freely over any media. This article cannot be sold or licensed.

A P P E N D I X

-->List of companies:

This is a list of some Japanese (or Japanese owned and controlled) companies. Some of the names that make this list may surprise you, depicted by '*':

* 7/11 Convenience Stores (US operations) (Ito-Yokado, Japanese Investor) Acura (Honda Motor Company, cars) Aiwa (consumer electronics, stereos) * B.F. Goodrich Tire (owned by Toyo Rubber) * Brother (electronic typewriters) * Bridgestone Tire Company (tires) * Bruce Springsteen (works for SONY) C. Itoh (computer printers) Canon (laser printers, cameras, photocopiers, consumer electronics) * CBS Records/Columbia House Records (owned by SONY) Citizen (watch company) * Columbia Pictures (owned by SONY) Denon (cassette tapes, consumer electronics, stereos) * Dunlop Tire and Rubber (Sumitomo keiretsu) Epson (computer company) * Firestone Tire and Rubber (Bridgestone Tire Company, Japan) Fisher Electronics (Stereo Maker) Fuji Film (film and chemical products) Fujitsu (nuclear and breeder reactors, consumer electronics, heavy industry) Geisha Foods (tuna and canned food products in the USA) Hino (heavy truck maker) Hitachi Industries (heavy industry, railroad, appliances & electronics) Honda (autos, motorcycles, small trucks) * IBM World Headquarters Bldg, Atlanta GA Infiniti cars (Nissan Motor) Isuzu (autos) * JVC (Japan Victor Company; owned by Matsushita Industrial Electric) Kao (computer disks and supplies) Kawasaki Heavy Industries (Motorcycles, trains, industrial steel) Kikkomann Foods Kenwood Electronics (Stereo Maker) Komatsu (A heavy Equipment maker) Konica (photocopiers, cameras) Kubota (heavy equipment, backhoes, tractors, bulldozers) Kyocera (computer and electronics maker) Lexus Automobile (Toyota Motor Company) Makita (power tools) * Maxell (cassette tapes) Mazda (autos) * MCA Home Entertainment (Home videos, tv shows;ie. Dragnet..etc) (Matsushita) Michael Jackson (works for SONY) Minolta (copiers, fax machines, electronics) Mita (photocopiers) Mitsubishi (a huge keiretsu;...banking, steel, autos, trucks, lead pencils, electronics, electricity generation, bicycles...and on and on) Mitsui (an other huge keiretsu, similar to Mitsubishi) Miyata (bicycles) Murata (fax machines and electronics) NEC (Nippon Electric Company; computers, cash registers, TV's, electronics) Nikko (consumer electronics, stereos) Nintendo Electronics (video games) Nishiki (bicycles) Nissan (autos, power boats, trucking and heavy transport vehicles) * Nomura Securities (financial firm) Okidata (computer printers and accessories) Olympus (cameras) Onkyo (electronics and stereo maker) Panasonic (Matsushita Industrial Electric Company) * Pebble Beach Golf Course California (Japanese Investors) Pentax (cameras) * Pentel (lead pencil company...Japanese have a huge share of the lead pencil market, look at your lead pencil, its probably Japanese) * Pilot (lead pencil company) * Pioneer (Stereo and electronics maker) * Quasar (Matsushita Industrial Electric Company) (Televisions, VCR's) * Raven (computer printers, faxes and accessories) (Matsushita Industrial) Ricoh (they make computer printers) * Roland (musical instruments) * Rockafeller Center (a Japanese holding company) Sanyo (electronics) * Seattle Mariners Pro Baseball Team (Owned by Nintendo) Sega (video games) Seiko (Watches) Sharp (copiers, faxes, TV's, electronics) * Shiseido (perfumes, cosmetics) Sony (electronics, movie production) * Star Electronics (they make computer printers) Subaru (autos) Sumitomo (banks, heavy industry, trains, shipbuilding, steel, electronics) Suzuki (autos, motor bikes) TDK (cassette tapes) Taito (video arcade games) * Tokyo Disneyland (it belongs to a Japanese holding company) Tomy (toy company) Toshiba (electronics, eletrical, home appliances, heavy industry, nuclear reactors) Toyota (autos, heavy transport trucks, industrial machinery) * Universal Pictures (Matsushita Industrial Electric Company) Yamaha (motorcycles, musical instruments) Yokohama Tire and Rubber (tire and rubber goods) * YKK (zipper company (look at the zipper on your clothes, its probably YKK as this company has an over 50% market share in the world))

-->Some US products which are really Japanese (or other)

Chevy Nova car (Toyota) Chevy Sprint/Pontiac Firefly (Suzuki) Dodge Colt (Mitsubishi) Dodge Stealth (Mitsubishi) Eagle Talon (Mitsubishi) Ford Mercury Villager (Nissan) Ford Mercury Tracer (Mazda) GM's Geo cars (mostly Japanese) HP printers (some of them are Japanese) Macintosh Powerbook Computer (some are SONYs) Some Sears major appliances, TVs, and electronics (Matsushita and others)

'Strategic markets' the Japanese have entered (or are doing so now) include:

>machine tools and robotics: The world is now dependant on Japan for much of the most modern robotic manufacturing equipment and machine making equipment in the world (imagine the importance of this if a real war broke out somewhere in the world where the US and Japan each supported the opposing parties). Originally attacked in the 1980's, today Japan dominates the world machine tool and robotics industries. Japan has also made a strong effort in the area of power tools (Makita, Hitachi), again with some dumping.

>computer memory chips and semiconductors: (Akio Morita (SONY CEO) and Ishihara, in their famous book "Japan that can say no! (to America)" stated that Japan was powerful because they could alter the balance of power by selling its critical Japanese-made-only microchips to the Russians instead of the USA). They also claim that we dropped the A-bomb on Japan because we are racists. Today, Japan dominates the semiconductor industry, having first attacked it in the 1980s.

>high performance telecommunications equipment: They don't dominate this yet, but they may by the end of the decade.

>automotive: US auto plants were used in WWII to make bombers...today many of these plants don't exist anymore.

>automotive parts: (Japanese cars made in USA are really assembled from parts which are usually MADE in Japan). These are the cars' critical components. The high precision equipment and technology to make these parts reside in Japan, not here. That's why high precision machining and advanced manufacturing is usually done in Japan (and why they also targeted that industry), and only final assembly is done here.

--------

-->The following articles referred to in the above paper are available via the Internet Computer Network at FTP Site: monu6.cc.monash.edu.au in directory: pub/nihongo

You login with name: anonymous Use your first name as the password

(Also available at public access bbs: 516-473-6351)

JAPANNO: An unauthorized translation of a best selling book in Japan "A Japan that can say no (to America)!" about why Japan is now number one and should take the place of the US as world leader. By Shintaro Ishihara (Japanese Parliament Member "Americans are lazy, ignorant and stupid") and Akio Morita (SONY CEO). This is actually a good analysis of many of America's problems. Note the version of this book sold in stores is a phony. 1/2 of the original version is missing (Akio Morita removed his part fearing it would hurt SONY's sales in the U.S.) and there is a new appendix specifically written for American consumption, much of which seems to be false).

MATSUSHITA.PBS: Transcript of a shocking PBS Frontline special about how a Japanese cartel wiped out the US TV industry and went on to take over the rest of world consumer electronics.

LOSEWAR.PBS: Transcript of an other excellent PBS Frontline special about how yet an other Japanese cartel conspired and took over the world supply of small computer displays. Good segments on how Honda used unethical (and possibly illegal) measures to drive U.S. auto parts makers out of business.

-->The following article referred to in the above paper is available via the Internet Computer Network at FTP Site: slopoke.mlb.semi.harris.com in directory: pub/doc/misc

(Also available at public access bbs: 516-473-6351)

AGNTLIST: The list of 'foreign agents' (with figures): former high level U.S. government public officials who later used their inside government contacts to work as agents for foreign interests in order to make quick money while betraying America. Many of them made over a million dollars doing this.

-------------- Here are a few good books to read on the topic:

-->"The Enigma of Japanese Power"; by Karl Van Wolferen, 1989, Alfred A. Knopf Press (this book used to be given away whenever your bought a subscription to Fortune Magazine. It may still be.)

-->"Trading Places, How we are giving our future to the Japanese and how to reclaim it", Clyde Prestowitz, New York: Basic Books 1989

-->"Agents of Influence", The list of 'foreign agents': former U.S. government public officials who later used their inside government contacts to work as agents for foreign interests in order to make quick money, Pat Choate, 1991

-->"Unequal Equities, Power and Risk in Japan's Stock Market"; Zielinski, Kodansha International, 1991

-->"The Japanese Company", Rodney Clark, Charles E. Tuttle Company 1979 (Yale University)

-->"The Reckoning", by David Halberstam, William Morrow & Co., 1986. An historical novel about Ford and Nissan from founding to the present.

-->"Head to Head - The Coming Economic Battle Among Japan, Europe, and America", by Lester Thurow, William Morrow & Co., 1992.

------------------------------------------------------------------- AFTERWARD, by Andre Robotewskyj; ar12@midway.uchicago.edu

Japan's government and companies have organized to fight an economic war against us which we are losing badly. What the ordinary Japanese people allow their government and companies to do is not acceptable. Outright discrimination against foreigners and treating women as 'non-people' is not tolerable in the modern world. The Japanese government and industries have treated the America that helped them so much after World War II with contempt and insolence. We had accepted their closed market and opened ours to them so they could rebuild their country and become full members of the peaceful world. Instead, their government and their industries chose to use this generosity as weapons against us in order to destroy our companies, our jobs, and our nation.

I used to buy lots of Japanese products, probably for the same reasons you might now. Others may not know the full consequences of their decisions like you do now. Telling them is important. If you know an effective way to get this message out to people, then it would be wise to do so, don't wait for someone else to do it for you.

America belongs to you and you have to do something for it once in a while. This is one of those times. She needs your help. If you have questions, please ask. Use this network and fax machines to organize yourselves to get this message out. Put copies of this article in lounges or on the company/school computer network. Send this article to your representatives, or your favorite political party. Scatter copies of it into the 4 winds. These are all things which can be done.

If you are a student, you probably realize much more than your parents do that your standard of living is likely to be a considerably lower than theirs. You are much more likely to have trouble finding a good job upon graduation than they ever had. That is how this problem affects you directly. As a result, you may wish to get your friends & family to tell others and organize or inform student groups to get the word out about this problem. If you don't act, its you (and your kids someday) who will suffer the most as a result of all this, so its up to you.

In the meantime, one very good way to get people aware of the topic is to get them a copy of Rising Sun (by Michael Crichton) as a birthday or Christmas present. This is a very good factually based fiction murder mystery book on the subject. It is a #1 best seller and is by the same author who wrote "Andromeda Strain", "Great Train Robbery" and other very famous books and movies. A movie version of this book (starring Shawn Connery) is being made and should be out next year.

Remember that a problem like this can be fought, one American at a time. Think of America when you do business and remember that exclusive self-centered thinking will only make problems in America worse than they are. That is the true lesson of the 1980's. Self centeredness doesn't work in the long run. If we were as loyal to each other as the Japanese are to each other, we wouldn't be in the economic and social mess we are now. Remember that, and expect it from your family, friends and associates. If you don't get what you expect, let them know. Hopefully in the future, the economic war will be called off and our two countries will live peacefully and with co-operation. I look forward to that day.

I run a mailing list which occasionally distributes articles like this one. If you'd like to be on the email receiver list, please send me a note (to the address below).

Andre Robotewskyj; ar12@midway.uchicago.edu