From: fierro@uts.amdahl.com (Doug Fierro)
Newsgroups: sci.econ
Subject: Re: Those Wicked Japs
Date: 13 Apr 92 01:53:44 GMT
Organization: Amdahl Corporation, Sunnyvale CA

In article <studier.702999342@ninja> studier@ninja.life.uiuc.edu (Jim Studier) writes:
>
>       The above author prints a transcript of the PBS special
>
> "HOW JAPANESE CARTEL DESTROYED US ELECTRONICS INDUSTRY (PBS-TV)"
>
> and comments:
>
>>     Such corporate policies are, in the long term, bad both for
>>  America and the ordinary Japanese people, to whom nothing is held
>>  against by this article.
>
>>  These kinds of actions on the part of gigantic Japanese
>>  multinationals are as big a threat to our way of life in America as
>>  the Soviets ever were. In fact, they are probably even a bigger
>>  threat because the Soviet system was not sustainable over the long
>>  term, but the Japanese industrial system is.
>        ....
>>  The consequences of economic warfare and military warfare are
>>  strikingly similar. Driving American industry out of business (be it
>>  cars, semiconductors or industrial equipment) through economic
>>  warfare is tantamount to dropping bombs on it. In both cases the
>>  factories are gone, the workers are unemployed and the technology is
>>  lost. This is what America is currently up against.
>
>   I disagree.
>The comparison of economic competition with warfare is pernicious mischief.
>Competition at most forces people to change jobs.  They are not shot to death.
>Physical capital such as buildings can often be reallocated to new uses.
>It is not destroyed as in a bombing. Those who purchase "dumped" products
>achieve a higher standard of living because they obtain better goods
>at lower prices.  If the "dumped" prices are financed by the Japanese
>people thats their problem, not ours.

  I think that is a very short-term and naive view; a country that dumps
a good on another country does have to make up the price difference elsewhere,
whether in another country or in their own by charging higher prices, but
if ten years from now you can drive foreign companies out of that industry,
you have just created a monopoly for yourself.  This does not even take into
account the loss of jobs and technology that go when an industry is killed,
or the cost to the Govt. to help these people who lose their jobs.  Japan
may believe that such a long-term effort is worth the short-term cost to their
citizens.

  For an analogy, would you be upset if airlines offered cut-rate faires 
for about ten years, and once all the minor players in the industry were
bankrupt and/or bought out, they raised prices even higher than they were
before deregulation?  Keep an eye out in the airline industry and see what
happens and tell me that U.S. citizens end up with a "higher standard of
living".

  Doug
-- 
                                                     Doug Fierro
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