How Can U.S. Reduce Huge Trade Imbalance? : <i> Learn to Export as Well as We Import </i>

As I jump out of bed in the morning, leaving my warm French sheets, put on my Chinese shirt and my English running suit, lace up my Korean jogging shoes, check the time on my Japanese watch, jog my four miles, shower with my English soap, dress in my Italian and French clothes, then dash off to work in my German car, I am poignantly aware of the large role that world trade plays in American life.

Americans have access to a variety of products largely because of international trade. And, a lot of that has to do with the strength of our own dollar, which has made foreign goods cheaper for Americans to buy, but has also made American goods prohibitively expensive for foreigners to buy. Due to a voracious consumer appetite, we are developing a total import dependency that could spell the demise of our comfortable life style.

Therefore, if we want to keep buying international products, we need to learn to export as efficiently as we have learned to import, or most of our manufactured goods and our food supply will come from other countries and destroy our own economy.

We can’t afford to do otherwise.

As the trade deficit escalates month by month, so does the crisis for American exporters, who must deal not only with the rising dollar, but also with laws that are filled with export disincentives and a very weak Commerce Department.

In addition, the Export Trading Company Act of 1982 put banks in direct competition with many of their small- and medium-sized exporter accounts by allowing them to enter the international marketplace as principal exporters.

Symptom of Trauma

The strong dollar is the greatest single factor in our export decline, but it is a symptom of the trauma, not the cause. The trauma is unbalanced trade. The causes include an overwhelming amount of consumption by spoiled and demanding consumer groups, the federal budget deficit and a government that has heretofore been insensitive to the need to defend our position in the export market.

To be fair, it is equally important to recognize that American producers have historically been concerned with the home market and have rarely been willing to manufacture products especially designed for foreign consumption.

Why? The “export or die” mentality that prevails in most other industrialized nations did not exist in the United States. And, because things were so good at home, there were plenty of consumers anxious to buy Americans goods--that is, until less-expensive competitors began sending their products here.

But ironically, because of our high-production capacity and despite our indifference to international trade, American export volume was very substantial. Then came the “strong dollar.”

The Reagan Administration says the strong dollar is good because it holds down inflation through the creation of cheap imports and the subsequent maintenance of low prices in the competitive marketplace.

Unable to Compete

This theory is sound, as far as it goes, but it ignores the fact that many American companies are closing and that many American producers are exporting jobs--moving their plants to foreign countries--since they can no longer manufacture competitively in this country.

Compounding that problem is the fact that much of America’s industry is unable to compete with cheap foreign labor and subsidized foreign exports.

We focus on the insensitivity of the Japanese with their closed markets and heightened exports, but we should also consider the fact that Europe has totally depended on its ability to export (primarily to the United States), instead of internally building its own recession-ridden economy in a responsible fashion.

According to recent statistics, Europe has created no new jobs for its people through its own economic development. With our overwhelmingly large volume of imports, America is called upon to provide economic stability for Europe and many developing nations by buying their products.

There is a positive side, however. California, if viewed on the basis of the gross national product, would be the eighth-largest trading nation in the world. What affects us will affect American trade in decades to come.

Because of emerging opportunities for trade in the Pacific Basin, California has a responsibility to lead the nation and to make the federal government understand what must be done to survive in the international marketplace.

There is no such thing as free trade, but there is fair and equitable trade.

If America wishes to keep its doors open to the well-designed and relatively inexpensive foreign products, we must bring some form of balance back to the trade picture--and that means we must also export products.

In a larger sense, we must reverse our role as a debtor nation and once again become the world’s leader.

Without this balance--meaning the renewed economic strength of the United States, upon whom so many developing nations depend--it is conceivable that we could lead the world into a recession, or even a depression.