Administration Is United on Trade, Mosbacher Says

Commerce Secretary Robert A. Mosbacher on Wednesday vehemently denied the existence of a rift within the Bush Administration over trade policy toward Japan.

Mosbacher, in remarks to the Society of American Business Editors and Writers, was responding to reports that two camps had emerged within the Administration over how to respond to trade barriers imposed by the Japanese.

According to published reports, Mosbacher and U.S. Trade Representative Carla A. Hills’ hard-line stance toward countries such as Japan that impose barriers to U.S. exports was at odds with a more diplomatic approach favored by Secretary of State James A. Baker III, Treasury Secretary Nicholas F. Brady and White House economic adviser Michael Boskin. Boskin said Monday that “bashing” countries such as Japan could lead to a global trade war.

No Intention to Get Tough

But, said Mosbacher, “there is absolutely, positively and completely no rift within the Administration on trade business in any shape or form.”

Mosbacher said he and Boskin had discussed the matter over the telephone and, while conceding that there were some differences of opinion, added, “We speak with one voice.”

Asked how tough the United States should be toward Japan, Mosbacher said confrontation was not the best policy.

“We have been with Japan great allies and great friends,” Mosbacher said. “So getting tough is not what I have in mind.”

Deadline Nearing

Mosbacher said the Japanese are tough competitors, but all the United States wants is a “fair, level playing field--a two-way street.”

Under the 1988 trade reform law, Hills must decide by May 30 whether to cite Japan and other countries for imposing unfair trading barriers on U.S. products. If negotiations to end the barriers fail, strong U.S. retaliation would follow. Congress has put tremendous pressure on Hills to name Japan as an offending nation.

Deficit Still Damaging

On another trade-related matter, Mosbacher said it appeared that the United States had realized about all it could from the previous Administration’s deliberate policy to reduce the value of the dollar, thus making U.S. exports cheaper abroad and imports more expensive.

Improvement in the U.S. trade deficit has stalled in recent months, with the deficit running at an annual rate of around $130 billion--down from record highs in recent years but still economically damaging.

Further reductions in the trade deficit would have to come from “grinding it out” and other ways, such as educating American businesses about exporting practices.

Mosbacher said he recently attended a meeting of U.S. furniture manufacturers. He said he left with the impression that “their idea of exporting is from North Carolina to Texas.”