U.S./Japan trade war gets big play

The U.S. decision to slap a 100% tariff on selected Japanese luxury cars (see Auto Talk, p. 18) prompts a barrage of pro and con media stories. A persistent theme is the harmful impact the tariff would have on Americans who own and work in dealerships selling the targeted vehicles. One dire threat: If they stand, the tariffs theoretically could put 8,000 people out of work. "You're going to see a bloodletting," warns David McDavid, who owns two Acura dealerships in Texas, in a Wall Street Journal article. However, it's rarely reported how much bloodletting has been caused by Japan's continuing automotive trade surplus. Using the Commerce Department's equation of 20,000 jobs lost for every $1 billion of imports, Japan's $37 billion automotive trade surplus in 1994 cost the U.S. 740,000 jobs.