April 17, 2009 at 1:00 am


Save GM with bold trade stroke

We hear about General Motors' struggling, bailouts and bankruptcy, and we hear about how Toyota, Honda and Nissan will fill the vacuum created by any GM or Chrysler bankruptcy.

But what we don't hear ought to pique your interest: Last year Japan imported a whopping 8,000 Fords. That's right, 8,000 Fords were sold in Japan while Toyota alone sold 2 million automobiles here in America. Honda sold a million. According to Frank Fillipo of Autoblog, poor GM only sold 2,000 cars in Japan last year.

Why? The average GM car in the United States costs about $25,000, but in Japan the same car costs $50,000. A big mark up, plus tons of other obstacles and restrictions. No one calls that protectionism, but that is exactly what it is.

There is an overwhelming pressure to keep foreign imports out of Japan, whether its so-called "inferior" American cars, "infected" Washington apples or "tainted" American meat. Eleven Saturn vehicles were sold in Japan -- a car made jointly by the U.S. and Japan -- and a piddling 12 Rolls Royces. I guess Rolls Royce is considered inferior as well.

Peter Mandelson, the European Union's external trade commissioner, said last week that Japan was "the most closed developed market in the world and that imbalances ... were truly staggering." The social pressures within Japan and the complex layer-cake of bureaucratic restrictions keep all imports marginalized, not just our cars.

To be specific: The Japanese car market of 4.5 million vehicles begrudgingly allowed 6 percent of their car market to be made up of non-Japanese manufactured vehicles. In South Korea, the situation is even worse. It imported 9,000 U.S. cars but sold 800,000 cars in ours. If you think a Kia outperforms a Malibu, good luck.

Imagine a refreshing change -- a new law requiring that Japanese and Korean car manufacturers only allowed to sell the same number of cars in the United States that they reluctantly import into their countries. In other words, the playing field would finally be leveled.

GM, Ford and Chrysler would start filling the vacuum created by the sudden absence of Toyotas, Nissans and Hondas from American showrooms. If Japan could only sell to us what it purchased from us, it would be limited to 5.5 percent of the U.S. car market and not a fraction more, and Korea would be limited to a mere 2 percent.

Thousands of American jobs would be saved; thousands more created. The Rust Belt would experience a renaissance.

Instead of Detroit, let's have Toyota City take it on the chin for a change.

Sure, the Japanese would protest that they had to start letting their showroom dealers start selling Fords and Chevys at competitive prices. Maybe a trade war would start; maybe they'd cash in their T-bills, but it is just as likely that the bigwigs of Toyota, Nissan, Honda and Kia would hurriedly ask parliamentarians to open markets to allow more American cars to be sold there so more of their cars could be sold here.

Maybe Congress and the media are opposed, but in the days of Jimmy Hoffa and Walter Reuther, a healthy strike by autoworkers and sympathetic truckers could shut our country down until we saw some real action. Maybe its time to clog the turnpikes, slow interstate commerce to a crawl, and demand that fairness in trade finally be implemented. If now is not the time, well, just how close does the patient have to get to death before we decide to stop the bleeding?

Jerry Kroth is an associate professor of psychology at Santa Clara University in California and a former Detroiter.