Embassy Row

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The Council on Foreign Relations is urging the next U.S. president to adopt a tougher trade policy toward Japan and avoid past mistakes that Tokyo exploited.

"To support a renewed Japan focus in Washington, the new administration should pursue a proactive trade policy," the council said yesterday, promoting a report due for release Friday.

"Years of trade-jousting with Japan have taught valuable lessons: Success requires leverage; it pays to have specific demands; short time-frames lead to truncated results; [and] fragmentation within the U.S. government has frequently been Japan's most powerful ally."

Whether it is President Gore or President Bush, the next U.S. leader should challenge Japan to join the United States in creating an open marketplace free of tariffs and over-regulation by 2010, said the report by Bruce Stokes, the council's senior fellow for economic studies.

"The time is ripe for a bold new initiative to recast the U.S.-Japan economic partnership for the 21st century," Mr. Stokes said in the report, titled "A New Beginning: Recasting the U.S.-Japan Economic Relationship."

"Passivity in the face of the staggering economic problems facing the world's second largest economy and America's principal ally in Asia would be a profound mistake.

"Charting a new course for the U.S.-Japanese economic relationship will require American assertiveness and a bold vision for a better future. It would be a fitting legacy for the new U.S. administration, a new Congress and a new Japanese government if they have the courage to begin to write it."

The council warned that "U.S. willingness to resolve mutual problems" depends on the continued success of the nation's economy.

"A new, proactive U.S. policy toward Japan is needed to maximize the potential of the U.S.-Japanese economic relationship and to cope with the inevitable problems in day-to-day ties between the two largest economies in the world," the council said.


Kazuo Kodama remembers that when he was studying at Oxford in the 1970s, he was asked a question on an exam about why Japan was an "economic giant but a political dwarf. …