• Choose a category
• All
• Classic-Fiction

By Root 1074 0

of our cities is matched by that of American industry. According to the General Accounting Office, for instance, the average coal miner produced 14 tons a day in 1965 and only 8.5 tons in 1976—yet President Carter’s original energy plan called for doubling coal production by 1985. In the first three months of 1978, the productivity of American workers fell 3.6 percent, the steepest decline in four years. Productivity is rising by an average of about 2 percent in the U.S.—three times below the rate in Germany and Japan. As New York or Detroit have trouble competing economically with suburban Connecticut or the Sunbelt, many American industries are getting clobbered by cheaper foreign competition. In 1977, foreign steel imports rocketed 114 percent—up 19.3 million tons. This explains why the steel industry laid off 20,000 employees over a span of just several months in mid-1977. For eighty-five years, steel mills have bordered the Mahoning River in Ohio; today, they are closing—victims of age, Oriental and European competition, and federal neglect. While the federal government decided to subsidize and help mechanize American agriculture, allowing the U.S. to become the world’s chief food provider, it made short-term steel decisions. The government occasionally complained about steel prices, but it ignored the industry’s pleas for subsidies and protective tariffs. In contrast, Japan planned ahead, subsidizing the modernization of its steel mills and protecting them with tariffs.

The steel-related automobile industry, which used to dominate the world, has seen its share of the American market diminish under the assault of smaller, cheaper foreign cars—often subsidized by their governments. Two million of these cars glut the American market each year. General Motors’ profits are up, but the little sister of the big three auto companies, American Motors, is teetering and, like New York and the steel industry, has requested federal loan guarantees.

The hot breath of foreign competition has invaded another American sanctuary, advanced technology. Just as England, which invented radar, lost its technological lead to America after World War II, America is today losing its near-monopoly. Want to purchase a fine camera and lens? The shelves of American camera stores are crammed with Japanese Nikons. A watch? We have trouble competing with the Swiss. A pocket-size tape recorder for journalists? I wouldn’t own anything but a Japanese Sony or Panasonic. Japanese radios, phonographs and television sets are more compact and cheaper. The U.S. may have invented the microwave oven and the citizens band radio, but our share of the world market is dwindling. How can American fabricated clothing compete with clothing fabricated in Taiwan for half the price?

It’s tough, which explains the clamor from labor and business executives and liberals—who once advocated free trade—for protective tariffs. “Foreign trade is the guerrilla warfare of economics,” declares AFL-CIO President George Meany, “and right now the United States economy is being ambushed.” Perhaps Mr. Meany had in mind the RCA Corporation, once the world’s television giant, now reducing its payroll and shifting much of its operation overseas to tap cheaper labor. Or perhaps he was thinking of Zenith, the country’s largest television manufacturer. In September 1977, Zenith announced that it was laying off one-quarter of its domestic work force and transferring “substantial portions” of its TV module board and chassis assembly operations to plants in Taiwan and Mexico, eliminating another 3,500 jobs. Zenith would also buy stereo products overseas because it was cheaper than making them here, thus erasing another 1,500 jobs.

Foreign competition can also be measured by the U.S. balance-of-payments deficit. In 1977, the chasm between our imports and exports reached a record $20.2 billion—double the figure for 1972, the previous record year. Between January and May 1978, 46 percent of all imports were foreign machinery, electronics, transportation equipment and manufacturing goods. These