For the request that Japan keeps making, U.S. policymakers have simple, undiplomatic answers: No. Never. Won't happen.
The request is: When the World Trade Organization meets in Seattle next month to map out new rules of global commerce, please agree to discuss changing the rules against the illegal practice known as "dumping."
Japan and many developing countries have been trying to build momentum for a change, saying current rules are often abused to keep out foreign products; the United States is moving assertively to stamp out any expectation the issue will even be discussed.
This dispute, one of many in the maneuvering before the Seattle meetings, underscores how differing economies approach those sessions with conflicting objectives. U.S. demands for more access to Japanese and European agricultural markets are stirring up similar opposition.
Calling Japan "the greatest dumping country in the world," U.S. Undersecretary of Commerce for International Trade David Aaron last week said the country is trying to change rules that it repeatedly violates. He has suggested Japan wants to paralyze the giant meeting in Seattle by introducing an issue that the United States considers to be a non-starter.
Last week, Japan signaled what it thinks of talk like that, formally requesting consultations with the United States over dumping duties that Washington put on a category of Japanese steel earlier this year. That move could presage a formal WTO hearing on the U.S. practice.
The U.S. actions against the steel appears to be driven "not by a desire to eliminate injury to the U.S. producers, but by protectionist intentions of the U.S. industry and government aimed at excluding a substantial portion of all steel imports from the U.S. market," Takashi Fukaya, Japan's minister of international trade and industry, said in a statement. Japan contends that the U.S. industry wasn't hurt by its products and that dumping penalties were miscalculated.
Dumping is the act of selling goods in a foreign country at prices below the cost of production or the price in the home country. Dumped products may be things the home country makes in excess; selling part of the output overseas at a loss may make more financial sense than shutting down a plant.
U.S. companies that believe foreign competitors are dumping goods here can complain to the Commerce Department and the International Trade Commission. Officials study the economics of the product, trying to calculate what it costs the producer to make it, or what it sells for in the home country. If they conclude that dumping has occurred, the government can impose a countervailing duty with the intent of wiping out the difference between the U.S. and foreign price. The duties can have the affect of shutting off the flow of the product entirely.
Facing a 33 percent rise in overall steel imports in 1998, the United States brought dumping cases against steel manufacturers from Japan. As a result, Japanese steel sales in this country have sunk to a fraction of 1998 levels. Other countries' steel sales here also were the subject of dumping actions.
U.S. officials' tough talk is in part for domestic consumption, signaling to labor unions and companies that they won't be left unprotected when global trade threatens them. Congress seems to support the position, too; a House resolution against changes in the dumping rules had collected 212 signatures as of yesterday.
For its part, Japan needs to export to keep alive glimmerings of an economic recovery that have begun to appear after a decade of stagnation.
Dumping rules were changed in the last major series of trade negotiations, the "Uruguay Round" that began in 1986. "Anti-dumping talks were one of the most sensitive items--they ran right up to the deadline," said Greg Mastel, an economist at the New America Foundation. "It's an area where the U.S. gave up quite a bit."
Numerous developing countries, such as India and Thailand, want some changes in world dumping rules. By refusing to discuss it, a Japanese official said, the United States is pushing "a narrow-focused agenda" that would force many countries "to be net losers." That could jeopardize the search for a package of changes on which all countries could agree, he said.
Moreover, Japanese officials argue, the United States is itself the target of dumping complaints. Mexico, for instance, has imposed anti-dumping duties on certain kinds of U.S. steel, paper and vinyl floor covering, among other products. "Many American politicians probably do not know this fact--more and more the United States is being victimized," said a Japanese official.
But their U.S. counterparts aren't buying it. At a White House briefing earlier this month, U.S. Trade Representative Charlene Barshefsky was asked if the United States had agreed to talk about dumping.
Her one-word answer: "No."