For Richer, For Poorer: The New U.S.-Japan Relationship (review)

BOOK REVIEWS 283 possibilities for, and limits of, future arms control efforts in the context of West European concerns about defense. But Feld's study does not provide this long-term perspective and is, therefore , rather disappointing in the end. Completed in mid- 1986, it is quickly losing its topical relevance. While the book does have some merit as a brief historical description of the preceding seven years of arms control, it is questionable whether this will bring the study much attention in the future. For Richer, For Poorer: The New U.S.-Japan Relationship. By Ellen L. Frost. New York: Council on Foreign Relations, 1987. 163 pp. f19.95/hardcover. Reviewed by Matthew Goodman, M. A. candidate, SAIS. In his landmark 1967 book, Le Défi Américain ("The American Challenge"), Jean-Jacques Servan Schreiber urged his fellow Europeans to imitate American management techniques so as to catch up in the "industrial war" with the United States. He wrote this book at a time when U.S. investment around the world was growing rapidly and there were fears in Europe of being "taken over" by American industrial might. Yet now the tables have turned, and it is the United States that faces a similar economic "challenge" from Japan. Again this development seems to be producing fear and resentment among those facing the new realities of the world economic order. Seen in this light, Ellen L. Frost's book For Richer, For Poorer is a timely reminder that, just as Europe had nothing to fear from the United States in the 1960s, today's challenge from Japan represents as much of an opportunity as a threat for the United States. As the title implies, Frost depicts the U.S.Japan relationship as a "marriage" between two admittedly unlikely partners brought together by mutual interest, if not always love. The couple may bicker from time to time, but this is one marriage for which divorce is not a viable option. Frost argues that the source of tension between the United States andJapan lies in the rapid shift in the relative wealth of the two countries since World War II. Relative to one another, Japan has grown richer, while the United States has become poorer. Inevitably, the process of adjusting to these new positions has caused a certain loss of orientation on both sides, and this, in turn, has resulted in friction between the two. The readjustment is made all the more wrenching by the existence of growing instabilities in the world economy, including unprecedented levels of Third World debt, massive capital flows, and highly volatile energy prices. Added to this are large macroeconomic imbalances within each country: excessive consumption and an over-propensity to import in the United States, and surplus savings and a huge gap between exports and imports in Japan. Psychological factors further complicate the adjustment process. Each side persists in maintaining outdated or inaccurate images both of itself and of the other. ThusJapan, despite its new wealth, continues to see itself as a poor and underdeveloped country struggling to catch up with the West, while Americans 284 SAIS REVIEW view Japan's huge current-account surpluses and flows of investment capital abroad, as well as high levels of per capita income, life expectancy, and literacy at home as attributes of an enormously wealthy and successful nation. Meanwhile , Americans continue to hold on to delusions of being "number one," while manyJapanese, despite lingering respect for their longtime benefactor, see the United States as a once powerful country unable to cope with new international realities. Together with different patterns of social behavior and styles of communication and leadership in the two countries, these misperceptions contribute to a "we versus they" mentality, which in turn breeds mutual suspicion and magnifies the smallest disagreement into a major confrontation. In one of the most interesting sections of the book, Frost discusses different perspectives on the notion of "fairness" in the two countries. Americans often accuse the Japanese of using "unfair" trade practices, such as restrictions on market access, dumping, and government subsidies, to gain maximum advantage in international trade while enjoying a "free ride" from the United States on defense. But the very...