Japan has continued to have current account surpluses and current account deficits in the United States, but are more related to macroeconomic imbalances than to trade practices. The fact is that Japan and the United States have become stakeholders in each other`s economies. Pressure to increase imports peaked in the late 1980s and early 1990s, when the United States insisted on quantitative targets to increase imports of semiconductors, cars and spare parts. Jagdish Bhagwati (1988) calls this policy voluntary import expansion (VIE) policy. In general, in theory (Greaney, 1996) and in practice (Dick, 1995), these policies have had negative (and generally higher)`s welfare effects or little effect (Parsons,2002). Between 1960 and 1964, annual trade deficits (based on customs clearance for imports) widened in Japan between $400 million and $1.6 billion. The era of the chronic trade deficit ended in 1965 and in 1969 Japan was widely regarded as a supernumerary trading nation, with a positive balance of nearly $1 billion. In 1971, the surplus reached $4.3 billion, and its rapid rise was one of the main factors in the U.S. decision to devalue the dollar and push Japan to revalue the yen – events that quickly led to the end of the Bretton Woods fixed exchange rate system. By 1972, Japan`s surplus had grown to $5.1 billion, despite the revaluation of the yen in 1971.
Statistics supported the idea that Japanese markets remain difficult to penetrate and showed that, in the 1980s, the share of industrial imports into Japan`s gross national product (GNP) remained well below the level of other developed countries. Frustration over the modest results of the MOSS process and other similar factors led to provisions of the Omnibus Trade and Competitiveness Act of 1988, which addressed Japan. Under the “Super 301” regime, nations should be designated as unfair trading partners and, where appropriate, specific products, which should be selected by retaliatory measures against the exports of these countries if the negotiations do not produce satisfactory results. Japan was described as an unfair trading nation in 1989 and negotiations began on forest products, supercomputers and telecommunications satellites. The collapse of the Japanese asset price bubble in the early 1990s and the lost decade that followed helped open up the incubator trade. Discount markets opened distribution chains and several companies turned to foreign trade and investment to avoid losses and even bankruptcies. Products manufactured by Japanese companies in South Asian countries have been reintroduced at lower prices. The Japanese consumer has also changed: economic problems have forced many Japanese to seek advantageous prices first and then to worry about national pride or higher quality. It was not US President Donald Trump or his former adviser Steve Bannon, but Walter Mondale who ran for the presidency of the Democratic Party in 1984.