U.S. and Japan Seek End to Squabble Over Trade in Wide-Ranging Talks
WASHINGTON -- Imagine sitting down with your next-door neighbors for a little chat. They have the nerve to criticize your choice in appliances. You, in turn, attack their household budgeting -- and even the way they're bringing up their kids.</br></br>Not many families would dream of such a confrontation. But that's precisely what the world's two leading economic powers have been doing here this week -- with the kind of result you'd expect when uneasy partners sit down to criticize each other's internal affairs. After two days of talks, called the Structural Impediments Initiative, both sides are better informed about their respective grievances, but they were far from any agreement on what to do.</br></br>The talks, part of an effort to resolve America's intractable $50 billion-a-year-trade deficit with Japan, are unprecedented: Never in history have two superpowers delved so deeply into each other's domestic affairs.</br></br>Japan attacked the voracious consumerism of the U.S. -- and even its declining educational standards. When the subject turned to U.S. manufacturing investment, the Japanese lambasted the U.S. for the explosion in leveraged buy-outs.</br></br>"They criticized us for our savings rate," a senior U.S. official said. "They think our cost of capital is too high. . . . They brought up our training and regulatory policies." And the list went on.