Budget Deficits: Japan and American Products

budget deficits: Project Syndicate When governments permit counterfeiting or copying of American products, it is stealing our future, and it is no longer free trade, according to Market Watch. So said President Ronald Reagan, commenting on Japan after the Plaza Accord was concluded in September 1985. NEW HAVEN, Conn. Today resembles, in many respects, a remake of this 1980s movie, but with a reality-television star replacing a Hollywood film star in the presidential leading role and with a new villain in place of Japan. The tough macroeconomic constraints facing a saving-short U.S. economy are ignored for good reason there is no U.S. political constituency for reducing trade deficits by cutting budget deficits and thereby boosting domestic saving. Back in the 1980s, Japan was portrayed as America's greatest economic threat not only because of allegations of intellectual-property theft, but also because of concerns about currency manipulation, state-sponsored industrial policy, a hollowing out of U.S. manufacturing, and an outsize bilateral trade deficit. (news.financializer.com). As reported in the news.