In 1989, Morita set out his views in a collection of essays titled The Japan That Can Say No: Why Japan Will Be First Among Equals. American business practices, though chapter titles such as “America, You Had Better Give Up Certain Arrogance” had a harsher tone than Morita usually expressed at New York dinner parties. Even the always gracious Morita found it difficult to mask his view that Japan’s technological prowess had earned it a position among the world’s great powers. “Militarily we could never defeat the United States,” Morita told an American colleague at the time, “but economically we can overcome the United States and become number one in the world.” “The 1-megabit semiconductors which are used in the hearts of computers, which carry hundreds of millions of circuits in an area which is one-third the size of your little fingernail, are only made in Japan,” Ishihara noted. “Japan has nearly a 100 percent share of these 1-megabit semiconductors. “Now Japan is at least five years ahead of the U.S. in this area and the gap is widening,” he continued. Computers using Japan’s chips were “central to military strength and therefore central to Japanese power… in that sense, Japan has become a very important country.” Other Japanese leaders appeared to take a similarly defiant nationalist view. One senior Foreign Ministry official was quoted as arguing that “Americans simply don’t want to recognize that Japan has won the economic race against the West.” to-be-prime-minister Kiichi Miyazawa publicly noted that cutting off Japanese electronics exports would cause “problems in the U.S. economy,” and predicted that “the Asian economic zone will outdo the North American zone.” Amid the collapse of its industries and its high-tech sector, America’s future, a Japanese professor declared, was that of “a premier agrarian power, a giant version of Denmark.” As Japanese firms grabbed market share, CEOs of America’s biggest chip firms spent more and more time in Washington, lobbying Congress and the Pentagon. They set aside their free-market beliefs the moment Japanese competition mounted, claiming the competition was unfair. Silicon Valley angrily rejected the claim that there was no difference between potato chips and computer chips. Their chips merited government help, they insisted, because they were strategic in a way spuds weren’t. Soon the company realized that tariffs might help, and reversed course, leading the charge for tariffs on imported Japanese DRAM chips. They accused Japanese producers of “dumping” chips in the U.S. below cost, harming American producers. Simplot was furious about Japan’s trade policies hurting his potato sales and his memory chips. “They’ve got a big tariff on potatoes,” he grumbled. “We’re paying through the nose on potatoes. We can out-tech ’em and we can out produce ’em. We’ll beat the hell out of ’em. But they’re giving those chips away.” That’s why he was demanding the government impose tariffs. “You ask why we go to the government? Cuz the law says they can’t do that.” The allegation that Japanese firms were cutting prices by too much was a bit rich coming from Simplot. Whether spud or semiconductor, he’d always said business success required being “the lowest-cost producer of the highest-quality product.”

— Chris Miller  


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