Take That! and That!

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As part of an agreement to give Motorola "comparable market access" -- reached in 1989 after Washington threatened reprisals -- the Japanese government provided the company a slice of the cellular-phone bandwidth in the Tokyo-Nagoya region. There was a catch: Motorola's new transmitting equipment would have to be installed by IDO, the wholly private cellular operator in that area. Called upon to build facilities for a competitor, IDO dragged its feet. In 1992, at Motorola's request, Washington sought and gained a follow-up agreement to speed construction.

Last summer Motorola again protested the slow pace, leading the White House back to bargaining with Japan. The U.S. wants guarantees that the new system will be up two years earlier than IDO's projected completion date in March 1997. In the view of IDO president Takeo Tsukada, that would lead his still unprofitable company to "certain bankruptcy." Motorola says anything less would keep it out of the cellular boom expected to start in April, when new regulations permit Japanese consumers to own phones instead of just renting them. Tokyo, meanwhile, insists that the remaining tangles are just a business dispute between private companies. "Washington is asking us to guarantee Motorola's business," complains a Japanese official.

Cellular phones are just one of 31 areas covered by trade agreements that the U.S. could use as gauges of Japanese intransigence and then retaliate. "It's not our desire to be provocative," says a White House official. "But the status quo cannot continue." Neither can the present standoff, without the danger of a more serious confrontation that nobody wants. Now, does anybody here know how to just dabble in a trade war?