Three days of intensive trade talks between the United States and China last week did not solve the hard-core issues. Although Secretary of Treasury Steven Mnuchin said, "We're putting the trade war on hold," quite a few Chinese economists or businesspersons are reportedly intrigued by the "Japan of the 1980s" in their efforts to visualize the future of U.S.-China relations.
The 1980s in Japan were both the best and worst for us. I started my career in 1978, when the Japanese economy looked like it was the best in the world. From textiles, steel and color TVs in the 1970s, Japan-U.S. trade frictions continued throughout the 1980s over Japan's rice, beef, oranges, cars, supercomputers and financial services.
The worst came right after the '80s, when the bubble boom collapsed in 1991-1993. The Plaza Accord of 1985, a potential turning point in Japan-U.S. trade relations, might have contributed to Japan's asset price bubble of the late '80s, which was then followed by a protracted period of deflation and low growth in Japan known as the "Lost Decade."