Of all the choices we make as consumers, our car purchases are among the most consequential. While cars are typically one of the most expensive purchases we’ll ever make outside of housing, the size of the auto industry gives those purchases an often-unseen political dimension as well.
To the extent that politics enters the conversation around the cars we buy, it usually centers around a dated concern for the interests of U.S.-based manufacturers (i.e. “Is it good for Detroit?”). What gets lost in the argument — along with billions of taxpayer dollars on bailouts — is the agenda Americans are actually endorsing with their purchases. And the trade issues with Japan that are apparently holding up the Trans-Pacific Partnership, along with the economic contributions of Japanese auto firms in particular to the U.S. economy, demonstrate that the old “Detroit versus Japan” debate no longer benefits U.S. consumers.
For example, the U.S. still imposes a 25 percent tax on pickup imports, the lone holdout of President Lyndon Johnson’s 1963 “chicken tax” and 10 times the tariff on passenger vehicle imports. Meanwhile, Americans purchase trucks in huge numbers despite concerns about energy security and global warming. Rather than simply enjoying the bounties1 of this hidden tax, U.S. automakers bang the drum against the supposed threat of Japanese trade policy. Automakers General Motors, Chrysler and Ford complain noisily that Japan’s “currency manipulation” and “non-tariff barriers” are obstacles to the TPP. In return for its lack of tariffs on imported cars (zero, compared with our 2.5 to 25 percent tariffs, for those keeping score), Japan is essentially being accused of cheating by not adopting U.S. automotive regulations and monetary policy.2