ABSTRACT
Increasing economic interdependence is posing new challenges to the United States's political-economic institutions and to traditional practices in foreign and domestic economic policies. This chapter examines the US response to the generic challenge of sectorally focused, structural economic changes in international production and trade. The steel and auto industries also lay many of their present difficulties on past policies of the United States government. US automobile industry spokesmen similarly have attributed much of their adjustment and competitive dilemma to policies and Washington. A virtual consensus exists in the United States that the essential role of government in the economy is to administer macroeconomic policy in a fashion conducive to even-handed economic growth and price stability. Demands for trade protection are likely for several reasons to be the modal public-policy remedy sought by beleaguered industries—particularly mature industries such as steel and automobiles.
