The long-departed senator from Utah and the congressman from Oregon must be looking up or down, as the case may be, at the actions in Washington and wondering if we have learned nothing since the disastrous tariff that bears their names was enacted in 1930. For one brief shining moment when Vice President Gore waved the picture of Reed Smoot and Willis Hawley at Ross Perot during the NAFTA debate, it appeared that this administration had learned from history. But all the lessons were quickly forgotten as everyone from the president to members of Congress now constantly berates and threatens Japan in an effort to reduce that country's trade surplus with us.

In a complicated world it is hard enough to make a good decision with all the facts, but it is infinitely harder when the data are bad. This administration's continuing salvos in what could be a disastrous trade war are based in part on some very bad data called the balance of trade deficit with Japan. Somehow, running a trade deficit with Japan was painted as bad for America. There are few if any facts in evidence to support this political assertion. In today's global market, the old international bookkeeping system that produced these figures is as out of date and misleading as single-entry systems would be for a mega corporation. As long as capital, both human and money, can move toward the best return and the most hospitable climate, there is as little reason for trade figures to balance between nations as between New York and California.

The international bookkeeping system we currently use is an artifact of the past, when national companies used to export finished products across country borders. Two major events have occurred that make these numbers not only worse than useless but dangerous.

The first is that sometime in the 1980s the volume of international production exceeded the volume of trade across borders. That is to say, the quantity of goods and services produced within a country by foreign owned or directed companies was greater than that of the goods and services crossing national borders. This is the natural result of a global business strategy, and this type of production is likely to continue to increase. As long ago as 1987 the McKinsey database listed more than 1,300 American and European companies operating in Japan, their aggregate sales representing almost 11 percent of Japan's GNP. None of these sales show in the balance-of-trade figures.

The second major change in the way the world works is that today value is often added in many different countries, and our bookkeeping system simply cannot handle this, nor was it designed to. The smart dress a woman buys in a New York store may have had a long journey. The cloth may have been woven in Korea of imported America cotton, finished in Taiwan, cut and sewed in India and given a brief stop in Italy for a "made in Italy" label.

This kind of a journey is today more the rule than the exception. The popular IBM PS2 Model 30-286 contains: a microprocessor from Malaysia; oscillators from either France or Singapore; disk controller logic array, diskette controller, ROM and videos graphics array from Japan; VLSI circuits and video digital-to-analog converter from Korea -- and it's all put together in Florida. Measuring systems have simply failed to keep up with the global market and have become less and less useful for policy determinations.

Not so many years ago Hong Kong did not keep any trade figures at all. Year after year the experts from the Bank of England made the long journey to Hong Kong to see how the economy was doing and found themselves frustrated by the lack of statistics. When they looked out their hotel window they could see the bustle, and when walking on the streets could feel the vitality. But they had to return home without the modern magic potion called "trade statistics." Our so-called trade figures do not include services that employ three-quarters of Americans and are therefore so out of date as to be dangerous.

One would never know from reading the papers that Japan is our second-largest export market, that our exports have grown almost 80 percent since 1986 and that the three largest categories of goods sold to Japan are all high-tech: office machines, aircraft and personal computers.

This is not to say that there are not many impediments to trade in both of our countries that should be reduced. In a large measure it was the slowness in removing these barriers that shaped the global market. Corporations leapfrogged the frontiers to set up local manufacturing and service companies whose products are not captured in the statistics.

To rely on the flawed trade figures in today's world to shape policy is as dangerous as if the Pentagon computed our firepower by counting the number of bows and arrows in the arsenal. The drive for freer markets must continue. To start a trade war that could destroy all that has been built would plunge us back into the bad Depression days of the Smoot-Hawley tariff.