An embattled George Bush in the White House, a Democratic Congress riled up about Japanese practices to give itself an unfair advantage in international economic competition…is it 2007 or 1992?

But seriously, as this FT article reports, Congress is pushing hard for Secretary Paulson to join with European governments to pressure Japan to raise interest rates and push up the yen.

What exactly do these esteemed members of Congress hope to achieve? Do they expect that if Japan changes its supposedly errant ways that America’s economic concerns will vanish and its economy will continue to lead the world? (I say supposed because it’s not exactly clear how Japan is manipulating its exchange rate, aside from having extremely low interest rates.)

As I’ve posited here before, America’s problems are rooted in the long-term challenges associated with the move to a post-industrial economy, and no amount of badgering of foreign governments will solve the long-term question of how to re-envision American institutions for the new era. Not surprisingly, John Dingell (D-MI), is leading the charge on this issue; it seems that Dingell, whose district includes the suburbs of automobile industry-dependent Detroit. It seems Dingell would rather freeze American industry than advance measures that will strengthen American dynamism and ensure that the engines of growth continue to purr — including Detroit. There’s no going back to 1950. And frankly, since a world with many major liberal economies means that millions, if not billions, of people are being lifted out of poverty, we shouldn’t want to go back to 1950 even if we could.

Dingell and his fellow Democrats should be using their majority to ask how to provide some degree of assistance in the short term to those affected by the post-industrial transition, and to consider long-term solutions to ensure that rising generations have the skills to compete in new global economy that has many major nodes, with which competing fiercely for an edge on the rest. Undermining the global economy by hectoring foreign governments is a solution to neither the short-term nor the long-term problem.

So to re-enact the early 1990s efforts to pressure Japan to do America’s bidding economically, given what we know now about how the global economy is changing, is indeed a laughable farce.