In 1987, for the first time ever, the Commerce department broke down the foreign investments by specific industry. The figures indicate clearly that foreign investors do not specifically target high-tech American firms. Levels of foreign investment in these firms were relatively high, but the levels were also high in some low-tech, mundane industries.

For example, the industry in which foreigners employed the largest percentage of American workers (61.2 percent) was cement manufacturing. By comparison, only 39.7 percent of American workers in household audio and video equipment manufacturing worked for foreign-owned companies. Foreigners do control 12.5 percent of the sales in electronics manufacturing, but they also control 16.8 percent of the sales in mining.

The point is, foreign investors make no broad attempt to target one segment of the American economy. Like all investors, they seek to make money wherever they can.

Finally, the statistics reveal that Japan is less involved in the American economy than the Japan-bashers charge. The rate of growth in investment in U.S. companies was higher for Japan than for other nations from 1979 to 1988. But in 1987, Japan's share of American industry was less than half of Britain's and only slightly larger than the Netherlands'.

Of course, Americans should not use foreign dollars as am investment crutch that allows them to consume more and invest less. This is precisely what happened during the Reagan years, and Clinton wants to fix it. But the answer cannot be to punish foreign investors. Instead, we should concentrate on another element of the Clinton plan: providing tax credits for Americans to invest in U.S. companies.

Clinton says he is simply trying to "prevent tax avoidance by foreign corporations." He couches his tax increase on foreign investors as a plan to begin collecting taxes foreigners have been avoiding for years. But the net effect is still an increase in the real tax burden for these investors. And anyway, many economists deny that foreigners have been cheating as much as Clinton charges.

We probably shouldn't be too hard on the governor. After all, he's the only one who's found the wherewithal to release an economic plan. And this is not intended to echo the charge that Clinton merely panders to voters according to poll numbers. His willingness to anger some of his most dependable voters--however calculated it may be--should be enough to dismiss the idea.

But in this case, Clinton has let the tendency to foreigner-bash influence an otherwise solid plan. He would be better to leave the xenophobic idiot vote to Ross Perot, who will win it anyway.

Editorial Chair John A. Cloud is an intern at The Wall Street Journal this summer.