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Reality is elusive in economics, where fads come and go, where strawmen are created so they can be cut down and where myths sometimes serve as well as facts, especially in popular interpretations.

It is a myth, for example, that Japan is the biggest investor in the United States and it will remain a myth until Japan overtakes the United Kingdom and the Netherlands.Myths persist for many reasons, one being that myths lend themselves to dramatic tales. And, because they have at least the ring of truth, some vested interests seize them and use them for their private propoganda purposes.

But no, the Japanese aren't the biggest buyers of U.S. assets. It might appear to be so because they increased their direct investments sharply, from $4.7 billion in 1980 to $33.4 billion in 1987.

With less public concern, however, Europeans and Canadians have long invested heavily in the United States. In 1987, the United Kingdom owned $74.9 billion of U.S. assets, the Netherlands $47 billion and Canada $21.7 billion.

Why the concern about the Japanese? The speed, perhaps. But the increase in Japanese investments may not be maintained. Do you recall in the 1970s when the oil-rich Arabs were said to be buying up America?

It is because of such misconceptions that the Washington-based Citizens for a Sound Economy Foundation has issued another in its series of myth booklets, this one written by its economist Michael Becker.

Recognizing the low level of economic literacy, the foundation states its position clearly: It is a non-partisan research and education organization. Its goal is to educate policy-makers, the media and citizens.

Among myths it seeks to disprove is the one about foreigners buying up America. Well, they are, you say. Well, they're not, says Becker. The fact, he says, is that foreign-owned assets are a very small percentage of U.S. assets.

Despite the recent influx of foreign capital, Becker says foreign investors own only 4 percent to 5 percent of U.S. physical assets.

Well, you say, they've been snapping up American farmland. And if they're getting our farmland, then they're increasing their control over our food prices. And food makes up a very large part of our consumer price index.

No, says Becker, they are not snapping up farmland. It's a myth, he says. "They own negligible amounts of farmland," by his estimates less than 1 percent.

The confusion, he suggests, might arise from the nomenclature, because timber land is sometimes classified as farmland. It isn't, of course, but mythologists sometimes fail to observe such distinctions.

Becker also tackles the notion that the United States is the world's largest "debtor nation." Why, he says, it isn't even clear that the United States is a debtor nation at all.

While Commerce Department figures on direct investments and stocks show the United States was a net debtor by $54.9 billion in 1986, Becker reminds us that market conditions have pushed up U.S. assets abroad.

He asserts that by adjusting the figures to 1986 market value the United States was actually a net creditor by $296 billion.