Random Musings - On Japan

My time in Japan was brief, but I did have the opportunity to meet interesting, fun individuals, whether on the tourist path through Kyoto or through my family in Osaka. As an outsider, I saw a country with an incredible culture, beautiful temples and masses of people walking through canyons of neon lights. The toilets were more complicated and advances than some of the computers in the US. Customs was efficient and painfree – They put a sticker in one’s passport with all the information the Japanese government deems important on a barcode. The trains are incredible. Kyoto, a potent symbol of past achievements in government and spirituality, stands as a monument to a glorious inheritance for the Japanese people. But, with all this, the majority of the people I met were pessimistic. It isn’t only my anecdotal evidence. The suicide rate in Japan is twice that in the US. In a recent poll by The Asahi Shimbun newspaper, the top three words used to describe the current era were “unrest,” “stagnation,” and “bleak.” After years of proclaiming the “Coming Asian Century” on magazine covers across the world, Japan is no longer assumed to be the forefront of that Asian revolution. China is.

Japan saw its economy explode in the late 70s and throughout the 80s. The world grew to accept Japanese cars and electronics. The newly rich captains of industry branched out and bought property in the US, including the trophy of New York City, Rockefeller Center. This was a time for optimism, optimism that found an outlet in building golf courses or buying overseas. But, then, the bubble burst, Japan fell into a deep and lengthy recession. Some economists, including Paul Krugman in the US, have blamed the length of the Japanese recession, on the government’s refusal to really push for a single, powerful stimulus to shock the country back into growth. Interest rates in the country hovered near zero for years. The recession has been referred to as the “Lost Decade” because no growth has occurred, the stock market didn’t return to the frothy levels of the 80s, and a generation has grown up in an economy without any reason for optimism.

The Japanese should be optimistic about their future. They have an incredible infrastructure with which to grow industries that should prove synergistic with the rise of China. They occupy an important position in the world, both geographically and politically. They are the major economy and democracy on the doorstep of the burgeoning Chinese. Their culture influences the world, from car and electronics to fashion and entertainment (although not music, their music is awful). The reasons are their, they have just been depressed for too long to see it.

My fear is less for the Japanese and more for my fellow Americans. We, too, have fallen into a terrible recession. Thankfully, the fiscal and spending stimuli have been large, even if some economists call them too small. The stimulus has been larger than either party thought necessary in October 2008, but, then again, the damage was far worse than anyone expected back then. I hope that Americans don’t fall into the trap of conceding growth and optimism to China. We, too, have reasons to be optimistic. The US was built on a foundation of dynamism, where innovation lives and breaths. I’m excited about my prospects upon returning to New York. Where else is every nationality of the world represented? It is easier to fall into a trap than to climb out of one. I have great hope in my country and my fellow citizens. I have faith in the current government with its incredible brain trust. Americans can find upside no matter what. Just ask GS.