The Island Nation

Japan will rebuild, but not how you think. And 20 years of misread history holds the clues.

BY PETER TASKER | MARCH 24, 2011

"When my mother was 10, she was evacuated to Sendai and saw the whole town get bombed flat. My father experienced the big air-raids on Yokohama. Their generation started out when there was nothing left of Japan but smoking ruins. Don't worry about us -- we'll definitely recover this time too."

So read an email I received a few days ago from a family friend, a professor of literature at a prestigious Japanese university. It served as further confirmation that the earthquake that hit Japan on March 11 may have shifted the land mass of the main island by six feet, but the country's extraordinary social cohesion and stoicism haven't budged an inch.

In a sense, Japan has been waiting for a crisis just such as this to show its inherent strengths. The foreign media have been hyperventilating over the question of whether Japan can rebuild (and improve upon) its economy. This misconceived idea stems from the frenzy of the 1980s, when foreign writers and academics lauded and feared Japanese industrial might. But when the Japanese economy stagnated, the praise and warnings turned to lectures and self-congratulation, as the West patted itself on the back for having bested the Japanese threat. But this analysis of the rise and fall of Japan's economy misses the point. In my three decades of residence here, Japan's underlying reality has changed a lot less than volatile foreign perceptions.

The Japanese economic miracle had nothing to do with competitiveness or the supposed omniscience of Tokyo's elite bureaucrats; it had everything to do with the resilience of ordinary Japanese people and the country's deep reservoir of social capital. And when Japan's economy faltered during the "lost decades," this likewise had nothing to do with a stodgy growth model or Tokyo's elite bureaucrats having dug their heads into the sand. Japan was urged to make radical economic reforms by many foreign observers, who were then disappointed by Tokyo's glacial progress in making them. But economic efficiency was never the end goal, whether Japan's economy was rising or falling. It was social stability. And this foundation has survived two tough decades and is now a national insurance policy being paid out in the aftermath of the recent disaster.

Japan will rebuild its economy, probably with impressive speed. But don't expect to see a plethora of Japanese billionaires emerging, along the U.S. or Chinese model, or the adoption of hostile takeovers, Reagan-Thatcher-style supply-side reforms, and the rest of the neoliberal agenda. Instead Japan will dig deep into its own values to forge a 21st-century version of the "rise from the smoking ruins."

If modern Japan has a common ethic, it's based on mutual respect, not victory in competition. The most potent symbols of this Japanese sense of social cohesion are the dowdy blue overalls worn by Prime Minister Naoto Kan and his ministers at news conferences and other public appearances since the earthquake. The idea is to express solidarity with the workers at the front line and reduce the sense of separation between rulers and ruled. This was a strategy also employed by the legendary business leaders of Japan's 1960s golden era. Soichiro Honda, for example, attended meetings with bankers in his overalls.

Indeed, the Japanese public looks back on the 1960s not primarily as a time of rapid growth, but as one of shared purpose and real equality. The 1980s, on the other hand, when Japan became a huge player on the world stage, is viewed with ambivalence. Justifiably so, as it led to the inflation of the "bubble economy," a period of manic speculation that makes America's subprime housing disaster look tame by comparison. Japan does gaman (endurance) superbly. It copes with the challenges of success less well.

This point was deeply misunderstood in the 1980s, when Japan inspired a mixture of respect and dread on the global stage, particularly in the United States. A group of academics and writers, most prominently the late Chalmers Johnson of the University of California, came up with the idea that the Japanese industrial challenge was so formidable that it required "containment," just as Soviet communism had.

FRED DUFOUR/AFP/Getty Images

 

Peter Tasker is a Tokyo-based investor and commentator.

DRAKEAU

1:07 AM ET

March 25, 2011

"Foreign observers often see

"Foreign observers often see mass immigration as a cure-all for Japan's demographic problem. It hasn't happened and it isn't likely to: In the Japanese hierarchy of needs, social cohesion ranks higher than top-line growth. Japanese opinion tends to focus on the potential downsides of large-scale immigration: Inequality would probably rise; the wages of low-earning native workers would likely be deflated by the new competition, while the upper-middle class would benefit from the services of inexpensive cleaners, handymen, and baby sitters. The Japanese also fear a dilution of shimaguni konjo, the "island nation spirit" that has helped them cope with a series of disasters of apocalyptic proportions. "

Let me get this straight....The Japanese fear the dilution of traditional values, wage competition and change of national character etc caused by migration and this is accepted, yet when Americans around the border of Mexico share these same concerns regarding illegal immigration they are slated as being racist? Undoubtably many are, but netherless, Western debate about imigration needs to be addressed without the spectre of the term racism. Multiculturalism carefully managed is key to integration.