Monday, March 2, 2009
Japan's downward spiral
Tamamoto Masaru, a senior fellow at the World Policy Institute, has a great op-ed in yesterday's New York Times. He argues that Japan has become a pyschological mess, touching on some of the issues that have most fascinated me recently - the country's failure to develop its own vision of its future, the reliance on Western models, the deeper malaise affecting ordinary Japanese. The point he makes about people's reliance on government to solve their problems is one that I hear often from Japanese friends, and one that came up in my conversation with a taxi driver in Sapporo over the weekend (I know, the taxi driver conversation is such a cliche, but this guy was unusually interesting, I swear). I've posted a link about this on my LinkedIn page and got a surprising amount of interest, so to summarize his argument: Hokkaido's financial resources have been severely depleted - remember Hokkaido Takushoku Bank, which went bust 12 years ago). Companies from the main island of Honshu that had branches in Hokkaido are shutting them down in this recession. And pillar industries like agriculture and commercial fishing are not faring well. The government's response for years has been to launch big expensive projects, particularly in tourism, but in this man's opinion, they never followed up effectively. They left them half-done. What is needed, this man said, was private investment, good corporate leaders who have a vision and are motivated to follow through. This lack of leadership is certainly something I remember from my days in Japan. And it's an interesting comment as people hope for public spending to arrest, if not reverse, the global economy's spiral.