The latest issue of Time magazine has an article that looks at the long term economic and political stagnation that has overtaken Japan - once the dynamo of Asia and now one of Asia's "sick men." I find it interesting that one of the overriding problems is the nation's political system which has become a constant revolving door with few legislators who to accept a changed society and economy and who are willing to put the long term interests of the nation ahead of short term political gain. I could not help but immediately see the parallels between the problems in Japan with the current tactics of the GOP which are all about short term political gamesmanship and which exhibit absolutely no concern for the long term best interests of the nation. The irony, of course, is that the Republicans market themselves as the super patriots and "real Americans" and yet they are only too willing to short sell the country's long term well being for short term partisan political gain. The reality is that the world and society are changing rapidly. Trying to re-establish a remembered time that in fact never existed does not provide the leadership that is needed nowadays. These uber-patriots of the GOP - and the talking heads at Fox News - should more appropriately viewed as traitors to the national well being. Here are some highlights (make sure to note the parallels with the current situation in the USA):*
While Asia lurches forward, Japan inches backward. And yet no one in Japan is doing very much about it. For 20 long years, ever since the spectacular collapse of a stock-and-property price bubble in the early 1990s, the economy has existed in a near cryogenic state. The postbubble period of malaise called the "lost decade" has stretched into the lost decades.
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Every few months, Tokyo's political revolving door spits out a new Prime Minister (Japan's had six PMs in the past four years) who inevitably vows that the time has come, finally, truly, to reform. But the proposals announced with expectant fanfare usually get swallowed up in Japan's dysfunctional political system.
*
Japan's struggle today starkly shows the perils of inaction, of allowing domestic political calculations and ideological inflexibility to take precedence over the pragmatism necessary to thrive in a changing world.
*
The business-as-usual approach in Sendai shows how stale Japan's bureaucracy-led economic model has become. "Japan still craves the old structure, but that structure is preventing the emergence of new industries," says Kazunori Kawamura, a political scientist at Tohoku University. "The bureaucrats create a system that benefits themselves.
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"The economy has continued to be stagnant because of the pursuit of economic policies that did not match the changes in the structure of industry and of society," Kan said in a June policy speech.
*
Japan's corporate sector hasn't been any more enlightened. The biggest names of Japan Inc. have been steadily losing ground in key industries and markets around the world, often to more nimble competitors from elsewhere in Asia. That is especially the case in the crucial emerging markets of the future — China and India — where Japanese managers have been slow to adapt product lines to the different needs of their up-and-coming, but still low-income, consumers. In India, for example, South Korea's Hyundai sold two-and-a-half times more cars in the rapidly growing market in 2009 than Toyota and Honda combined, according to J.D. Power & Associates. Japanese brands are also falling behind in hot, new consumer markets. South Korea's Samsung and LG Electronics are tops in the expanding LCD TV business, not Sony, Sharp or Panasonic, while Taiwan's Acer is winning in the mini-PC netbook market.
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In fact, Japan's entire economic model needs an overhaul in order to create new opportunities for the nation's youth. Policymakers must break once and for all from the export obsession held dear for decades and find new sources of growth at home. That means ending its traditional bias toward manufacturing and developing the inefficient services sector by slashing the red tape that stifles competition. Japan also requires major labor-market reform in order to boost wages, productivity and worker welfare, thus stimulating more consumer spending.
*
Such a sweeping vision for the nation's future and its role in the world is regrettably absent. Katsuji Konno, president of Igeta Tea Manufacturing, a Sendai-based chain of specialty tea shops, complains that the country's leaders are too focused on short-term fixes rather than long-term solutions. "You have to think of more drastic measures," he says. "You need to think 10, 30, 40 years ahead." Until Japan stops living in the past, it may not have a future.
*
Success in the future requires that one recognize that the past is just that - the past. As the world and the global society changes, nations must change or suffer the consequences. Sadly, the GOP - and cities like Martinsville, Virginia - want to go backwards in time, not forward to embrace the new world. If the USA sticks to the Martinsville/Ken Cuccinelli model, the future will be bleak indeed.
*
Every few months, Tokyo's political revolving door spits out a new Prime Minister (Japan's had six PMs in the past four years) who inevitably vows that the time has come, finally, truly, to reform. But the proposals announced with expectant fanfare usually get swallowed up in Japan's dysfunctional political system.
*
Japan's struggle today starkly shows the perils of inaction, of allowing domestic political calculations and ideological inflexibility to take precedence over the pragmatism necessary to thrive in a changing world.
*
The business-as-usual approach in Sendai shows how stale Japan's bureaucracy-led economic model has become. "Japan still craves the old structure, but that structure is preventing the emergence of new industries," says Kazunori Kawamura, a political scientist at Tohoku University. "The bureaucrats create a system that benefits themselves.
*
"The economy has continued to be stagnant because of the pursuit of economic policies that did not match the changes in the structure of industry and of society," Kan said in a June policy speech.
*
Japan's corporate sector hasn't been any more enlightened. The biggest names of Japan Inc. have been steadily losing ground in key industries and markets around the world, often to more nimble competitors from elsewhere in Asia. That is especially the case in the crucial emerging markets of the future — China and India — where Japanese managers have been slow to adapt product lines to the different needs of their up-and-coming, but still low-income, consumers. In India, for example, South Korea's Hyundai sold two-and-a-half times more cars in the rapidly growing market in 2009 than Toyota and Honda combined, according to J.D. Power & Associates. Japanese brands are also falling behind in hot, new consumer markets. South Korea's Samsung and LG Electronics are tops in the expanding LCD TV business, not Sony, Sharp or Panasonic, while Taiwan's Acer is winning in the mini-PC netbook market.
*
In fact, Japan's entire economic model needs an overhaul in order to create new opportunities for the nation's youth. Policymakers must break once and for all from the export obsession held dear for decades and find new sources of growth at home. That means ending its traditional bias toward manufacturing and developing the inefficient services sector by slashing the red tape that stifles competition. Japan also requires major labor-market reform in order to boost wages, productivity and worker welfare, thus stimulating more consumer spending.
*
Such a sweeping vision for the nation's future and its role in the world is regrettably absent. Katsuji Konno, president of Igeta Tea Manufacturing, a Sendai-based chain of specialty tea shops, complains that the country's leaders are too focused on short-term fixes rather than long-term solutions. "You have to think of more drastic measures," he says. "You need to think 10, 30, 40 years ahead." Until Japan stops living in the past, it may not have a future.
*
Success in the future requires that one recognize that the past is just that - the past. As the world and the global society changes, nations must change or suffer the consequences. Sadly, the GOP - and cities like Martinsville, Virginia - want to go backwards in time, not forward to embrace the new world. If the USA sticks to the Martinsville/Ken Cuccinelli model, the future will be bleak indeed.
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