Globalization done right: taking a closer look at Japan

[idlisambar]

(Quasi-repost from Editorials/Articles board)

For more than a decade now we have been told that it is inevitable that high-wage nations like the United States will be hollowed out by a rising China. This is dangerous nonsense that has already done untold damage to the United States.

Although China has every right to aspire to become rich, other nations should not be expected in response to have to weaken their industries, let alone impoverish their manufacturing workforces. If this point is not understood in the United States, it is well understood elsewhere, not least among China's richest trading partners in East Asia. In varying degrees, South Korea, Taiwan, Singapore and Japan have cooperated with China's desire for export-led growth yet they have done so without compromising their own fundamental economic interests.

The experience in Japan, where I have lived for nearly twenty years, is particularly instructive. It is a little known fact that wages in Japan are actually higher than in the United States -- about 20 to 30 percent higher measured at recent market exchange rates. Yet even as Japan has rapidly increased its imports from China, it has shown no evidence of being hollowed out. Quite the reverse. Japan's industrial strength has, on balance, actually been considerably enhanced by trade with China in recent years. Certainly Japan's trade surpluses have continued to burgeon. Japan's current account surplus last year, at $181 billion, was not only the largest of any nation in world history but it was more than three times Japan's current account surplus in 1989, the last year of the Tokyo financial boom. .....

http://www.uscc.gov/hearings/2005hearings/written_testimonies/05_21_22wrts/eamonn_fingleton_wrts.htm

[mimitabby]

1. thanks! great info

[necso]

2. Worth a read.

However, there are significant cultural differences between Japan and the US which must be considered when looking at any Japanese model. For example, in America, serving the national interest has long since ceased to have any practical and consistent meaning (with the definition of national, not oligarchal, interest). Currently, serving our national interest is defined (in practise) as letting the (international) rich and powerful have unrestrained rule (incrementally, it is true, as opposed to all at once -- but this is a concession to political reality -- and a practical solution to the problem of "boiling a frog") while engaging in insane and naive foreign policies -- both of these practises having significant deleterious effects on the national interest.

It is the sale-ability of the posturing and manipulation that counts in America, not the quality of the measurable results.

This is a recipe for disaster. But then, who is really prepared to deal effectively with our problems -- it might prove discomfiting to the comfortable.

[idlisambar]

3. Some notion of "national interest" is one piece of the puzzle

I think you are right that the US is essentially rudderless with respect to economic policy. The current American system relies on individuals, whether consumers or businesses/corporations, to optimize their individual circumstances. Such a system cannot produce results that are optimal in terms of collective (national) interests.

I don't think deep cultural differences prevent the US from adopting a more adequate notion of national interest. As recently as 1992, Paul Tsongas and Ross Perot were both articulating a vision based on economic "national interest" that was well received. Admittedly, it's tough in the current political environment, but as economic circumstances become worse there will be an opening for such notions to come back into favor.

[necso]

4. Perhaps

some more balanced notion of national interest can emerge here. Certainly, I do not think that our culture forbids it, I just think that we have moved far away from it -- and that it will not be easy to attain. Moreover, I do not think that increasing economic difficulties will necessarily drive us in that direction. Indeed, I would say that trends to this date can be read otherwise. (And there are other cultural differences of note.)

Besides, there is the pertinent question of whether or not any "solution" to our problems will (in practise) just amount to more dogma, manipulation and exploitation -- and another means to benefit the elite, although perhaps a new elite (at least in part).

And there is a great deal of collusion (manipulation, etc) among the powerful "individuals" in our current system. So the average individual person plays the game at a tremendous disadvantage... But that's the point -- the individual person up against the power of the corporations (and the rich and powerful more generally) backed by the power of the state.

Besides, it all comes down to specific policies -- and to shake off failed policies (much less come up with new ones), the leadership has to shake off old thinking.

Of this, I remain deeply skeptical... And I am no fan of Perot.

[idlisambar]

5. I'm also skeptical but less so

My view is that increasing economic difficulties are a necessary but not sufficient condition for refocusing on notions of national interest and collective well-being. The troubles of the 1930's certainly pushed us in this direction, but there are certainly other possibilities. There are many other precedents in which civilizations facing troubles respond poorly and descended into further difficulties. The hold of wealthy elites and other self-serving interests (domestic and foreign) on our political system is one of the biggest challenges to overcome.

On Perot, just to get a sense for where you stand, I would be curious to know if you didn't like the man, didn't like his ideas, or both.

[necso]

6. I see little point in

expressing my opinion of Perot. I merely wished to express that I was not an admirer -- and this only in the context of you having raised the name in a not unfavorable way. Consider this a vanity, if nothing more.

I keep many opinions to myself... for a variety of reasons.

And I would probably argue that an effective definition of the national interest could be achieved through implementing a series of practical policies derived from it (this definition) and that effectively instantiate it. And I would probably argue that the self-same policies (properly constructed and simply explained) are the best route to achieving the power necessary to implement them. (Certainly, moreover, I would spare the people greater suffering if I could avoid it.)

But I won't say that I see this trend.

...

I am planning on mooching some free eats soon, so I will spare you further quibbling.

[On the Road]

7. Of Course You Don't See That Trend

You won't see it until Democrats can explain it it ordinary terms that resonate with the average voter.

There's nothing to prevent the US from using the national interest as a political ideal. Electricity and phone service were made universal through intrusive public policy. The internet was more of a giveaway, but one that returned huge rewards for the country. People respond to the arguments as long as they're presented with them in a straightforward and compelling way.