Japan's Legacy and Destiny of Change
For a nation whose founding is lost in the mists of antiquity, Japan is in many respects a very new country. Last year we celebrated the hundredth anniversary of the Meiji Restoration, which marked our entry into the modern world. This year the Ministry of Foreign Affairs, which I am honored to head, observed its centennial. By contrast, the United States, which is in every respect a young nation, possesses a number of institutions that are far older than many of Japan's. The Department of State, for example, is only a dozen years short of its bicentennial, and Harvard University, with its 333-year old history, is more than three times the age of my own alma mater, Tokyo University, now in its ninety-second year.
For a nation whose founding is lost in the mists of antiquity, Japan is in many respects a very new country. Last year we celebrated the hundredth anniversary of the Meiji Restoration, which marked our entry into the modern world. This year the Ministry of Foreign Affairs, which I am honored to head, observed its centennial. By contrast, the United States, which is in every respect a young nation, possesses a number of institutions that are far older than many of Japan's. The Department of State, for example, is only a dozen years short of its bicentennial, and Harvard University, with its 333-year old history, is more than three times the age of my own alma mater, Tokyo University, now in its ninety-second year.
This newness of modern Japan, which makes it unique among the "advanced" nations, is also an essential key to our view of the world. To understand Japan's outlook and its vision of the future, it is necessary first to comprehend our country's brief and turbulent history as a modern state, and the effects these compressed events have had on the Japanese mind.
Two sets of events in particular have been decisive in their impact: the developments leading to the Meiji Restoration, which forcibly integrated Japan into the nineteenth-century jungle of world diplomacy, and total defeat in the Second World War, which profoundly changed Japan's direction as a modern nation-state.
The first of these traumatic national experiences is so recent that, until a decade or so ago, there were people still living with personal memories of the feudal Tokugawa era. Indeed, Japan's "age of discontinuity," to borrow Professor Peter Drucker's apt phrase, began not with the contemporary technological explosion, but with the arrival in 1853 of America's "black ships," which came to open up Japan, and were met on the beach at Kurihama by the feudal levy armed with matchlocks and pikes, "as on Bosworth field."
From that moment to the present, the lot of our people has been forced change-rapid, relentless and often violent-and painful adaptation to change.
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The West often ascribes mystery and chaos to political and economic power in Japan. Yet Japanese power is actually a carefully structured hierarchy, and the capstone is neither big business nor the Ministry of International Trade and Industry but the little-understood and low-profile Ministry of Finance. The MOF controls Japan's equivalents of the U.S. Federal Reserve, Treasury Department, Internal Revenue Service, and Federal Deposit Insurance Corporation. It is the prime mover behind Japan's savings rate, distribution of overseas aid, and regulation of monopolies. However obscure, it may well be the most powerful bureaucracy in the world.
The Asian financial crisis had a side benefit: prodding the Japanese government to fix its economy. But as the sense of urgency eased, so too did the momentum for change. The Liberal Democratic Party, never a true champion of reform, now blocks deregulation from every angle. Wasteful public spending has created little but debt. And the public's trust in its government is all but gone. Recovery would require Japan's politicians to give up the many benefits of the status quo, which they will not do without a fight. So Japan's reforms are stalled permanently. Its economy is, too.
It was only a few years ago that South Korea, wracked by poverty, political chaos and popular discontent, was widely regarded as a sinkhole of American aid. Now this small, ruggedly anti-communist country enjoys relative political stability and is making impressive economic progress. It has become one of the success stories of the United States assistance program. How did this startling reversal come about?
