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SHALL WE DANCE?

By Frank Gibney
September/October 2000
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Essay
Japan: A Rising Sun?
M. Diana Helweg

The Japanese economy of old -- coddled by an overbearing government and riddled with corruption -- is dying. Today Japan is undergoing nothing short of an economic revolution. No longer able to count on bailouts, banks are restructuring. Companies are putting profits ahead of personal loyalties. Reforms are breathing life into decayed industries. And the climate for foreign investment is better than ever. The most important force for change is the wave of small, creative, high-tech companies that have built Japan's very own Silicon Valley. The government's lackluster economic stewardship is no longer important. The state is not driving today's revolution; business is.

To the Editor:

Aurelia George Mulgan shows a keen knowledge of what is happening in Japan, as opposed to what people hope will happen there ("Japan: A Setting Sun?" July/August 2000). She deservedly underlines the extraordinary connection between the government and the business sectors that thus far has undermined any attempts at real recovery -- just as in an earlier era, it proved a springboard for a different kind of economic success.

M. Diana Helweg's article in the same issue, "Japan: A Rising Sun?" pins hope on Japanese business' turning the country around -- with only minimal attention paid to the political arm. Japan simply does not work that way. The political-business connection, regrettably, is for the time being as strong as ever, thanks to the pernicious Liberal Democratic Party. Helweg is also too optimistic in using the success of Sony, Toyota, and a few similar companies as augurs of a new recovery. They are international corporations that wheel and deal with a freedom not remotely enjoyed by the great majority of Japanese businesses, which are still feeding at the trough of government protection. Furthermore, the unraveling of Japan in the last decade deserves far more attention than Helweg's passing mention. She offers an all-too-tidy version of Japan's assumed twenty-first-century resurgence.

Frank Gibney

President, Pacific Basin Institute, Pomona College

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