Education About Asia

Will Japan Change?

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Is Japan once again changing? Unlike 1868, when the newly empowered Meiji emperor moved to Tokyo to preside over a series of dramatic changes that became more generally known as the Meiji Restoration, or 1945, when the Allied Occupation allied with relatively progressive Japanese to create a new constitution and institute a set of major reforms, Japan has yet to see a truly dramatic leader or many public protests. Yet a less dramatic series of political, economic, and social developments, combined with the shocking March 2011 double blow of a 9.0 earthquake and forty-five foot tsunami, raises a question: Is Japan currently in the midst of a third major transformation?

Economic Issues

For some time now, Japanese voters have been upset by the collapse of what had been called Japan’s “economic miracle.” As most forcefully—if controversially— explained by Chalmers Johnson and refined a bit by Steven Vogel, Japan’s once-praised “developmental state” linked the deeply entrenched, pro-business Liberal Democratic Party (LDP), an elite bureaucracy armed with considerable regulatory power, and large banks that gave long-term loans to export oriented companies. These in turn combined close ties with their subsidiary firms and dealers into groups of affiliated companies known as keiretsu, most of which promised permanent employment to an elite male workforce in return for loyal and dedicated work.1 Add to this a “second budget” of capital from the postal savings system and what was known as amakudari (literally “descent from heaven,” or the practice of companies hiring retiring bureaucrats who had once supervised them), and you have a tight-knit economic system.2 Particularly useful when Japan was trying to modernize its economy, all this encouraged annual GNP growth of 9 to 10 percent per year up to the oil crisis of 1973 and a relatively respectable 3 to 5 percent growth thereafter. In the process, Japan quickly became the second largest GNP in the world. It also built highly successful export industries in areas such as electronics and cars that amassed huge trade surpluses.