Dislocations
Friends who don’t live here frequently ask me what it is about Western media reporting about Japan that drives me up the wall. I usually complain that journalists recycle the same scripts over and over, but that in and of itself isn’t really it. Some things said repeatedly because they’re actually happening repeatedly. But The New York Times business section featured an excellent example yesterday of things I sometimes find it hard to put my finger on: skating over the interesting issues a story raises in a way that means there’s little new for people who know Japan and plenty that’s potentially misleading for people who don’t
Martin Fackler, who wrote the piece, doesn’t make any factual errors that I can see. (Well, the first sentence should probably say, “remote northern coast of Japan’s main island,” since he’s not talking about Hokkaido.) And he tries to give several points of view about a controversial phenomenon. The result is still unenlightening. I assume that one of his editors, not he himself, wrote the headline and subhead. Still, they do pretty aptly sum up the article, which presents a phenomenon with quite a long history with little context:
Japan’s $4.7 trillion economy has expanded for the last five and a half years. Urban centers like Tokyo and Nagoya, the seat of the Japanese car industry, are thriving, as seen in the building boom decorating Tokyo’s skyline with glittering new high-rises.
But in regions like Akita, the mountainous northern prefecture that is home to Noshiro, downtowns have emptied and factories have closed, and an exodus to Tokyo of youths seeking jobs has left behind towns that are predominantly for the elderly.
There is widespread concern here that these changes are turning Japan into a nation divided into winners and losers, split geographically between prosperous cities and the depressed rural areas. Many here attribute this growing disparity to Japan’s embrace of American-style economic liberalization, begun in the 1990s to end the nation’s decade of stagnation.
The measures to open up markets helped revive cities like Tokyo and lowered prices for Japan’s long-suffering urban middle class. But elsewhere in Japan, they are seen as bringing unwelcome and wrenching change.
…
For all of Japan, the question now is whether this sort of reaction will be strong enough to stop or reverse economic liberalization. The central government has already begun to tighten restrictions on large stores, and many in rural areas are calling for more public works.
But many in Tokyo and regions like Akita say Japan’s soaring fiscal deficits make it impossible to return fully to the old ways, and many advocate opening markets further.
There’s no indication in this flurry of “some say” explanations of whether any of them have, you know, more evidence than others. No one can gainsay the point that market liberalization has plenty of enemies in Japan. Whether–given the collapse of the Bubble produced by the “old ways,” increased competition from China in the manufacturing and tech sectors, and Japan’s dependency on export markets for its wealth–it has any viable alternative is another matter. Of course, Japan is not going to become Estonia. Japan will continue to make the trade-offs that suit its own culture, which does indeed include a tendency to distribute benefits through the group, even when the group is the entire population of the country.
But there are, in fact, trade-offs involved, and it’s perilous not to recognize them. Fackler coolly reports that “many in rural areas are calling for more public works” without giving even the slightest hint of the degree to which the post-war “Got a problem? Get a cement mixer” approach to rural economies helped get them into their current pickle. During the era of economic hypergrowth, massive road-building, earthworks, and other construction projects gave people in rural areas something to do besides farming. Cruelly, it also deceived them into believing they were earning their money by producing value for the economy just like the major cities, and it diverted their energy away from building other skills and exploiting local assets. Now that the funding for boondoggles is harder to come by, keeping the egalitarian mask over productivity disparities is more difficult. Residents of rural areas have less income and purchasing power. Keeping out imports and big-box retailers may protect local businesses from “excessive competition,” But there’s a case to be made that it also “protects” cash-strapped consumers from goods they can more easily afford.
We hear little about their problems in Fackler’s article, but to his credit he displays some awareness that the mom-and-pop retailers he’s writing about are not limitlessly sympathetic characters: “In interviews, local business leaders bemoaned their declining fortunes, but also quickly dismissed suggestions that they seek new opportunities in nearby emerging markets like China or Russia, which sits just across the narrow Sea of Japan from Akita.” Plenty of people in rural Japan were perfectly happy for Tokyo and other major commercial centers to do the hard work of wealth creation when painful adaptation to new economic realities was something expected only of foreign markets when Japan came up with innovations in metal, automotive, or electronics manufacture.
Fackler might have produced a genuinely illuminating piece if he’d explored in more detail the proposals for economic revitalization that forward-thinking locals are putting forth, exactly who’s moving to scuttle them, and how they’re defending their resistance. It’s too bad that he or his editor decided that the boil-in-bag narrative of how the cities are wicking away young talent from rural areas and leaving them in the dust economically was all that needed serving up. His article ends just as it starts getting interesting.