Sunday, July 17, 2005

Hard times in Japan

From Time magazine. Increased inequality and competition... is this our future, or are we already there?

A decade ago, 90% of Japanese considered themselves "middle-class." In an Asia-wide survey conducted by U.T. last year, however, 60% of Japanese now rate their economic status as "below middle-class." The public's increasing awareness of kakusa shakai is reflected in the Japanese media's obsession with who is up and who is down. Whether in magazines, on TV chat shows or on bookstore shelves, the domestic debate is dominated by the idea of kachigumi and makegumi ("the winning team" and the "losing team"). Fashion magazines are filled with beauty tips to marry early and avoid being a poor, single woman.

Yet, while the poor get poorer, the rich are getting richer. Last month, the national tax agency released its annual list of the country's top 100 taxpayers. Tatsuro Kiyohara, a 46-year-old fund manager at Tower Investment Management, ranked No. 1, with a tax bill that suggested a personal income of approximately $100 million. This marked the first time a wage earner had captured the top spot, an occasion that many writers and talk-show hosts alternately hailed and lamented as a signature moment in the new, more Darwinian society—for Kiyohara's pay is almost entirely performance-based.

Will American workers displaced from jobs in manufacturing, textiles and other industries really be able to "move up the value chain"? Younger Japanese are already facing these issues as their economy "hollows out" in the face of competition from China - Japan's number one trading partner.

Naoki Ijiri... jobless gloom. The 25-year-old polytechnic college graduate had come to the job-placement office this spring after searching fruitlessly for work for six months—long enough to convince himself that he would never find a career to match his training as an environmental-systems engineer.

"People like me who aren't particularly talented at anything are happier with the old system of lifetime employment and seniority-based salaries," he says. "The supposed 'chances and opportunities' that a competitive economy offers is for those who are already steps ahead." Ijiri later found work as a security guard, hardly the future he once envisioned for himself.

...Akiko Miyamoto, manager of the unemployment office that Sasamoto frequents, says she sees the same story again and again: a sense of entitlement and unrealistic expectations followed by depression and paralysis once the going gets tough. "People come in wanting to be designers or photographers or editors," she says, "but there are very few jobs in those fields posted here."

3 comments:

Anonymous said...

Steve,

It is a lot, lot tougher to go down that it is to be poorer but starting from a very poor state and moving up.

I worry about rise in social tensions (ex., anti-immigrant, anti-Asian sentiments) in US and Europe as more jobs inevitably move to India and China. Moreover, the *APPALLING* education provided to an *average* student in the US does not help matters (note how Toyota decided to build plant in Ontario, rather than southern US, even though the latter offered much more tax incentives, because of inadequately educated workforce).

The economic policies being recklessly pursued here are extremely harmful and no one seems worried about it. Listening to excellent economic advice, as during Kennedy or Clinton admin, seems to be a distant memory.

MFA

steve said...

MFA,

I agree with your comments. It will be interesting to see how protectionist sentiments play out in congress this year. Were it not for Bush's assurances of an imminent renminbi revaluation (who knows whether those assurances will turn out to be correct), the protectionists appeared to have the votes for a rather strong tariff bill.

Steve

PS said...

It has been suggested by many that the danger of protectionist vote in the Congress is merely a trump card for Bush in geopolitical stance on N.Korea, Taiwan and Middle East.... so the vote will never happen in the end (if the bluff is successful of course).

WTO should recognize labor force to be a commodity on par with soy beans, steel, textile, etc.
In this case China and India will be penalized for underselling their commodity named labor.

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