Stitch, I thinkJapan's stand result from an ingrained xenophobia. They are realy afraid that if they stimulate local demand and liberalize imports, foreign cultures with some of their less beneficial sides (at least as viewed from the traditional strict "class structure" in Japan) will take hold more and more. They are already seeing a decline in some of their music and arts that are being influenced, and I would be the first to admit, negatively by western music styles. They fear a situation where a college drop out (like Gates) can wield more power that their established kurizu (I am not sure if I have this term right, but it is more or less the corporate equivalent of the Chaebols in Korea). Thus they keep their doors closed for as long as they can. What they are missing in the process, is that long term, their main markets are their neighbors, and their neighbors will not be able to buy much if they are weakened economically or go into a depression. If they get Japan to be the leading locomotive of economical rejuvenation by increasing demand from the rim, 5 years down the road, they will once more be able to have normal trade relations with strong and growing economic partners.
I think that there is also a great fear of fiscal stimulation since it does lead to deficits, yet monetary stimulation is out of the question with interest rates as low as they are. Finally, there is the freeze before overwhelming forces described by Worsick before, that lead to inaction. Sukibara (and I am sure I missed and misplaced few letters in his name) some two three weeks ago stated unequivocally that the MOF will not let any of the 19 big banks fail. This pronouncement (and similar ones by him and other spokepeople from the LDP) almost tie their hands.
Some questions you may ask them could be around what is the status of venture capital in Japan and how is new enterprise formation encouraged. Other questions could surround the problems of liquidity in their banking systems and steps which will encourage money flowing through their economy (I am guessing that a good chunk of money is frozen in those unproductive assets on the banks' books).
Anther question would address the steps corporations can take to honor their life commitments to employees yet provide for the necessary mobility of labor to higher productivity jobs (since it is inevitable that the low productivity jobs will migrate with capital to low labor cost countries).
Well, I could go on for longer, but that is a starter.
Zeev |
