Tuesday, January 25, 2011

The "Cool Japan" Delusion

There's a recent "Views from the Street" at the Japan Times online asking the question "Can selling 'cool Japan' save the ailing economy and help avert a demographic disaster?"

First of all, the "Cool Japan" campaign, if it can be called a campaign, is a move to promote Japanese culture abroad as hip, or "cool" as the kids say these days. While I might argue that it the branding of Japan as "cool" has been relatively unsuccessful, as I believe many more people would associate Japan with words like "technological," "exotic," or "strange," there is no denying that the spread of some elements of "cool" Japanese culture around the world has enjoyed more than modest success. Anime, manga, video games, and Japanese pop music have spread to many countries, although they thrive particularly among those members of "geek culture," as noted quite some time ago by Emily Leach of Asian Week. Still, I don't mean to assert here that Japan isn't "cool." What I do mean to assert is that the whole notion of "cool Japan" relating to Japan's economic woes is flawed.

Cool Japan is a red herring. Japan's stagnant economy can be traced back to the 1990's and its accrual of debt and fiscal deficits (Sound familiar? If America makes it out of the current recession, it will succeed where Japan has failed). Japan's economic problems cannot be saved by some giant advertising campaign. And they will be severely worsened, possibly to the point of collapsing the national economy, within the next 50 years. It has nothing to do with image. It has to do with individual behavior and national policy.

As Tornadoes at As I see Japan...from LA has been pointing out in recent posts, Japan is suffering from population decline. Not only that, but Japan's population is aging. This means that as the years pass, there will be less people working and more people retiring. Eventually there won't be enough taxes coming in to pay for all the "free" health care and welfare that is required.

There are two possible solutions:

(1) Japanese people need to have more children. This is the easiest way to increase the population and inject some new blood into the ailing economy.

(2) Ease immigration policies. This is obviously not happening.

As it is, the "cool Japan" movement, even if it were effective, can only boost tourism and sales of Japanese goods. What it needs to do is encourage immigration to Japan. And the Japanese government needs to allow for this. 

And so will Japan somehow weather the storm, or will it fade away into oblivion (in a cool way, of course)?


  1. Japan's in a sticky spot. In order to get more young workers, they paradoxically need to RELAX the back-breaking careerism which currently stops anybody from having kids. It'll hurt, but the longer they kick it down the road, the worse the pain will be.

  2. This population decline is bad. On coming of age day less than 1% of the population became an adult (20yrs old). That's the lowest it's ever been since those statistics have been tracked. In the Japan Times they say:

    In 10 years, the population of 20-year-olds is expected to total 1.19 million. But after that, it is forecast to decline at an accelerated pace, reaching 930,000 in 2031. In 30 years, it is projected to fall to 780,000.

    Talking to Japanese people I know, no one seems interested in having kids. Most people seem to not even be interested in marriage. Many are quite happy to live at home with their parents.

    I should also add that I think Japan is pretty cool. There is that whole weirdness thing though too.

  3. It seems Japan is going the third route. Rather than have more babies or more immigration, they will just build more robots to serve all the elderly.

    Of course robots don't pay taxes though.

  4. this is something I've thought about a lot lately since I think I'll be here for a while. I think the government should give tax breaks to encourage people to have more kids. The City of Sendai now gives financial support, but I think it should extend through the formative years.

  5. One thing I heard from one of the teachers I work with is that the national healthcare insurance doesn't cover childbirth or admission for women who give birth, so having kids can also be rather expensive.

  6. I too have been thinking that if population decline is such a big problem for their economy they should enact tax breaks to encourage people to have more children. I'm thinking something like married couples with children pay no taxes at all the year a child is born, 50% break the following year, 30% break the year after that, but if you want a break the fourth year you gotta have another kid.

  7. One of the things about the population issue is that the current crop of older folks are the result of strong encouragement to procreate around the time of World War II (for obvious reasons). It isn't necessarily a "natural" situation for Japanese folks to have as many kids as they used to, particularly based on lifestyle considerations (hard working, little free time, few public schools that are only recently "free" and expensive education overall, etc.).

    Once the current age crisis passes and the large number of older folks pass away, there should be somewhat of an easing of the crunch as the numbers settle down to a consistent level. That being said, if the birthrate continues at 1.4, it will never work out without immigration to fill the gap. I don't think that any amount of financial aid short of making having children profitable is going to really change things though. Japanese people worry more than others about security and take responsibilities very seriously. Having a child isn't something they're going to do just to appease the government's need for more bodies, particularly with so many jobs being sent abroad and their fears that their progeny might not have the same lifestyle level as themselves.

    Eventually, Japan will ease immigration restrictions. I don't know when or how, but they are moving in that direction now in a way. They are trying to streamline immigration processes as well as increase the visa terms for work visas. They're also doing a lot more multilingual service than 20 years ago (especially, I'm seeing more Korean in addition to English). I think these are all slow steps in the process of getting people used to a more ethnically varied society. Like everything else though, it's slow in Japan.

    It may be too slow, or not. It really depends on how they manage their national debt problem. Japan has a higher per capita debt than the U.S., but they are in debt to their own people (not other countries). This makes repayment less dire as there is almost no interest involved (though there is worry that the boomers will withdraw a lot of money after retiring and suck a lot of the money out such that the government will have to start paying it back).

    Personally, I think Japan is on its way to a serious decline, but that it will level out before it reaches greatly diminished status in the world economically. I think their level of education and technology are high enough to keep them afloat, but that they will eventually drop even lower than having the number 3 economy. However, there will always be cultural interest in Japan. They've had more influence than any other Asian culture on the Western world in terms of popular entertainment. Even before video games, manga, and animation, people were watching Godzilla and Ultraman. It's been around long enough to be something Westerners can be nostalgic about.

  8. That's a good point about the reason for the population boom around the time of the war.

    It's also come to my attention that one of the few things health insurance doesn't cover over here is childbirth, which can be very expensive if a woman is admitted. That's a little ironic.

    Yeah, things'll even out eventually. Just may happen after enough damage has been done to the Japanese economy to set them back decades.