In the 80s, many people thought that the Japanese economy could overcome that of the United States, including the Americans themselves. But that’s not what happened.
Japan is believed to be a modern country, with state technology -Art -Art, almost futuristic.
But last year the Japanese celebrated the end of a slightly unusual war.
A silent war that has gone unnoticed for most of the world. A war against … quadrants.
In 2021, the then minister of digital transformation, Taro Kono, complained that the Japanese were still required to use floppy records when they had to send documents to the government.
Three years later, this requirement was finally withdrawn and said triumphantly: “We won the war against the floppy disk!”
The example is symbolic of how Japan, who was seen as the country of the future, was blocked in the past.
In the 80s, most of what existed in the world came from Japan.
At the time, the Japanese economy became the second largest in the world and many people thought that it could even overcome the United States, including the Americans themselves.
But that’s not what happened. In the end, Japan that everyone expected never arrived. The country has simply stagnated.
Japanese miracle
When the Second World War ended, Japan was destroyed.
As part of a project to go up, the country has decided to contact the sector and had a very important ally: the United States.
This is what Professor Hiroaki Watanabe of the Ritsumeikan University of Kyoto explains.
“After the end of the Second World War, the world lived a system divided into two poles, capitalists against communists, during the Cold War. And of course, for the United States, Japan has become very important,” says Watanabe.
At the time, it was indicated that the communists would beat the civil war in China, as he did. Therefore, it was important for the Americans that the economy of Japan was strong to contain the influence of the communist movement in the region.
And the betting strategy on industrialization has worked. During the 1960s, Japan grew up much more than the United States, at a rhythm that exceeded 10%.
At the time it was relatively easy for Japan to export its products. The local currency, the Yen, was worth a bit of dollars, which made the Japanese products very cheap in the rest of the world.
The United States, in particular, were detected by Japanese products such as Sony’s Toyota and Walkmen cars.
And Japan became the second largest economy in the world.
Unbalanced trade
But this strong growth in Japan had a problem: the Japanese sold much more to the United States than they purchased – and over time it has been annoyed.
In 1985, the two countries made an agreement in which Japan basically agreed to evaluate Yen beyond the dollar, which made the Japanese products more expensive and much more difficult to export.
Why does Japan agree with this plan?
“I think it is essentially because … a great reason is that Japan depends on the United States for safety. So it is very difficult to resist an American question with this type of imbalance of power,” says Watanabe.
With the decrease in exports, the Japanese economy has slowed down.
To try to solve this problem, the government has decided to lower its interest. The idea was to encourage people and companies to spend, since taking money on loan was cheaper.
This money was used both on the stock market and on the purchase of properties, which caused a trigger of the prices of shares and the square meter.
At the time, analysts even said that only an area close to the Imperial Palace of Tokyo was the same as the entire state of California, more than 400,000 times larger in the area.
Banks began to accept expensive properties as a guarantee for loans.
But in practice, he had not justified for such a great increase in the value of the real estate sector, nor the value of the shares.
In other words: it was a bubble.
And in the early 90s this bag finally broke out. The bag collapsed, thousands of companies broke and the value of the properties has fallen.
With this, the banks, which had the value of these properties as a guarantee, were also in a difficult situation. And the loans stopped, also for the private sector, which was without money to invest.
What no one expected is that this impact would last decades, as explained by the sociology teacher of the London School of Economics and political science (LSE), Kristin Surak.
“It is a difficult question to answer to, which has caused stagnation or because Japan is using so much time to recover. And I think there is also no clear response in Japan,” he says.
The lost decades
Since the beginning of the 90s, Japan has spent about 20 years practically without inflation.
In practice, this means that in 2010 it was possible to buy some products by paying almost the same price of 1992.
And when people buy little, prices fall and companies can fail.
On the one hand, this allowed the Japanese to maintain their purchasing power, because the wages were also practically the same during this period. They alone had a low purchasing power.
To try to encourage consumption, the country started printing more money and further lowered the interest rate. This is one of the main tools of a government to stimulate the economy.
But in the case of Japan, he did not work.
“The government was trying to heat the economy all the time. [Imprimir mais dinheiro] It is an obvious choice for any government. But Japan was not reacting to the classic economic solutions that are usually offered. “
Even with the interest rate close to zero, people were still without expenses – that some analysts attribute at least in part to a cultural issue.
“The Japanese are very worried about the future, health and pension. So instead of spending, if they make money, they save.”
To make the situation even more complex, Japan was also the first industrial power that saw its population narrowed. The country has recorded less and less birth and could lose a fifth of its current population until 2050.
And it is difficult to increase production with fewer people to produce.
In this case, the way out is to increase productivity, or the ability to do more with less.
But Japan is also the country with the lowest productivity among the seven major economies in the world.
And part of the explanation may seem contrary: the unemployment rate is very low. But this happens precisely because many of the people employed are in few production works or perform functions that have been automated in other countries.
“In Japan, for example, you may find six people who drive traffic in a small parking lot and this must not happen,” says Surak.
The former BBC correspondent in Tokyo, Rupert Wingfield-Hayes, has spent many years in Japan. He left in 2023 and, before leaving, he made the following analysis: “When we think of the elegant bullet trains of Japan or the wonderful production in the Toyota assembly, we can easily think that Japan is the efficiency model. But it is not. Public money is spent in doubtful utility activities”.
An example would be just below the feet of those who pass through the streets of Japan: The Manholes. Or rather, the culse caps. They are beautiful, but they are also expensive.
By 2023, each could cost up to $ 900 or more than $ 5,000.
There is also a Japanese Tombuscolo company, which says that there are thousands of different caps in the country.
Many people see all this an indication of the reasons that led Japan to have one of the greatest public debts in the world, behind only Sudan.
And this report is aggravated by an elderly population that cannot retire due to the pressure on the pension and the health system.
Calm
But despite everything, there is no protest on the streets.
For those who see outside, it seems that things will be really surprisingly well.
The crime is very low and the life expectancy is very high. Education is one of the best in the world and the unemployment rate is not a problem.
Also, while the population is reducing, there is still a lot of job offer.
“The situation is not as serious as in many other countries, at least it is relatively easy to get a job these days, even if it is not well paid. The salary is quite low, but you can survive,” says Watanabe.
Part of the explanation of this apparent normality could be in the fact that before it stops growing, Japan was very rich.
So rich that, despite having spent 30 stagnant years, Japan has fallen from the second to fourth place among the largest economies in the world.
But in 2022 things began to change, even if slightly. Inflation exceeded 2% after the pandemic and the beginning of the Ukrainian war – and has remained above that level since then. And the Bank of Japan has increased the interest rate at the highest level since 2008.
But it is not yet known what the impact of this long -term will be.
“If you talk to the economists in Japan and in the government, they are usually quite realistic who say something like this”, we want to be among the 10 largest economies in the world “, one thing that often hears from countries that were also the second largest economy in the world”, says Surak.
At least a part of this pessimism on the future is due to the fact that the Japanese themselves recognize that in many areas the country is still blocked in the past.
The same day on which he declared the war against the floppy disk, the then minister of digital transformation promised to get rid of another enemy of modernity: fax.
But at least for now, it remains firm and strong, even in the same buildings as the government.
Source: Terra
Rose James is a Gossipify movie and series reviewer known for her in-depth analysis and unique perspective on the latest releases. With a background in film studies, she provides engaging and informative reviews, and keeps readers up to date with industry trends and emerging talents.
