AsiaFile

Some of you know I publish a column every six weeks or so in the Nikkei Shimbun…or at least the English Weekly version.

However, since the paper is not really “Web friendly” I thought I would put my latest column here, too.

JAPAN’S LESSON FROM NOV 4

STOKE POLITICAL COMPETITION

Stock market collapses. Government passes package to stimulate consumer spending. Central bank cuts interest rates to spark growth.

These are headlines we have come to associate with Japan as it struggled through a “lost decade” of deflation and decline, and ones we have been reacquainted with now that Japan’s political bureaucracy is trying to shelter the nation from the global financial crisis. In recent weeks however, the same headlines have also surfaced in the U.S. after the collapse of major investment banks and financial institutions.

Because the harvest of recent headlines seems so similar, I am often asked whether I think America could possibly fall into the same trap of deflation, debt and decline that continues to plague Japan in 2008, nearly twenty years after the economic bubble burst.

Routinely my answer is “no” – but not for economic reasons alone.

Even though obvious similarities exist between America’s current struggles and the collapse of Japanese equity and real estate markets in the late 1980s. I don’t think the U.S. will succumb to a similar fate.

That’s because fixing the economic challenges that confront both superpowers is as much about political leadership, innovation and the will of its people as it is about the details and timing of macro-economic policy. And on November 4 the American electorate, as well as the American political system, once again resoundingly demonstrated that it retains the vital ingredients necessary for rebirth and renewal that Japan unfortunately still sadly lacks.

The lesson for Japan from November 4 seems quite simple and stark: No nation can expect to emerge from a long, structural depression until it creates a system that permits real political change and encourages real political competition. Unless its people can grasp a real sense of the possible, that one citizen’s commitment and passion and energy can really make a difference and engineer fundamental social change, then a nation like Japan can only conjure a future shadowed by stagnation and ennui.

Make no mistake. The landslide victory of Democrat Barack Obama over the incumbent Republican party was not some cosmetic statement about a younger man’s charm or charisma, though Obama offers these qualities by the bushel.

Obama was an unlikely challengers when the long presidential campaign began. He is, after all, a young, African American with little previous national exposure. His  victory personifies the passion of millions of Americans to set the nation onto a starkly different course. They expressed that passion by voluntarily contributing millions of dollars to the Obama campaign, and by spending thousands of hours of their own time canvassing neighbors, knocking on the doors of strangers and enrolling new voters to participate in the political process.

This passionate engagement of the citizenry to overturn an old order helped turn the election to the opposition party. The political victory evoked tears of joy among hundreds of thousands of loyal supporters. Could you ever imagine seeing such a thing in Japan?

What still astounds most foreigners about Japan’s contemporary predicament is that after twenty years of lousy economics and slumping growth, rising suicides, falling birthrates and stubborn unemployment the same party, the Liberal Democrats continue to run the country. No opposition group –not even the leading alternative party, the rival Democratic Party of Japan – has been able to articulate a coherent, comprehensive, competing political ideology that might engage the citizenry. And when it comes to the basic building-blocks of politics – issues, organization and strategy – the vast majority of the Japanese people simply don’t care, abdicating their power to plodding bureaucrats and inept, corrupt politicians.

Without a passion to invest in political action, without an ideological “brand” to bring to battle, without a zest for social reinvention or a belief in a brighter future, Japan is destined to be stale and bereft of new ideas.

Whatever the achievements or failures of the Obama administration which takes over next Jan. 20, the American people have demonstrated that wealth and military power does not exempt a nation from the burden of reinvention if it hopes to maintain its strengths and position of leadership in a changing world.

It is fair to wonder when the Japanese people will be able to make a similar statement.