When the great recession began last year, the fate of Japan was often held up as an awful warning to the west. If the US and the European Union failed to adopt the right policies, it was said, they too might suffer a Japanese-style “lost decade”, followed by years of feeble growth.
Now that the Japanese have used Sunday’s election to elect the Democratic party – breaking with more than 50 years of rule by the Liberal Democratic party – a new western narrative is taking hold. This is a political revolution; it is Japan’s big chance to break with the years of stagnation.
But both these stories are wrong. The Democrats are unlikely to shake things up hugely. Nor should they. For the story of Japan over the past 20 years is by no means as dismal as much western commentary would have it.
It is true that, since its asset-price bubble burst in 1990, the country’s economy has grown slowly, the stock market has slumped and national debt has risen to awesome proportions. But, despite these trials, it has remained a sane, stable, prosperous and exciting country. Politically, culturally and even economically, it offers not so much a warning as an inspiring example of how to deal with a long period of adversity.Rachman's MO is in marked contrast to that of the FT's contrarian-in-residence, celebrity columnist Niall Ferguson, who seems constitutionally inclined to sniff out the most outlandish hypothesis and then find ingenious ways to support it. Rachman's leash is composed of facts; stylistically, he gives the persistent impression of going where they lead him. The style is deadpan, sometimes tentative, on-the-one-hand-on-the-other. His conclusions often boil down to the inherently contrarian premise that boring is good. Japan is an avatar of social peace and prosperity. The EU is annoying but has been a titanic force for the same qualities. Humanity is probably tending gradually toward world government. Barack Obama's rhetoric is mainly platitudinous hot air (I think he's wrong there).
Rachman might be speaking of himself when he writes, approvingly, that "Japan has alwas gone for change within well-defined limits." He'd like us all to do the same.
UPDATE (via James Fallows): for a very different if not out-and-out contradictory view of the import of Japan's election, see Karel van Wolferen's account of the new crew's determination to break the unelected bureaucracy's grip on policymaking.