Japan is in deep trouble. Everyone knows it and the experts confirm it. True, stock prices are higher than they’ve been in 30 years; still, “going into 2024,” writes American investor and financial commentator Jim Rogers in the business magazine President (Feb 2), “I’m not optimistic about the world situation;” nor does Japan reassure him: “I don’t think the Japanese can be as prosperous or as happy as they were before.”
“Before” means the 1970s and ’80s – a lost, squandered golden age, seen from today’s pinched perspective. “It was a completely different country then,” Rogers writes. Population soared, the economy surged, there seemed nowhere to go but up; would Japan unseat the U.S. as the world’s top economy? Japanese acquisitions of prime American real estate symbolized an irresistible buoyancy that bubbled through all sectors of society, from the corporate boardroom to the disco floor. Japanese high-tech led the world, Japanese money enriched the world, Japanese tourists and shoppers flowed worldwide. Who could have foreseen then the ever-dwindling shadow Japan casts today? Emblematic (if chronic population decline is not sufficiently so) is Tokyo Shoko Research’s report last week of an eight-year-high 8,690 corporate bankruptcies in 2023. “Japan,” Rogers writes glumly in President, “could cease to exist in 50 or 100 years.”
The magazine’s own view, as reflected in several articles it presents along with Rogers’ on the theme “Rich families, poor families,” is brighter. “The difference between profiting and losing,” reads an introductory remark, “is the difference between knowing and not knowing.” Rich families know, poor ones don’t. Poor ones learning can get rich. The requisite knowledge is of circumstances and the system. The circumstances are grim and the system not always wise, but skilful steering round the shoals, given knowledge and imagination, is possible and productive. Japan and the world may be in for a rough ride. Many will be upended. But you needn’t be one of them.
Rogers himself offers copious advice on investing your way to prosperity, suggesting his unshaken faith in individual initiative – which the Japanese government itself has been actively promoting via NISA (Nippon Individual Savings Account) tax incentives to draw small investors into the stock market. Nor is investment the only road open. There’s a pension to be maximized (e.g. by working longer), tax deductions to be minimized (knowledge again the key: it’s a complex subject; boiled down to a phrase: the more you know the less tax you pay), hobbies to be turned into side if not full-time occupations (a rising and interesting trend on which more in a moment).
Let’s return first, lest we forget, to Rogers’ pessimism.
Yes, Japan’s stock prices are high – proving what? Certainly not a wave of prosperity; on the contrary, he says, Japanese in general feel poor and discontented, and with reason. Living costs rise, wages don’t, at least not in proportion. Discontent simmers through the developed world. Japan’s is not the only intellectually bankrupt government Rogers castigates. Shallow short-term solutions are everywhere deployed against deep long-term problems. You can’t prime an economy forever, he says, on government debt. Japan’s is especially high; therefore perhaps especially ominous – but the phenomenon is global. “Between 2025 and 2027,” Rogers writes, “I think the world will be full of unhappy citizens.”
His painful analysis continues: Discontented electorates spawn politicians who blame foreigners – easy targets – for all ills. That rouses demagoguery, which raises pressure, which can push trade into trade wars and trade wars into shooting wars. Japan had better watch its step here, Rogers warns. Its falling population may not, long term, be able to sustain an economy, let alone an armed force. It’s not the least of his reasons for fearing for Japan’s future.
Stanching population loss is key to the nation’s survival, in his view. Failure to apply one if not both of two obvious possible solutions – making babies and/ or welcoming immigrants – has him shaking his head. Singapore, he says, turned its economy around on the strength of an immigrant surge that brought not only labor but new ideas. Japan sees but is not inspired.
The country stagnant, it’s up to the individual, and here, as noted, the picture brightens. Think hobbies, counsels consultant Mitsuhiro Toda in his contribution to President’s package. This is an age in which you can publish yourself, broadcast yourself, record yourself and send your voice to the world. SNS broadcasts drawing tens and hundreds of thousands of followers have turned “You-tubing” into a serious career option, much embraced, surveys show, by schoolchildren looking to the future. Success on that scale will naturally reward very few, but adequately supplementing an inadequate full-time salary is within much wider reach. If your hobby is handicrafts, sell them online; if amateur pursuit of special knowledge, lecture online. Maybe you’ve been through something and can offer experience-based counseling to others? “Or fortune-telling,” suggests Toda.
To think that that would still sell, in these sophisticated and cynical times.© Japan Today