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March 11: nation transformation?

by Anthony Fensom

REIMAGINING JAPAN: The Quest for a Future that Works. Edited by McKinsey & Company; executive editors Clay Chandler, Heang Chhor and Brian Salsberg. VIZ Media, 2011, 464 pp., $38.99 (hardcover)

Read any business report on Japan of recent times and there is a familiar theme: economically eclipsed by China, and with a shrinking population, the country’s outlook appears as weak as the ratings agencies portray its debt position. Then came the tragic events of March 11, 2011, with the devastating earthquake, tsunami and nuclear disasters.

But then who listens to doomsayers, anyway?

Certainly not the authors of the wave of books recently released on the Japan recovery theme, including charity works “2:46: Aftershocks” and “Tsunami: Japan’s Post-Fukushima Future” (reviewed below).

Released this month, “Reimagining Japan: The Quest for a Future that Works” was compiled by management consultancy McKinsey & Company prior to the March disasters, but quickly updated to reflect the impact of what has been described as the nation’s biggest crisis since the Second World War.

Like others in its category, the McKinsey work reflects the enormous affection held for Japan internationally, as indicated by a 2010 BBC World Service poll that showed the nation second only to Germany in international esteem.

In a collective wake-up call for Japan, authors including Nissan CEO Carlos Ghosn, Fast Retailing’s Tadashi Yanai, SoftBank’s Masayoshi Son and a range of other Japanese and foreign opinion leaders from various fields provide insights into the measures needed to induce a sustainable recovery.

Japan Times readers will be familiar with most of the solutions outlined by the authors; many have been debated endlessly during the past two so-called “lost decades,” but with little sign of resolution.

Put simply, the reforms sought would serve to “globalize” Japan, both internally and externally. This would include openness to outsiders and outside ideas, whether in terms of increased foreign study or accepting more skilled immigrants.

Women are also key to the revolution, with Yokohama’s first woman mayor, Fumiko Hayashi, and others highlighting the importance of supporting female workers and child-rearing, thereby revitalizing not only the economy, but also a male-dominated society.

Takeda Pharmaceutical President Yasuchika Hasegawa describes Japan’s system as “half-socialist capitalism,” urging greater emphasis on indirect taxation, more foreign trade deals and an acceptance that “the outcomes that individuals achieve cannot and will not be the same.”

Yet the question remains as to whether the jolt of the recent disastrous quakes will awake a reformist spirit.

Commentator Peter Tasker refers to Tokyo Gov. Shintaro Ishihara’s description of March 11 as tenbatsu (divine punishment) — a statement quickly retracted — as not a pitiless comment from the veteran politician, but rather indicating that the nation had reached a metaphorical turning point.

The Japanese, Tasker writes, have expressed regret and resolve over the disasters in equal measure: “regret for the loss of national ‘pride,’ and resolve that the drift and apathy that has characterized Japan’s political scene over the last several decades cannot continue.”

The perils of simply rebuilding the Tohoku region and perpetuating the existing system are clearly shown in the book, including continued decline in Japan’s presence at home and abroad, together with an increasingly divided, lonely and aged society.

Importantly though, the strongest criticism of past practices is not from the much-maligned foreign commentators, but from Japanese with an intimate knowledge of the system.

One of Japan’s leading businessmen, Yanai asserts that “Japan’s biggest problems are conservatism and cowardice,” calling for a new breed of “globalized” Japanese capable of being successful at home and abroad.

“My advice to young Japanese is simple: get out of Japan,” Yanai urges.

The University of Cambridge’s Masaru Tamamoto condemns the nation’s leaders for being stuck in the past: “They have squandered two decades in a futile effort to preserve the unpreservable, racking up vast public and private debt to bolster a spent order.”

It is depressing to consider that Japanese born after 1990 have known only deflation and decline. Younger generations condemned as “freeters,” “NEETs” or “hikikomori” isolationists deserve much better from their leaders if they are to access the same opportunities given to their parents.

Yet there is still much to be proud of in Japan, with Nissan’s Ghosn arguing that its traditional strengths in service quality, simplicity and excellence in process offer strong foundations for a successful turnaround.

Critics will contest the selection of authors and the proposals presented in the book, which reflects the publisher’s origins in consisting largely of economic reforms. While political leadership is called for, little attention is given to the need for matching political and social changes, made even more difficult by the recent merry-go-round of prime ministers.

Yet while the solutions presented in “Reimagining Japan” are not new, it is only to be hoped that the willpower to create a “new Japan” may finally have been mustered. Doing nothing is also a choice, but it is not one that a proud nation should be making for either itself or Asia’s future.