One of my recollections from the bubble economy of the 1980s was a passage in a 1987 book titled “Hokokuron” (“The Theory of National Wealth”). Its author, the late economist Taiichi Sakaiya, stood out as one of the bubble era’s most fervent cheerleaders.
An American business executive, Sakaiya wrote, once played host to a group of visiting Japanese high school students.
“I live in a 14-room house on the outskirts of Boston,” he informed them. “We have a pool and greenhouse.”
“How much would you say it’s worth?” a student asked.
“About $2 million,” came the reply.
“Oh, America has really become poor,” the student responded. “In Japanese yen, that’s only about ¥250 million. My family lives in a three-story house in Chiyoda Ward, Tokyo, on about 18 tsubo (approximately 59.5 square meters) of land. We could easily get ¥1 billion ($8 million) for our place.”
That was not an exaggeration. In those heady times, according to one estimate, the market value of the Imperial Palace — a somewhat larger property situated in the same Tokyo ward — was assessed as being worth more than the entire state of California.
The excesses of the bubble were rooted mainly, but not entirely, in inflated land values. With the complicity and even encouragement of major banks, land owners collateralized their property, sinking the proceeds into risky investments. After the inevitable crash, they were not only wiped out, but left with huge, irredeemable debts.
The havoc wrought by the bubble’s collapse notwithstanding, capitalism in Japan is alive and well. A report issued in 2018 by Paris-based Capgemini Consulting found that the United States boasted the greatest number of so-called high net worth individuals, around 5.29 million people, and Japan ranked second, with 3.16 million.
The estimated total assets of these moneyed Japanese came to ¥847 trillion, or an average of ¥268 million per person. The numbers of high net worth individuals from the previous year’s report rose by 9.4 percent, indicating that more Japanese are getting richer.
Noting that “Humanities studies won’t hack it,” Shukan Gendai (June 15) profiled 30 successful male entrepreneurs with educational backgrounds in the physical or natural sciences, or engineering.
An accompanying table listed their alma maters and estimated personal assets. Many are first-generation company founders who started information technology-related businesses from the late 1980s or in the decades that followed.
One person on the list whose name was recently in the news was Masahiro Noda, chairman of the OBIC Group, whose Mobara Country Club played host to President Donald Trump and Prime Minister Shinzo Abe last month. Noda, 80, is said to have amassed a personal worth of at least ¥295.5 billion.
As for the others on Gendai’s list, just under half are relatively young — with 10 in their 40s and three in their 30s. Katsuya Uenoyama, head of PKSHA Technology, which specializes in algorithm modules, and Motoki Shioda, a co-founder of the mobile game company Akatsuki, Inc., are both 36.
Gendai’s writer clearly viewed a liberal arts education as not being conducive to financial success.
Naturally, a technical education does not rule out humanitarian concerns.
Disturbed with the problem of human poverty, biotech company founder Mitsuru Izumo, 39, had initially aspired to work for the United Nations. After gaining acceptance at the Faculty of Letters at the elite University of Tokyo, he transferred to its Faculty of Agriculture.
Izumo’s firm, Euglena, is promoting midorimushi, a highly nutritious algae-like substance with promising potential.
Izumo told the magazine that since his company went public, his lifestyle “hasn’t changed a bit.”
“Can you drive two cars at the same time?” he asks, rhetorically. “You can live in a splendid big house, but cleaning requires a lot of work. My jackets are from Uniqlo (a low-priced casual retailer), and somebody gave me my watch as a gift. A person needs to have a sense of how to spend money, but for me it’s enough to have a sense about my company’s product.”
More than the affluent, however, it’s been those on the other end of Japan’s economic spectrum who have been the focus of the latest headlines, particularly as concerns rise over their post-retirement years.
The headline of the May 21 issue of Nikkan Gendai screamed, “sharp increase in impoverished seniors.” The accompanying article painted a bleak picture of the future, describing Japan as “the archipelago where the elderly are abandoned.”
Two weeks later the media was incensed when a council at the Financial Services Agency issued an estimate that because the public pension system won’t be able to sustain people’s standard of living, a couple who will live to age 95 will need at least ¥20 million in savings. As one result, companies may face greater pressure to extend worker retirement until the age of 70.
At a meeting with legislators in the Diet’s Upper House earlier this month, Abe vehemently attacked the agency’s estimate as being “idiotic.”
An acerbic cartoon by Mitsuru Yaku in Shukan Taishu (July 1) caricatured a seated Abe as the Hindu-Buddhist deity Enma, the judge of the underworld, who sends departed souls to (in this case) financial heaven or hell. On Abe’s right stands Finance Minister Taro Aso, who Yaku portrayed as “Keneo,” the old man who teams up with Datsue-ba, the old hag of hell, to mete out punishment according to the gravity of the deceased’s sins.
Aso is frequently targeted by the media because of his considerable personal wealth and disinclination to show discretion in the ways he spends it.
Friday (June 28) published a detailed compilation of Aso’s reported assets, which it found to be “exceeding ¥500 million.” In addition to real estate holdings, he reportedly owns shares in numerous major corporations, including Kyushu Electric Power Co. (4,934 shares), Nishitetsu Railways (15,663) and Bridgestone Tire (4,350), among others.
Big in Japan is a weekly column that focuses on issues being discussed by domestic media organizations.
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