Japan Sheds Its Myths

ROBERT RENO

November 04, 1992|By ROBERT RENO

A state and culture as old as Japan's does not, in the space of a year, lightly give away the secrets of its historical direction.

But the evidence is mounting that, narrowing our vision to the modern era, Japan is, in 1992, undergoing a revolution as fundamental as the Meiji restoration and as consequential as the events of 1945. It was, of course, a perverse coincidence last month that as Japanese military forces moved into Southeast Asia after an absence of 47 years, a Japanese Army officer wrote in Japan's most widely circulated magazine that it was time for a military coup d'etat to restore the confidence of a nation scandalized by corruption in its political system.

The Japanese soldiers in Cambodia, under U.N. command, are widely seen as a sign Japan is taking seriously its role as a more international minded, responsible superpower. The Army officer who called for a revolution was not taken seriously except as a reminder of a mind-set that once led to Japan's ruin.

Japan's trade surplus leaped alarmingly last month to an all-time high. Even as, in the home economy, corporate insolvencies rose 35 percent in September, Japan's customs-cleared exports have now risen 11 percent so far this year, an astonishing feat given the weakened economic condition of most of its major trading partners.

Still, leading economists are talking about the Japanese economic miracle as a bubble that has burst. And nobody believes that we have yet seen all the consequences -- domestic and international -- of weaknesses that have been disclosed in the Japanese banking system and of the orderly but devastating crash that has occurred over the last year in the Japanese real-estate and stock markets.

In his new book on Japan, ''The Bubble Economy,'' Christopher Wood suggests we are seeing the disintegration of a whole body of myths, many of them contradictory, which the Japanese have believed about themselves and that Westerners have cultivated about Japan.

''The burst of the bubble economy,'' he writes, ''has already laid to rest one myth, namely that Japanese stock prices always rise. It is in the process of demolishing another myth, namely that Japanese land prices cannot fall. The third myth, which will also soon be discredited, is the growth myth. The frantic economic growth of recent years based on a liquidity-triggered boom in private sector business investment is simply not sustainable.''

To imagine a Japan without the economic growth rates that have astounded the world since 1945 -- real growth rates that exceeded 10 percent annually over whole decades -- is simply to abandon everything we think we have learned about Japan.

The more hopeful view is that the new, demythologized Japan is but a nation undergoing a painful but necessary conversion to the status of a more conventional economic power that will consume more at home, be less of an irritant to its trading partners and accept greater foreign penetration of its commercial system with happier results for all. The alternative may be a politically and economically destabilized Japan, more inward looking, less at peace with itself and everybody, exporting financial instability along with its cars and computers.

Robert Reno is a columnist for Newsday.

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