Years ago, in my Davos days, a Hong Kong billionaire assured me that China was relatively simple for westerners to understand, but no one could really figure out Japan. I regularly see things that confirm his insight.
David Pilling has a fascinating column in today’s Financial Times about the wave of nostalgia that is overcoming Japan’s political and policy elite. I found this particularly striking:
The third crumbling pillar is the postwar economic model itself. There is now much talk of putting more emphasis on agriculture and de-emphasising the manufacturing industries on which postwar wealth was built. “Japan, having major strength in manufacturing, will probably suffer most,” says Mr Sakakibara, who argues that, even after this economic crisis subsides, the world will never return to previous levels of material consumption.
Japan’s farm industry is commonly regarded as heavily protected, but the Japanese worry that they only produce 40 per cent of their calorific requirements. Mr Sakakibara supports the DPJ’s proposals massively to increase subsidies to agriculture and to industrialise the family-run farming industry. He has been trying to persuade Toyota that cars are a dying industry and that it should turn its engineers on to farming efficiency instead. The era of just-in-time carrots could soon be upon us.
Do they teach comparative advantage in Japanese economics courses?