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The Enigma of Japanese Power, by Karel van Wolferen; More Like Us, by James Fallows; Yen!, by Daniel Burstein; Japanese Investme

The Japanese Challenge

The Enigma of Japanese Power: People and Politics in a Stateless Nation.
by Karel Van Wolferen.
Knopf. 496 pp. $25.95.

More Like Us: Making America Great Again.
by James Fallows.
Houghton Mifflin. 245 pp. $18.95.

Yen! Japans New Financial Empire and Its Threat to America.
by Daniel Burstein.
Simon & Schuster. 335 pp. $19.95.

Japanese Investment in the United States: Should We Be Concerned?
by Kozo Yamamura.
Society for Japanese Studies. 289 pp. $5.00 (paper).

The United States is obsessed with Japan, and with reason. No foreign power, not even West Germany, has delivered so severe a shock to American self-esteem in the postwar era, not to mention what Japan has done to the balance of trade, the structure of American foreign debt, and the shape—or nonexistent shape—of important American industries.

Much of our economic concern about the Japanese is summarized in two questions: Can they ever change to become less of a competitive threat to us? Can we change to become more of one to them? Karel van Wolferen’s book, The Enigma of Japanese Power, which ponders the first question, emphatically answers no. Van Wolferen, a Dutch-born journalist, knows a great deal about Japan. He has lived in the country for many years, speaks the language fluently, and has even taught university courses there. But none of this has left him with terribly friendly feelings toward the place.

Japan, as van Wolferen sees it, is set on a course that it cannot change, run by an endlessly manipulative elite that is culturally unable to think of any ends beyond its own unlimited economic growth. To van Wolferen, Japan is not a polity, but a “System” comparable (not morally but structurally) to Nazism and Marxism-Leninism in its focus on power for power’s sake and in its all-encompassing domestic control.

So far as trade and industry are concerned, he argues, Japan is “structurally protectionist. It has to stay so if it wants to continue enjoying [the] proven benefits” of an economic model that van Wolferen, citing the American political scientist Chalmers Johnson, calls the “capitalist development state.” That, in turn, is a bureaucratic-industrial partnership “sealed by a shared industrial and trade strategy.” The challenge of Japan, he maintains, “is whether international free trade as a system can survive so long as the countries without a trade strategy are locked in a struggle to accommodate these formidable capitalist development states.”

That last statement alone would be reason enough for protectionist-minded claques in the U.S. executive and legislative branches to brandish van Wolferen’s book at committee hearings and on C-SPAN. But the real insidiousness of this book goes well beyond reformulating run-of-the-mill protectionist arguments. Van Wolferen’s intention is to give Western Japan-bashing a basis in anthropology.

Thus, he contends that Japanese society is “hollow at the center”—it lacks values, ethics, principles, morals, or norms that would limit the accretion by the country’s bureaucratic-industrial elite of power for its own sake. What does this mean? Essentially, that the Japanese cannot be trusted, and especially not to change the country’s goal of unlimited industrial expansion.

Van Wolferen goes even further. Japanese society, and especially the Japanese political system, lacks anything at all that would link it sympathetically with the West. “Japan and the Western nations stand at opposite extremes when viewed in the collective context of human civilization.”

This is pejorative cultural judgment of breathtaking sweep that, when it is not based upon strange generalizations about the nature of the West, amounts to an elaborate conspiracy theory of Japanese history. Indeed, despite its exotic focus, and although van Wolferen himself is certainly no leftist, his book resembles the work of New Left social theorists like C. Wright Mills in describing the workings of the United States.



Two conspiratorial assumptions give an artificial coherence to van Wolferen’s political sociology. The first is the notion that any deviation from a textbook—i.e., highly artificial—description of how political and social institutions work means that the institutions must be, in some fashion, a sham, fraud, or optical illusion. Thus, Japan has “the most complete set of democratic trappings [sic] outside the West”; but the parliamentary opposition is “ritualistic and harmless,” and absorbs “potentially genuine opposition.” Japan’s frantically energetic newspapers “never really ‘take on’ the System. They will occasionally rage at some of its elements . . . [but] they make no attempt to . . . provide a critical frame of reference enabling readers to ask questions concerning the System’s essential nature and the direction in which it is taking them.”

The second conspiratorial assumption is that all of these deformations and illusions are the product of an otherwise dispersed elite that operates consciously as a whole in its own interest, and gets away with it through means that are never clear, except that they do not include social consent. As van Wolferen puts it: “The System is what it is by virtue of informal relations that have no basis in the constitution, in any other laws, or in any formal rules of the ministries, the [ruling Liberal Democratic party], the corporations, or any other of the . . . institutions.”

This view considers the issues of culture, custom, historical particularity, religion, and that singularity known as “values” to be significant only insofar as they support the main thesis, of sinister manipulation. The Japanese ethic of loyalty is, he says, “in essence, an ethic of submission.” In almost the same breath, he notes that in Japanese companies, “employees are intensively and constantly involved in meetings, work discipline groups . . . and the like. All of this helps to shape a personality susceptible to manipulation.” Like the New Left on America, van Wolferen believes that everything in Japanese society that does not promote rebellion is evidence of domination.

Now there is no denying that Japanese politics are dominated by a bureaucratic-industrial oligarchy, that corruption in Western terms is endemic, that a wide variety of Japanese social priorities have been neglected in the rush to world economic might. But it is a long way from there to a 2,000-year conspiracy. Van Wolferen’s thesis essentially dismisses as inconsequential the deep changes that are now sweeping through Japan as a result of its growing wealth. One of them is Japanese ownership of factories, homes, and other property abroad, which is likely to erode, at least at the margin, the country’s pernicious insularity. The money scandals that brought down Prime Minister Takeshita, the rising political clout of Japanese women, national efforts to find a new balance between work and leisure time, even the extent to which Japanese markets actually have opened up under tough U.S. and European bargaining pressure—according to van Wolferen, these things do not mean much. Actually, however, as July’s election results underscored, they point to something that he systematically excludes as impossible: a deeply conservative, inward-looking society is undergoing a significant and quite rapid change of character.



The characteristics that cause van Wolferen to consider Japan beyond the pale are precisely the ones that push James Fallows into a form of populist introspection. A one-time Naderite, a former Jimmy Carter speechwriter, proponent of the Gary Hart less-is-more school of American defense-procurement reform, Fallows is now a full-time journalist who has lived with his family in Asia for the past three years. His children have gone to Japanese schools. He has weathered the newly minted scorn of Asians for “lazy Americans.” All of that experience has led him to conclude that America, for all its flaws, is a pretty great place, and to worry that in its rush to cope with the Asian economic challenge, the U.S. will emulate the Japanese too well.

Faced with Japan’s hierarchical, persistent, and self-abnegating society, Fallows asserts that America’s strength is something greatly different: a “talent for disorder.” If Japanese society offers everyone a place at the cost of Western-style individuality, he observes, the American social and economic genius is to create opportunities where they did not previously exist—social mobility:

The United States may be “deindustrializing”; its relative power in the world may be in decline. But for people determined to reinvent their lives and create new roles for themselves, even the America of the 1980’s can be a malleable, forgiving culture. The more America allows people to make new choices and changes, the healthier and more productive the whole society will be.

In line with this romantic populism, Fallows decries what he calls the growing “Confucianism” of American society—a caste rigidity that in his view began to set in with the increased emphasis in the late 19th and early 20th centuries on formal schooling as a means of upward mobility, and especially of professional licensing.

This so-called Confucianism is more nearly Prussian, for the growth in American society of educational hierarchy, professionalization, and civil testing that Fallows deplores owes a lot to Germany, nothing to Japan or China. Be that as it may, his real purpose here is to endorse some reverse social engineering of American life.

Fallows has a number of ideas on how to reduce the creative drag of “Confucianism” on the American economy. Some of them will not be welcomed, to put it mildly, in traditional liberal circles. Welfare benefits, he believes, should be tied to work, to reinforce the tie between effort and fulfillment. The decaying American school system badly needs an overhaul: the best means of doing that, he argues, would be to institute a voucher system. Public schools, like private ones, should have the ability to hire people on the basis of their competence—thus eating away at the monopoly position of certified teachers. In the same vein, Fallows says, nurses should be allowed to offer a variety of medical services if they can pass competency tests.

One can share many of Fallows’s prejudices against educational, medical, and other forms of academic licensing, but even so, many disciplines are vastly more technical now than in the 1880’s—and besides, why stop with the professions? There is a great silence in Fallows’s argument over one of the most creative and distinctively American risk-taking activities: entrepreneurship. What, if anything, does he think should be done about the absurdities of tort law, the reporting manias of various U.S. government inspectorates, the elaborate testing requirements of the Food and Drug Administration, the bureaucratizing urge to indulge in a risk-free consumer society?

Still, even though he avoids some of the toughest issues, the surprising fact that Fallows is willing to cast aside a number of strongly held liberal ideas in the process must be considered a political event of some note.



No such surprises await readers of Yen!, a breezy, alarmist, and fairly conventional sky-is-falling view of the Japanese economic menace. Daniel Burstein, a New York-based economist-journalist, argues chiefly that Japan, having conquered the world industrially, now stands ready to take control of the world financial system with its immense capital surpluses. Among other things, he blames the fiscal policies of the Reagan administration for selling America’s industrial birthright for a mess of fiscal-deficit and foreign-debt pottage. (There is little mention of the congressional role in budget-making here.)

The world Burstein descries is fraught with new dangers: loss of American control over economic policy as the republic sinks deeper into foreign debt; the siphoning off of profits by Japanese branch-plant capitalism in the U.S.; attendant decline in American living standards; the gobbling up of U.S. assets, including corporations and real estate; the possibility of global economic collapse if Japanese speculative fever at home ever peaks.

Interestingly, many of the anxieties Burstein voices about the loss of U.S. economic sovereignty were first expressed by Europeans in the 1960’s about the advent of the American multinational corporation. For solutions to the problem of dissipating U.S. economic muscle, Burstein proposes fiscal deficit cuts and something he calls “wealth bonds,” meaning a 20-percent income-tax surcharge on the rich to reduce the deficit. Presumably the Japanese would take care of future U.S. capital investment, because the rich would probably no longer be so able to do it. Burstein also calls for an end to the free-trade “charade,” meaning that the U.S. should admit that “we need a policy of managed trade, and for the first time, carefully enumerate the areas of business we seek to protect fully, why, and for how long.” Perhaps we can ask the Argentines for advice.



Japanese Investment in the United States, a compendium of monographs by a variety of U.S. and Japanese scholars, tries to put one aspect of the rise of Japan’s economic might in non-nationalistic perspective. This basically conservative volume argues that Japanese investment here is smaller and less of a problem than current hysteria suggests; that the Japanese trade surplus is a short- rather than a long-term phenomenon; and that perhaps the chief culprit in this orgy of concern is the lingering U.S. fiscal deficit.

Kenneth Pyle, professor of history and Asian studies at the University of Washington, adds a note of sympathy for the crisis that wealth is producing within Japanese culture. As a result of its enormous trading income, an insular country is facing kokusaika, or “internationalization” of its perspectives. Pyle sides with those in Japan who feel that for the country to succeed in adjusting to its global clout, it must open itself further to the outside world. That process, says Pyle, is “still a fragile blossom in Japan. It does not represent a national consensus.” It threatens many domestic and bureaucratic interests; they would prefer a continuation of Japan’s inward-looking, essentially xenophobic protectionism.

It would seem, in short, that there is room for great and baleful complicity between the protectionists on both sides of the Pacific.



About the Author

George Russell is the executive editor of Fox New Channel.

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