More nonsense from the New York Times on Japan’s “lost decades”

The Times says Japan is “disheartened.” It hasn’t looked at Japan’s trade figures — or America’s.

The New York Times yesterday carried a major article headlined “Japan Goes from Dynamic to Disheartened.” Rarely has the truth of the Japanese economy been so completely misrepresented. This article is a highly selective pastiche of isolated hard-luck stories plus spin from propagandistic sources (as close observers have long understood, the Japanese establishment exaggerates Japan’s weaknesses and understates its strengths, the better to stay out of Washington’s sights on trade). Worse, key “facts” are indisputably wrong.

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Appearance on BBC World

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Lessons from the Sublime Porte: How to lose an empire

Current U.S. trade policies were first tried by the Ottoman empire.  As I show in this article — first published in the August 2010 issue of the American Conservative – America’s decline is proceeding even faster.

Here’s an economic history test:

1. Which Great Power pioneered the secular trend towards freer international trade?
2. Which Great Power first resorted to spiraling foreign indebtedness to pay for its wars?
3. Which Great Power first permitted large-scale foreign direct investment in its domestic industries and infrastructure?

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Edwin Reischauer: An ambassador who lied TO his country

John Kennedy’s ambassador to Japan is the subject of a new biography. Unfortunately, as I point out in this review (which  was first published in the June 2010 issue of the American Conservative), the author’s agenda has little to do with the truth.

  • Edwin O. Reischauer and the American Discovery of Japan, George R. Packard, Columbia University Press, 368 pages

Before there was Beatlemania, there was Reischauermania. Admittedly, the latter was more localized and, of course, it is not much remembered these days. But it was huge at the time, and in the end it may prove to have left a bigger mark on history.

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Myths of the Japanese economy

This is a longer version of an article I have just published in the journal of the Overseas Press Club of America.

Former Tokyo correspondents held a reunion at the Overseas Press Club in New York in March at which I was a speaker, and I was less than flattering about recent coverage of Japan. On the principle that it is as well to be hanged for a sheep as a lamb, I herewith offer more detail on my strictures.

Although in the space available I cannot do a comprehensive job of debunking conventional coverage (for more details, see my books), I list below six myths that can be readily disposed of in a few sentences.

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Germany: The big engine that could

When the global economic crisis began in 2008, many commentators predicted Germany would be among the worst hit. As I show in this article — first published in the American Prospect — Germany has in reality excelled not only in maintaining jobs but in boosting exports.

American and British commentators have told three stories about the German economy over the past decade, all of them derogatory. Articulating a standard conservative view, Adam Posen of the Peterson Institute for International Economics in 2006 characterized Germany’s performance as “lastingly poor.” In a similar vein, Jude Blanchette, blogging for the libertarian Mises Institute, predicted in 2003 that nothing but “rot and indolence” lay ahead. Another version of the indictment states that even though Germany was once an economic powerhouse, its best days are over. Thus in 2003, Larry Elliott of the Guardian reported that the German economy had “sputtered to a virtual halt” and, in the view of many, had succeeded to Britain’s 1970s-era role as the “sick man of Europe.”

A third story holds that, to the extent Germany is surviving at all, it is only by giving up the distinctive elements of its economic model and embracing American norms. Edmund L. Andrews, for instance, claimed in the New York Times in 2000 that “the structure and ethos underlying Fortress Germany have begun to crack like a house on a California fault line.” Supposedly the Germans were taking a leaf out of Silicon Valley’s book by moving to a freewheeling employment model, and many recent university graduates were forsaking a secure, carefully nurtured career with a long-established employer for a bumpier ride with an entrepreneurial start-up.

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How the press stabbed Detroit in the back

In a new article for CounterPunch, I show that, by failing to blow the whistle on protectionism in key foreign markets,  the American press shares  blame for Detroit’s implosion.

For decades East Asian competition has played a controversial role in the decline of the American car industry.  Both Japan and Korea have long been accused of unfair trade and closed markets. For their part Japanese and Korean officials have argued that their markets are open and that an incompetent and heedless Detroit doesn’t make the sort of cars their consumers want.

In all the charges and countercharges,  little of the remarkable truth of Detroit’s trade problems has come out. To see how well—or rather how badly—you understand the background, try this quiz:

1. What was the Detroit companies’ share of the Japanese market in 1930? (a) About 90 percent. (b) About 20 percent. (c) Less than 4 percent.

2. How many models do the Detroit corporations currently make with the steering wheel on the right (the standard configuration for Japan)?  (a) More than 40. (b) 12. (c) 3.

3. What was the combined share of all foreign makers’ marques – American, European, and Japanese – in the Korean car market in the last decade?  (a) Less than 2 percent. (b) Around 15 percent. (c) More than 70 percent.

The correct answer in each case is (a).

If you flunked, don’t feel bad. Just cancel your newspaper subscription.

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The complaisant watchdog: how the press missed the Madoff scandal

The Wall Street Journal and the New York Times slept while Bernie Madoff swindled. [Article first published in CounterPunch. To read the original click here.]

An old maxim has it that newspa­per editors separate the wheat from the chaff, then print the chaff. By this standard, the editors of the Wall Street Journal have shown special deftness in their handling of the Madoff affair.

They used the occasion of whis­tleblower Harry Markopolos’ testi­mony in Washington recently to ad­dress seemingly every minuscule detail of the scam. They even published an irrelevant, if lovingly crafted, floor plan of Bernard Madoff’s office in the Midtown Manhattan Lipstick build­ing.

Yet, in all their apparent desire to “flood the zone” (maybe they’re angling for a Pulitzer!), one detail was missing. Not a word of explanation was offered about the curious role played by the Journal’s own Washington-based investi­gative reporter John R. Wilke.

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I told you so (cont’d)

In 1999 I wrote a book that foreshadowed the collapse of America’s New Economy stock  boom. I went on to publish a paperback version with a new introduction — an introduction whose prescience has also stood the test of time. This is that introduction as it was published in Unsustainable, the 2003 paperback edition of In Praise of Hard Industries.

This book’s analysis of the future of the American economy is a sombre one — so sombre indeed that when it was first aired in an earlier version in 1999, the reaction of many readers was not so much shock as outrage. In updating the argument for this 2003 edition, I would have liked to have struck a more optimistic note. But in some ways the facts are even more troubling now that they were in 1999.

The case I presented in 1999 was that America’s then ecstatic infatuation with the so-called New Economy (the economy of computer software, the Internet, movie-making, finance, and other “sophisticated” services) was misguided. America, I argued, was squandering vast resources on untried and, in many cases, patently unworthy New Economy businesses. Meanwhile it was utterly mistaken in turning its back on its manufacturing base. I was concerned in particular about the wholesale erosion of America’s advanced manufacturing industries, which had been the font of American prosperity and power in the previous century.

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A reviewer who has read the book

The American radio industry’s top liberal talk show host has had some nice things to say about my book on China. That’s flattering. What’s even more flattering is that he has read the book. Really read it, that is.

One of the more discouraging things I have learned in a writing career that now stretches back nearly 40 years is that few people read books. They buy books;  they talk about books; they deck out their living room shelves with books; they like to be photographed with books. But that does not mean they actually read books.
In my experience, even book reviewers rarely get much beyond the first chapter. They then move straight to the last few pages of the final chapter before writing a review.  This will consist mainly of a statement of the reviewer’s opinions not on the book but rather on the underlying topic that the book addresses. If the reviewer agrees with the author’s opinions on this topic (which the author will probably, if he is doing his job, have withheld until the last few pages), this will come through loud and clear. Equally if the reviewer disagrees, this  too will be evident. But the basic point is that the review will be about opinions, those of the author and those of the reviewer, with the latter’s holding center-stage.

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