Japan lost third place to Germany in the ranking of the world's largest economies. This event, which occurred last year, in most developed countries of the world could have become the subject of criticism of the government or at least heated discussions among expert economists, and could have led to an internal political crisis.
At the end of 2023, Japan's GDP is estimated at $4.23 trillion. , while Germany - 4.43 trillion. At the same time, Japan retained first place in the world in terms of public debt (255% of GDP), which is twice the average level of the G7 countries - 128%. Over two years, the yen has lost 50% of its value against the dollar, which theoretically should have caused quite serious consequences for the national economy. But in Japan, other than financiers and institutional investors, no one really noticed anything.. Yes, prices have risen, yes, government support ratings have gone down, but these trends for democracies are more a tradition than an exception.
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Much more attention is paid to the issue of the stability of the Japanese economy in the United States. There, public debt has exceeded 120% of GDP and, according to forecasts by the Congressional Budget Office, the debt burden will continue to grow by at least 3% of GDP annually over the next 30 years, with the economy projected to grow at 2%.. What to do about this is still completely unclear, which is why they pay attention to Japan, which copes well even in the worst situation.
One of the factors determining the financial stability of Japan is the bank savings of the population, which the Japanese keep on deposits even at extremely low, if not negative, bank rates. This amount is estimated at $14.6 trillion.. Unlike the United States, the Japanese are in no hurry to invest these funds in the stock market, but, of course, household deposits are a cheap resource for lending to government programs. In the USA the situation is completely different.
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Orthodox economists who advocate free markets and unfettered growth models often criticize the Japanese economy, calling the previous thirty years “lost.”. But, as it turned out last year, the legendary Warren Buffett, head of one of the largest investment companies in the world, Berkshire Hathaway, has a different opinion. He visited Japan and acquired additional stakes in each of the five largest trading houses - Mitsubishi Corp.. ,Mitsui\u0026Co. , Itochu, Marubeni and Sumitomo Corp. Now his fund owns an average of 8.5% of the shares of each of the corporations worth 2.8 trillion yen. The fund's statement states that these investments are long-term, moreover, Warren Buffett intends to increase his stake in each corporation to 9.9%. After this statement, the value of the shares of the mentioned corporations increased from 30 to 44%, and the stock market received new dynamics. Already this year, despite discussions about not very positive results for 2023, the value of shares of Japanese trading houses continued to grow significantly, and the Nikkei index broke all records.
The world-famous “sogo shosha” - as the “Big Five” are called in Japan - have been the foundation of the Japanese economy since the end of the 19th century, and “experts” most often view them as a certain anachronism, “traditional Japan”, and not its future. But Warren Buffett saw another aspect that is often overlooked - the difference between the Japanese economic model and the traditional approaches adopted in the West. For example, experts cite the following statistics: the ratio of remuneration for CEOs of companies and the average employee in Japan is perhaps the lowest among developed countries (11:1) against, say, the UK (22:1) and the USA (475:1). The management of the largest corporations adheres to very strict rules of “good governance” and traditionally pays more attention to the fair distribution of profits than to their concentration in one hand. According to investors in the Japanese economy, the local model, which places as a principle the rational use of resources, fair wages, maintaining harmony in society and trust between the government, business and society, is now almost more attractive than risky investments on the principle of “it’s all for me.”.
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In reality, of course, the situation is much more complicated, since, in addition to actually managing the country's financial system, the Japanese government must also give priority attention to the current account balance. Japan is deeply integrated into the world economy and is one of the largest exporters and importers. The devaluation of the yen and the huge global demand for Japanese engineering and electronics products make it possible to talk about positive export prospects. At the same time, the chip shortage, which is still felt, political instability within the country and geopolitical challenges associated with Russia’s war against Ukraine, the increasing threat from North Korea and tensions around Taiwan and the South China Sea, are diverting significant resources to security. Taking this into account, Japan is forced to increase its defense budget, join international weapons production projects and has already revised its rather strict principles for arms exports. Steps are also being taken to significantly increase the quota for attracting foreign labor, as the growth of the elderly population in Japan breaks all records.
Taking into account the Japanese business philosophy and worldview, focused on harmony both within society and between society and nature, it is not surprising that a significant part of Japanese economists are adherents of the “anti-growth” theory (although they do not always admit this, avoiding criticism in favor of. These approaches are more focused on the fair distribution of created goods, ensuring harmony, mutual respect and mutual support in society, and a sharp reduction in consumption, in particular non-renewable natural resources, than the classical “free market” models. Thirty years of almost “non-growth” indicate that such an approach is possible, and it is quite natural to expect that it will dominate the new technological order, given the predicted social tensions in industrial societies, taking into account the expected large-scale use of artificial intelligence instead of workers in.
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The Sustainable Development Goals, adopted by the UN General Assembly in September 2015, are perceived in Japan as a plan of concrete action, and not just a call to humanity. Quite often, during official meetings with representatives of the government, parliament or business, on the lapel of the interlocutor’s jacket you can see a special multi-colored badge - the emblem of the “sustainable development goals”. They sincerely support the ideas of overcoming poverty, inequality, preventing climate change and ineffective environmental management, and are trying to contribute to achieving greater predictability and fairness in international relations. In particular, this applies to a number of initiatives within the country (for example, regarding gender equality), as well as large-scale assistance programs for countries that cannot cope with modern challenges on their own.
One example that anti-growth theorists cite to demonstrate the need for a fundamental, rather than decorative, revision of the philosophy of development is electric vehicles.. On the one hand, the rapid development of electric transport was associated with a very favorable idea of \u200b\u200breducing carbon emissions and improving the environment. But few people have calculated the energy and resource costs associated with lithium mining and battery production, and the environmental risks associated with recycling batteries that have exhausted their resources.. The same electric vehicles become part of a traditional marketing strategy, when new models are released more often than the previous ones exhaust their resources, and, from the point of view of the classical growth model, must be consumed. All this neutralizes the effect of introducing electric engines instead of classical ones..
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The transition to renewable energy sources also requires a significant increase in the production of windmills or solar panels and the creation of complex systems for their integration into the power grid. The implementation of “green” standards has different costs for the countries of the global North and the global South, and the monopoly position of global corporations, with which, for a variety of reasons, it is almost impossible for newcomers to compete, increases inequality.
The idea of \u200b\u200b“anti-growth” provides a different view of development. It is not the increase in consumption, but its decrease that are the real indicators of growth, as are increases in life expectancy, water quality and the extent to which environmentally friendly waste disposal technologies are used.. If humanity consumes more products well packaged in plastic, and then all these packages form giant islands of garbage in the ocean, this is not development. If a change in the technological structure involves the replacement of gigantic volumes of electronic equipment (computers, monitors, printers, servers, etc.). ), which is simply taken to landfills in Africa, is not development. Free enterprise should not mean getting rich at any cost. Discussions about revising the development paradigm arose not because someone wants to return to the past - to socialism or even communism, but because globalization, which became the pinnacle of the previous stage of human development, which is now being transformed, proved the need for greater understanding along the North-South lines.
This is also important for us because it is precisely on existing outdated differences that Russia plays today when it promotes anti-Western narratives in the global South under the slogan of anti-imperialism. The most incompetent of all empires with a fascist ideology turns out to be quite successful where social inequality, poverty and the lack of basic conditions for a normal life are still a reality. The philosophy of global development, aimed at the common good and inclusive development, could become one of the factors of consent and counteraction to Moscow’s toxic narratives.