Japan needs reform, but old orthodoxies won’t give way easily

When I was 16 - that's (ahem) 25 years ago now, right before Japan spiralled into economic stagnation - I stayed a year with a Japanese family as an AFS exchange student.

I attended a girls school in a suburb of Osaka, in the south of this amazing country. It was quite the cultural leap from Pukekohe, to put it mildly. School six long days a week, an hour's trip each way to school (bike, train, another train, then bus, was the one-way journey) and strict obedience to the phalanx of top-notch teachers brought in for every subject, from music, to calligraphy, to basketball, to advanced physics (and English, always English).

But oh, the money. This was Japan's gilded age. All the girls wore designer gear - and every bit of the school uniform was made by high-end designers as well. Every handkerchief, every umbrella, every hair tie, was Gucci this, Prada that. The school trip was to Korea. My host father proudly drank whisky with gold flecks every night when he got home from his job around 10pm.

Soon after I left he died of lung cancer from the two to three-pack-a-day smoking habit so common to men in that relentless corporate culture.


I thought about all that decadence and my host father's inevitable death from overwork when thinking about the visit this week of Shinzo Abe, the Japanese Prime Minister. When I went to Japan all those years ago, and for several years after I returned, everything Japanese was in vogue. I envisaged a future of high-profile translation and diplomatic work, thanks to my efforts to learn the language; unfortunately, I wasn't quite so prepared for the Chinese century that soon began.

Japan remains important - as you would expect of a $5.5 trillion economy with 127 million consumers. But it's hard to understand why the Japanese consumer, or Japanese industry, would be inclined to let something like the TPP trade deal be overly advantageous to a country such as New Zealand.

Even domestic reform is meeting resistance. Abe has been trying to institute his "three arrows" of change to overhaul the Japanese economy; the last of these includes moves to address Japan's crazy work/life balance. The Economist reports that one of Abe's most recent proposals is something called a "white collar exemption", which aims to tackle the inhumanely long hours the average salaryman needs to work. It would see the end of overtime payments and jobs for life, and also reduce the number of so-called "irregular workers" - the hordes of young people employed without job security and on reduced wages, in order that their seniors can keep working.

Even back in 1989 I could see young men glumly steeling themselves for lives like their fathers. And women, often incredibly well educated, unable to use that potential in the workplace once they married and had children. Both these factors do nothing for timely reproduction, workplace innovation or growth. Abe is trying his best to make Japan more productive and friendly to its young workers. He's also trying to free the country's markets. But I reckon, based just on casual observation, he has the huge weight of history and orthodoxy against him.