14 August 2010

Slate on the Slow Demise of the Japanese Economy

Alexandra Harney of Slate has an interesting article up today about the perfect storm of economic stagnation and demographic decline that for the last decade-plus has had the Japanese economy locked into a slow downward spiral. The occasion for the article is a macabre hunt for bodies: some Japanese families have been hiding the deaths of their elderly relatives so as to continue collecting their retirement benefits, as in some cases one or two generations of un- or underemployed family members depend on these benefits to make ends meet. (You may remember a news story a week or so back about how the world's oldest man, a Tokyo resident, turns out to have passed away quite some time ago.)

But the article goes far beyond simple sensationalism, describing how many signs suggest that the US could be in the early stages of a similar spiral: high youth unemployment and underemployment, high and rising education costs, fears of deflation suppressing expansion, and aging population, and near-total legislative deadlock. Of course, in my opinion, the US may have a few trump cards up its sleeve that Japan doesn't, such as a stronger small-business tradition and, all the current noise about the issue aside, a much better track record of attracting, legalizing, and retaining immigrants. (Japan's extremely strict immigration policies certainly don't help with its shrinking population!)

On a different note, it turns out Fukuoka is one of the places in Japan bucking these trends: despite a downturn in the city's banking industry, according to Wikipedia Fukuoka is Japan's second-youngest city (average age: 38) and second-fastest-growing. There still seem to be a lot of unoccupied apartments--though I suspect that's partly the result of folks traveling for the summer, as well as the result of multi-generational families consolidating under one roof.

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