Can Japan recover the lost 30 years

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 Can Japan recover the lost 30 years


Video: Shinzo Abe officially resigns as prime minister

Japanese Prime Minister Shinzo Abe said at a press conference at 17:00 local time on Friday (28) that he had decided to resign in order to avoid the deterioration of the old disease and expressed his apology to all Japanese people. Previously, Japans economic data in the second quarter of 2020 showed that, affected by the new epidemic, Japans GDP fell by 7.8% month on month in the second quarter and 27.8% in annual rate, setting a new record of decline.

Abe once said he had enteritis in junior high school. The 28 th resignation statement and apology seem to be Abes final response to the illness. After Abes back, what he still left behind is a sluggish economy, which is not only caused by the new epidemic, but also from Japans persistent disease of losing economic initiative after World War II.

Surplus monster: the United States was born and bred by itself

On August 14, 1945, Emperor Hirohito announced that he would accept the Potsdam Proclamation of the allies and surrender to the allies

In 1945, due to Japans defeat in the Second World War, the United States, as a victorious country, issued the US policy towards Japan in the early post-war period and occupied Japan alone. Since then, the so-called demilitarization and democratization transformation aimed at the whole society of Japan began. As a result, Japan has become a partially sovereign country. However, in order to compete with the Soviet Union, the trial, accountability and liquidation of the war criminals in the Second World War, which should have been carried out by the United States government, stopped. On the contrary, it controlled Japan by drawing on and cultivating the old Japanese chaebols and war criminal families who had launched an aggressive war, so as to make Japan a bridgehead against the Soviet Union.

In 1960, the then Japanese Prime Minister Shinzo Shimbun (left) signed a treaty with then US Secretary of State Robert Holt.

Abes grandfather, kishine, once led the Japanese invasion of China in the Kanto area during the war of aggression against China. He was known as the Manchuria five people Gang together with the then chief of staff of the Kanto army, Yingji Tojo, and the other three war criminals. However, after the end of World War II, he was regarded by the United States as the best candidate for Japans pro american faction and was exempted from prosecution. In 1954, he established the Democratic Party of Japan as the Secretary General. In the same year, his grandson Shinzo Abe was born. In 1957, kishine became Prime Minister of Japan, which opened the history of kishine and Abe family as Japanese bureaucrats after World War II.

The headquarters of Mitsui chaebol in the Central District of Tokyo: Mitsui chaebol is one of the four monopoly chaebols in Japan, and developed from the chaebol dominated by Mitsui family. After World War II, the chaebol promoted Japans modernization process. At present, it has 25 core enterprises, including Sakura Bank, Toshiba, Toyota and other well-known Japanese enterprises.

In 1949, Joseph Dodge, the financial adviser of the occupying forces and President of the Bank of Detroit of the United States, put forward the economic route for the post-war reconstruction of Japan, known as the dodge plan in history. The plan is mainly divided into three aspects: first, control Japans domestic demand, reduce excess purchasing power and expand exports; second, the United States invests in Japan and expands production; third, and most importantly, it adopts the single exchange rate system to fix the exchange rate between yen and US dollar at 360:1, cancel the subsidy and restore the market mechanism. The Dodge plan was originally formulated for the sake of American political and economic interests during the period of American occupation, but objectively laid the foundation for Japan to have a strong industrial production capacity and become an export-oriented country in the future. However, the establishment of a single exchange rate and the loss of economic sovereignty have laid hidden dangers for Japans economic weakness for 30 years since 1990.

On October 19, 1950, the Chinese peoples volunteers crossed the Yalu River and joined the Korean people in fighting against the invaders

Shortly after World War II, the United States launched the Korean War, and some Japanese military enterprises production capacity served American orders. According to statistics, the Korean War brought Japan $2.4 billion in special needs income. After the entry into force of the Japan US Mutual Defense Assistance Agreement (MSA), Japan received a total of 576 billion yen of military aid between 1954 and 1967, which was equivalent to 27% of the total amount of military supplies purchased by Japan during the same period. Military aid not only brings economic benefits directly, but also indirectly brings advanced industrial technology and production capacity to Japan. Taking the optical industry as an example, after obtaining a large number of orders for telescopes from the United States, Japan optics and Tokyo optical company also obtained technologies such as independent production and development of military optical sight lens and aerial camera, which also laid a technical foundation for the later Japanese military technology to turn to civilian use. The single exchange rate allows Japan to simply improve production efficiency and produce goods at lower costs, thus promoting exports.

The above reasons made Japans GDP growth rate as high as 9.2% in the early postwar period. In addition, in the 1950s and 1970s, in order to make the labor force more stable, train skilled workers and improve production efficiency, Japanese enterprises generally adopted the lifelong employment system and the annual serial wage system, that is, the older the seniority, the higher the salary. These systems have also accelerated the development of Japans economy objectively.

The official website of Chengqi college published an article on Shinzo Abes experience when he was studying in the University

It was also during this period that Shinzo Abe, a young man, followed the arrangements of his family and came to the nobility School of the children of Japanese bureaucrats and plutocrats, Chengqi College (at that time, it was a consistent system college including primary school, junior high school, high school and University, now Chengqi University), and spent 16 years here. Born in a political family and an aristocratic school, Abes education quality was higher than that of most Japanese peers. From primary school to junior high school to high school and University, Abe studied basketball, Kendo and archery. It was also during this period that the young Abe witnessed Japans economic take-off. Born in a political family, Abe wrote down his dream of becoming a politician on his future dream list when he graduated from primary school.

From 1947 to 2003, Japans total annual education and culture funds (left) and the proportion of education and culture funds in the current fiscal expenditure (right)

In Japan at that time, Abes educational resources could not benefit the whole country, but the Japanese governments investment in education and culture gradually increased. In 1956, Japans education and culture funds accounted for 12.4% of the fiscal expenditure, and maintained a proportion of more than 10% for quite a period of time.

The enrollment rate of Japanese high schools, universities and short-term universities in April 1954 and 1974

In Japan, the enrollment rate of high school, University and short-term university increased from 50.9% and 10.1% in 1954 to 90.8% and 34.7% in 1974. This further provided talent guarantee for Japans industrialization and industrial upgrading.

Dodge plan has a more prominent impact on Japans export expansion, which makes Japan develop a set of export-oriented economic model. Since the 1970s, Japan has been in a trade surplus all year round.

From 1979 to 1985, Japan had an annual trade surplus with the United States

Abe Shinzo Abe in his youth (right)

Japans powerful manufacturing industry has also begun to encroach on the U.S. market, which has triggered a 40 year trade crackdown on Japan. It was also during this time that Abe, directly or indirectly, began to hear voices from across the Pacific. When Abe obtained a bachelors degree in political science from Chengqi University in 1977, he was in time to catch up with the restrictions on the export of color TV sets from the United States to Japan. In the same year, Abe went to the U.S. to study in Nankai University of public policy. After only three semesters, Abe returned to Japan to work in a steel company in Kobe. At this time, Japans steel industry was bound by two trade protection agreements signed by the United States and Japan.

From 1957 to the 1990s, the United States imposed export restrictions on Japan in six different industries, including textiles, steel, household appliances, automobile manufacturing, semiconductors and telecommunications. Behind this is the reduction of the comparative advantage of American manufacturing industry brought by globalization.

Since the 1980s, a series of boycotts against Japanese goods broke out in American society

In the 1970s, the stimulus of war on American consumption and economic growth disappeared completely, the dividend of the first round of scientific and technological revolution caused by atomic energy and electronic information technology disappeared, and the fierce international competition brought about by economic globalization reduced the trade surplus of the United States. Coupled with the outbreak of two oil crises, American society began to experience 13 years of economic stagflation.

The U.S. GDP growth rate and CPI growth rate from 1961 to 1980 (left) the U.S. foreign trade gap from 1961 to 1980 (right)

The proportion of Japans exports to total GDP after World War II (left) Japans foreign trade gap after World War II (right)

During this period, there were many crises in the US dollar. In 1971, Nixon, then president of the United States, stopped foreign governments and central banks from using US dollars to exchange gold with the United States. This led to the collapse of the Bretton Woods system of gold standard, which was established in 1944, in which the US dollar is linked to gold, and each countrys currency is linked to the US dollar. So far, countries began to adopt the floating exchange rate system. Japan, which enjoys the great convenience of the fixed exchange rate system, also adopted the floating exchange rate system in February 1973. However, as of 1978, the yen rose to 194.3:1 against the US dollar, up to 85.28% compared with 1973.

u25b3 Shintaro Abe (right) and Shinzo Abe (left) take the Shinkansen train

At this time, Japan naturally became a thorn in Americas eye. In the past ten years since 1976, the United States has launched 15 301 investigations against Japan in accordance with article 301 of the United States Trade Act promulgated in 1974, covering automobiles, steel, semiconductors, pharmaceuticals, etc. It was in 1982 that Shinzo Abe really entered the Japanese political arena. From 1982 to 1986, Abes father, Shintaro Abe, and then Japanese Prime Minister Yasuhiro Nakasone dominated Japans foreign affairs and trade. Facing the aggressive trade restrictions of the United States at that time, Abes compromise seemed to indicate the future of Abe.

Until 1985, the United States finally launched the Plaza Agreement, but it was the fault of Japanese policy makers that made Japans long-term high trade surplus with the United States come to an end.

Plaza Agreement: the end of Carnival and the prelude of desolation

The finance ministers of the United States, Japan, the former Federal Republic of Germany, France and the United Kingdom held a meeting with the central bank governors at the New York Plaza Hotel

The reason why Japan joined the Plaza Agreement is that it hopes to get rid of the further trade restrictions imposed by the United States on Japan. However, the Japanese side obviously underestimated the impact of the agreement. Then Japanese finance minister takeshibatu said: it doesnt matter if the yen rises to 190 to 1! At that time, the exchange rate of the yen against the US dollar remained at 240:1, which means that the Japanese government is still extremely optimistic about the future yen appreciation space. Within three months after the Plaza agreement came into effect, the US dollar depreciated rapidly, and the exchange rate of Japanese yen against US dollar rose rapidly from 250:1 in 1985 to 200:1. In 1987, less than three years after the Plaza agreement came into effect, the yen doubled against the dollar, reaching 120:1.

In 1986, the average house price in Tokyo soared by 120%. At the peak of the property market in 1991, the house price in downtown Tokyo was as high as 14.5 million yen per square meter. In the heyday of housing prices, the land price in Tokyo metropolitan area 23 was enough to buy the entire United States.

The Rockefeller Center in Manhattan, New York City, USA

In addition, a large number of export enterprises in Japan made a reduction in the export shortfall caused by the appreciation of the yen. Borrowing low interest loans from banks also increased the leverage ratio while blowing up the bubble, which also created a boom in the late 80s. The Mitsubishi Co invested 850 million yuan to buy the New York Rockefeller, regarded by the Americans as a symbol of the United States and a symbol of prosperity. The center has 51% of the shares; Sony spent 3.4 billion dollars to buy Hollywood Columbia film company, Samsung film company and four seasons hotel in Hamburg; Panasonic group has spent 6.1 billion dollars to buy out all shares of Universal Pictures; Shuwa Co., Ltd. has won the famous painting sunflower by Citiplaza in Los Angeles and Van Gogh. After that, ABC building, mobile oil company headquarters and Citibank headquarters all changed their ownership and became the property of Japanese.

At the same time, the growth of the Japanese stock market is just as crazy. In 1983, the Nikkei average index was 8800 points. In 1986, it rose to 16400 points. In January 1987, it broke through 20000 points and reached a record high of 38957 points at the end of 1989. In March 1987, the total market value of Japans stock market had reached 2688 billion US dollars, surpassing the United States and ranking first in the world. At that time, the total market value of global stocks was $7467 billion, with Japan accounting for 36%.

From the early 1990s, Japan ushered in a long period of economic downturn

Faced with the huge bubble of Japans real estate and stock market, everyone realized that the burst of bubbles was only a matter of time and way. With the implementation of the tightening policy from 1989 to 1990, Japans economic bubble burst, and the Japanese economy began to decline rapidly. The early debt, aging and fewer children caused by the reduction of demographic dividend, bank bad debts, zombie enterprises have also emerged. Since 1991, Japans GDP has declined rapidly. By 1993, Japans GDP growth rate has dropped to 0.17%. During this period, Abe experienced Japans economic downturn, his fathers death, and by virtue of his fathers and grandfathers personal connections and political resources, Abe ascended the Japanese political arena.

From the beginning of the 1990s, Japans economic bubble burst, and until 2011, the Japanese economy continued to slump. During the Asian financial crisis in 1997 and the 2008 global financial crisis, Japans GDP growth rate even dropped to negative. This period of time has also been called Japan lost 20 years. After entering the millennium, the Japanese economy still shows no signs of improvement. With the help of his grandfather and father, Shinzo Abe became the Chief Cabinet Secretary of Junichiro Koizumi, then Prime Minister of Japan. Since then, Shinzo Abe has been regarded as the successor of Junichiro Koizumi.

From 1991 to 2011, Japanese government debt

In order to cope with the stagnation of economic development, the Japanese government continued to use positive fiscal policy and loose monetary policy to stimulate the economy. During this period, the Japanese government issued more than 20 emergency economic measures, accumulating more than 200 trillion yen of financial investment, but the effect was only to increase the debt of the Japanese government.

From 1981 to 2017, Japans financial social security expenditure

After the huge bubble burst, Japanese consumer confidence continued to slump, and the high savings tradition also made it difficult for the consumer market to rejuvenate. In terms of industry, many Japanese enterprises are also subject to the lifelong employment system and hierarchical system, so it is difficult to improve their competitiveness and innovation ability. Enterprises that cant afford high labor costs even employ a large number of temporary workers to reduce their expenses. In addition, the aging population and the previous lifelong employment system have increased the governments and enterprises security expenditure, further increasing Japans economic burden. The Japanese economy has not been able to get a boost in the long run, and the nation has not been able to get out of the bubble burst in 90s for a long time, which has led to the constant replacement of the prime minister between 1989 and 2012. In addition to Junichiro Koizumi, who took office in 2001, has been the Prime Minister of Japan for six years with slightly effective economic policies. In the 13 years from 1989 to 2001, Japan has replaced 10 prime ministers, each of whom has been in office for no more than 16 months. After Junichiro Koizumi stepped down in 2006, the global economic crisis brought Japans prime minister back to the frequent replacement of seven prime ministers in six years.

Abenomics: a brief superficial prosperity

Abe Shinzo and his three arrows

Abenomics in 2012 is mainly divided into three parts. Abe called it three arrows, namely, large-scale quantitative easing, fiscal stimulus and structural reform to promote private investment. Its means are to devalue the Japanese yen externally, promote exports, realize inflation at home and boost consumption. In fact, the so-called abenomics is the same as the traditional economic theory, which relies on the active fiscal policy and loose monetary policy to increase the market currency circulation and promote investment and consumption. However, the volume of Abes version is unprecedented. In 2013, toyohiko Kuroda, the governor of the Bank of Japan, who took the lead in implementing the quantitative easing program, even named the program heterogeneous quantitative easing, which means a radical quantitative easing policy that transcends time and space, breaks through history and is unprecedented in history. Prior to the Koizumi administration, Japan had adopted quantitative easing policy. The amount of basic currency rose from 69 trillion yen in 2001 to 112 trillion yen in 2006, an increase of 43 trillion yen in five years. The quantitative easing implemented by Abe since he took office has increased the amount of basic currency by 132 trillion yen in two years, showing his radical heart.

Since 2013, the Bank of Japan has mainly purchased treasury bonds, ETFs and J-REITs

At the same time, in terms of fiscal policy, Abe implemented a larger scale of asset purchase, with an annual growth rate of 50 trillion yen in treasury bonds alone, and expanded to 80 trillion yen in October 2014. With the addition of long-term treasury bonds, 40 year treasury bonds are also regarded as the purchase objects. Such a large-scale purchase of treasury bonds and issuance of currency made Japans economy recover and grow from 2012 to 2014.

According to the data of Japans cabinet office, this round of economic expansion in Japan lasted 71 months from December 2012 to October 2018. During the period, the number of unemployed people decreased significantly, wages increased and the profit margin of enterprises increased. Data from a French financial institution show that, stimulated by abenomics, the relative depreciation of the yen has led to an increase in the number of tourists to Japan. According to the data, the number of tourists to Japan more than doubled between 2011 and 2014, while the total expenditure of tourists to Japan also increased by nearly 150%.

u0394 Japan is deeply aging, and the vitality of social labor force is not high

In view of Japans persistent problems of low fertility and aging, Abe renewed the content of his abenomics and launched new three arrows, including free day care, providing care subsidies, etc. Although it is still difficult to solve Japans inherent social problems, Abes relatively flexible means also enable him to become the longest serving prime minister in Japans history on August 24, 2020.

The proportion of government debt supported by the Bank of Japan

The final result shows that such a radical fiscal and monetary policy has increased Japans debt burden. According to the statistics of the International Monetary Fund, as of 2019, Japans total debt accounts for 238% of Japans GDP, and its total debt has exceeded twice the total economic volume. Such large-scale borrowing and aggressive monetary policy are almost out of proportion to the amount of economic growth and inflation achieved. In addition, the data shows that the two rounds of quantitative easing started in March 2013 have injected nearly 300 trillion yen of basic currency into the market. However, as of March 2016, the current account balance of the Bank of Japan was as high as 27 billion yuan, and its actual effective monetary line was far less than the amount of additional currencies. Abe has paid a huge price to achieve its goal of promoting economic growth and inflation. After entering 2018, due to Japans serious aging, low national expectations for the future and labor force vitality decline and other stubborn diseases that are hard to change for a while, abenomics shows a weak trend. Under the premise that Japans domestic demand is difficult to improve, Japans economy, which relies heavily on external demand, is difficult to be stimulated by fiscal and monetary policies.

Waterloo: Abe, Trump and the Tokyo Olympics

Trump, who came to power in 2017, made Abe, whose economy and defense rely heavily on the United States, suffered a Waterloo. On January 23, 2017 local time, U.S. President trump announced that it would withdraw from the TPP, which means that the largest economic sponsor in the TPP will withdraw. Forced by the withdrawal of the United States, Japan, as the largest economy in the TPP at that time, began to dominate its operation, and renamed it cptpp on November 11, 2017.

On August 21, 2016, Shinzo Abe, then Prime Minister of Japan, personally took part in Tokyo eight minutes as Mario

Novel coronavirus pneumonia is also a major force in the USs economic and trade strength. Andoubles unexpected result is that the 2020 Tokyo Olympic Games, which he has been pushing, is also postponed because of the new crown pneumonia epidemic. Since taking office in 2012, Abe has said: let the Olympics be the trigger to eliminate Japans 15 years of deflation and economic recession. Three years later, at the closing ceremony of the Rio Olympic Games, Shinzo Abe, as prime minister, personally took part in Tokyo eight minutes and played the famous virtual role of Mario in Japan. In 2020, Abe will be in power for the eighth year, and the benefits of abenomics will be decreasing day by day. At the same time, Japan, as an export-oriented country, will face more and more downward pressure on its economy. This makes Abe regard the Tokyo Olympic Games as a lifesaver to boost its economy.

During the new epidemic, Japan launched the goto travel tourism stimulation activity in July under the pressure of economic downturn

In 2020, tourism to Japan will contribute 0.15 percentage points to Japans potential economic growth rate. The Olympic Games held at this time are regarded as the extension of abenomics. In order to hold the Olympic Games well, Japan spent seven years building various stadiums and infrastructure in Tokyo, and continued to invest in the Olympic Games under the circumstances of huge fiscal deficit caused by the expansion of public expenditure due to the implementation of abenomics. According to the Research Institute of the Japan Economic Research Center, Japan has invested 32 billion to 41 billion US dollars in the construction of competition venues and the increase of hotel passenger capacity. However, the global pandemic of the new crown epidemic has turned the life-saving straw that Abe valued so much into a thing of the past.

Abe left the hospital by car

Coincidentally, on August 17, after Abe came to Yingqing university hospital for seven hours of examination and treatment, the Japanese Cabinet Office released Japans GDP for the second quarter of 2020. After excluding price changes, Japans real GDP in the second quarter of 2020 further decreased by 7.8% compared with the first quarter, with an annual rate of 27.8%, the worst record since World War II. In addition, the data for the second quarter also showed the decline in Japanese personal consumption, which fell by 8.2% month on month and exports by 18.5%. Abes health and Japans economy are in the same predicament and suffer Waterloo together.

Lost 30 years: can Japan recover it?

(function(){( window.slotbydup=window .slotbydup||[]).push({id:u5811557,container:ssp_ 5811557, async:true }On August 28th, if the Tokyo Olympic Games were held as scheduled, it would have been 20 days since the end of the games, and the reconstruction and demolition of the temporary venues should be almost completed. But the novel coronavirus pneumonia situation has left the Andouble administrations Olympic plan completely empty. The rise of trade protectionism led by the United States, the impact of the new crown epidemic, the postponement of the Olympic Games, the high aging, stagnant domestic demand, and the debt platform, which has carried out abenomics for many years, have made Abes eighth year in power difficult. Four days after becoming Japans longest serving prime minister, Abe resigned for health reasons. At present, it is not known whether the several successors will pursue abenomics, but the clock will not stop, and the lost 30 years is moving towards a longer time Source: cctv.com editor in charge: Kang Ruixin_ NB16727

On August 28, if the Tokyo Olympic Games were held as scheduled, it would have been 20 days since the end of the games, and the renovation and demolition of temporary venues should have been almost completed. But the novel coronavirus pneumonia situation has left the Andouble administrations Olympic plan completely empty.

The rise of trade protectionism led by the United States, the impact of the new crown epidemic, the postponement of the Olympic Games, the high aging, stagnant domestic demand, and the debt platform, which has carried out abenomics for many years, have made Abes eighth year in power difficult.

Four days after becoming Japans longest serving prime minister, Abe resigned for health reasons. At present, it is not known whether the several successors will pursue abenomics, but the clock will not stop, and the lost 30 years is moving towards a longer time