
Japan's Growing Poverty Defies Glib Explanations - akg_67
http://www.bloombergview.com/articles/2016-04-26/japan-s-growing-poverty-defies-glib-explanations
======
nihonde
It's depressing to read all the misguided commentary about Japan in western
media. We're talking about one of the world's oldest continuous civilizations,
which currently has the longest life expectancy, and one of the lowest crime
rates.

Japan will endure, as it has for thousands of years. I'm more worried about
where America and Europe are headed. Prosperity is one thing. Greed,
corruption, and exploitation are another.

Anyway, in my experience, Japan today is a pleasant place to live. The lack of
boom times here has rendered Japan more humble and practical than in the
recent past. Most people in Japan ultimately enjoy a middle-class existence
that would be the envy of the average American family. There are plenty of
people who are struggling here, but Japanese people have endured far worse.

Western commentators will tell us that huge bloc of elders are an impossible
burden on Japanese society. I see it differently—those people are a treasure
trove of hard-earned experience. We can learn from them, and they're currently
doing an excellent job as stewards of this place. They've seen first-hand the
folly of chasing America and Europe on their imperialist fancies.

I would rather live in a "poor" Japan than in a "rich" America any day of the
week. You can't put a price on peace of mind and the general atmosphere of
civility and willingness to come together for a common cause.

~~~
_Codemonkeyism
"They've seen first-hand the folly of chasing America and Europe on their
imperialist fancies."

Interesting view on history.

~~~
nihonde
Well, it was intended as an "aside" comment, but it's still interesting, if
controversial. I believe that there is an unbroken thread from the arrival of
American ships in Tokyo bay in 1853 to the current day. If you look at the
official US history of that event (it's here:
[https://history.state.gov/milestones/1830-1860/opening-to-
ja...](https://history.state.gov/milestones/1830-1860/opening-to-japan)), it
is characterized as a great opening of Japan to the world. In fact, it was in
the pursuit of an arrogant imperialist notion of "Manifest Destiny" that
Commodore Perry humiliated the Japanese and scared them into thinking that
they needed to get into the expansion and conquest game in order to survive.
It was a clear message from the Americans: we're coming in whether you like it
or not.

Some call it a wake up call; others call it a provocation. Reasonable men and
women can disagree about it. There's no doubt that it directly led to the
lowest and highest points of Japanese civilization in the 20th century,
though.

I think if people looked into the context of events with more curiosity, we
would ultimately all benefit from the inquiry.

(And yes, I do believe that America and much of Europe are still pursuing an
imperialist agenda. Call me crazy, if you want.)

~~~
_Codemonkeyism
Following this line of thought I would assume America is chasing Europe on
their imperialist fancy, Europe (modern) those of the British, the British
chasing Romes fancies, Rome those of the Greeks, the Greeks those of the
Egyptians (and Persians?) and the Egyptians those of Sumer. This probably goes
on though noone left writings before the Sumerians (but my knowledge is fague
here).

I would also assume the invasions e.g. of Korea by Japanese before 1853 where
not imperialist by intention.

~~~
nihonde
Great point about Toyotomi Hideyoshi's attempt to conquer Korean and China! I
guess the legacy of the Edo period was a kind of reset on that ambition,
because the country was closed and not looking for a fight. I would say it was
actually the failure of the shogunate to stand up to Commodore Perry that
ended Edo and kicked off the outward-looking Meiji.

I'm no expert in this area, but I enjoy learning about it.

~~~
jazzyk
What about the post-Meiji period?

The attack on Pearl Harbor in 1941 was just a misunderstood act of extending
an olive branch?

~~~
nihonde
(Again my views only.) I think it was a direct reaction to the aggression of
1853. It was preceded by posturing/maneuvering in the South Pacific if I'm not
mistaken. To be clear, I don't think it was justified or proportionate, but I
do think those events were closely linked in that Japan saw Americans as
encroaching on their sovereignty and an imminent threat from the "East".

------
_Codemonkeyism
Basically there are two definitions of poverty with two crowds of followers.

1\. People are poor if they can't afford (basic) things. People are very poor
if they go hungry to bed.

2\. People are poor if they earn less [1] than the average (not median)
household. From the article "The report looked at the gap between the income
of the poorest Japanese families with children and the average household
income."

When does the poverty rate rise in 1. and 2.?

1\. When peoples (real) income decreases (e.g. they lose jobs) and they can't
afford (basic) things they could afford 10 years before. Or prices are rising
to the same effect. The margin between income and costs gets smaller.

2\. When some people get a lot richer (e.g. the "1%") then the income average
rises and the poverty rate rises, although "poor" people might also have
higher income or can afford more things than 10 years before (because of
cheaper food, clothes, phone costs, energy they have more "disposable
income").

I wish we would label these two types of poverty differently to have better
discussions.

[1] EDIT: a certain percentage

~~~
thaumasiotes
> People are poor if they earn less than the average (not median) household.
> From the article "The report looked at the gap between the income of the
> poorest Japanese families with children and the average household income."

And I thought the US move to define the poverty line as the 40th percentile of
income (or something lower; I don't remember this too well) was absurd. The
average household income is, by necessity, well above the 50th percentile
everywhere. There is no one seriously advocating that over 50% of every
country's population is living in poverty.

~~~
mafribe

       the poverty line as the 40th percentile 
       of income [...] was absurd.
    

It's best understood not as a honest attempt at understanding poverty, but as
a political manoeuvre.

In the past (19th century and before), the socialist/communist tradition had a
real point in that large swathes of the population were poor in an absolute
sense (e.g. going hungry, cold, no adequate health-care, pension etc). The
socialist/communist tradition was in some sense about abolishing absolute
poverty (whether the proposed methods were helpful or not is another
discussion). If you read e.g. the communist manifesto [1], that is clear. Most
of socialist/communist politics centered around politicising and radicalising
the absolute poor with a view towards taking them out of absolute poverty.

However, modern industrialised society has (simplifying a bit) abolished
absolute poverty.

This leaves socialist/communist politics in a conundrum: how to continue to
politicise/radicalise people to become followers. The concept of relative
poverty is the answer: all the old political tools can be reused by changing
what is meant by poverty.

[1]
[https://www.marxists.org/archive/marx/works/1848/communist-m...](https://www.marxists.org/archive/marx/works/1848/communist-
manifesto/)

------
taneq
It's interesting that the author equates "Japan has very high labor force
participation and low unemployment." with "No laziness or idleness here."

The Japanese workplace culture of the 'sarariman' who spends 14+ hours a day
in the office, achieving almost nothing, is legendary.

~~~
bcook
(Edit: I replied to the wrong poster or some similar mistake.) _Disregard_

How can you argue against the author's immeasureable words/phrases like "very
high", "low", "laziness", or "idleness", especially considering that you are
relying on anecdotal evidence yourself?

I have seen a bunch of tall trees Georgia, but my friend from California says
they are small; which of us is correct?

 _Who cares when the answer yields no useful, quantifiable information..._

~~~
Dylan16807
> How can you argue against the author's immeasureable words/phrases like
> "very high", "low", "laziness", or "idleness"

That's not what's happening at all. Taneq is saying nothing about the relative
nature of those words. They are arguing that the author is making an inference
_in the wrong direction_.

> especially considering that you are relying on anecdotal evidence yourself

Talking about cultural roles is the opposite of an anecdote.

~~~
bcook
Yeah, I agree. I think I made a mistake.

I edited my post. I am not sure what my original post was referring to...
embarassing. :)

------
GreaterFool
"The survey compared the incomes of the bottom 10 percent of households with
children to the average income of 41 countries who are members of the OECD or
the European Union.

The income gap in Japan was found to be 60.21 percent, meaning the household
income of the nation’s most underprivileged families with children was less
than 40 percent of the average."

I'm not sure how to read this. Income gap be damned, what is the minimum
livable income? There's a difference between being poor relative to one's
peers and being too poor to afford housing / food / education.

I live in Tokyo at the moment. My experience (as a single person without kids)
is that if one wanted to live frugal but happy-go-lucky life it could be done
quite cheaply.

"The income of the poorest fell from about ¥902,500 to ¥840,000 during the
same period, according to data compiled by Abe of Tokyo Metropolitan
University"

So there are some numbers, but what is the cost of living and where? Moving
from Tokyo to Osaka would probably cut my living expenses by 50% or more. What
about living in a smaller Japanese town?

The cost of living disparity between major urban areas and rest of Japan is
probably _gigantic_.

~~~
mkagenius
> ¥840,000

That's INR 8,597,047 in India. I think only top execs at a well established
company make that much in India. Amazing.

~~~
vemy
That value is in Japanese Yen (JPY), not Chinese Yuan (CNY).

~~~
mkagenius
Sorry, lazily I just copy pasted into google, and didn't check the currency
google understood it to be.

------
chvid
First off. Economists define "poverty rate" in a slightly cheeky manner:

"The poverty rate is the ratio of the number of people who fall below the
poverty line and the total population; the poverty line is here taken as half
the median household income."

This means that if the middle class is 5% better off after one year and the
lower class is only 2% better off, then the poverty rate will go up.
Eventhough all households are doing better.

The same goes in reverse. If the middle class is 5% worse off after one year
and the lower class is only 2% worse off, then the poverty rate will go down.
Eventhough everyone is doing worse.

This does not mean that the number is meaningless; it just cannot stand on its
own.

Secondly. Japan is much nicer with those bad things that hurt the lower
classes in other societies:

Crime is much lower, relatively few people in prisons. And the public school
system is of very high standard.

~~~
AnimalMuppet
If I understand this correctly, basic income could eliminate poverty (by that
specific definition). It would need to pay people half the median income, but
tax the median income at a rate that means that exactly offsets the basic
income payment (and, probably, tax higher incomes at higher rates).

------
Pitarou
Very poor article. I can list three widely touted explanations off the top of
my head that the author doesn't touch upon.

1\. strong insider / outsider effect in the labour market

2\. high barriers to employment for mothers

3\. weak social welfare system

------
hudibras
One thing that will help is the planned raising of the minimum wage in Japan,
from around 800 yen/hour now to 1000 yen/hour in 2020. [0] The minimum wage in
Japan is below-average by most measures for OECD countries. [1]

[0]
[http://www.japantimes.co.jp/opinion/2015/12/11/editorials/mu...](http://www.japantimes.co.jp/opinion/2015/12/11/editorials/much-
needed-minimum-wage-hike/)

[1] [http://www.oecd.org/social/Focus-on-Minimum-Wages-after-
the-...](http://www.oecd.org/social/Focus-on-Minimum-Wages-after-the-
crisis-2015.pdf)

------
raverbashing
10 yrs of recession, or is it 20 yrs already?

Failure to compete in high-tech areas (when was the last time you got a mobile
phone made in Japan)

Which is funny because Japan was very strong in the modern days of computing
and videogames. What happened? My guess is that software got more complex and
their vertical way of working is not productive for the complexity expected
today

~~~
icelancer
Japan has SERIOUS issues with NIH syndrome. They were on the cutting edge of
technology when they led it. Not so much when it would require adoption from
American and Chinese suppliers and service exporters.

~~~
_delirium
There's a significant U.S.-Japan language gap as well, which tends to work to
the disadvantage of whichever side is not currently ahead technologically.
Very few American engineers read Japanese-language journals or trade press,
and very few (though somewhat rising) Japanese engineers read English-language
journals or trade press.

------
gozur88
Japan had a system in which the companies had a paternal relationship with
their employees. Once you were hired, they kept you on even if they didn't
need you. Even if you'd become too old to be productive (madogiwa zoku, or
"window seat tribe"). The welfare system, such as it was, consisted of
companies taking care of their employees with government bureaucrats and
public opinion punishing transgressors.

But that kind of system can only function when the economy is growing. When
the recession started in 1989 Japanese companies found themselves in the
position of either making people they didn't need redundant or going out of
business. Since there isn't much of a social safety net for the unemployed,
people who got laid off (and the growing ranks of part timers - "arubaito")
didn't have anywhere to turn.

------
xg15
_" [The corporate-welfare system] has declined in the years since the
administration of former Prime Minister Junichiro Koizumi ended a ban on the
use of non-regular workers in manufacturing. But much of the shift to low-
paid, insecure jobs has happened without major changes in policy. In
particular, stringent government protections of regular workers have been kept
in place."_

Am I reading this wrong? So the author acknowledges that there is a shift from
regular to irregular jobs - and then wonders how that could lead to poverty
as, after all, the _regular_ jobs are still protected...

This looks to me like seeing a conundrum where none actually is.

------
x5n1
Can't see why this would not happen to the rest of us as well as time goes
along. Sure there will be basic income, but that does not mean that you won't
be living in poverty despite getting it.

~~~
meric
Yeah, stuff and food and automated services would be cheap, but real estate
expensive. Like today, but even more so.

~~~
x5n1
Real estate, insurance, utilities, it all adds up. The living wage in many
cities is at least 10/hr. Which means that just to pay for basics you need to
get $1600 per month as a single individual. When they talk of basic income
they never talk about money like that, usually around $700, just around
poverty level.

~~~
adrianN
With basic income you don't have to live in cities with high cost of living.

~~~
x5n1
Living wage in Mississippi is $9.95. It is the poorest state in the union, and
a former home of mine. You still need plenty of money just to be ok in the US.

------
cronjobber
> The report looked at the gap between the income of the poorest Japanese
> families with children and the average household income.

This is the relative definition of "poverty". Throws me every time until I
remember that in western political talk, "poverty" almost always means
"relative poverty", which "is a measure of income inequality." (Wikipedia)

Maybe we're looking at the rich country problem of the average household being
overpaid. Sad they can't overpay every Japanese, but not exactly catastrophic
either.

------
RobertoG
The author says: unemployment is low in Japan and poverty is growing.

A normal person would think automatically that wages are low or/and public
spending in automatic stabilizers is low.

It seems a professional economist prefer more exotic explanations.

It's specially puzzling that Japan government prefer to buy financial assets
that invest in their own people when, both, rates are very low and they are
suffering deflation.

But, of course, that would be redistributive and, even worst, it could work
and create a bad precedent.

------
bakhy
i don't know if i maybe missed something, but it does not seem like the
inequality argument has been contested by anything in the text. in fact, the
author states that in Japan, like elsewhere, despite a struggling economy, the
rich are still getting richer. if all the other possible explanations do not
work, then Japan is perhaps the best example of what Piketty wrote about.

------
dnautics
Easy glib explanation: negative interest rates (a wealth transfer from the
poor to the wealthy) and crony capitalism.

------
arca_vorago
Central bankers corrupt everything they touch, and Japan is no exception.

------
brandelune
The author is stupid.

"How about free-market policies? Here the story is more ambiguous, but I still
see this as a minor factor at most."

Because of such neoliberal policies, 40% of the work force is now on irregular
lowest wage jobs with no job security whatsoever, no medical coverage/pension
at all.

Neoliberal policies of the last 2 decades are destroying what boosted Japan
prosperity and stability.

The author lives in a dream world where Japan has always been a country with
low criminality, obedient citizen etc. But that is only the product of the
after-war and the massive US investments to make Japan the first barrier
against Asian communism. Now that the socialist block is dead, neo-liberals
can destroy at will all the social policies that were created since the 40's.

~~~
bcook
If you removed "The author is stupid." from your post, I (and other "adults",
assumedly) would be much more receptive to the rest of your post.

(If you remove that line, I'll delete this post.)

------
sun_n_surf
Ah, Noah "I didn't get kicked out of academia for not producing research and
being a low-brow blog hack, I left because SFO" Smith.

