Monday, February 21, 2011

Trading places

Years ago I predicted that the early 21st century in Asia will be like the early 20th century except that the roles of Japan and China will be reversed. At this point I can see how the process plays out. In early 20th century it was naïve to assume that Asia will modernize steadily with the strong leadership of Japan. Today, it is naïve to assume that China will democratize itself and pave the way for a long prosperity of Asia through peaceful means. It is obvious for Chinese communist party leaders that they don’t gain anything from Chinese democracy. They will lose everything when China is democratized. I think that some Chinese officials make comments about the need for political reforms only when they criticize their rival factions that support stricter state controls.


The Chinese leaders have no incentive and no intention to accept democracy. They seem to be building the strong economic and military power to fend off foreign and domestic pressures while they implement their sophisticated totalitarian control. China will not offer the alternative model (to the one with democracy and rule of law) for the world to follow, but it offers a model for 21st century’s dictators (“Peaceful Rise” while increasing its military budget more than 10% per year is a clever peace of propaganda).


Many people who wanted to see the demise of China made wrong predictions. It is important to separate their hopes and fears from what is likely happening. They need to think “what the options will be if they were Chinese leaders” to get more realistic scenarios. Then you can rule out the future where China launches total war against the US for the global domination. The most important thing for Chinese leaders is to keep their system as long as they can.


Here is my prediction of what will happen:

Great recession in late 2000s: While the financial shock caused ripple effects around the world China is relatively unscathed. However, the policies that they used to keep their economy afloat deprived them the opportunity to soft land their bubble economy.

2010-2020: Japan will face financial crisis and political turmoil. In a dire economic situation Japanese people will strongly resent China.
China will face the inevitable burst of its bubble economy after it becomes too obvious that most of the Chinese workers cannot afford to buy their homes (just like what happened in Japan). There will be massive riots in everywhere in China. Still, Chinese government will retain the control of media and their leaders will survive the crisis by using their nationalistic sentiment. Chinese leaders will start to say “Foreign powers are determined to stand in our way to restore our rightful position as the leader of Asia”. They will choose the target of their nationalist propaganda carefully. They will choose a hated and militarily weak nation such as Japan as their scapegoat. China will take a hard stance toward Japan in territorial and historical issues.

2020-2030: China’s population bonus ends. The rapid aging of its citizens and decline in the working age people will slow down Chinese economy. At that point there will be groups of neo nationalists in China. They will be the creation of Chinese prosperities rather than the economic hardships. One group will be right wing neo nationalists (new China chauvinists) who believe that Chinese communist party and foreign powers are major obstacles for China to materialize quick improvements in their living standards that they deserve. Another group will be neo socialists who are outraged by the big income inequities but disguise themselves as neo nationalists. Their strategy will be gradually getting into local branches of the government and silently exercising controlling influence (local military districts that Chinese government has a hard time controlling will be their target too).

Chinese government will try to control neo nationalists, but they will have the situation of “tail wagging a dog”. By controlling local government branches, they can do things to push the central government to the edge. If they control a military district they can start a military skirmish too. Since they are free from a fear of divided China they can launch a well calculated coup. It will be a power struggle rather than a democratic revolution. There is no guarantee that communist party wins.

Monday, February 7, 2011

The next wave of Japanese immigrants

I came to America in the 2nd wave of Japanese immigration to the US. We were called as the New 1st Generation since the 1st generation of Japanese immigrants who came to the US before WWII became senior citizens at that time. There are multiple definitions of the New 1st Generation, but I think the term generally refers to Japanese immigrants who came to America from 70s to 90s. When we came some people thought that we were marginal people who couldn’t be a part of mainstream American, but not really accepted in Japanese American communities. That stereotype somewhat reminds me of the stereotype of Gen-Xers. Decades later many of us are living as a part of American society and don’t have perceived frictions with Japanese American communities.

In general, we are the generation that overcame hardships and assimilated to America like the previous generation. However, the reason why we came is different from that of the previous generation. It is said that most of the pre WWII Japanese immigrants came here to save a lot of money and return to Japan. That situation was depicted in “Gan Gara Gan”, a good manga story about Japanese immigrants by Housei Hasegawa. In the story, Rakuichi Nanotsu tried really hard to make money to go back to Japan. The anti-immigration laws at that time made it difficult for them to save money and many of them stayed here. It is a good lesson from the history.

When we came here Japan already became prosperous. That is why many of us came here to be someone that we want to be rather than escaping poverty. For our generation trips outside of Japan are nothing new. Books such as “How to walk on the planet” became very popular. Some of us read books like “How to quit Japanese” (This is actually not a book on how to move to another country. It is more like a cultural study by comparisons). Some of us are engineers, translators, corporate managers, chefs, etc. The Japanese immigrants in the 2nd wave are mostly non agricultural workers. Some of us who work as specialists tend to have comfortable middle class lifestyles. Together with the flashy lifestyle of Japanese corporate types we were generally viewed as affluent immigrants back then.

I think that the next wave of Japanese immigrants will come in the next 10 to 20 years. In Japan it is estimated that the young generation will have to pay 40 mil yen (about $490K) in tax more than the amount they receive in public services. The senior citizens today will receive 57 mil yen (about $695K) in public services more than they pay in tax. This astounding gap (about $1.2 mil) will trigger them to “vote on foot” (dissent by leaving their country) in a nation where young people only hold minority votes. In the next 10 to 20 years it will be painfully obvious that Japan doesn’t offer bright future for young people. Today, Japanese people who leave the country may be mostly limited to specialists and affluent people, but once mass emigrations start a number of young people will follow.

The next wave of Japanese immigrants will be characterized by the amount of information that they use to choose the best country for them. In our generation it was harder to get information about countries that offer opportunities for us. Today’s young people can use internet (SNS, Twitter, etc.) to get as much information as possible to find a nation that offer young people good opportunities. Since the US is a developed nation that doesn’t have severe aging population issues many Japanese people will decide to move to the US.