This week, the effects of the collapsing asset bubble spread as the extent of the damage caused is revealed; Japan’s financial and political leaders scramble to respond, while refusing to admit the scale of the crisis. Plus, the legacies of the bubble era for Japan today.
This chapter by Dr. Ohno Kenichi of Japan’s National Graduate Institute for Policy Studies on the bubble and its effects
A New York Times article on nostalgia for the bubble era.
Tett, Gillian. Saving the Sun
The old Long Term Credit Bank of Japan; nationalizing the LTCB was the moment the Japanese government finally found a systemic response to its crisis of confidence.
Japan’s unemployment rate has spiked since the bubble; it still remains low compared to other industrialized countries, but the effects on Japanese society have been substantially disruptive.
Prime Minister Abe is now Japan’s third longest serving prime minister ever. Yet his policies of Abenomics have failed to substantially revive the economy.
A graph from Nakaso Hiroshi’s paper showing the fall in Japan’s economic growth rate after the bubble.
Initiatives like “Premium Friday” are attempts to revive the Japanese economy, but they don’t address the lack of confidence consumers have in their economic futures — which is what holds them back from spending money.
This week, it all starts to come crumbling down. Japan is plagued by scandals that destroy public confidence at the system right as some begin to look around and say, “hey, does this all seem a bit unsustainable or is it just me?”
Kingston, Jeff. Japan in Transformation, 1945-2010.
Dubro, Alec and David Kaplan. Yakuza: Japan’s Criminal Underworld.
Ezoe Hiromasa, the head of Recruit Corporation, whose illicit money laundering via the stock market touched off the first major 1980s scandal.
Sumita Satoshi, BOJ governor 1984-89. He is often blamed for the bubble, though responsibility is not solely his.
Kanemaru Shin giving an apologetic press conference as the scale of the Sagawa Kyubin scandal becomes clear. Kanemaru would die just a few years later, but the damage to public confidence would linger.
Recruit HQ via Google maps. The company still exists today, and surprisingly has not rebranded.
Land like this is prime target for yakuza jiageya, who would try to convince the home owners to sell so that the home could be bought up and developed.
This week, we turn our attention to the 1980s. Japan and the United States find their relationship wracked by increasing tensions over political and economic relations, and turn to the solution of an agreement designed to ease the pressure of Japan’s economic growth. The result? Japan’s infamous Bubble Era!
Pempel, T.J. Regime Shift
Anchordoguy, Marie. Reprogramming Japan
Jansen, Marius. The Making of Modern Japan.
The murder of Vincent Chin in 1982 was symptomatic of the level of tension (both economic and racial) in the US-Japan relationship by the 1980s.
The negotiators of the Plaza Accord. James Baker III (USA) is at center. Takeshita Noboru (Japan) is at right.
Ginza’s Yonchome in 1955.
Ginza Yonchome in the 1980s. You can see the incredible growth in just two decades and change.
Another shot of the Ginza in the 1980s. By the height of the bubble, one square meter of commercial real estate here cost $750,000.24
This week, we cover the little-known “Chichibu Incident,” an uprising against the Meiji government in 1884 that saw several thousand people take up arms against the state. Where did it come from? How did the rebellion fare? And what is its connection to the broader trends of Japanese history?
Bowen, Roger W. Rebellion and Democracy in Meiji Japan.
Siniawer, Eiko. Ruffians, Yakuza, Nationalists: The Violent Politics of Modern Japan.
Steele, M. William. Alternative Narratives in Modern Japanese History.
Tashiro Eisuke, party secretary of the Poor People’s Party (Konminto)
A monument to the Chichibu Incident. At the time decried as treason, the event is now more often viewed as a genuine popular uprising against a government that was not considerate regarding the hardships its policies inflicted.
Another monument to the incident. Note the leaders to the right (Tashiro is the one standing).
Kinsenji, a Buddhist temple in Chichibu, holds the grave of Tashiro Eisuke. He was captured by the government and executed for treason.
A Japanese-language map of the incident, from a local museum.