When Prime Minister Kan Naoto raised the possibility of Japan's participation in the Trans Pacific Partnership, he likened it a "third opening" of Japan -- on a par with the transformation wreaked upon Japan by the arrival of Commodore Matthew Perry's black ships and the post-surrender Occupation of Japan.
Besides the tactical problem of trying to present the TPP in a positive, neutral light after describing it as commensurate with the two instances the United States forcefully dragged Japan into its vision of a world order (and boy oh boy, have the troglodyte nationalists and anti-American leftists gone to town on portraying the TPP as an American plot to destroy Japan...not that Japanese special interests are not slowly destroying Japan on their own without U.S. interference, thank you very much) is the question of the real value Japan can draw out of a further set of shocks to its system. What with the reconstruction of the Tohoku region, the continuing disaster that is Fukushima Daiichi (now they are finding evidence the melted fuel at the bottom of the reactor has gone critical...oh great), the soaring yen (pax Richard Katz and others who argue that the yen is not at an aberrantly high level), declining population and fertility and a looming mass of baby boom retirees landing on the pension system, the rise of highly competitive rivals in all tradeable goods, does Japan actually need any more shock treatment? The Nippon Keidanren (and when the history of the TPP fight is written, the Nippon Keidanren's complacency and sloth should be the subject of scathing criticism) and the government have not made the case that this is so.
A society can only take so much torsion before it breaks. It it should not surprise anyone that in the next week the Noda government packs it in on the TPP fight, realizing the country faces way internal challenges that only can be handled on an individual and idiosyncratic basis, rather than via a multilateral, all-encompassing template.
If the Prime Minister really believes that TPP participation is not beyond the pale, the next key date is November 8, when the Liberal Democratic Party is scheduled to release its position paper on TPP participation. Based on what the main opposition party says, the New Komeito having already come out against TPP participation, the government and the Democratic Party of Japan will map out their next moves.
I kind of understand where the "yen is not overvalued" comes from. Seems most people are focused specifically on the dollar, and somewhat less on the Euro. But those two have been falling relative to other currencies rather than the Yen rising compared to them. The Yen-Swedish crown rate, for instance, is pretty normal; close to its overall average over the past decade or so.
ReplyDeleteIt's sort of the same as when some argue in alarm that few Japanese students study abroad anymore. Seems they mostly look at the students going to the US; specifically, and don't look at overall numbers. Looking at them, there is a small drop - perfectly normal given a worsening economy - from a high peak five to ten years ago.
Have to look at the whole picture.