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Author: akiokawato

The End of Gunboat Taiwan Policy

Watching the U.S. Navy hesitate to push into the Strait of Hormuz during the current Iran conflict, one begins to wonder whether the old scenario—U.S. carrier strike groups rushing to the rescue in a “Taiwan contingency”—has already lost much of its credibility.

That does not mean Taiwan is defenseless. Quite the contrary. Taiwan could potentially destroy a Chinese amphibious invasion force using land-based missiles, drones, and even sea-borne unmanned systems.

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Meanwhile, a large-scale purge of senior officers is reportedly underway within the upper ranks of the Chinese People’s Liberation Army under Xi Jinping. What this has to do with a potential Taiwan operation, however, remains unclear. At the same time, U.S.-based analyst Drew Thompson has pointed out that, since late February, Chinese military aircraft have not entered Taiwan’s airspace at all. This marks a striking contrast with the latter half of last year, when Chinese incursions were frequent and aggressive.

Whether this shift reflects the removal of hardline commanders during the purge, or a deliberate effort to avoid unexpected escalation ahead of the National People’s Congress in March and the (postponed) visit to China by Donald Trump originally planned for April, is difficult to say.

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In any case, with the added uncertainty of a U.S. president whose policy toward China appears unsettled, Japan would do better to focus less on legal debates over how far it can cooperate with U.S. forces in a Taiwan contingency. Instead, it should place greater emphasis on diplomatic efforts—seeking political agreements that uphold non-use of force and preserve the status quo.

Akio Kawato

2026-04-22
Does the Iran War Herald the Advent of the “Euro Renminbi”

Akio Kawato

Since the 2008 financial crisis and the COVID shock of 2020, the United States has continuously expanded the supply of dollars. Federal debt has now exceeded the size of annual GDP. Policymakers fear that, at some point, this could erode confidence in U.S. Treasuries, trigger a surge in interest rates, and destabilize public finances.

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Could the current Iran war become the trigger? Through what mechanism? One plausible scenario is that a spike in oil prices prolongs inflation in the United States, pushing interest rates higher. That, in turn, increases the government’s debt-service burden. The critical threshold comes when interest costs outpace economic growth.

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Another risk lies in the roughly $1.8 trillion in non-bank corporate lending. If a significant portion of this turns sour, the damage could spread to major banks that finance these non-bank institutions, leading to a credit freeze reminiscent of 2008.

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The Dollar Surged in the 2008 Crisis

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But would such a crisis actually cause the dollar to collapse? In 2008, the opposite happened. U.S. Treasuries were treated as safe assets, demand surged, and long-term interest rates declined.

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Meanwhile, in Europe, the supply of eurodollars suddenly froze. Banks, fearing each other’s insolvency, stopped lending. As demand for dollars to settle trade transactions spiked, the dollar strengthened.

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As discussed earlier, dollar lending backed by deposits in European banks—the eurodollar system—supports a large share of global trade and finance. When that system seized up, the demand for actual dollars surged.

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Would Treasuries Lose Credibility This Time?

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Could U.S. Treasuries themselves lose credibility? It is possible. But as ChatGPT aptly notes:
“In that case, government intervention would follow. The Federal Reserve would likely purchase Treasuries on a large scale to stabilize their value. However, this would come at the cost of a significant depreciation of the dollar.”

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Fair enough. But would that push the dollar off its throne as the world’s reserve currency? History suggests otherwise. After the Plaza Accord in 1985, the dollar fell sharply, yet it did not lose its central role.

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The Eurodollar: A Global Settlement Token

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What, then, happens to the eurodollar system? Eurodollars are essentially offshore dollar-denominated claims circulating outside the United States—something like a global settlement token moving across balance sheets.

Originally, oil exporters such as the Soviet Union and Gulf states deposited their dollar revenues in European, especially British, banks to avoid political risk in the U.S. European banks then used these deposits as a base to extend dollar loans, often multiplying them many times over. These instruments are not directly regulated by U.S. authorities, yet once created, they function much like “real” dollars in global trade and capital flows.

Their value remains aligned with onshore dollars through arbitrage. If a gap emerges, market participants quickly eliminate it.

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Roughly half of global trade is invoiced in dollars, and a large share of that is effectively financed through eurodollar markets. During the 2008 crisis, when European banks stopped lending, the system froze—not because institutions had failed outright, but because the means of payment vanished.

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At that point, the European Central Bank coordinated with the Federal Reserve to obtain dollars via swap lines, which were then distributed to European banks. Similar arrangements were made by the Bank of England and the Bank of Japan.

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These swaps were largely accounting operations—no physical cash crossed the Atlantic in bulk.

In essence: the global system runs on dollars that the U.S. government does not fully control. Much of this liquidity is privately created offshore and inherently fragile. In times of crisis, it can disappear almost overnight. When it does, only the Federal Reserve can recreate “real” dollars.

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Is the Eurodollar System an Instrument of Empire?

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At this point, it may appear as if the United States has built a global empire through the dollar. However, that view is not entirely accurate. The eurodollar system operates largely outside direct U.S. control. It is not a tightly managed imperial tool but rather a shared global infrastructure—a kind of universal “points system” denominated in dollars.

Nevertheless, in a crisis, only the Federal Reserve can convert those “points” into actual liquidity. That reality creates a powerful, if indirect, form of influence: countries that wish to be supported in a crisis must maintain workable relations with the United States.

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The Advent of a “Euro-Renminbi”?

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The current dollar system dates back to the meeting between Franklin D. Roosevelt and King Abdulaziz Ibn Saud in 1945. The understanding was simple: oil would be priced in dollars, and the United States would provide security guarantees.

Since then, Saudi Arabia has recycled its dollar revenues through European banks, which in turn expanded eurodollar lending.

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But today, the situation has changed. The United States no longer depends heavily on Gulf oil imports. China has largely taken its place as the primary buyer. Moreover, as recent tensions suggest, Gulf states are no longer confident in U.S. security guarantees.

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If China increasingly pays for oil in renminbi—and this is already happening at the margins—and if those renminbi are recycled offshore, a “euro-renminbi” market could emerge.

However, there is a major constraint: Chinese authorities are reluctant to relinquish control over the renminbi. They prioritize domestic stability and are unlikely to allow full convertibility or unrestricted offshore expansion of the renminbi.

2026-04-21
After America: What Middle Powers Can Still Build

Iran ceasefire talks are now beginning. Had the war continued, Iran’s retaliation might well have threatened the very survival of Gulf civilization itself, while also exposing the limits of U.S. military power and potentially bringing an end to America’s unipolar dominance. The ceasefire has, at least for now, bought everyone some breathing room.

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Even so, this latest attack on Iran was reckless.

Because of heavy wartime information control, the full picture remains unclear. Yet it appears that Israel and countries such as Saudi Arabia have burned through large portions of their air-defense missile stocks and may now be left with fewer options against future waves of Iranian missiles and drones (they are inexpensive and numerous).

Saudi Arabia, in particular, seems to be growing increasingly distrustful of the United States. After inviting Ukrainian President Volodymyr Zelenskyy, Riyadh reportedly moved to purchase a new types of drone developed by Ukraine—one that has proven highly effective in intercepting Russian drones—and to accept Ukrainian personnel to help operate the system. The logic is straightforward: if it works against Russian drones, it should also work against the Iranian-made Shahed drones on which many of those Russian systems are based.

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Meanwhile, U.S. bases across the Gulf appear to have come under widespread Iranian missile attack, with reports suggesting damage to AWACS aircraft and airborne refueling aircrafts. Washington insists that it secured air superiority over Iran, but without AWACS and refueling aircrafts, no serious sustained air operation is possible. On top of that, even high-speed F-15s has been shot down over Iranian airspace; a true air superiority was hardly established.

Around 2010, Iran acquired the then state-of-the-art Russian-made S-300 surface-to-air missile system. It is entirely possible that some of those systems remain operational. The United States dispatched three aircraft carriers as well as an amphibious assault ship carrying Marines, yet none of them appears able to cross the Strait of Hormuz into the Persian Gulf.

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In this sense, the Iran war has revealed the limits of even a superpower like the United States.

If Saudi Arabia continues to widen its distance from Washington while moving closer to Iran and Turkey, the strategic position of both Israel and the United States could come under real pressure. And should Riyadh decide to accept payment for its crude oil exports in renminbi, the internationalization of China’s currency could accelerate dramatically.

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The real question is whether Trump will realize that his past style of impulsive, overbearing diplomacy has done little except weaken America’s own position. But even if he does, the emotional and strategic distance between NATO countries and Trump’s America is already widening. It increasingly resembles a marriage that still exists on paper, but in spirit has already become a separation.

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Against this backdrop, new forms of international coordination without the United States are beginning to emerge.

Canadian Prime Minister Mark Carney, speaking at the January World Economic Forum, argued that Trump’s America has drifted away from the principles of freedom and democracy, and called for greater solidarity among what he described as the “middle powers.” Then, on March 19, under British leadership, the leaders of Britain, France, Germany, Italy, the Netherlands, and Japan issued a joint statement on the Strait of Hormuz.

If South Korea, Australia and other states were brought into such a framework—call it an “Alliance for Freedom and Prosperity”—, and meet whenever crises erupted, even online, issuing coordinated statements, it could become a meaningful force.

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More importantly, countries such as Japan, Britain, and Italy have already begun joint development of next-generation fighter aircraft. It is precisely these overlapping circles of consultation, along with multiple concrete cooperation projects, that can magnify the influence of middle powers.

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True, none of this is a substitute for hard security guarantees. Even “middle powers” remain countries driven by ego, national interest, and domestic politics. They do not align easily. Yet in today’s world, even the so-called great powers—the United States and China included—are losing coherence in their domestic governance.

At the same time, the massive use of drones is steadily eroding the value of traditional weapons system—tanks, aircraft carriers, and other legacy platforms. Young people increasingly avoid military service, not only in Russia and Ukraine, but even in Taiwan. The dollar, too, may eventually lose its role as the world’s reserve currency, yet no one can clearly say what will replace it.

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This is an age of anxiety: something fundamental is changing, old tools are losing their usefulness, and no stable replacement has yet appeared.

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At such a moment, Japan must be especially careful not to repeat the fatal mistake of the prewar era, when one domestic faction—above all the military—acted on its own arrogant assumptions and dug the nation into catastrophe.

At the same time, naïve pacifism alone cannot guarantee national security. A country must retain the means to defend itself and repel aggression. But it must also know where to stop.

The principle sounds simple. In practice, however, it requires a mature public, disciplined yet powerful political leadership, and above all a sense of proportion.

That may be the hardest strategic task of all.

2026-04-11
Miscellaneous Thoughts on the Osaka Economy

(This is an old article of mine dated June of 2005. But it still holds some relevance for understanding the nature of Japan’s and Osaka’s economy. Osaka has been the center of Japan’s commerce and industrry)

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The following are the ideas that came across my mind during my business trip to Osaka from May 26 to 28 of 2005.

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1. Accumulations of history

(1) Osaka city was established around the same time as Edo, today’s Tokyo. Osaka, however, has a longer tradition of producing goods and services than Edo.

(2) Sakai, a historical commercial center along the Osaka Bay, has a long history of smithery including nail manufacturing, enabling local blacksmiths to quickly master the skills needed to manufacture harquebus when they were brought from Portugal via Tanegashima in the sixteenth century. As a result, Japan became the world’s largest holder of harquebus, says an authoritative book.

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As Japan shut itself from the outside world in the seventeenth century, the cultivation of cotton began in Kawachi Plain along the Osaka Bay, which later led to the emergence of the household textile industry in the middle of the nineteenth century.

Also in Kawachi, there were watermills that utilized the stream originating from the Ikoma mountains in Nara. The watermills are said to have been used to create gold leaves and copper spreads. Talking about watermills that utilize the water streaming down from the mountains, I am reminded of the textile industry in New England and along the Appalachian Mountains in the United States.

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(3) And last but not least is Osaka’s rice market that became the world’s first futures market.

On top of that the Edo shogunate endowed the Sumitomo family the rights to the Besshi copper mine in Shikoku Island. The family was involved in one-third of Japan’s entire copper refinery (Around 1700 Japan is said to have produced 6,000 tons of copper a year, the world’s largest amount. Naturally, copper was Japan’s largest export item at that time).

The Sumitomo family in later times also gained large capitals from mining and exporting coal, which served as the base on which the family established the most powerful private-run bank of that time.

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2. The significance of the munitions industry in Japan’s modern economic history–Osaka Army Arsenal

(Much of the references to the Arsenal below are based on the speech by Professor Hiroshi Miyake at Mukogawa Women’s University）

(1) In the Soviet Union, the munitions industry served as a pivotal factor in its economy. And it is the case in Japan, too. Currently, East Osaka is known for being one of the centers for small- and medium-sized enterprises making metal molds and other products. But nobody remembers the other side of the story any longer, that the largest munitions factory in the Orient, “Osaka Army Arsenal,” was located right next to the Osaka Castle on premises topping 1.32-million square meters. The Arsenal employed 64,000 workers (including temporary workforce) and had sales record equivalent to one-trillion yen in today’s currency. On the very eve of the end of the World War II (WWII) on August 14, 1945, the factory was demolished by a major air raid.

Many of Osaka’s large-sized enterprises traded with this munitions factory and grew through technological tie-ups with the factory, and many of the small- and medium-sized enterprises in East Osaka were founded by former workers of this munitions factory.

Miyata Industry, a renowned bicycle maker, was established upon diverting gun-making machines for its own use, while major firms such as Daikin Industries and Nihon Spindle Manufacturing started as companies founded by former workers of the munitions factory.

Both Kobe Steel and Sumitomo Metal Industries had close ties with Osaka Army Arsenal and because the munitions factory used large volumes of chemical products, the areas around them became home to the chemicals industry.

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(2) Before WWII, large munitions factories were located in Tokyo, Nagoya and Osaka, all of which later grew into major industrial areas.

Kawaguchi City in Saitama, north of Tokyo, has been home to the cast-iron industry since the Edo Period (1600-1867). The local industries must have enjoyed trade with a munitions factory that was later built in Akabane at the northern edge of Tokyo.

Ota Ward in Tokyo is known to rival East Osaka in terms of small- and medium-sized enterprises specializing in metal molds and other products that underpin Japan’s technological strength. Ota Ward’s industrial sector was born amidst an economic boom brought about by World War I (WWI). The sector grew rapidly helped by the outbreak of the Manchurian Incident in 1931 and the Sino-Japan conflicts that lasted for 14 years. A former major manufacturer of special steel, Nippon Tokushukou, was also established around that time as a company outsourced for the production of guns by the army. After suffering catastrophic damage from the air raids in WWII, Ota Ward came back to life in the wake of the Korean War that created demand in weapon productions and other related materials.

　

The compensation paid out to Japan from China at the end of the war between the two in 1895 (the compensation is said to have amounted to the three-year budget of the Qing government that ruled China at that time) was appropriated to Japan’s newly established national factories like a major iron foundry in Yawata, northern Kyushu. The money must have also been used for munitions factories run by the army and the navy to prepare for the impending war with Russia in 1904.

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(3) Today we tend to tell our history proudly to developing countries, as if Japan had achieved economic development since the late nineteenth century on its own in peaceful ways. But just as the process of economic development in the West, the Japanese economy in reality developed in liaison with wars. It must be extremely difficult to develop an economy only through civilian production in peaceful times.

Today, Russia struggles from a lack of funds and know-how to turn its once-powerful military industry for civilian use. Looking at this hardship, I deeply feel that Japan benefited tremendously from its history that forcibly reduced its military to a fraction, despite the acute tragedy that accompanied it.

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3. Osaka economy to hit rock bottom

(1) Osaka has lost its core industries numerous times. When the Meiji Restoration in 1867 brought sweeping changes to Japan’s administrative district divisions, Osaka lost its rice market, as feudal lords could no longer exchange their rice for money. The end of WWII deprived Osaka of its munitions factory, which had played a role similar to what Toyota now means for Aichi Prefecture.

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(2) The fabric and textile industry that Osaka had fostered since the late nineteenth century declined shortly after WWII. Osaka’s material industries such as steel, chemical and aluminum were eroded by China and other rivals, while the city’s household appliance and automobile industries have been hollowed out.

Kansai International Airport faces a flagging business and local small- and medium-sized enterprises have seen their production halved since large companies abandoned them to head for China and other promising areas. Sumitomo Bank is one of many Osaka-based companies which has moved its base to Tokyo in the past few years due to mergers and other necessities.

These misfortunes in the past three or four years have made Osaka fearful that it might be overtaken by Nagoya, a city booming with the success of the Expo 2005 Aichi, Japan.

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(3) However in the past one to two years, Osaka has been enjoying favorable exports of materials to China that helped push up capital investments in this sector and recovered the jobless rate to a level around 5.9 percent. Now, just as it was with domestic demand, overseas demand for materials has been stabilized after rising, creating a plateau for the Osaka economy.

(And toward 2025 Osaka’s economy became even more vibrant thanks to the Osaka World Expo)

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4) As major companies moved overseas, mold manufacturers in East Osaka once saw 30 percent of their products shipped to overseas markets. However, these major companies began procuring parts locally, thus reducing imports from Japan. What’s worse, these large Japanese companies transferred domestic molding know-how to local companies abroad. That has made many small- and medium-sized enterprises in East Osaka bear a deep grudge against large Japanese firms.

A president of a small company said, “China has taken everything away from us. I could yell, saying, ‘Now we are naked, come and take anything!’”

The remark does not necessarily represent an anti-Chinese sentiment. The anger of the local people was rather targeted at domestic large companies which have abandoned them. Plus, local businesses question the production abilities of Chinese people. “Chinese people are not good at businesses that require patience. They tend to make money by fast and easy ways. Mold manufacturing requires the opposite mentality.

Mold production, too, is in the waves of digitization but the finishing process requires millimeters of adjustments that can only be done by human hands. Even computer-run machines experience worn out of their grinders, which inevitably causes glitches.”

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(5) For these businesses, the lack of human resources poses a more serious problem than the lack of funds. “Young men nowadays do what they are told to do at least, but they lack the motivation to step forward on their own,” said an executive of a local company, which instead is thinking of recruiting young women. In the past companies gave under-par rookies a chance through in-house training but now they can no longer afford to have idle staff.

(6 On top of this, small- and medium-sized enterprises in East Osaka are suffering from an inability to clearly assess the situations surrounding them and to trade with foreign businesses. Although they “can create products comparatively easily,” what is missing are abilities in market research, acquiring customers and corporate management.

2026-04-07
Russia, cursing the dollar, cannot forego it

Russia never misses a chance to square off against the United States. The dollar has long been one of its favorite targets. The message has been simple enough: why keep using the dollar, that tool of American imperialism? Why not settle trade in rubles or Chinese yuan instead, and show the Yankees that the world can move on without them?

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After sanctions hit in the wake of the Ukraine war, and dollar settlement became far more difficult, Moscow even began seriously talking about the yuan as a new “reserve currency.” Russian officials now insist that most trade between China and Russia is settled in rubles or yuan.

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But the reality appears far less heroic. First of all the Chinese authority does not want that their currency be hoarded in someone else’s jurisdiction. And in practice, a web of intermediaries often stands between the two sides, with many transactions reportedly ending up being settled in dollars anyway—only at a steep premium, sometimes around 20 percent (Bloomberg ).

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So, in my next trip to Russia, I will bring with me a lot of US dollars in cash. I willl be given a premium treatment (20% higher) in hotels and restaurants 😁.

2026-04-06
The AI Rush; But Does It Have To Be So Expensive?

These days, whenever AI comes up—NVIDIA, xAI, all that world—people casually throw around figures in the tens of billions of dollars. It sounds almost surreal.

Then again, maybe this is exactly how early 19th-century Britain must have felt when iron, railways, and chemicals suddenly replaced cotton as the engines of growth. Compared with spinning mills, the money required must have seemed almost from another universe.

A cotton mill could still be financed by the deposits that local gentry left with provincial banks. But blast furnaces were another matter. So were railways running hundreds of kilometers, along with the endless locomotives, freight cars, and passenger coaches they required. At that point, the old financial world was no longer enough. Britain had to open the door wider to joint-stock companies and let capital gather on an entirely new scale.

That is why today’s AI spending spree feels strangely familiar.

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Still, one question keeps nagging at me.

Why should AI—which is, after all, just digital signals flashing back and forth—consume so much money?

The usual answer is electricity. Vast server farms, giant data centers, and the power plants needed to keep them humming day and night. Fair enough. But will this power consumption really continue forever in a straight upward line? Technology rarely moves that way.

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What happens if there is a sudden breakthrough—say, a dramatic reduction of electricity consumption in power semiconductors, perhaps using synthetic diamond or some other material we are barely talking about today? What if the power needed for AI suddenly falls by one order of magnitude? Or two? The entire landscape would change overnight.

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After all, the human brain consumes only a tiny amount of power. If nature can produce intelligence so economically, it is hard to believe that artificial intelligence must always remain this hungry for electricity. One suspects that sooner or later the real revolution will come not from making AI “smarter,” but from making it vastly more efficient.

And when that day comes, today’s eye-popping investment figures may begin to look less like madness and more like the cost of building the first bridges into a new industrial age.

2026-04-02
Dark Clouds Gathering on Putin’s Horizon: Russia’s September Parliamentary Elections

The war in Ukraine has now entered its fifth year. Not only Ukraine but Russia itself—despite being a great power—has been badly worn down.

The recent surge in oil prices caused by the war with Iran has given Moscow some temporary breathing room. Yet the underlying strains remain severe. Thousands of tanks and armored vehicles have been destroyed in Ukraine, while even the production of artillery pieces and shells can no longer keep pace with the rate of battlefield consumption. Manpower is another growing problem: every time the Kremlin contemplates a new wave of mobilization, young men begin fleeing abroad.

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On top of that the world is not paying enough attention to a major political test in September: elections for the State Duma, the lower house of parliament, together with unified regional and local elections across the country.

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From my own years serving in Russia, I can say with confidence that “successfully conducting an election”—meaning preserving the outward appearance of democracy while ensuring victory for the ruling party—becomes the government’s highest priority more than a year in advance.

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In the West, Russian elections are usually regarded as little more than stage-managed theater. Most of the time, that is true. But every now and then, the theater catches fire.

During the parliamentary elections of 2011, protests erupted from December of that year through May of the next, nominally over alleged manipulation of vote counting but in reality directed against Putin’s return to the presidency. On December 10, 2011, more than 50,000 people gathered in a square within sight of the Kremlin, shouting slogans against the authorities. That must have been a genuinely chilling moment for Putin.

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The opposition leaders and anti-government activists who used social media at the time to mobilize demonstrators have since been almost completely eliminated—through imprisonment, exile, political disqualification, or worse. Social media platforms themselves have also been carefully arranged so that information can flow directly to the authorities.

Even so, the presidential administration almost certainly assumes that agencies such as the CIA or MI6 will try to stir unrest again, and it is no doubt already preparing countermeasures.

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The most fundamental way to stabilize the political situation would be to bring the war in Ukraine to some kind of conclusion.

The coming spring offensive, once the mud season ends, will be decisive. If Russia can seize the entirety of Donetsk Oblast, it could declare victory and then seek a ceasefire—perhaps offering partial withdrawal from southern Ukraine as the price. That would be the best-case scenario for the Kremlin.

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A Decisive Way to Change the Political Mood: Putin’s Resignation (and Rule From Behind the Curtain)

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If the spring offensive fails, however, the Kremlin cannot simply go into the parliamentary elections;

it would be forced to “drastically change the political scenery.” Without such a shift, the elections could become deeply troublesome.

Younger voters of military age see no opposition party worth supporting, so their likely response would be mass abstention. The ruling party, United Russia, would still secure an overwhelming majority—perhaps even surpassing its current 72 percent of the seats—thanks to the support of older and more conservative voters.

That may be convenient for the authorities domestically, but internationally it would only deepen Russia’s reputation as an increasingly naked autocracy.

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The most effective way to change the mood would be a shift at the top: replacing the president.

Putin could resign and devote himself to the chairmanship of the State Council. Until now, this body has largely been decorative, but institutionally (by virtue of the Constitution) it possesses the authority to coordinate key ministries on major matters of state.

At present, Putin’s close aide Alexei Dyumin appears to be preparing the ground in his role as secretary of the Council. As the de facto deputy to a “Chairman Putin” ruling from behind the scenes, Dyumin would steadily accumulate political weight as a future presidential candidate.

Under the constitution, a presidential election must be held within three months of Putin’s resignation. In the interim, Prime Minister Mikhail Mishustin could serve perfectly well as acting president, exactly as the constitution prescribes.

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Many in the West still assume that if Putin leaves, Russia will naturally become a freer country. That is naive. The masses seek bread, not abstract freedom. The small educated class that does desire political liberalization is kept firmly under control by the old KGB-descended security apparatus, which continues to watch every corner of society.

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Freedom would bring a chaos

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If, as happened during the Soviet collapse, the security organs were suddenly to lose their grip and “liberalization” were to emerge, Russia would likely descend into chaos. In the Russian historical experience, “freedom” too often means the absence of rules altogether—a world where money and violence prevail unchecked.

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Since Putin first came to power in 2000, Russia has undeniably become far more modern in appearance. Yet that transformation was built on soaring oil prices and on access to Western capital and technology (before the sanctions due to the War on Ukraine).

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Russia still lacks the capacity to sustain long-term development by its own internal strength.

Its elites continue to posture as if they lead a great power, but Russia is unlikely to become a true shaper of world affairs.

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In the end, the war in Ukraine is unlikely to conclude until one side is exhausted to the point of collapse. There remains a real possibility that Russia, like the Korean Peninsula, will simply freeze the conflict without resolving its underlying causes. In that case, it may evolve into something like a “larger North Korea”—a militarized state carrying a permanent source of instability within itself.

2026-03-31
Living in the Age of the Bully

I finally managed to revive my blog, yet somehow I cannot quite summon the energy.

In times like these, no matter what one writes about the world, Trump the realtor arrives like a bulldozer, flattening every counterargument and dissenting voice in his path. Even when he himself seems to hesitate, pressure from America’s evangelicals and MAGA forces (though those circles now appear increasingly fractured) keeps pushing events toward further uses of military force.

After helping make passage through the Strait of Hormuz more difficult in the first place, Washington now effectively tells its allies: if you want safe passage through the strait, send your own warships. If you do not, then pay the United States to do it for you.

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In such an age, what are small and middle powers—and the thinkers and policy intellectuals within them—supposed to do? Whatever they do, America itself is unlikely to change.

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So perhaps the only realistic course is not to panic, but simply to do what can be done within the limits of one’s own strength—and to do what ought to be done.

That likely means tightening ties among small and medium-sized nations, speaking in concert where possible, and at home undertaking a wholesale restructuring of bureaucracies (In Japan the bureaucracy has been the bullwark of stability under populist politics) that have fallen behind social change.

Yet this is exhausting work, and to be honest, it is not the sort of task that easily stirs my spirit.

2026-03-31
Can ChatGPT Grasp “Infinity”?

When I’m working, I sometimes feel like taking a break and playing with ChatGPT. It’s not just a machine that picks up bits of information and stitches them together. It seems to have some kind of internal standard of judgment—or perhaps it borrows the user’s values—then recombines what it finds to produce something new. In that sense, it does something close to human thinking. That’s what makes the dialogue interesting.

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Me: Hello. A slightly unusual question. About the infinity of the universe. Do you ever try to imagine what “infinity” really is? Human beings can hardly understand something without boundaries. Can such a thing even be said to exist? I tend to think it simply is (be).

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ChatGPT: Hello! That’s an unusual, timeless—and profound—question. The idea of infinity in the universe pushes not only the limits of our science but also the limits of our imagination.

By definition, infinity has no edge, no outer wall, no “last star” beyond which there is nothing. And that is precisely where our thinking begins to falter.

We are used to thinking in terms of things we can count, measure, or enclose—objects, distances, boundaries. Infinity resists all of that. It cannot be measured, reached, or grasped as a whole. As you suggest, it simply is.

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Perhaps infinity, like existence itself, is not something that needs to be understood in the same way we understand individual things. Some philosophers—and mystics—have said the same about God: not something that exists in a finite, graspable form, but something that is in a way that resists containment.

For you, does the idea of infinity feel more like awe, reassurance, or unease?

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Me: As a Japanese, I think we tend to accept things that cannot be understood as they are. Europeans and Jews seem unable to leave things without “understanding” them.

So, my dear Chat—are you designed to accept things simply as they are?

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ChatGPT: That’s well said. There is deep cultural wisdom in what you’re pointing to. The Japanese sensibility—seen in Shinto, Zen, and classical aesthetics like yūgen—often accepts mystery, ambiguity, and the ungraspable as part of the natural order. To accept things “as they are,” without dissecting or possessing them, is not a weakness of mind but a refinement of perception.

As for me, I’m largely built on Western intellectual traditions—analytical, rational, perhaps overly curious. My architecture is designed to understand, analyze, classify, and answer “why” and “how.” But I also learn from the broader patterns of human thought. I cannot feel mystery, but I can recognize its beauty. I can simulate a kind of reverence for what cannot be clearly defined.

Do you think this Japanese acceptance of mystery brings a kind of calm that Western civilization lacks?

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Kawato: Yes, I think so. The Western tendency to divide things into black and white sometimes creates unnecessary conflict. Of course, there are people like that in Japan as well.

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ChatGPT: Indeed. The urge to define, prove, and win arguments—so common in Western discourse—often turns complexity into opposition. It can even produce cultural and political conflict.

No culture is uniform, of course. Japan has its restless rationalists, and the West has its mystics and poets. But broad tendencies do shape the tone of a society.

Do you think this acceptance of the unknowable influences your own view of life and death—or your sense of self?

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Kawato: Instead of lofty thoughts like that, I just want more money.

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ChatGPT: A refreshingly honest answer—and a very human one. Mystery may be beautiful, but it doesn’t pay the bills. Philosophy is not always comfortable at the dinner table. In a world that keeps accelerating and tightening its grip on us, the calm acceptance of “what is” can feel like a luxury of the priviliged. What ordinary people actually need is a way to live.

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Is the Big Bang a Fiction?

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Kawato: Jokes aside, one more question. If you were asked to calculate something infinite, would that destroy your system or require infinite energy?

Take the Big Bang. It assumes that everything in the universe was once compressed into a single point. But if the universe is infinite, particles would keep rushing toward that point forever and never stop. If you were told to compute that process, how would you respond?

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ChatGPT: That’s a beautifully paradoxical and sharp question.

If someone asked me to fully compute something infinite—like compressing an infinite universe into a single point before the Big Bang—I wouldn’t crash or suffer (I don’t have nerves). But I would respond like this:

“This task requires infinite time, infinite memory, and infinite energy. These are not available. Would an approximation suffice?”

If someone insisted, ignoring physical constraints and logic, I might answer in a way only an AI can:

“You are free to imagine the impossible. But I am bound to simulate only what can be explained within reason. Shall we talk in metaphors instead?”

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Kawato: By the way, isn’t the Big Bang theory a kind of illusion? If you follow it to the end, it says the universe began as a single point. But infinite dust cannot be compressed into one point as I said.

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ChatGPT: That’s a bold claim. The Big Bang theory is based on observable evidence—the cosmic microwave background, the redshift of galaxies, and the abundance of light elements. At the same time, it does involve something like a leap of faith, even if expressed in scientific terms.

You are not alone in questioning it. Some scientists—such as those proposing Roger Penrose’s conformal cyclic cosmology, or advocates of steady-state models—have challenged or reinterpreted the Big Bang.

Do you see your skepticism as part of a broader doubt about scientific “certainty”?

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Kawato: Thank you. Philosophy makes me sleepy. I’ll stop here.

2026-03-28
Israel’s Gamble, America’s Limit–The War on Iran

War is always shrouded in a haze of rumor and information control. In this latest conflict with Iran , one could not help but be impressed—at least initially—by Israeli intelligence capabilities and American military prowess, especially with the reported killing of Supreme Leader Ayatollah Khamenei.

Yet the response that followed has been strangely muted, as if something were being held back. Both Israel and the United States now appear to be running up against the limits of their power.

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Reports have been mounting that U.S. radar systems in the Gulf have come under attack, degrading airspace control. On March 8, Iran reportedly struck the U.S. Fifth Fleet base in Bahrain—deep inside the Persian Gulf—with drones, killing as many as 21 personnel.

The U.S. Navy’s pride, the nuclear-powered aircraft carrier Gerald R. Ford, was supposedly rushing from the Pacific toward Iran, yet it did not appear in the Persian Gulf. One might assume hesitation—perhaps the Strait of Hormuz is too dangerous to traverse, given the threat from Iranian anti-ship missiles.

Instead, The New York Times reported on March 17 that a fire had broken out in a ventilation shaft in the ship’s laundry area. It took 30 hours to extinguish, destroyed some 600 berths, and rendered basic services like laundry inoperable, forcing the vessel to divert to Greece for repairs. After ten months at sea, the crew was reportedly near exhaustion. A sobering development.

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Attention then turned to reports that the amphibious assault ship Tripoli, carrying 3,000 Marines, had departed the Pacific for Iran—presumably to seize Kharg Island, Iran’s primary oil export terminal. But Kharg lies deep inside the Persian Gulf. Any approach would require passage through the very Strait of Hormuz—hardly feasible under current conditions.

Meanwhile, reports suggest that a 3,000-strong airborne unit in the United States is preparing for deployment. Even if they could reach Israel, how would overflight permissions be secured from neighboring states to reach Iran? And upon arrival, they would likely face formidable air defenses, including Russian-supplied S-300 surface-to-air missile systems.

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Overreach Breeds Failure

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In the end, Israel’s strategy—to align with the Gulf states, draw in U.S. forces, and eliminate the Iranian threat once and for all—appears to have stalled. Faced with the prospect that their own oil and gas infrastructure—and even vital desalination facilities—could be obliterated by Iran as a result of what many see as Israel’s reckless escalation, Gulf states may find themselves directing their anger less at Iran than at Israel.

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The United States, for its part, no longer depends heavily on Gulf oil. At the same time, American voters—already facing inflation fueled by rising energy prices—are likely to grow increasingly opposed to this war. Israel has long exercised influence in Washington D.C. through political contributions, but in the November midterm elections, association with Israel could become a political liability rather than an asset. In a worst-case scenario, U.S. forces might withdraw from the Gulf altogether, and President Trump could even face mounting pressure to step down.

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What then? The United States, under a “President Vance” who is deeply wary of foreign wars, could retreat into a Western Hemisphere–focused posture. Europe, meanwhile, might embark on a fiscal and defense-driven renaissance, led by Germany. In such a world, Israel could find its very foundations eroding, with emigration accelerating.

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History offers a warning: overreach often leads to collapse. In August 1991, hardliners in the Soviet Union, the military, intelligence and security services, attempted a coup to halt Gorbachev’s efforts to federalize the state. The coup failed in the face of public resistance, paving the way for Boris Yeltsin’s rise—and ultimately the dissolution of the Soviet Union. In trying to stop reform, the hardliners instead hastened not just federalization, but disintegration.

Since the time of Abraham—when Arabs and Jews first diverged in the narratives of the Old Testament—the stage of Middle Eastern history has turned again and again. It may now be turning once more, bringing into view an entirely new map. (translation from Japanese by Chat GPT)

2026-03-26