The author of this blog will answer to your questions and comments. And this is the only place in the world where you can engage in free discussion with people from English, Japanese, Chinese and Russian speaking areas.

Author: akiokawato

  • 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)

    .

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

    .

    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.

    .

    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.

    .

    (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.

    .

    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.

    .

    (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.

    .

    (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.

    .

    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.

    .

    (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.

    .

    (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)

                                       .

    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.”

    .

    (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.

  • 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?

    .

    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.

    .

    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 ).

    .

    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 😁.

  • 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.

    .

    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.

    .

    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.

    .

    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.

  • 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.

    •

    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.

    ・

    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.

    •

    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.

    •

    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.

    •

    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.

    •

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

    .

    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.

    •

    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.

    •

    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.

    ・

    Freedom would bring a chaos

    ・

    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.

    •

    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).

    .

    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.

    •

    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.

  • 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.

    .

    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.

    .

    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.

  • 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.

    •

    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).

    •

    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.

    •

    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?

    •

    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?

    •

    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?

    •

    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.

    •

    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?

    •

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

    •

    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.

    •

    Is the Big Bang a Fiction?

    •

    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?

    •

    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?”

    •

    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.

    •

    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”?

    •

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

  • 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.

    .

    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.

    .

    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.

    .

    Overreach Breeds Failure

    .

    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.

    .

    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.

    .

    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.

    .

    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)

  • Should Japan go nuclear or can it?

    (Currently Japan’s prime minister TAKAICHI Sanae is in Washington D.C., an official visit long planned. During the meeting with President Trump, discussions are likely to cover not only the current situation regarding Iran but also the future direction of the Japan-U.S. alliance in the Asia-Pacific region.

    For reference, I have posted below my own article on Japan’s nuclear armament.

    While discussing nuclear armament has long been considered taboo in Japan, it is now possible to discuss the technical feasibility of such a move. As you can see, though, nuclear armament of Japan would not be so easy even from a technical viewpoint)

    ・

    　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　July 14, 2022

    Until now, even mentioning the word “nuclear has been taboo in Japan. This is because of the experience of the actual use of nuclear weapons in Hiroshima and Nagasaki.
    However, with North Korea developing more and more nuclear missiles and Putin unhesitant to use nuclear weapons in Ukraine, even Japan has begun to discuss the pros and cons of nuclear armament and, if so, what form it should take. So let me try to summarize some basic points here.

    ・

    　If Japan were to arm itself with nuclear weapons, it would have to drop the “three non-nuclear principles”; (not possessing, not producing, and not allowing the introduction of nuclear weapons). This is neither a constitution nor a law, but a resolution of the Diet, so it is not difficult to change. So, if we drop this principle and allow Japan to possess nuclear weapons, what is the next step?　

    ・

    “Japan can easily produce nuclear weapons”: a too easy-going statement

    ・

    First, there is the question of whether Japan can easily produce nuclear weapons.
    There is a theory saying that “Japan has 50 tons of plutonium, which can be used to make nuclear weapons, so it can build 6,000 nuclear bombs”. But, as it turns out, the story is not so simple. Eighty percent of Japan’s plutonium is deposited with the United Kingdom and France. And the 10 tons of plutonium in Japan is still in the waste from the light water reactors and contains too many impurities to make a nuclear bomb.
    　
    One more thing. There is an option to make a nuclear bomb using uranium as material. But for this, a large amount of uranium 235, which is contained in uranium ore only by 0.7%, would have to be produced, and Japan does not have the facilities or technology to do so. Even if it did, the problem of how to secure uranium ore imports would arise.

    ・

    This is where the issue of the NPT (Nuclear Non-proliferation Treaty) weighs in. This treaty prohibits countries that do not possess nuclear weapons from developing them. It is theoretically possible to get an exception, but Russia, China, and South Korea, as well as the United States, are unlikely to recognize Japan’s nuclear armament. Japan could withdraw from the treaty and go nuclear, but then its uranium ore imports would be cut off.
    ・
    “Nuclear Sharing” with the U.S.

    ・

    So, shall we have the U.S. deploy its nuclear weapons in Japan? In that case Japan would drop one of the three non-nuclear principles: “Do not allow to bring nuclear weapons into the country”. But right now, there are no U.S. nuclear weapons that can be brought into Japan. In the past, U.S. Navy nuclear submarines equipped with Tomahawk cruise missiles with nuclear warheads sailed around Japan. However, from the Bush administration to the Obama administration, the U.S. pulled out the Tomahawks and scrapped the nuclear warheads.

    ・

    Therefore, the only deterrent that could dissuade China or North Korea from launching a nuclear attack on Japan is the nuclear bombs carried by bombers deployed on the island of Guam. This is not very promising.

    The U.S. military is currently developing intermediate-range missiles with nuclear warheads and has announced its intention to deploy them in Asia as well. Russian Foreign Minister Lavrov and others have already warned against deploying these missiles in Japan and other countries. What to do about this?　

    First, there will be a huge debate in Japan over whether to accept or not. Even if they decide to accept it, no local government will accept its deployment. Even if they do, the only places they would admit them deployed would be on uninhabited islands or submarines. And Japan does not yet have such a submarine; normally, such missiles would be mounted on nuclear submarines, which can remain submerged for months at a time.

    ・

    There is an argument, then, that these missiles be mounted on U.S. nuclear submarines, etc., for “joint use” (i.e., sharing) with Japan. Japan would propose “A country so-and-so is doing something wicked, let’s shoot them with nuclear missiles”, and if the U.S. says “Okay”, the missiles would fly, or the U.S. would propose “Let’s shoot that guy”, and Japan would agree.

    You may think this is a very cumbersome and unthinkable approach for the U.S. military, but that is what Germany is doing with the US. Germany has about 20 small U.S. nuclear weapons – called tactical nuclear weapons -deployed in Germany, and if the enemy attacks Germany, they will explode right under the noses of their large forces (but in German territory). This is called the “Dual Key” method. Both Germany and the U.S. have to agree to “turn” the key.

    For Japan, however, it is very hard to realize a sharing of missiles on board submarines. There are limits to communication with submarines in the water. If sharing is to be done, the new medium-range missiles being developed by the U.S. military would be deployed to a remote islet and shared with Japan.

    ・

    I can think of no other scenario in which Japan could go nuclear. Perhaps Japan has the guts not to care, even if China, North Korea, or Russia threaten to use nuclear bombs – threats don’t work on those who are not aware of them – or it could develop laser or electromagnetic weapons that would certainly bring down their missiles. The only other option would be to develop laser or electromagnetic weapons.

  • How to Survive Trump’s Armageddon

    For some time now, analysts have been pointing to the possible end of the U.S.-led postwar order. With the Strait of Hormuz now facing the risk of closure, global stock markets, oil prices, and other indicators are swinging wildly. The atmosphere feels almost apocalyptic.

    ・

    History shows many moments when an existing system of security and economic stability suddenly collapsed. The fall of the Roman Empire and the upheavals surrounding World War II and the decline of the British Empire are classic examples. The key question is always the same: will chaos persist, or will a new order eventually emerge?

    ・

    At the root of the current turmoil lies the hollowing out of the U.S. economy and its increasing dependence on government debt. President Trump has treated the containment of fiscal deficits and the prevention of TB markets’ collapse as his highest priorities. For this purpose he proudly raised tariffs, only to see the policy fail after the Supreme Court ruled the measures illegal.

    His second objective—winning the midterm elections in November—was supposed to be achieved by boosting popularity through ending the wars in Ukraine and Gaza. That effort also failed.

    Now, having effectively given up on dreams of a Nobel Peace Prize, he has instead pushed forward with military interventions in places such as Venezuela and Iran.

    ・

    In times like this, the European members of NATO—longstanding guardians of the traditions of liberty and democratic thought—should remind themselves of their historical role and help guide the United States back toward a responsible course. Instead, they are themselves drowning in economic stagnation and domestic demands for redistribution, increasingly ensnared by populism.

    Israel, for its part, insists on pursuing absolute security regardless of the consequences for its surroundings, continuing a hard-line policy with little visible long-term strategy.

    China, meanwhile, faces economic difficulties and signs of weakening control over its own military, leaving it in no position to pursue the conquest of Taiwan. The Chinese economy, massive though it is, thrashes about awkwardly. The government keeps corporations afloat with subsidies while trying to compensate for weak domestic demand through export expansion—an approach that increasingly provokes resentment around the world.

    ・

    Amid this global disorder, one must ask: what remains intact of the modern values of liberty, democracy, and the rule of law?

    The United States itself provides one answer. Even Trump has not been able to overturn the principle of the rule of law embedded in the American constitutional system. In January, the Supreme Court—despite having a majority of justices appointed by Trump—ruled his tariffs illegal, necessitating refunds to companies.

    Another example occurred in Milwaukee that same month. When 3,000 officers from Immigration and Customs Enforcement (ICE) were deployed to intensify the roundup of undocumented immigrants, two citizens protesting the operation were shot dead, triggering a major public outcry. The city government moved to legislate limits on ICE activity, and Homeland Security Secretary Kristi Noem—who oversaw ICE—was ultimately dismissed by Trump. The clearly defined relationship between federal and state authority likely prevented the situation from spiraling into something resembling civil war.

    ・

    Looking at international institutions, Trump has withheld U.S. contributions to the United Nations. Yet the amount—just over $800 million out of a total UN budget of less than $4 billion—is not large enough; we can find a modus vivendi easilly. Moreover, Trump’s attempt to create an alternative body called the “Board of Peace” has failed to gain support from European governments.

    ・

    The U.S. dollar will probably maintain its dominant role in global payments and savings. It remains the most widely used currency abroad and is simply convenient. The role of recently introduced stablecoins also deserves attention. Nevertheless, for various reasons the dollar will likely depreciate against other currencies over time—something that has happened before, as in the Plaza Accord of 1985.

    The global trading system—embodied by institutions such as the WTO—will remain in place, since most countries’ tariff structures are still anchored to WTO rules. Systems governing shipping, aviation, and telecommunications will also endure. The global division of labor in manufacturing, the so-called supply chain, will keep its main features, fostering investments in countries with low wages and elevating their economy.

    ・

    The one major uncertainty is artificial intelligence: how it will reshape the world. Will AI serve humanity, or will human beings end up serving AI?

    ・

    In this turbulent environment, Japan must keep sight of the true meaning of progress: improving people’s living standards and expanding human rights.

    Since the Meiji Restoration (1868), Japan has worked steadily to modernize and rationalize its society. Yet the task remains incomplete. Today we can even see a troubling decline in the quality of some politicians and bureaucrats. Decisions should not be reduced to populist and self-righteous majority rule. They must be reached through careful deliberation and reasoned debate.

  • Japan Is Richer Than Its GDP Suggests

    (This essay first appeared in Newsweek Japan in 2011. The basic situation has not changed very much since then, so I am reposting it here. I plan to update the argument soon—although the U.S. or even the global economy might collapse before I get the chance.)

    ・

    These days I often hear Japanese friends complain, “Japan has become poor.” When I ask why they think so, the answer is usually simple: hotel rooms in the United States or Europe now cost three times as much as in Japan.

    At first glance, the numbers seem to support this gloomy view. Japan’s GDP has steadily fallen behind that of the United States and China, and it was eventually overtaken by Germany as well.

    But the reality does not quite match the statistics.

    ・

    A couple of years ago I visited the United States and was shocked by the condition of the subway system. While the upper middle class and above may enjoy living standards comparable to Japan’s top elite, the situation for the average middle class—and especially those below it—can hardly be called prosperous.

    ・

    Japan, by contrast, has changed quietly. Japanese homes were once mocked abroad as “rabbit hutches.” They may still be smaller than Western houses, but their interiors—clean, functional, and carefully designed—now often exceed the Western average in comfort.

    ・

    So let me turn my friend’s complaint upside down. If Japanese travelers can stay in hotels (in Japan) that are often more comfortable than the Western average for only one-third the price, perhaps the conclusion should not be that Japan is poor—but that Japan is relatively rich.

    ・

    What has actually happened is something subtler. It is not so much that Japan’s living standards have fallen behind the West—though Japanese cities may still lack some of the visual grandeur of Western capitals. Rather, over the past decade the West has experienced inflation while Japan remained trapped in a deflationary environment. In effect, the two sides have begun living in different price worlds; the sharp depreciation of the yen in recent years has only widened that gap.

    During the decade following the 2008 Lehman shock, cumulative inflation in the United States reached roughly 27–28 percent, and about 12 percent in France. Japan’s inflation during the same period was only around 5 percent. Meanwhile, the yen weakened against the dollar by about 34 percent.

    The United States adopted aggressive monetary easing, and inflation naturally followed. Japan also implemented massive monetary easing later under the Abe administration. Yet for many years the country remained stubbornly deflationary—though inflation has begun to appear recently.

    ・

    Why the difference?

    ・

    Part of the explanation lies in Japanese attitudes toward money. Japanese people are generally wary of “making money with money”—that is, speculative investment.

    In the United States, more than half the population invests retirement savings through mutual funds. Those funds then leverage that money twenty or thirty times over in financial markets, generating profits along the way.

    As a result, finance and insurance account for about 6.8 percent of U.S. GDP. In Japan the share is only about 4.1 percent. The difference may appear modest, but in absolute terms it amounts to nearly ¥120 trillion.

    In other words, the American economy is greatly inflated by financial capital. As long as the bubble does not burst, that financial expansion appears as real wealth.

    ・

    Some people in Japan argue that the country is already comfortable enough and does not need further economic growth. But without growth—and the tax revenues that come with it—the quality of social security and healthcare will inevitably decline. Even the equipment of Japan’s Self-Defense Forces could eventually fall behind that of South Korea.

    ・

    The deeper problem is psychological. The trauma of the asset bubble collapse in early 1990s still hangs over Japanese society. Consumers keep their wallets tightly shut. Companies restrain wage increases—although they have recently begun to raise wages again, they still lag behind inflation—and businesses hesitate to invest.

    ・

    The result is a vicious circle. Because the economy fails to grow, both consumers and companies become even more cautious. Japan ends up trapped in a deflationary spiral of its own making.

    If this continues, the country could eventually become poor for real.

    ・

    There is a well-known measure called the Big Mac Index. It compares the price of a McDonald’s Big Mac around the world and uses that comparison to estimate the purchasing-power value of currencies.

    By that measure, the dollar should not be around ¥115 (now about ￥157)—as it was at the time—but closer to ¥70.

    If Japan’s GDP were converted into dollars at that purchasing-power rate, the result would be striking:

    115 ÷ 70 = 1.64.

    In other words, Japan’s economy would appear about 64 percent larger than the official dollar-based figure suggests.

    ・

    Japan does not need to overstretch itself. But there are sensible steps the country could take: systematically repair aging infrastructure, strengthen disaster preparedness in a country increasingly exposed to severe natural disasters, and expand investment in renewable energy.

    Even a modest commitment by companies to return part of rising revenues to employees—if not through permanent wage increases, then at least through bonuses—could help break the deflationary cycle.

    ・

    If a nation constantly tells itself that it is shrinking, it will shrink.

    Yet Japan possesses many of the historical and social conditions necessary for growth. Instead of assuming decline, the country might simply allow itself to breathe—and grow again.

日本のトレンド

世界のトレンド

基本記事

このサイトについて

このサイトのオーナーについて

リンク