I found this lament for Japan by Rupert Wingfield-Hayes at BBC touching. The TL;DR version of the piece is
- Forty years ago Japan was the richest country in the world on a per capita basis
- Now it’s lagging behind many developed countries including Germany, the United Kingdom, and United States
- He attributes the decline to Japan’s demographic collapse
- Japan’s population is unlikely to recover through immigration
Here’s a snippet:
In front of the Imperial Palace in Tokyo, the skyline was dominated by the glass towers of the country’s corporate titans – Mitsubishi, Mitsui, Hitachi, Sony. From New York to Sydney, ambitious parents were imploring their offspring to “learn Japanese”. I had wondered whether I’d made a mistake plumping for Chinese.
Japan had emerged from the destruction of World War Two and conquered global manufacturing. The money poured back into the country, driving a property boom where people bought anything they could get their hands on, even chunks of forest. By the mid-1980s, the joke was that the grounds of the imperial palace in Tokyo were worth the same as all of California. The Japanese call it the “Baburu Jidai” or the bubble era.
Then in 1991 the bubble burst. The Tokyo stock market collapsed. Property prices fell off a cliff. They are yet to recover.
A factor Mr. Wingfield-Hayes does not consider in his calculus is public debt:
Japan has the highest debt to GDP ratio of any major developed country—right around 230%. As I have mentioned before debt overhang is known to be a drag on GDP growth.
As to immigration as a solution to Japan’s problems, let’s make a comparison. I do not believe that Germany can spur its economy by importing illiterate non-German speakers from Africa and such “workers” will inevitably become a drag on German public services. In many cases migrants are making their way to Germany expressly for the purpose of availing themselves of public services. It’s not a winning formula.