Blindside: Why Japan Is Still on Track to Overtake the U.S. by the Year 2000

Rating:
Summary: Brilliant analysis of a World beating economic system
Review: Brilliant analysis of a World beating economic system
Reviewer: Patrick Walsh from Amsterdam, North Holland The Netherlands
Don't pay any attention to the detractors of this author.
He lives in Japan.
He has worked as a successful financial journalist around the world.
His correct forecasting of the Japanese economy is on record (e.g. Euromoney Magazine).
Has been widely praised (see two sites, unsustainable dot org and, fingleton dot net).
Check out the above dot org site for current articles from
this author.
You will be surprised at the articles on there that deal with the press, who widely report a slump in Japan that never seems to happen
- if Japan is in a slump, why such continued strong export performance in the hi-tech area?
Japan may have "crippling" debts, but you can be sure its not
foreign debt and,
therefore much less of a problem, unlike the USA which is burdened by a debt with a large foreign component.
Fingleton rightly points out in this book that the Japanese economy cannot be understood
without looking at it in terms of a big picture.
Read the content on the above sites, think a little,
read this book and, his more recent work "In Praise of Hard Industries" and, you will be a lot farther along the road to understanding where the World economy is going.

Rating:
Summary: this one has not aged gracefully
Review: for anyone wishing to understand the Japanese economy and the people that make up that economy, this is the book. Fingleton gets beneath the surface-view of Japan that so many Westerners use to describe the country. those who label Fingleton as alarmist or racist follow the lead of typical Japanese thinking that equates criticism of the government's policies with anti-Japanese sentiment.

Fingleton has a deep respect for the Japanese government's ability to manipulate both its own citizens and the U.S. in order to strengthen its economy. The premise of the book is to reveal the mindset of the Japanese government and people so that Americans can better understand how they are viewed by Japanese and respond more adroitly to the challenges of the ever-expanding U.S.-Japan relations.

The most interesting part of the book are the 40 pages devoted to the history of U.S.-Japan relations in the chapter "The Will to Win".

If you need one book to give a well-documented overview of the Japanese economy, this is it!

Rating:
Summary: Inside the Puppet Kingdom

Review: From Tokyo Journal Magazine - www.tokyo.to

By Robert Guest

Inside the Puppet Kingdom

Blindside by Eamonn Fingleton

The stockmarket is sinking into Tokyo Bay, like a yakuza in concrete geta. GNP is growing like rice planted in a desert. Honda's stopped hiring, bad debts are menacing several medium-sized banks, and analysts are whispering that the entire financial system might be on the verge of collapse. Inside the Puppet Kingdom

This is probably not the best time to be publishing a book about the invincibility of the Japanese economic model. But that is exactly what Eamonn Fingleton, former Tokyo correspondent of Euro Money, has done. Blindside is turning out to be this summer's beach reading for bright young Japanologists everywhere. At elite private seminars, and on the Internet, young men with joint Japanese/Economics degrees and prominent Adam's apples are excitedly picking over Fingleton's thesis: that Japan is poised to overtake the United States as the world's largest economy by the year 2000.

This is what's politely called a "brave" argument. In other words, almost no one agrees with Fingleton. "Japan seen sliding into second recession," ran a recent headline in the Financial Times; "Crisis Among the Rabbit Hutches," observed the Sunday Telegraph. But Fingleton tackles the doom-merchants head on, with some perceptive observations about their over-reliance on Western securities analysts (who tend to be conventional free marketeers), and ignorance of Japanese economic history. "Some systematic flaw in Western psychology," he believes, "leads Westerners, and particularly Americans, to exaggerate Japan's weaknesses and belittle its strengths."

We all know that Japan rose from the rubble of defeat and transformed itself, phoenix-like, into the world's second biggest industrial power etc., etc. Where scholars, journalists and shot-bar bores are unable to agree is how the miracle occurred. The debate works something like this. On one side are those who reckon Japan got to be super-rich for very straightforward reasons: everyone worked hard, and the government orchestrated sensible macro-economic policies like keeping inflation down. This is the conventional, free-market view.

Opposed to it is that of the revisionists. Chalmers Johnson, the granddaddy of them all, pointed out a decade and a half ago that the Japanese government intervenes in its economy, and that these interventions seem to make rather a lot of difference. He argued that when those clever bureaucrats at MITI organized low-cost finance for high-tech industries, tolerated cartels, and gave an implicit guarantee that no big company would be allowed to go bust, it was the cozy confidence these policies fostered which allowed the bubble to expand so unstoppably.

Fingleton stands back to back with the revisionists, and in some ways overshadows them. His prose is fizzier and more arresting than scholarly Professor Johnson's, and commands a wider sweep than trade-negotiator-turned-sanctions-hawk Clyde Prestowitz.

In brutal summary, he believes that the Ministry of Finance (whose top bureaucrat has almost as much power at his disposal than the President of the United States) interferes with people's lives in such a way as to make everyone richer in the long term.

For an economy to grow, you need investment, and for investment you need capital. The MOF sees raising capital for industry as its most important task, and it gets its hands on the stuff by taking it from you and me. If we put our hard-earned yen into a Japanese bank, we earn lousy interest, because the boys at MOF want banks to lend money cheaply to the likes of Mitsubishi and Toyota.

If Junichiro Sixpack wants a loan to build an extension to his four-and-a-half mat, he can't have one. If he wants to take his money out of the bank after 7pm, he can't do that either, because MOF wants to make it hard for him to spend and easy for him to save. The will to save explains a lot about Japanese government. Why do we have trade barriers? Because they reduce the range of goods on Japanese shelves, thus dulling Junichiro's desire to go shopping. So he saves his money instead.

Such is the power of the sinister MOF that it can make politicians pass laws that their constituents hate. No one in the Diet wanted the consumption tax, but they voted for it anyway. When former Prime Minister Yasuhiro Nakasone made a stand, MOF had investigators look into his murky campaign finances, and forced his resignation. Politicians with equally grubby hands, but who supported the tax, were left alone. The consumption tax discouraged consumption, thus encouraging saving, thus giving industry more money to invest . . . which is what the Ministry of Finance wanted all along.

Bureaucratic brilliance is probably what allowed Japan to catch up so rapidly with the west-Fingleton is also right to point out the way in which South Korea has copied the Japanese model with such success. But at a time when the economic backroom boys-on both sides of the Sea of Japan-are pulling back from the economy, and undoing the old control mechanisms, Fingleton is struggling against the tide. As a work of theory, Blindside is readable, engaging and thoroughly recommended; as a chart for the stratospheric future rise of the Japanese economy, it is either a work of a busy ima

Rating:
Summary: An Eye Opener
Review: I was speaking to a friend of mine who is in the insurance sector in Tokyo. During the course of our discussion, we came to the topic of economic slump and how people who visit Tokyo on business are led to believe that the slump is much larger and more devastating than what the press reports.
My friend laughed it off and said the Japanese are good artists of deception and he went on to give me an example. India ( like most developing countries of the region ) takes loans from ADB. apparently ADB is funded by Ministry of Finance, Japan to a large extent. Now an ADB loan is used for infrastructure development like say laying of roads.
Japanese cos. are given the contract for providing the raw material and equipment for the same like Mitsubishi Tar and Sumitomo cement and so on citing that Indian cos are below par for such raw material ( its a different matter that L & T cement is used in construction of airports in many countries )

Finally for the repayment of the loans, the Japanese Govt formally issues a soft loan to repay the ADB debt. In the larger scenario not only has the govt benefitted from this but Japanese cos also are benefitted in the longer run. So the money given out as loan by the govt reaches Japan through the Keiretsus.

A lot of this may not be available in the open to be proved but is definitely the source of speculation and thus may never be proved.

On reading Blindside such practices only come out in the open.

Overall, one of the best books i have read - both in fiction as well as non-fiction.

Rating:
Summary: Isn't it time to stop worrying about the Japan threat?
Review: This is another in a long line of "mercantilism" books on how other nations are going to overtake the US. These books view global economic activity as a zero sum game in which nations gain only at the expense of other nations. This idea fell out of favor in the economics profession in the 1700's but remains a favorite in pop economics. In fact we benefit from economic prosperity overseas: it means better, cheaper goods for us to buy and growing markets for our goods. Unfortunately, as recent experience atests, the Japanese have done a great job of producing and marketing industrial products, but have never put together a modern financial/service sector. Japan's economic demise is drag on the global economy and if the global economy is to right itself, we can only hope the title to this book is correct!