Korea should avoid Japanese-style demise: policy guru

“Japan is fast deteriorating as a country due to its distorted welfare policy. Korea could end up like Japan unless it exercises extra caution.”

Terashima Jitsuro, 65, chairman of the Japan Research Institute and a leading policy voice who has had a huge influence on the external policy of the incumbent Yoshihiko Noda administration, gave sincere advice to Korean politicians on welfare policy in a Dong-A Ilbo interview. “Distorted welfare policies are making the Japanese people weak,” he said, adding, “I`m keeping a close watch on Korea, worrying that Korea might also be slowly taking the path of a Japanese-style demise.”

Dong-A conducted a face-to-face interview with Jitsuro at the Terashima Library in central Tokyo on Thursday, and exchanged supplementary written questions and answers for five days afterwards. The interview was meant to assess why the government under the Democratic Party of Japan is on the verge of failure slightly more than two years after taking power away from the Liberal Democratic Party for the first time in 54 years.

The Democratic Party has withdrawn or scaled down pledges on key welfare policies, including child allowance and toll-free expressways, that had served as the driving force for its acquisition of power. The party is poised to see a split over a bill on raising the excise tax to compensate for the government`s fiscal deficit.

Considering that the fundamental cause of the eurozone`s fiscal crisis is also “overly generous welfare policies,” the crisis faced by the Democratic Party of Japan represents a common global dilemma.

Dong-A: Many critics say the Japanese government under the Democratic Party of Japan has proven to be a failure.

Jitsuro: In the Cold War Era, Japanese politics had the clear theme of socialism versus capitalism. After the end of the Cold War, Japan’s political circle saw an era of division and congregation, as parties failed to find a new policy framework and only sought to take power. The Democratic Party of Japan took over in 2009, but it presented election pledges proposed in the belief that it could take power only by focusing on welfare and emphasizing “from concrete to man” rather than devising policy for the nation based on the big picture. This was a party of sound bites that merely pursued decoration through dessert and salad while lacking the main dish of policy. We have clearly witnessed what happens when such a party takes power. If you ask whether the Japanese people are disappointed for this reason, this is not necessarily the case. With this situation as a turning point, which direction Japan should take going forward has become clear.

Dong-A: Parties in Korea are racing to present welfare policy pledges ahead of the presidential election as well.

Jitsuro: If Korea has excessive confidence that it has already achieved success, politicians naturally come to consider the need to spend more money for the people, and Korea should be mindful of the side effects as well. This is the so-called issue of justice of distribution. Many people are surprised to hear that 3.7 trillion yen (47 billion U.S. dollars) is spent to protect the people’s livelihood in Japan. As much as 3 million yen (38,000 dollars) per year is paid to a family of three on welfare, including 2 million yen (26,000 dollars) for protecting their livelihood, plus subsidies for rent and medical care. In comparison, more than a third of Japanese workers earn less than 2 million yen per year. People who work hard, pay taxes and sustain the nation are facing more disadvantages than those on welfare. If this happens, the country will deteriorate swiftly. Korea could become like Japan unless it uses extra caution.

Dong-A: You mean Korea should be wary of expanding welfare?

Jitsuro: I am not opposed to welfare. What I mean is that for Korea to introduce welfare, it needs commitment and should introduce it knowing the situation clearly. If all people agree on the principle of child rearing collectively “from cradle to the grave” by society as in Northern Europe and are committed to take the necessary burden to that end, the country could pursue such welfare. But if a country pursues a society in which people who work hard are rewarded to ensure that the country gains the upper hand in global industry and economy, this is completely a different story. If parties present election pledges only by mixing up sweet promises, the country will end up bankrupt. The Democratic Party of Japan pledged a child allowance as a populist idea to win votes. In the end, the policy increases the people’s burden but the party faces strong public resistance because the people were unaware of this burden. The same holds true with a pension for guaranteeing a minimum standard of living.

Dong-A: Specifically, what do you mean by “deterioration of the nation”?

Jitsuro: The younger generation in Japan actually have the idea that they will not work and live on welfare when young, and manage to survive on a pension for guaranteeing a minimum standard of living at an advanced age. Japan has become a country where younger people have lost the desire to be successful and intend to compete due to various reasons. The younger generation now hate competition the most. Everyone thinks of getting a grade of "B" instead of "A." It is hard to find members of the younger generation who seek to grow successful in the future. I feel like Korea is also moving toward that direction as well. When I was working in New York in the 1990s, I often saw staff of Korean trading companies working part time at vegetable stores at night. Alarmed, I asked why, and they told me that they needed money to fund their children’s education. These days, no Koreans seem to be like that, and more Koreans seem to be interested in shopping for luxury goods than Japanese. I am keeping a close watch on Korea, worrying that the country might be slowly taking the path of Japanese-style demise.

Dong-A: Some say populism leads to dictatorship.

Jitsuro: If garnering more votes by making sweet promises does not work, populism in the final phase presents extreme slogans by taking the bandwagon of the sadistic mood of the people. Examples include Osaka Mayor Toru Hashimoto and Tokyo Gov. Shintaro Ishihara. Ishihara talks in an arrogant fashion as if he despises the public, but the public likes and cheers him nonetheless. Hashimoto claims that "Your thinking is wrong, but the public accepts it, saying he is frank and candid. A democracy denying democracy effectively emerges. We should remember that Adolf Hitler emerged while enjoying an overwhelming approval rating of 90 percent in the Weimar Republic, which was considered the most democratic. What comes after populism is "fascism with a smiling face," which denies populism.

Dong-A: Many people worry that young Japanese are becoming too passive and negative.

Jitsuro: This is an issue I am agonizing over as a university president as well. If the trend of introversion continues, the cheap nationalist idea that Japan cannot afford to lose to Korea or China will naturally emerge, which is worrisome. But these days, young Japanese people have the idea of equality toward Korea or China. They don’t believe that Japan is superior. I think this is a possibility. It is important that younger people have far-reaching sight and possess a grandiose view of the world.

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