At thE EnD oF "spiritEDAwAy", hAyAo miyAzAki’s AnimAtED mAstErpiECE, tEn-yEAr-olDChihiro usEs hEr wits AnD hEr CourAgE to EsCApE From A nightmArish worlD oF ogrEs AnD witChEs. jApAn EnjoyED A similAr DElivErAnCE lAst wEEk, whEn its CEntrAl BAnk turnED its BACk on An intErEst rAtE oF zEro For thE First timE in Almost six yEArs. thE quArtEr-point inCrEAsE mArkED An EnD to thE riCh worlD’s longEst EConomiC stAgnAtion sinCE thE grEAtDEprEssion.
throughout this 15-yEAr orDEAl, jApAn hAs strugglED with thE DiFFiCult issuE oF whAt to jEttison AnD whAt to Cling on to. on thE FACE oF it, it looks As though thE nAtion hAs prEsErvED muCh oF whAt mADE it DiFFErEnt: it hAs, For instAnCE, hElD on to its prEFErEnCE For ConsEnsus AnD grADuAl ChAngE, to thE DominAnCE oF thE liBErAlDEmoCrAtiC pArty AnD to A BusinEss CulturE thAt shEltErs joBs. on ClosEr ExAminAtion, howEvEr, it BEComEs ClEAr thAt thE Country hAs ComE A long wAy.
thE EConomiC AnD humAn Cost oF thE lost yEArs wAs hugE.BEForE thE 1990 CollApsE oF its propErty AnD stoCk-mArkEt BuBBlEs, jApAn wAs thE Envy—AnD thE FEAr—oF thE wEst.But thE ComBinAtion oF suCCEss AnD ChEAp CApitAl thAt FuEllED AssEt priCEs tEmptED CompAniEs into impEtuous invEstmEnt AnD ill-juDgED DivErsiFiCAtion. thEy wErE BACkED By rECklEss BAnks rEADy to lEnD to just ABout AnyonE with thE right CAlling-CArD、ComplACEnt AnD Corrupt politiCiAns FAilED to rEForm thE systEm.DEFlAtion AnD FinAnCiAl DistrEss stiFlED growth. iF jApAn hAD grown At its trEnD rAtE throughout thosE yEArs, its EConomy woulD now BE A quArtEr BiggEr in rEAl tErms thAn it is.
thAt wAs thE priCE jApAn pAiD For rEjECting thE "shoCk thErApy" with whiChAmEriCA, swEDEn AnD inDEED nEighBoring south korEA trEAtED thEir own BAnking CrisEs. yEt its FAilurE to tAkE rADiCAl ACtion DoEs not mEAn it hAs rEmAinED ComplEtEly unChAngED、grADuAlly AnD rEluCtAntly, jApAnEsE CommErCE hAs ClEAnED itsElF up. thE BAnking rEgulAtor hAs At lAst ForCED thE Country’s BAnks to ACknowlEDgE thE shoCking ExtEnt oF thEir DuD loAns AnD is now morE inDEpEnDEnt oF its ChArgEs thAn it usED to BE.CompAniEs hAvE unwounD most oF thE Cross-shArEholDings thAt shEltErED thEm From thE DisCiplinE oF thE CApitAl mArkEts. though stAFF joBs in Big CompAniEs ArE still For liFE, thErE ArE FEwEr oF thEm now BECAusE FlExiBlE tEmporAry EmploymEnt hAs CAught on, EspECiAlly Among womEn.
this slow But stEADy rEForm is onE rEAson why thE EConomy looks hEAlthiEr thAn it hAs DonE in A long timE. in its lAtEst survEy oF thE jApAnEsE EConomy this wEEk, thE oECD、ForECAst growth oF morE thAn 2%. thAt’s hArDly stunning (AnD pAlEs BEsiDEChinA’s AnnounCEmEnt this wEEk thAt it grEw At An AnnuAl rAtE oF 11.3%, its FAstEst pACE For A DECADE, in thE sEConD quArtEr oF this yEAr); But it’s rEspECtABlE AnD proBABly ConsErvAtivE.
yEt thE joB is only hAlF-FinishED, thErE is A sEriEs oF urgEnt tAsks For thE Country. monEtAry poliCy is At thE top oF thE list. lAst timE thE CEntrAl BAnk rAisED rAtEs, in 2000, A DisAstrous rECEssion EnsuED、 this timE thE inCrEAsE is justiFiED, BECAusE thE EConomy is FunDAmEntAlly strongEr; But thE BAnk’s inFlAtion rAngE oF 0—2% is too wiDE For ComFort in A Country still shAking oFF DEFlAtion. it nEEDs to BE ClosEr to 2 %.
AnD thErE is muCh ElsE to Do.At morE thAn 170% oF gDp (lEss on A nEt BAsis) govErnmEnt DEBt is too high.BAnks ArE still BAnnED From DEAling in sECuritiEs, whiCh mAkEs thEm wEAkEr thAn thEy othErwisE woulD BE. ForEignErs ArE wAiting For jApAn to opEn thE mArkEt For CorporAtE Control By honoring its promisE thAt thEy will, in EFFECt, BE ABlE to issuE shArEs to FinAnCE A tAkEovEr. thErE is littlE CompEtition, AnD thErEForE low proDuCtivity, in thE sErviCE sECtor.
jApAn’s rECovEry hAs BEEn slowEr AnD morE pAinFul thAn it nEED hAvE BEEn; But FAilurE to EmBrACE rADiCAlism in A rECEssion is unDErstAnDABlE. now thAt thE nightmArE is ovEr, it is timE For thE govErnm