How did it happen that about 20 years ago, the Japanese became total economic illiterates? Are there no Supply Siders at all in Japan?
1) alot of asia picked up on the Japanese model, first korea, then china, now Vietnam. Export to the US, start out with low quality consumer goods, work your way up the manufacturing value chain. So the Japanese got blown out of some very profitable markets by lower cost producers who made goods of comparable quality and followed the same business model.
2) the generation of politicians and industrialists trained by the US post WW2 retired. I’ve never seen a study or book on this, but I’d like to know whether or not Japan has reverted to its more traditional commercial practices and how those differ from the postwar generation’s. Simply a gut-level instinct, but my completely unsubstantiated guess is it has been a factor.
3) banks and a real estate bubble, and the government was in the pocket of the banks who did not want to be forced into liquidation. so financial corporation revenues went to debt service instead of commercial loans. sound familiar?
4) the Asian concept of face/keeping up appearances. you can go broke, or at least experience a significantly diminished standard of living, trying to maintain it. and its not just asians, ask the british aristocracy, Austria, argentina and millions of americans with high debt to income ratios and maxed out credit card balances.
They exported cars & Stereos to use
We exported Liberalism to them