Japan must shake off US-style globalization

The likely next prime minister outlines his hopes for a more Asia-focused Japan.

By Yukio Hatoyama

from the August 19, 2009 edition

TOKYO – In the post-cold war period, Japan has been continually buffeted by the winds of market fundamentalism in a US-led movement that is more usually called globalization. Freedom is supposed to be the highest of all values, but in the fundamentalist pursuit of capitalism people are treated not as an end but as a means. Consequently, human dignity has been lost.

The recent financial crisis and its aftermath have once again forced us to take note of this reality. How can we put an end to unrestrained market fundamentalism and financial capitalism that are void of morals or moderation in order to protect the finances and livelihoods of our citizens? That is the issue we are now facing.

In these times, we must return to the idea of fraternity – as in the French slogan “liberté, égalité, fraternité” – as a force for moderating the danger inherent within freedom. It must be the compass that determines our political direction, a yardstick for deciding our policies. The idea of fraternity is also the spirit behind our idea of achieving “an era of independence and coexistence” in today’s world.

Fraternity as I mean it can be described as a principle that aims to adjust to the excesses of the current globalized brand of capitalism and accommodate the local economic practices that have been fostered through our traditions.

The recent worldwide economic crisis resulted from a way of thinking based on the principle that American-style free-market economics represents a universal and ideal economic order – and that all countries should modify the traditions and regulations governing their own economy in order to reform the structure of their economic society in line with global standards (or rather American standards).

In Japan, opinion was divided on how far the trend toward globalization should go. Some people advocated the active embrace of globalism and supported leaving everything up to the dictates of the market. Others favored a more reticent approach, believing that effort should be made instead to expand the social safety net and protect our traditional economic activities. Since the administration of Prime Minister Junichiro Koizumi (2001-2006), the Liberal Democratic Party has stressed the former while we in the Democratic Party of Japan have tended toward the latter position.

(For context on Japan’s election August 30, read: Briefing: Why power may shift in Japan)

The economic order or local economic activities in any country are built up over long years and reflect the influence of each country’s traditions, habits, and national lifestyles. However, globalism progressed without any regard for various non-economic values, nor for environmental issues or problems of resource restriction. If we look back on the changes in Japanese society that have occurred since the end of the cold war, I believe it is no exaggeration to say that the global economy has damaged traditional economic activities and destroyed local communities.

Capital and means of production can now be transferred easily across international borders. However, people cannot move so easily. In terms of market theory, people are simply personnel expenses, but in the real world people support the fabric of the local community and are the physical embodiment of its lifestyle, traditions, and culture. An individual gains respect as a person by acquiring a job and a role within the local community and being able to maintain his family’s livelihood.

Under the principle of fraternity, we would not implement policies that leave economic activities in areas relating to human lives and safety, such as agriculture, the environment and medicine, to the mercy of the tides of globalism.

Our responsibility as politicians is to refocus our attention on those non-economic values that have been thrown aside by the march of globalism. We must work on policies that regenerate the ties that bring people together, that take greater account of nature and the environment, that rebuild welfare and medical systems, that provide better education and child rearing support, and that address wealth disparities. This is required in order to create an environment in which each individual citizen is able to pursue happiness.

OVERCOMING NATIONALISM THROUGH AN EAST ASIAN COMMUNITY

Another national goal that emerges from the concept of fraternity is the creation of an East Asian community. Off course, the Japan-US security pact will continue to be the cornerstone of Japanese diplomatic policy. Unquestionably, the Japan-US relationship is an important pillar of our diplomacy. However, at the same time, we must not forget our identity as a nation located in Asia. I believe that the East Asian region, which is showing increasing vitality in its economic growth and even closer mutual ties, must be recognized as Japan’s basic sphere of being. Therefore, we must continue to make efforts to build frameworks for stable economic cooperation and national security across the region.

The recent financial crisis has suggested to many people that the era of American unilateralism may come to an end. It has also made people harbor doubts about the permanence of the dollar as the key global currency. I also feel that as a result of the failure of the Iraq war and the financial crisis, the era of US-led globalism is coming to an end and that we are moving away from a unipolar world toward an era of multipolarity.

However, at present, there is no one country ready to replace the United States as the world’s most dominant country. Neither is there a currency ready to replace the dollar as the world’s key currency.

Although the influence of the US is declining, it will remain the world’s leading military and economic power for the next two to three decades. Current developments show clearly that China, which has by far the world’s largest population, will become one of the world’s leading economic nations, while also continuing to expand its military power.

The size of China’s economy will surpass that of Japan in the not-too-distant future. How should Japan maintain its political and economic independence and protect its national interest when caught between the United States, which is fighting to retain its position as the world’s dominant power, and China, which is seeking ways to become dominant?

This is a question of concern not only to Japan but also to the small and medium-sized nations in Asia. They want the military power of the US to function effectively for the stability of the region but want to restrain US political and economic excesses. They also want to reduce the military threat posed by our neighbor China while ensuring that China’s expanding economy develops in an orderly fashion. These are major factors accelerating regional integration.

Today, as the supranational political and economic philosophies of Marxism and globalism have, for better or for worse, stagnated, nationalism is once again starting to have a major influence on policymaking decisions in various countries. As symbolized by the anti-Japanese riots that occurred in China a few years ago, the spread of the Internet has accelerated the integration of nationalism and populism, and the emergence of uncontrollable political turbulence is a very real risk.

As we maintain an awareness of this environment and seek to build new structures for international cooperation, we must overcome excessive nationalism and go down a path toward rule-based economic cooperation and security.

Unlike Europe, the countries of this region differ in their population sizes, development stages and political systems, and therefore economic integration cannot be achieved over the short term.

However, we should nonetheless aspire to move toward regional currency integration as a natural extension of the rapid economic growth begun by Japan, followed by South Korea, Taiwan, and Hong Kong, and then achieved by the ASEAN nations and China. We must therefore spare no effort to build the permanent security frameworks essential to underpinning currency integration.

Establishing a common Asian currency will likely take more than 10 years. For such a single currency to bring about political integration will surely take longer still.

ASEAN (Association of Southeast Asian Nations), Japan, China (including Hong Kong), South Korea, and Taiwan now account for one quarter of the world’s gross domestic product. The economic power of the East Asian region and the interdependent relationships within the region have grown wider and deeper, which is unprecedented. As such, the underlying structures required for the formation of a regional economic bloc are already in place.

On the other hand, due to the historical and cultural conflicts existing between the countries of this region, in addition to their conflicting national security interests, we must recognize that there are numerous difficult political issues. The problems of increased militarization and territorial disputes cannot be resolved by bilateral negotiations between, for example, Japan and South Korea, or Japan and China. The more these problems are discussed bilaterally, the greater the risk that citizens’ emotions in each country will become inflamed and nationalism will be intensified.

Therefore, somewhat paradoxically, I would suggest that the issues that stand in the way of regional integration can only really be resolved through the process of moving toward greater regional integration. The experience of the European Union shows us how regional integration can defuse territorial disputes.

I believe that integration and collective security in the Asia-Pacific region is the path we should follow toward realizing the principles of pacifism and multilateral cooperation advocated by the Japanese constitution. It is also the appropriate path for protecting Japan’s political and economic independence and pursuing our national interest from our position between two of the world’s great powers, the United States and China.

We are currently standing at a turning point in global history, and therefore our resolve and vision are being tested.

Let me conclude by quoting the words of Count Coudenhove-Kalergi, the father of the European Union, written 85 years ago, when he published “Pan-Europa.” (My grandfather, Ichiro Hatoyama, translated his book “The Totalitarian State Against Man” into Japanese.)

“All great historical ideas started as a utopian dream and ended with reality.”

“Whether a particular idea remains as a utopian dream or becomes a reality depends on the number of people who believe in the ideal and their ability to act upon it.”

Yukio Hatoyama heads the Democratic Party of Japan.