Pax Nipponica
From 'Capitalism that works' towards trusted mediator between the U.S. and China
The following is a slightly modified version of the English original that was published in Japanese by the NIKKEI on October 25. It is basically a first attempt to take my “Capitalism that works” thesis towards a possible next level, Pax Nipponica. It’s a polemic, deliberately so. What has taken me by surprise is the overwhelmingly enthusiastic response from Japanese readers, so I wanted to make it available to a more global audience.
Towards a Pax Nipponica
Japan is in a unique position to emerge as a true 21st century global leader. As the world is becoming increasingly polarized and confrontational, no nation is better placed than Japan to mediate between the two superpowers, the US and China. This is true for all aspects of policy leadership. Not just trade, finance and economic but also diplomacy and global security.
The primary lesson of the 21st century so far is that neither `Pax Americana` nor a `Pax Sinica` is an acceptable solution to much of the world. Yes, there is intensifying rivalry between the two . But for different reasons, neither Washington nor Beijing offer a credible answer to the aspirations of the Global South or the problems facing old-world Europe. And the more both Washington and Beijing leaders insist on a `Are you with us, or are you against us` commitment from their allies, the greater the resentment against the hegemon will grow. Trust is eroding fast. In contrast, a “Pax Nipponica” would almost certainly be welcomed by the world. Japan has got what it takes to mediate and moderate a new world order.
To be sure, my vision of a ‘Pax Nipponica’ is a next step evolution from the ‘Pax Britanica’ (1815-1914) or the ‘Pax Americana’ (1945-???). Both Britain and America ruled the world by brute force: their currencies were the undisputed anchor currencies of the global financial system; their leading companies were the undisputed innovators and oligopolistic leaders of global commerce; their universities attracted and educated the best and brightest from all over the world; and their armies were the most advanced and dominant. Today’s Japan has none of this. There is literally no area in both hard- and soft-power where Japan dominates the world. And that’s precisely why ‘Pax Nipponica’ is possible.
Japan is not threatening, not feared; but Japan is admired. It is the world’s only true post-industrial society, a frontrunner in many areas – a role model for having engineered the fastest and most successful economic development ever, for having a socio-economy resilient enough to survive the biggest deflation cycle in history without suffering social unrest and disruptive inequality; and that is now teaching the world how to age gracefully, how to maintain and create equitable prosperity by enhancing asset income rather than relying primarily on employment income.
All over the world, Japan is admired for an exemplary balance between intense economic modernization and solid perseverance of national traditions and social norms; for having not just imported western culture but perfected and improved upon it in so many areas - from architecture to fashion to food or video games, male- and female figure skating, golf or baseball. Make no mistake: viewed from a global perspective, Japan is the most highly respected nation and culture in both the East and the West, and the North and the South of this world. Japan has got what it takes to lead a global ‘Pax Nipponica’.
What’s next for Japan?
What about the domestic perspective? Is Japan’s elite ready to lead and orchestrate a global ‘Pax Nipponica’? It is, of course, not quite right for a non-Japanese to answer to this question. I personally think the answer should be yes. This is because the world desperately needs a trusted and honorable mediator, now more than ever. More importantly, in my view, Japan stands at a historic inflection point – Japan needs to embrace and rally behind a new goal. Post-war, post-bubble, post-deflation, post-lost decades — Japan knows what’s behind it, but doesn’t quite know where to go from here.
It is not a coincidence, in my view, that the LDP has once again lost parliamentary control recently, just as they did in the early 1990s when Japan had a similar breakpoint in the Zeitgeist - then the overarching post-war goal of catching up to the U.S. had been achieved; now the overarching post-bubble goal of ending deflation and, at the same time, gracefully restructure baby boomer salarymen based corporate culture has also been completed. Then as now, the LDP has no answer to “what’s next for Japan".
Beyond the ‘Settlement of the Post-War Accounts’
When I arrived in Tokyo almost 40 years ago, then Prime Minister Nakasone Yasuhiro was promoting his Comprehensive Settlement of the Post-War Accounts (Sengo Seiji no Sōkessan). To me, as a German national, a lot of Nakasone’s arguments and reasoning made sense. To this day I very much admire his central demand that there must be more to Japan’s national ambitions than ‘economic centrism – keizai chushin shugi’; and that Japan should unmark itself as a defeated country and build a post-post war system.
However, I have always been puzzled by how inward looking, how narrowly focused on only Japan the elite’s call to ‘settle post war accounts’ has been. No global aspirations, no vision, no aspirations, and no demands on Japan’s elite to leverage Japan’s strength and wisdom to build a better world and promote a better humanity.
Forty years ago, this was perhaps understandable because Japan’s elite still needed to muster strength to say ‘No’ to America: it was a big deal when Sony founder Morita Akio and then LDP heavyweight Ishihara Shintaro published an article by that name —「NO」と言える日本 — in 1989 in Japanese (English version came in 1991). Was Japan’s elite really ready to revolt against their U.S. masters; or was this just a sign of bubble-empowered hubris? Either way, it was all “No” and zero insights or vision of what new “yes” Japan should strive for. But that was then…
In 2024, Japan has a unique opportunity to re-set national ambitions and goals. It`s not about saying ‘no’ or ‘yes’ to America (or China). The world is waiting for Japan to say ‘we propose to do it this way’. Japan has got what it takes to be a global rule maker and mediator between East and West, North and South. ‘Pax Nipponica’ is an ambition the world is waiting for, and Japan’s elite should embrace. As a Japan optimist, I hope they will.
Thank you for reading. As always, comments welcome. Best & many cheers from a rather rainy Northern California ;-j
Here the link to the NIKKEI article: PaxNipponica
Pax Nipponica in action :
First, I share your general optimism about Japan's future. However, this may be for different reasons.
While your vision of Japan as a global negotiator among the superpowers is aspirational, is it really possible? Who would take the lead? While there may be some charismatic leaders here and there, Japan doesn't seem to have enough human talent to be taken seriously.
Moreover, the country is still very much a gerontocracy in desperate need of new political leadership (and not just a new face who is a fourth-generation Diet member). Before any attempt at a greater global role, Japan must first get its own house in order -- including finding a way to allow 50% of its population (aka women) to play a larger, upfront role in managing every aspect of society.
My gut feeling is that post-industrial Japan will, in fact, retreat from the global stage and simply find a way to live comfortably off its asset-based economy. I'm still committed as a long-term permanent resident, and we'll see what happens.
The question might be to examine what Pax [country]
"There is literally no area in both hard- and soft-power where Japan dominates the world"
Generally, this is the context for a strong regional power, and I am struggling to think of a regional power that managed to provide an alternative global platform of the kind you are describing in the modern age. Nations have played kingmaker or patron, the movement of Dutch wealth to England laying the foundation for the GBE, Japan investing infrastructure, loans, technology in Indonesia or Vietnam. Providing a different global approach requires incredible outlays and sacrifice. It is money that won't go to public subsidies, infrastructure, ect. Every generation of Japanese leadership looks at the costs and decides that effort and money should be spent either at home or nearby.
I think this points to what another commenter mentioned about getting more Japanese women into what I assume is politics, it is the same question for whether young people want to make the sacrifice and risk to provide another perspective, instead of viewing it as a just burden for people who graduated from Todai.