The economic models of China and Japan are rooted in similarities; however, could not have evolved more differently. Both countries built their economy from an authoritarian one-party government model. This evolved from two themes common to Asian Pacific culture. The first is the absolute respect for the hierarchal relationship. Starting in the most basic unit, the family, Asian cultures respect their elders as well as those in authority over them. Secondly, cultural collectivism is a common facet of Asian nations. Unlike the west, peoples from countries such as Japan and China would prefer to make decisions collectively rather than by majority. The culture of a people trained to obey those in authority and to collectively agree on the best way to succeed, lend themselves perfectly to an authoritarian one-party government.
Economically, both of these countries use this state model to run their economies. This is where the similarities divide. Japan built a Market Economy with a twist. In Adam Smith’s model, the market is the invisible hand which controls the ebb and flow of the economy. Japan’s version replaces the market with MITI. With MITI as the invisible hand, it could be construed that Japan follows a Planned Economic route; however, the Japanese government doesn’t own any aspect of business. MITI simply guides private enterprises to consider the best for Japan in its endeavors. Any controls placed on a private company are for the best of Japan and with the culture of collectivism and hierarchal respect for authority, it is an easy sell.
China, on the other hand, has had a more difficult time revving up the economic machine. Their problems started when they shunned the international market and began looking internally for ways to build a self-sustaining system. Japan, pre-WWII and even after their defeat and occupation by the United States continued learning from the international market and determining where they could plug in and rebuild their country. China, instead, turned to the Soviet Union and isolated themselves from the major players of the international market. By adopting the Soviet model, China’s political body took control of every facet of the economy. The political body was not stable post WWII so as the government floundered along went the economy. Mao recognized the inadequacies of the Soviet model and tried on two occasions to revert back to the peasant population and use mass uprisings to bring glory back to China. Unfortunately, placing economic controls into the hands of the uneducated simply couldn’t work. Peasants are used to being controlled. Although a wave of euphoria swept through them as the Great Leap Forward and Cultural Revolution took over; their inability to plan strategically in an international market forced the Communist Party to resume the Soviet blueprint and forcibly take control of the economic model.
Both countries still maintain their one-party, authoritarian schemes. Japan, not surprisingly has held the number two spot in the world economy for sometime. What is surprising is that China, despite the slow start and huge obstacles it endured is quickly catching up. They both are an example to late developers that it is possible to compete in the world market regardless of when they entered the game. Peeking over at the west and watching the collapse of a two-party democratic free market has to make one wonder if the style of government really matters at all or if the market has a crest and a valley for every player.
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Japan reminds me somewhat of German market controls, where the state often owns shares in companies, laws protect workers and integrate them into company board advisory positions, and short-term investment is shunned (as opposed to the Anglo-American model of hire and fire and speculative investment). In a way, the German government has worked diligently to protect the “Made in Germany” brand, enforce the standards that make that brand resilient, and ensure it is done in a socially responsible way. Now I know this sounds somewhat utopian, but it is similar to what the Japanese are doing – state intervention in the market for the greater good. However, unlike in China, although the ruling party is conservative, traditional, and supposedly quintessentially Japanese, the people do have the option of voting for an opposition party. The fact that the ruling party has proven resilient should not diminish the fact that the opposition, although weak, does have an opportunity to compete with the ruling party for control, but remains relatively unpopular. In China, the door to opposition is not open, unless it is done according to acceptable protocol within the single party and behind closed doors. Will China loosen the reigns once it reaches a broad level of development (not just in the cities)? Once it has completed its greatest projects, which it does not believe democracy is able to facilitate with its chaotic approach to management and ever-changing popular whims, it will be interesting to see how China changes, if at all. It could actually create a type of authoritarianism that parcels out bits of local control to elected, vetted leaders but retain control over the centers of power (like the military an foreign policy) in a strong executive branch, creating a quasi democracy like Iran’s. While Japan’s system is more of a self-imposed cage, China’s is more of an imposed cage with serious consequences for dissent. While dissent in Japan may be seen as antisocial and deviant, dissent in China may be seen as an outright threat, for which there may be no tolerance.
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