Friday, June 5, 1998
Metaphors are flying fast and furiously regarding the role of Japan in the economic recovery of Asian nations. In the words of one critic, Japan should not be a"tinderbox" that handicaps a solution to the problem but part of the solution itself. Others have described Japan as a "linchpin" or as the critical "locomotive" without which Asia will not recover.
The problem with these metaphors is that they fail the reality test. As argued at some length in a recent JEI Report (No. 20A, May 22, 1998) titled "Asia's Locomotive: Japan's Potential and Limitations," Japan, although having the largest economy in Asia, has too little trade with the region for it to affect Asian economies much even if it were to grow much faster or significantly slower. In fact, most Asian nations are far more affected by what happens in the United States or in non-Japanese Asia than in Japan.
Confronted with the data contained in the JEI Report cited above, economists who have argued for the importance of Japan in Asia do not deny the validity of the economic counter-arguments, but add that Japan should still do what it can. Of course, they are right in that respect. They are also right in pointing to severe economic problems in Japan. However, their public arguments still are objectionable. In greatly exaggerating the importance of Japan, if only by the metaphors they employ, they are providing ammunition to other critics to blame Japan for the existing Asian economic mess or for its persistence. Japanese policy contains a great deal that is objectionable, but to blame it for the economic problems of Asia is more than an overstatement. It is wrong.
"JEI's Spin on the News" are the opinions of one of more members of JEI's staff and do not necessarily represent the views of the organization.