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An Update on Industrial-Environmentalism

by techno Sun Jun 22nd, 2008 at 02:40:58 AM EST

When my book "Elegant Technology" was published in late 1992, I included a claim--on the COVER--that Industrial Redesign was the preferred environmental strategy of Japan and Western Europe.*  Oh, the flak I took for that.  The real estate bubble had just popped in Japan and the gloating in the financial press in USA was so intense, the idea that Japan had anything to teach us was considered laughable.  I even wished I could redo the cover because in the post-bubble Japan, the changed intellectual atmosphere would destroy sales.

Funny how predictions based on Institutional Analysis turn out.


Japan Poised as Green Leader
NATHAN GARDELS
June 17, 2008

http://www.huffingtonpost.com/nathan-gardels/japan-poised-as-green-lea_b_107713.html

TOKYO -- Prime Minister Yasuo Fukuda's announcement that Japan will cut carbon emissions by 60-80 per cent by 2050 sets a serious tone for the upcoming G-8 Summit at Lake Toya, Japan.

Even if real action remains stymied in the lame duck days of the Bush administration, Japan's leadership sends a signal to the world that the rich industrialized countries -- whose emissions accumulated the "stock" of greenhouse gases in the atmosphere that are causing global warming -- accept their responsibility. This is the precondition required for developing countries like China and India -- responsible for massive new "flows" of industrial exhaust -- to join any common global program beyond the Kyoto Protocol to stem climate change.

The summit comes in advance of the convergence of a major economic and geopolitical shift in the world.

Unlike past oil shocks, this current bout of price increases is here to stay. The long term demand trend for oil is ever upward because of rapid growth of India, China and the "rising rest." Though there will be dips, the price of oil is not likely to go down, only up. And up.

The next American president, whether Barack Obama or John McCain, will embrace the spirit of Kyoto, if not the actual protocol. Both of them have made this clear in their campaigns. This in turn will lead ultimately toward a global grand bargain in which the main emitters, including the US and China, agree to curb emissions. In exchange the rich nations will agree to the transfer of clean technology to the rising "flow" countries.

Japan is uniquely positioned to take advantage of this shift. While the world has been focused on the miracle of Chinese growth, the war in Iraq and terrorism, Japan has been engaging in a quiet revolution. It has become the incubator of the energy efficient technologies of the future.

Japan is the leading manufacturer and exporter of hybrid cars, most famously the Toyota Prius, which is selling like hotcakes in the United States. Honda has developed a hydrogen fuel cell car that is being prepared for mass production. Komatsu has just produced the world's first-ever hybrid heavy machinery, a 20-ton excavator used in construction sites all across Asia.

Japan is responsible for 50 per cent of the world's solar power energy production. Japan uses 20 per cent less energy to produce a ton of steel than the US; 50 per cent less than China.

Innovations abound from capturing "ice energy" to more energy efficient plasma screens. Indeed, the facility that will house the media at the Lake Toya summit will be cooled by snow stored in thermal insulation instead of by air conditioning.

As America has moved toward a largely financial economy, exemplified by the sub-prime mortgage crisis, Japan retains the very manufacturing and engineering prowess the world needs to face the daunting challenge of climate change.

This fits Japan's historical profile well. Going back centuries, it has had something of a green identity. As Umehara Takeshi, the great Japanese anthropologist, has noted, the Shinto religion, in which man is not considered apart from nature, emerged from ancient Japan's "civilization of the forest."

In the 17th century, as Jared Diamond points out in his seminal book, Collapse, the Tokugawa Shogunate reforested Japan, denuded by development, and saved it from the kind of ecological catastrophe that struck the Mayans. Though one of the most densely populated countries in the world, 70 per cent of Japan today is covered by healthy forests.

And, of course, the namesake of the very Protocol which is the first global effort to come to grips with climate change, is Japan's ancient capital, Kyoto.

Beneath the surface of Japan's faddish consumer society, the frugal culture of an island nation that must wisely husband limited resources still lives. Today, we recognize that the Earth itself is an island. Taking Japan's lead, the whole planet would be wise to adopt that frugal sensibility, living intelligently instead of wastefully.

I am sorry if I bore you folks with my claims to the astonishing ability of Institutional Analysis to accurately predict the future.  But over 16 years ago, what is going to happen July 7 to 9, 2008 at the G-8 Summit at Lake Toya, Japan was already so obvious, I decided to put it on the cover of probably the only book I'll ever get published in USA.

So what were the Institutional assumptions about Japanese environmentalism that caused me to make such a claim on the cover?

  1. The Japanese are obsessed with the value of oil.  It can be convincingly argued that Japan attacked Pearl Harbor to secure oil supplies.  Not only do they thoroughly understand oil's value, they have no domestic suppliers (oil lobbyists) to cloud their national debates over economic policy.

  2. Japanese manufacturing dominance is due to two related cultural traits--attention to details and the notion that nothing is ever perfectly finished.  They are far less interested in who was first to build something and far more interested who builds it best right now.  (I remember reading some of the many books published in the 1980s on Toyota's statistical quality controls and concluding that either folks used their methods or produced inferior goods.)

  3. Unlike the Brits and Americans, the Japanese do not require that their intellectuals be technologically illiterate to the point of open hostility to the mechanisms for the community's survival.  In the Anglo countries, environmentalists tend to suggest primitive solutions (in those rare cases when they actually offer solutions).  By contrast, the Japanese understand that, for example, increases in per capita energy and other resource efficiencies will most likely come from perfected technologies and manufacturing methods.

Combine these factors and it is logical to assume that when greener technologies are made, the Japanese are more likely than anyone to produce them.  It is important to remember here that technology is evolutionary.  The better you are right now, the better you can be tomorrow.  It is not enough to want to be "greener."  Skills are necessary.  Even more important, methods must be in place so that existing skills can get better.

Of all the crimes of Finance Capitalism, none has been more serious than the destruction of industrial potential.  Here in USA, we have not only failed to build an environmentally sustainable infrastructure, we have spent the last 35 years destroying the manufacturing base necessary to meaningfully embark on such a project.

*Actual quote from the top blurb on the cover "Why industrial redesign has become the preferred environmental strategy in Japan and Northern Europe and the lessons for all who would follow"

Display:
Of all the crimes of Finance Capitalism, none has been more serious than the destruction of industrial potential.  Here in USA, we have not only failed to build an environmentally sustainable infrastructure, we have spent the last 35 years destroying the manufacturing base necessary to meaningfully embark on such a project.

BusinessWeek has a sobring cover story on this very topic:  Can the U.S. Bring Jobs Back from China?

And yet, it ends holding out hope for a green manufacturing resurgence in the U.S.:

Expecting the U.S. to recapture industries that have already gone to China may not be realistic. But the new cost equation likely will influence many decisions about where to locate production in the future. America remains the world's biggest manufacturer, after all, because it's still the largest market for everything from drugs and packaged foods to high-end medical equipment. The U.S. may have as good a chance as anyone of being a strong player in nascent industries, whether next-generation wind turbines, medical devices with nano-scale sensors, or electric cars. The challenge will be to persuade reluctant venture capitalists and corporations to invest again in modern U.S. production facilities.

What would be required, for instance, for the U.S. to re-emerge as a player in batteries? It is an industry, after all, on the cusp of radical technological change that could spur development of future eco-friendly vehicles, cell phones, and home appliances. Boston-Power's Lampe-Onnerud has suggestions, but America may not be ready for them. Washington could lend up to $50 million in seed capital to promising startups, for example, and state governments could build industrial parks with low-cost facilities and services that rival those found in China. "If we got state and federal support," she says, "we would team up with others in a heartbeat and grow an industry."



... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)
by marco on Sun Jun 22nd, 2008 at 07:08:03 AM EST
Oh goody.  The country that blows through $12-20 billion a month in its criminally insane occupation of Iraq, has a few folks THINKING about LENDING $50 million to promising start-up ventures.  And WOW--some more industrial parks--like we don't have any of THEM!  Boy THAT will show the world how serious we are about green technologies ;-(

On second thought--those were just some suggestions of one of those start-up dreamers.  Never mind.  

We. Are. Doomed.

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Sun Jun 22nd, 2008 at 09:03:29 AM EST
[ Parent ]
While I agree with Susan Chira's statement (back in 1991) that, "America now seems more like the decadent superpower once portrayed in Japanese wartime propaganda," I remain leery of repeating the Japanese militarists' mistake of contemptuously counting America out as a bunch of decadent merchants.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)
by marco on Sun Jun 22nd, 2008 at 05:39:48 PM EST
[ Parent ]
Calling us "decadent merchants" sounds like high flattery these days.  I mean, hedge fund operators don't even have anything all that useful to sell.

"Remember the I35W bridge--who needs terrorists when there are Republicans"
by techno (reply@elegant-technology.com) on Sun Jun 22nd, 2008 at 07:26:42 PM EST
[ Parent ]
In the 17th century, as Jared Diamond points out in his seminal book, Collapse, the Tokugawa Shogunate reforested Japan, denuded by development, and saved it from the kind of ecological catastrophe that struck the Mayans. Though one of the most densely populated countries in the world, 70 per cent of Japan today is covered by healthy forests.

Yeah, but they are ripping Australia and others of their forests. And they are still into "scientific" investigation of whales' extinction chances.

But Japan may be a relatively good place to survive a global collapse or a climate (if not seismic) mess. Just because of their traditional attitude.

by das monde on Sun Jun 22nd, 2008 at 07:48:38 AM EST
The Aussies are doing a fine job of destroying their own environment and do not have first-class global manufacturing expertise to compensate.

As for the whales--I try to avoid that subject.  The Norwegians are about as environmentally conscious as anyone earth and the whale-lovers hate them too.  The USA is awash in the sort of "environmentalist" that drives to meetings in an SUV to plan to save the whales and eagles and panda bears.  And while I would prefer that environmentalists worry about whales AND their carbon footprints, I will appreciate the carbon footprint types more because climate change is a MUCH bigger problem.

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Sun Jun 22nd, 2008 at 08:45:50 AM EST
[ Parent ]
Massachusetts was about 30% forested after the Civil War.  It is now about 70% forested because many of those farms were abandoned over the last 150 years.

What the Tokugawa Shogunate did on purpose we did by accident.

Solar IS Civil Defense

by gmoke on Sun Jun 22nd, 2008 at 07:54:29 PM EST
[ Parent ]
Let me see if I understand your point.  Because Massachusetts did by accident what the Japanese did on purpose, we should assume that we will be able to make high-performance solar cells (or other green technologies) by merely wishing them into existence, while those poor damn Japs have to work their butts off?

If you actually believe this, please post a picture of the most sophisticated and complex thing you ever made using your wish method.

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Sun Jun 22nd, 2008 at 09:17:49 PM EST
[ Parent ]
You don't understand my point.

MA second (and third) growth forests were not planned as I assume were the Japanese reforestation efforts and are thus probably significantly less productive and useful.  However, they are there.  It happened.  Leave land alone and it will grow stuff, produce an ecology.  Ain't wishing and hoping but Mama Gaia doing what she do best.  We in MA can maximize that gift if we are smart enough to do so but we haven't been so far.

I admire the Japanese and have visited there a couple of times.  I'd like to go back.  I do not call them derogatory names.

If you want to see what I've built, by wishing or hard work or a combination of both, I suggest you take a look at my videos at
http://www.youtube.com/gmoke

Solar IS Civil Defense

by gmoke on Sat Jun 28th, 2008 at 01:38:36 AM EST
[ Parent ]
Brilliant, and incredibly far-sighted,as ever.

The other side of the Japanese coin - and I have seen this apply to the mega Corps who use the Six Sigma approach - is that it may lead to "closed" solutions.

ie flexible and continuous perfection of particular solutions within a particular framework or paradigm.

But the "disruptive" solutions also necessary for our planetary survival come from the Chaos outside these frameworks, and that requires a more individualistic and less collaborative mindset.

How to bring these together - that is the problem - and IMHO it is the consensual protocols I observe emerging (Japan now has LLP's, albeit restrictively applied....) which will enable the chasm between Japan and the West to be bridged, I think...

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sun Jun 22nd, 2008 at 09:42:43 AM EST
Of course, you are right about the weakness of "closed" solutions.  I drive a Lexus and while it is the highest application of Toyota's statistical quality controls, gets very good gas mileage, and is a brilliant piece of machinery--it is still a CAR!

However, should the day arrive that I buy a solar array for my roof, I would find it VERY reassuring if they were made by Toyota.  Methods are methods.  

I am not so worried about the Japanese "breaking out of the box."  The announcements referred to above demonstrate they have already broken out a "box" that seems to have trapped the Anglo world.  And you can make book if the Japanese claim they can reduce their carbon footprint, they have already figured out how they will do it.

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Sun Jun 22nd, 2008 at 01:21:04 PM EST
[ Parent ]
Excellent diary, as usual, Techno.  

While you may justly have felt like Cassandra for the fifteen years since the publication of your book, the tide does seem to be turning.  To see ideas you have long championed become more accepted is some consolation, even if it is not accompanied by the recognition your book deserves. Time for an updated 2nd Edition?

Amory Lovins, founder of the Rocky Mountain Institute, has long been another such voice crying in the wilderness.  His 2005 book, Winning the Oil End Game: Innovations for Profits, Jobs, and Security lends support to your thesis. (Link is to a summary of a Wilson Center Event with Lovins.)

From Wilson Center summary


Lovins maintained that business-for-profit and military innovations to increase fuel efficiency and to utilize energy alternatives could greatly benefit U.S. security and economic interests.

Lovins asserted that pure economic incentives will sharply reduce the use of oil in the United States in coming years, since "it is cheaper to substitute oil than to keep buying it." He also cited two additional reasons for eliminating U.S. use of oil. First, national security is threatened by a variety of oil-related factors, from supply instability and geopolitical competition to the environmental costs of oil use. Second, U.S. competitiveness in the global transportation market is at stake, so long as other countries continue to produce cheaper and more fuel efficient vehicles and airplanes. Therefore, there are sound economic, and well as political and environmental reasons to stop using oil.

In order to compete in the global marketplace successfully and reduce security threats, the United States must double the efficiency of oil use and increase its reliance on alternatives sources of energy, such as biofuels and natural gas reserves. The average cost of ending the use of oil would be $15 per barrel, significantly lower than the official Energy Information Administration's (EIA) forecasted cost of $26 per barrel by 2025. The cost of making the transition from an oil-based economy would be about$180 billion; however, the transition would entail 2 million new and preserved jobs and it would generate $150 billion in gross returns per year. This process can be accelerated through favorable policymaking at the federal, state, and local levels, as well as by educating industry leaders about the economic advantages of making the transition.


(My bold.)  Looks like Lovins needs a new edition as well!

Lovins has also developed a method of "forging" composite carbon structural elements with significantly improved strength to weight factors for use in automobiles. I recently saw a video clip but have not been able to find a reference.

For more on Lovin's vision circa 2005 see this

But you have properly identified the major problem in the USA, which is undoing the damage to the industrial infrastructure done by the Financial Sector.  What is needed is a generalized understanding by the voting population of the importance of an industrial base appropriate to present conditions, how bad policy and financial regulations can encourage destruction for profit, and how to prevent a replay of the current disaster at least for a couple of generations.  This requires leadership and a receptive public.  The current problems may be creating a receptive public.  We can only hope that the requisite leadership emerges.  

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun Jun 22nd, 2008 at 01:33:23 PM EST
Thanks Geezer.

We'll see about a second edition.  I am getting a little old for this sort of thing.

I have been a minor fan of Lovins for some time now.  He talks about the right subjects and he certainly tried to build an energy-efficient house in Aspen.  But that's where he trips up.  His house cost a TON of money and wasn't very practical.  His ideas for the hyperlight carbon-fiber car are just as impractical and even MORE expensive.  In the end, he mostly proves that building a green society will be a LOT harder than it looks on paper. It's too bad he couldn't have hooked up with folks who actually knew how to build the sorts of things he envisions--the Swedish home builders or say, Honda come to mind.

But yes, even if Lovins had done everything right, we still would have gone backwards if we hadn't prevented the crooks and fools from taking over the economy.  

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Sun Jun 22nd, 2008 at 07:22:42 PM EST
[ Parent ]
Whenever I see anything about Japanese technology I'm immediately taken back to the Onion and

Earthquake Sets Japan Back To 2147 | The Onion - America's Finest News Source

TOKYO--Japanese government officials confirmed Monday that the damage wrought on Japan's national infrastructure by the July 16th earthquake--particularly on the country's protective force field, quantum teleportation system, zero-point fusion energy broadcasting grid, and psychodynamic communications network--was severe enough to set the technologically advanced island nation back approximately 300 years to a primitive mid-22nd-century state of existence.


Any idiot can face a crisis - it's day to day living that wears you out.
by ceebs (ceebs (at) eurotrib (dot) com) on Sun Jun 22nd, 2008 at 02:32:34 PM EST
The last time I was in Japan was in the mid-80s.  I wonder if there are still people living in cardboard boxes around Shinjuku.

Solar IS Civil Defense
by gmoke on Sun Jun 22nd, 2008 at 07:57:24 PM EST
[ Parent ]
Not around Shinjuku, but go to Ueno, and you got a veritable camp of blue tarp tents.  Also, in cold weather, the tunnel connecting Ueno JR Station to the Ueno subway station is regularly lined with miserable homeless old men.  It is shocking.  Also, around Shibuya station, there are two or three regulars you can count on seeing, most conspicuously around last train time: an old lady and an old man, as I recall.

More info on homeless in Tokyo

Having said that, the number of homeless in Japan is estimated by the Ministry of Health, Labour and Welfare to have declined from about 125,000 in February-March 2003 to 18,500 in January 2007 (Wikipedia).

Taking 20,000 homeless in Japan over a 127 million population, that is a 0.016% rate.

For comparison, as of 2005, 744,000 homeless in the U.S. over a population of 300 million, that is 0.25% -- or over 15 times as many homeless per capita as in Japan.

As of 2007, France had 100,000 homeless over a population of 60 million, which comes out to 0.16%: far less than in the U.S. but still ten times as bad as Japan's.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)

by marco on Sun Jun 22nd, 2008 at 09:44:45 PM EST
[ Parent ]
marco: Having said that, the number of homeless in Japan is estimated by the Ministry of Health, Labour and Welfare to have declined from about 125,000 in February-March 2003 to 18,500 in January 2007

That "about 125,000" should have been "about 25,000" -- 25,296 to be exact.  Sorry for the gross mistake.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)

by marco on Mon Jun 23rd, 2008 at 12:05:38 AM EST
[ Parent ]
Just so you remember.  The social distribution of wealth and the costs of housing are very separate and wholly unrelated issues to whether a country can create enough green technologies to reduce their carbon footprint by 80%.

Of course, I will always argue that the BEST way to eliminate homelessness is to create more good-paying jobs (well, duh!)  And the surest way to prosperity is to employ people to build an infrastructure that operates on solar income rather than burn natural capital.

If we do the right thing by the ecosphere, we can afford to do the right things socially.

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Mon Jun 23rd, 2008 at 01:45:41 AM EST
[ Parent ]
techno: Just so you remember.  The social distribution of wealth and the costs of housing are very separate and wholly unrelated issues to whether a country can create enough green technologies to reduce their carbon footprint by 80%.

Of course.  I only was commenting on homelessness in Japan in response to gsmoke's comment upthread.  Basically, my point was that while homelessness, when you see it in Japan, is shocking and pitiable -- as it should be everywhere -- its occurrence is far lower than in other developed countries.  Even in the happiest country in the world, Denmark, the number of homeless as of the beginning of 2007 was conservatively estimated to be 5253.  Out of a population of just under five and half million, that comes to 0.096% -- better than France (and of course the U.S.), but still six times worse than Japan's rate.

techno: Of course, I will always argue that the BEST way to eliminate homelessness is to create more good-paying jobs (well, duh!)  And the surest way to prosperity is to employ people to build an infrastructure that operates on solar income rather than burn natural capital.

If we do the right thing by the ecosphere, we can afford to do the right things socially.

Hear, hear.  That said, doing right by the ecosphere is not sufficient: there also has to be political determination to do the right things socially.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)

by marco on Mon Jun 23rd, 2008 at 02:49:46 AM EST
[ Parent ]
Any chance that they are cooking the books? If not I'm impressed. How do they do it?
by generic on Tue Jun 24th, 2008 at 08:54:39 AM EST
[ Parent ]
I am not familiar enough with the problem.  das monde or Zwackus, or tuasfait (if he is still around), might be able to explain better.

They very well may be cooking the books.  But I don't think that explains the entire difference.

Japanese social welfare has a bad reputation, but I know there are lots of city- and burrough-level services for providing jobs for the unemployed.  If you go to Japan, you will find certain jobs that seem "needless", most conspicuously, uniformed men and women at street construction sites politely waving pedestrians through carefully constructed byways so that they avoid hurting themselves near the site.  Any half-careful person could navigate these areas without any guidance, but the presence of these "waver-on's" not only clearly gives you warning that you may need to be a little extra careful around here (especially relevant for Japan's increasingly elderly population), but more importantly, they provide jobs and dignity to people who otherwise may not have such jobs -- and might be on the streets.

Japan also still has a relatively strong sense of family responsibility to elders and family in general.  People would rather take care of their own then let them wind up on the streets.  For example, my uncle drank himself into decrepit destitution through his adult life (my father is Japanese).  No doubt he would have been on the streets had another uncle's wife's resourcefulness not managed to find a way to persuade the local welfare bureau to pay him unemployment and medical insurance (even though I think he normally would not have qualified for these.)  While I imagine for any family in any developed society there would be a significant amount of shame in having a homeless family member, I believe this may be particularly so in Japan, where the principle of face is still very significant (though less over time).

Unfortunately I have no numbers to support these hypotheses, just guesses.  In short, the numbers may be underreported, but I think there are certain features of Japanese society that also reduce homelessness to a level below other developed countries'.

... all progress depends on the unreasonable mensch.
(apologies to G.B. Shaw)

by marco on Tue Jun 24th, 2008 at 07:54:43 PM EST
[ Parent ]
That said, doing right by the ecosphere is not sufficient: there also has to be political determination to do the right things socially.

I argue that ONLY a socially enlightened society will be ABLE to build a sustainable society.  For example, it will be impossible to understand the issues of sustainability unless you strike the ideal balance between what is individual and what can best be done as a group.  I think a good starting place is 50-50 (which gets me into a LOT of trouble with the libertarians.)

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Wed Jun 25th, 2008 at 01:07:32 AM EST
[ Parent ]
... is a job guarantee at a living wage ... and if in a local area a prevailing regional or national living wage cannot obtain affordable secure shelter, then including guaranteed access to affordable secure shelter.

Of course, in the US a substantial amount of homelessness is due to failures of the mental health system, but even so we will be seeing a big spike in homelessness for economic reasons as the recession unfolds.


I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Mon Jun 23rd, 2008 at 01:18:01 PM EST
[ Parent ]
This is not really germane to the instant discussion. But, since you have brought up the subject of Japan, and especially since you bring up that many American elites find the idea that "Japan [has] anything to teach us ... laughable": it occurred to me earlier this year what a complete hoax it is for anyone to point to the problems of Japan in the 1980s and 1990s and claim that they have nothing to teach us. What I mean is that there was NO solution that could be effected by a national monetary authority that could possibly have worked in an international economic regime of neo-liberal free capital flows. Just look at what used to be known as the carry trade. The Bank of Japan tried essentially negative interest rates, which supposedly "did not work" to halt and reverse the financial crisis. But the real reason negative interest rates did not work was because the Japanese were unable and /or unwilling to buck the U.S. and other world financial elites in order to impose capital controls. In the absence of capital controls, the carry trade developed, undermining the attempts of the Bank of Japan to solve the crisis.
by NBBooks on Mon Jun 23rd, 2008 at 10:15:20 PM EST
But you know something?  Yes, their real estate bubble crashing was a serious matter.  But those incredibly low interest rates did allow Japanese industry to spend a lot of money to get VERY sophisticated.

Shows what culture can do.  WE get low interest rates and we get a real estate bubble.  After all, real estate speculation is what settled the USA.  Japan has the lowest interest rates on the planet and they get global industrial leadership.  To use just one example--who can ever catch Toyota?  Obviously, this is a culture that really wants to be best at building difficult things.  It's the reason I put them on the cover of my book.

As a known car buff in my circle of friends, I often get asked about car purchases.  I discovered that friends get really cranky if they take my advice and then have problems with the car.  So these days, I only recommend Toyota because I want them to STAY my friends--especially with women who are just terrified by the prospect of being stranded by the road in a strange place.  And now Toyota has the most experience with hybrids.  First they make something as complex as a car so reliable it is the first choice for your girlfriend, and now they are going green.  This is one hell of an industrial lead!

"Remember the I35W bridge--who needs terrorists when there are Republicans"

by techno (reply@elegant-technology.com) on Wed Jun 25th, 2008 at 12:54:39 AM EST
[ Parent ]


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