What happened to the Japanese Economic Model?
It was in 1964 that the Japanese miracle was first proclaimed. In the next three decades, this phenomenon spread through much of Asia as the smaller economies there, imitating and adapting Japan’s methods, created the world’s most economically dynamic region. It was an unprecedented achievement, but the force always had a dark side. With much of Asia now on life support, it is time to recognize that the Asian brand of capitalism is dangerous to the world economy’s health and that it must be abandoned, particularly by Japan. In the wake of recent financial crises, leaders and analysts alike have been quick with assurances that the problem is not systemic, but merely one of mismanagement. Thus, at the recent Asia-Pacific Economic Cooperation summit, President Clinton spoke of a few “glitches in the road.” At the same time, news stories and commentary in The Washington Post and the New York Times pointed to the high savings rates and other “sound fundamentals” of the Asian economies as ev
