What's wrong about being smaller: the case for Japan

Last week, China whizzed by Japan to become the world's second largest economy. The announcement naturally provoked some uneasy sentiments in Japan. With the population expected to shrink 50 million by 2050, Japan's future is bleak, some worried. However, some think that for Japan, being smaller is a more sustainable way to live in coexistence with the environment. This piece of writing merely presents view from both sides and by no means means attempt to suggest which is a better way. After all, it is an issue that the Japanese citizens should decide for themselves.

Among the advocates of a smaller japan is Professor Norihiro Kato of Waseda University. He argues that we have come to see the limit of our resources and a slowdown in production provides a smooth landing for downsizing.

"Japan doesn’t need to be No. 2 in the world, or No. 5 or 15. It’s time to look to more important things, to think more about the environment and about people less lucky than ourselves. To learn about organic farming. Or not. Maybe you’re busy enough just living your life. That, the new maturity says, is still cooler than right shoulder up. "

We have long believed that the fruits of economic success can be shared by the population as growth continues. However, we have also turned a blind eye to the other side of the equation - an environment cost that has to be borne by the population as well. There may exist a perfect equilibrium between economic growth, environment and the population and our environment, as a natural constraint, simply cannot support a perpetual and limitless growth.

Sakanaka Hidenori,  a former direcotr of the Tokyo Immigration Bureau, also discusses the "Small Option" in his analysis of Japan's immigration policy. He makes no point in hiding that a shrinking population means that the younger generation has to pay higher taxes, entitles less pension benefits to support the current social welfare for the retired.  However, with tight control, Japan can become a more compact society "with a moderate-sized population living a comfortable, relaxed lifestyle in a rich natural and social environment". In short, one that resembles New Zealand or the Scandinavian countries.

For most people, however, growth is the magic word. Striving to be number 1 should be the only goal for the country. This view is most strongly upheld by traditional politicians who promise to lead the lackluster economy out from the 20 year stagnation to appeal to their constituents.

Ohmae Kenichi (大前研一), a former business and corporate strategist at McKinsey, does not explicitly side with either option but in his book "So long America...until you come back to youserlf", he proposes that Japan can issue more visa to obtain semi-skilled workers from Southeast Asia to fill the open positions in the fast-growing elderly health care business. The decreasing number of young people has left many industries short of staff and alike.

It will take a lot of soul-searching in Japan to decide which way to go from here. But whatever way it pursues, changes are bound to happen.