tag:blogger.com,1999:blog-17232051.post3694084465521734258..comments2024-03-18T22:32:52.802-04:00Comments on Noahpinion: The Neoliberal ChoiceNoah Smithhttp://www.blogger.com/profile/09093917601641588575noreply@blogger.comBlogger59125tag:blogger.com,1999:blog-17232051.post-92050066092465416282013-08-26T05:42:49.785-04:002013-08-26T05:42:49.785-04:00Hi. I live in Japan, not Japanese but I am a fluen...Hi. I live in Japan, not Japanese but I am a fluent speaker and have lived in Tokyo for 12 years so far. I have worked as an independent contractor, a contract employee and as a full time employee (currently). I have Japanese colleagues and friends that have done all the other forms of employment. Between us I believe we have a lot of shared experience of working in Japan. There is, as pointed out above, a huge difference between laws on the books and actual enforcement. There is also a vastly different work-life balance and also the imbalance between the sexes. All this parameters makes it very difficult to compare jobs and employment between Japan and abroad. <br /><br />I also find problems in the term "Japan". As you probably know, there is a huge difference in Japanese work life and employment between Tokyo and virtually the rest of the entire country. When I compare employment in Tokyo with the situations of my friends in rural Toyama prefecture or on the Island off the coast of Niigata, I often find it hard to imagine we live in the same country. <br /><br />Another huge difference, that makes comparisons between Japan and the US (why those two countries that have nothing whatsoever in common should always be compared is beyond me) impossible is the simple fact that Japan has had a minimal population increase over the last two decades, there are (virtually) no natural resources, Japan is an export based economy and people here actively embrace the ideas of harmony and equality (take as an example the 2000 USD water melons, that is how the trickle down economy should really work). <br /><br />Sorry if I sound negative or incredulous, but we are getting perplexed by all these foreigners saying we should do this or we should do that, especially people from cultures/economies that are in even worse shape than ours. This sort of "they ought to...." talk is just used by air headed local politicians to pick and chose from to fit whatever ideology they are currently nursing. <br /><br />No foreign journalist or economist can possibly have missed that Abe (and his wife) is hardly of sound mental or physical health.<br /><br />Not meaning to come down like a ton of bricks, but we need more consideration of the real facts on the grounds before taking into consideration the opinion of foreigners. Surely you know of the honne/tatemae concept? It applies to everything. Everything has a front and a back in Japan.<br /><br />If you want to compare Japan to other countries, a more reasonable subject might be ROK and Japan, or even ROC and Japan.<br /><br />Best regards, The Little Salaryman in Tokyo Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-39024047506087100402013-08-25T06:51:54.486-04:002013-08-25T06:51:54.486-04:00To moderators: we are surprised at your having del...To moderators: we are surprised at your having deleted our comments. Since other anonymous comments were not deleted, and our tone was reasonable, we have to assume you did it merely to silence unwelcome opinions. One comment pointed out that the first job in the US is also extremely important, and especially that aspirants 'good jobs' in finance, law and government have to be on the track since grade school, with these desirable employers increasingly hiring only out of a few top colleges. Another pointed out the pervasive and misplaced attitude of intending to 'help Japan' and the third inquired as to the advisability of forcing women into the work force.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-69231893669912153562013-08-23T16:16:10.540-04:002013-08-23T16:16:10.540-04:00So in other words, you're racist and would rat...So in other words, you're racist and would rather hundreds of millions of Chinese people live in abject poverty so that a few low-skilled union workers in the U.S. don't lose the "dignity" (whatever that means) of a union job. Oh, and if the cost of living goes way up, you don't care about that either. <br /><br />I'm sure the UK was way better off before the U.S. became so economically successful. Obviously having people in other countries be economically successful is bad. So F*ck the Chinese, right? The only think that matters is unions. Unions are people too!Cliffnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-308280645333115012013-08-22T03:22:11.408-04:002013-08-22T03:22:11.408-04:00There is very little evidence to argue for example...There is very little evidence to argue for example, that tax policies, like very progressive income taxes pre 1981, do any sort of income redistribution or "prevent wealth concentration" when you look at the % of GDP revenue data.<br /><br />When you talk about "ultra high income" are you talking about personal income or "corporate profits?"<br /><br />Frankly, I want to scrap the entire "welfare" mess for a negative income tax, and scrap the minimum wage, since it is largely non binding. The negative income tax will provide the floor without the effect of increasing LOW SKILL unemployment (before anyone talks about "no to little effect on unemployment" studies, when we are already talking about a largely non binding price floor).<br /><br />But your recommendations have all perverse incentive effects, which is why they have been changed over the years, they encourage offshoring, and simple tax evasion. Although, a land tax would be nice, since you can't offshore that.Yeahnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-70114087029896531502013-08-20T07:04:58.703-04:002013-08-20T07:04:58.703-04:00": As a number of commenters have pointed out...": As a number of commenters have pointed out, neoliberalism vs. corporatism is not a binary choice.You can have some of each, just like you can go to the grocery store and buy some eggs and some milk. The point of this post is that there is a real tradeoff between the two"<br /><br />I dont get this at all. Neoliberalism IS corporatism! Putting the needs of the firm ahead of workers is what neoliberalism is...... especially after you miraculously start counting corporations as people too! Then it becomes;<br /><br />"All "people" have a right to influence the political process with their money"<br /><br />"All "people" have a right to low taxation"<br /><br />"All "people" have a right to low government interference with their activities"<br /><br />There is no tradeoff with corporatism and neoliberalism, they are one and the same as I see it.Greghttps://www.blogger.com/profile/03139782404004492965noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-12023934339059824562013-08-20T05:22:43.217-04:002013-08-20T05:22:43.217-04:00Isn't part of the problem that 'neoliberal...Isn't part of the problem that 'neoliberalism' is used here to conflate two, possibly more different sets of 'villains' as opposed to individual policies? That's what Ames' near-apoplexy tells me - commentators have accidentally triggered his 'thoughtcrime' button. The substance of the policies, the realities of Japan's economy, all are irrelevant, as Ames would have offered the same response to such policy themes being advocated anywhere, at any time.Manoshttps://www.blogger.com/profile/01568922717477813566noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-49819910501260850622013-08-19T13:01:05.517-04:002013-08-19T13:01:05.517-04:00I've read that post now, and I think Noah has ...I've read that post now, and I think Noah has it backwards. That post, for example the quote by Shoichi Nakagawa, definitely shows that it's a cultural problem. Then Noah immediately mentions how Abe wants to fix the problem... by even more market regulation (a quota is a regulation). Then Noah is right by saying that Abe has to convince Japan itself. He needs to enact cultural change.<br />I'm not saying that labor market liberalization is unnecessary, but that it will not promote gender equality unless culture changes first.Alexander Sebastian Schulzhttps://www.blogger.com/profile/15135338616598357444noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-66622513516536600542013-08-19T10:35:34.475-04:002013-08-19T10:35:34.475-04:00Yes. But I think of that as compatible with neolib...Yes. But I think of that as compatible with neoliberalism.Noah Smithhttps://www.blogger.com/profile/09093917601641588575noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-52391250761611976972013-08-19T10:28:40.945-04:002013-08-19T10:28:40.945-04:00There is a third choice which allows liberal labor...There is a third choice which allows liberal labor markets and still protects the middle class. Tax policies which prevent wealth concentration worked well in this country for many decades. When ultra-high income is taxed at high rates the corporate executives no longer have strong incentive to strip wealth from the economy. A strong social safety net also provides a floor for wages. Property tax and inheritance tax with reasonable individual exemptions prevent the richest individuals from developing an inter-generational permanent wealthy class.kramerhttps://www.blogger.com/profile/00412019828714207222noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-36373052412000644812013-08-18T21:39:06.155-04:002013-08-18T21:39:06.155-04:00Actually that is an incredibly good point, and the...Actually that is an incredibly good point, and the subject of a big future post... :-)Noah Smithhttps://www.blogger.com/profile/09093917601641588575noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-12506052278123814402013-08-18T21:06:18.717-04:002013-08-18T21:06:18.717-04:00Hi Noah,
I've lived in Japan for the past 14 ...Hi Noah,<br /><br />I've lived in Japan for the past 14 years and wonder how your take on the "non-liberalized labor market" relates to non-enforcement of labor laws. On paper, companies are not supposed to discriminate against females in employment and yet they very much do. Many large companies follow labor laws around overtime work, but smaller companies often do not. In general, you have a quazi-non-liberalized labor market in which many of the protections which are afforded to workers on paper never pan out in practice. If labor laws were actively enforced, would this be detrimental to the economy? Seems to me it would result in more workers being pulled into the work force (because you couldn't get away with simply having employees work for nothing...the infamous "service overtime")and a much higher rate of women in the workforce. As opposed to getting rid of the protections Japan already has, wouldn't fully enfocing the laws on the book also lead to a real payoff in productivity (workers wouldn't hang around the office until late at night to look busy because everyone else is hanging around the office), hiring (it would be cheaper to hire more people than to pay people for the actual overtime they work), and female participation in the workforce? <br /><br />Just wondering,<br />Kevin<br />(in Osaka)<br /><br /><br />Just wonderig,<br /><br />KevinAnonymoushttps://www.blogger.com/profile/06905808845415117734noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-16648580320762571222013-08-18T20:51:20.008-04:002013-08-18T20:51:20.008-04:00It seems a better "natural experiment" w...It seems a better "natural experiment" would be rather to compare USA post '80s vs. USA pre '80s. Perhaps around that time we can find productivity and marginal ROI kinked upwards? <br /><br />johnhttps://www.blogger.com/profile/01628063779348336042noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-82707074245354189162013-08-18T20:48:26.658-04:002013-08-18T20:48:26.658-04:00A recession offers the opportunity to lay off expe...A recession offers the opportunity to lay off expense and increase margins. Persistently low rates force a high multiple. Is there any other mystery? johnhttps://www.blogger.com/profile/01628063779348336042noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-6432946442202879052013-08-18T20:05:43.010-04:002013-08-18T20:05:43.010-04:00Noah, this portion of your commentary sticks out t...Noah, this portion of your commentary sticks out to me for further examination:<br /><br /><i>I think that Japan's labor-protectionism has caused deep unfairness to persist in Japanese society. Japan is still one of the lowest-ranking countries in terms of women's equality. Go into a lot of Japanese companies, and you still see the men climbing the corporate ladder while the women serve tea. That cozy boys' club is protected by the government, which makes it incredibly difficult to fire the mostly-male "正社員" (lifetime) employees, while making it incredibly easy to fire the mostly-female "契約社員" (contract) and "アルバイト" (part-time) employees.</i><br /><br />Is it labor-market rigidity that has caused women to be shuffled into 'non-regular' employment, or is it not a consequence of 'societal norms' instead?<br /><br />(I'm using the term 'societal norms' in a very broad sense here, one not meant to be gone into too deeply for the moment.)<br /><br />Consider for a moment, that the majority of women in Japan generally do not enter four-year post-secondary programs of study, nor do the slim percentage who do so generally go onto graduate programs.<br /><br />Does this not suggest to you that - rather than the lifetime employment system - the issue preventing more women from being in the workforce is an issue of societal expectations?<br /><br />Not to mention the other issues contributing to the low participation rate of women in the workforce. Such as those surrounding day-care (not the lack of facilities, but the lack of child-care workers), the tax penalties for two-earner households, and so on and so forth.<br /><br />Which is not to say that the lifetime employment system is a good thing. It certainly was at one time, and it may actually still be so - I do not know.<br /><br />But if we're actually looking to help Japan, would it not be better to look at the most effective solutions to this and other issues, rather than throwing neoliberal complaints about Japan's unique - and labor-friendly traits - at the walls and seeing if any of it sticks?Michael David Bergernoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-49863340125901554902013-08-18T19:38:11.195-04:002013-08-18T19:38:11.195-04:00Why have we continued to enjoy a secular bull mark...<i>Why have we continued to enjoy a secular bull market in the U.S.A.?</i><br /><br />Margin debt? Post-K and Zerohedge togetha, now you know you in trouble.<br /><br />http://www.zerohedge.com/news/2013-08-09/stock-market-bubbles-and-record-margin-debt-repeating-history-ignoring-all-warnings<br /><br />"I sincerely believe that this environment is due, in large part, to the Bernanke Put and the idea that you 'can’t lose' by owning risk assets because the Fed will put a floor under the markets no matter what."<br /><br />http://pragcap.com/de-ja-vu-on-margin-debt-2013-repeats-1999-2007#ixzz2cMoFfokOJohn Snoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-19611488254954190552013-08-18T19:00:06.335-04:002013-08-18T19:00:06.335-04:00John S
The problem that Noah and all liberals are...John S<br /><br />The problem that Noah and all liberals are grappling is partially their inability to come to terms with the impact of free capital on 'free labor markets'. If I can hire Chinese slaves to build my stuff I will, and and the idea that Chinese slaves cant be taught to code in python is just a left over of the more racist "Orientals arent creative" meme that has been going on for the last 20 or so years. <br /><br />There is *nothing* that you can do that someone living in a country that is much poorer than yours cannot do. The only challenge is providing decent electricity and the initial capital to build up their servers or whatever and getting the goods over here. (And maybe a level of trust, since white people dont like the idea of the Chinese military having hardcoded entry points soldered right onto their motherboards, of course now that we know that the NSA and their British lapdogs are doing the exact same thing who knows, maybe buying those Huewei motherboards at 1/3rd the price is looking good again)<br /><br />So the real question is, who gets to be poor, the people who were unlucky to be born in third world hellholes or the people in the West -- who will continue to face relative decline in well being as the natural outcome of a 'free market' system. Now I know what Noah and the other free traders will respond, in free trade everyone benefits! Well, that is patently false. The people who lost their union jobs and the dignity of being 'middle class' are never going to get that back, they will just get cheaper Ipads. And the Chinese slaves will never be allowed to be as wealthy as the American workers of the 50s were because there are always Burmese or Laotian slaves to take up the slack once China's hourly wage breaches some kind of reasonable wealth limit. <br /><br />Now it gets particularly awkward for Noah and other liberals, unlike Republicans/conservatives who believe god decides who gets wealthy and thus have no problem with latin americanization of the US society (obviously having too many darkies in america is a different problem, but having an almost aristocratic elite is totally acceptable, even welcome to them), because they believe in equality and meritocracy and opportunity (and all these things are slipping away). Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-39585621640638203342013-08-18T18:59:35.213-04:002013-08-18T18:59:35.213-04:00One point which deserves to be made w.r.t. US vs. ...One point which deserves to be made w.r.t. US vs. Japan and fairness: US median income still kicks Japan's ass. The size of the pie matters.<br /><br />USA: #4, $29,056 (PPP)<br />Japan: #21, $19,564<br /><br /><i>The annual median equivalised disposable household income for selected countries is shown in the table below. This is what a each equivalent adult in a household in the middle of the income distribution earns in a year.</i><br /><br />http://en.wikipedia.org/wiki/Median_household_income#International_statistics<br /><br />http://en.wikipedia.org/wiki/Household_income#National_accounts_adjustmentJohn Snoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-51402206950558580612013-08-18T18:41:28.602-04:002013-08-18T18:41:28.602-04:00that disadvantage of women would not disappear in ...<i>that disadvantage of women would not disappear in a more liberalized labor market."</i><br /><br />I believe Noah would disagree somewhat:<br /><br />"Japan's protected economy, heavily subsidized "zombie" companies, and weak corporate governance insulate it from the Beckerian free market forces that probably helped advance gender equality in the U.S. in the 80s and 90s."<br /><br />http://noahpinionblog.blogspot.kr/2013/04/will-abe-address-japans-number-one.htmlJohn Snoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-21145976659910385192013-08-18T18:32:42.978-04:002013-08-18T18:32:42.978-04:00I think the U.S. has gone too far in the other dir...<i>I think the U.S. has gone too far in the other direction!</i><br /><br />I think you're somewhat conflating two separate issues: labor market flexibility and the social safety net. Surely, labor market flexibility can and should be increased everywhere (even in the US), with positive gains for overall dynamism and more fairness to the lower half of bifurcated labor markets like those of Japan and Europe. <br /><br />Strengthening of the social safety net is a political issue, the optimal level of which is debatable (we would also probably do well to favor cash, rather than in-kind, transfers). <br /><br />Finally, we need to stop relying on the university system as a means to transmit skills to the labor force. More agile programs like the rapidly growing "coding bootcamps" in the US, which produce job-market ready programmers in 4-10 weeks, should instead be the norm in terms of job training.John Snoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-6312068051686737682013-08-18T17:56:12.829-04:002013-08-18T17:56:12.829-04:00One choice that never shows up is to weaken corpor...One choice that never shows up is to weaken corporations dramatically by putting progressive taxes on their gross income. This would eliminate corporate inefficiency and encourage corporate bankruptcy. The corporate bankruptcy rate, especially for large corporations, is way too low. There should be several spectacular failures annually. It's not as if the factories and equipment vanish or the workers lose their skills just because the managers screwed up. Instead of just collecting rents, our zero efficiency banking sector could reorganize assets to built new generation companies every few years, each time increasing efficiency and workers' wages.<br /><br />(This isn't completely thought out, but it doesn't seem any less thought out than the Soviet style garbage that passes for economics wisdom these days. It just switches the bias in favor of the workers, rather than the managers.)Kaleberghttps://www.blogger.com/profile/05283840743310507878noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-17020390047319093642013-08-18T17:50:55.393-04:002013-08-18T17:50:55.393-04:00Basically, the US took the option of only creating...Basically, the US took the option of only creating part-time or non-life-time security jobs. That seems to be it. There have been no good jobs with any security created. If you are Japanese, odds are you are better off.Kaleberghttps://www.blogger.com/profile/05283840743310507878noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-29799081983156308502013-08-18T14:43:21.178-04:002013-08-18T14:43:21.178-04:00No wonder their suicide rates are so high. No wonder their suicide rates are so high. Bretthttps://www.blogger.com/profile/05741738070067590221noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-65178334307664011722013-08-18T14:15:05.235-04:002013-08-18T14:15:05.235-04:00It's not an essentialist choice but a historic...It's not an essentialist choice but a historical one - and that's an essential difference. <br /><br />The bifurcated labor market is a way of protecting existing players (workers) when competition from globalization and lowered standards in every aspect of economic life are threatening wages. There is a reason bifurcated labor markets happened when they did: historical conditions. <br /><br />That means this trend will run its course eventually and we'll discover more about the tradeoffs when the long term costs become apparent. <br /><br />Do you choose economic efficiency and globalization over democracy? That may be the real dilemma. Because of course you cannot continue indefinitely with a system that causes a decline of standard of living for most citizens without an eventual challenge - if that country is a democracy. <br /><br />Really the arguments over whether the top one per cent "deserves" their outsize share is irrelevant in the long run - in a democracy. Fairness is in fact a (much) more important value. And also there is the issue of social cohesion and stability. <br /><br />I think the choices that countries have made to protect high wage labor is political. It is like the choice gentrifying cities make to have rent control. It is stabilizing. You think Japan is showing signs of damage from labor market calcification. I suggest that given the long recession Japan has done very well in protecting living standards. <br /><br />It remains to be seen how the instability from our declining middle class will effect this country. Low marriage and birth rates across the non-professional classes are here it stay, I predict. Goodbye demographic dividend. And what else are waving adieu to? <br /><br />minkahttps://www.blogger.com/profile/04067741747813131873noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-12922119419696111972013-08-18T14:14:56.041-04:002013-08-18T14:14:56.041-04:00Obviously there is no simple answer. To start dow...Obviously there is no simple answer. To start down the rabbit hole, the first thing to notice is that corporate profits as a share of the US economy have increased significantly. <br /><br />Of course that only prompts the question of what legal and other structural factors in this country provided the avenue for increased corporate profits not available to companies in Japan. I would love to hear thoughts on that. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-60282672111194385832013-08-18T14:12:36.302-04:002013-08-18T14:12:36.302-04:00To think with these reforms Japan could have had t...To think with these reforms Japan could have had the same stellar performance as Ireland or Estonia!Anonymousnoreply@blogger.com