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Japan's Growing Poverty Defies Glib Explanations
- x5n1 11y agoCan't see why this would not happen to the rest of us as well as time goes along. Sure there will be basic income, but that does not mean that you won't be living in poverty despite getting it.
- meric 11y agoYeah, stuff and food and automated services would be cheap, but real estate expensive. Like today, but even more so.
- x5n1 11y agoReal estate, insurance, utilities, it all adds up. The living wage in many cities is at least 10/hr. Which means that just to pay for basics you need to get $1600 per month as a single individual. When they talk of basic income they never talk about money like that, usually around $700, just around poverty level.
- sun_n_surf 11y agoAh, Noah "I didn't get kicked out of academia for not producing research and being a low-brow blog hack, I left because SFO" Smith.
- raverbashing 11y ago10 yrs of recession, or is it 20 yrs already? Failure to compete in high-tech areas (when was the last time you got a mobile phone made in Japan) Which is funny because Japan was very strong in the modern days of computing and videogames. What happened? My guess is that software got more complex and their vertical way of working is not productive for the complexity expected today
- icelancer 11y agoJapan has SERIOUS issues with NIH syndrome. They were on the cutting edge of technology when they led it. Not so much when it would require adoption from American and Chinese suppliers and service exporters.
- _delirium 11y agoThere's a significant U.S.-Japan language gap as well, which tends to work to the disadvantage of whichever side is not currently ahead technologically. Very few American engineers read Japanese-language journals or trade press, and very few (though somewhat rising) Japanese engineers read English-language journals or trade press.
- adrianN 11y agoGDP per capita hasn't changed all that much since the late 90's. I wouldn't call that a recession.
- tonyedgecombe 11y agoUnemployment has remained very low as well, considering their demographic changes Japan is doing quite well.
- jazzyk 11y agoYes, but low unemployment comes at a price. Most domestic companies are shielded from competition, and can employ many more people than they should. These companies are backed by the central bank (BoJ), which has been printing money left and right, and now owns more than half of the nation’s market for exchange-traded stock funds[1]. [1] http://www.bloomberg.com/news/articles/2015-10-28/owning-half-of-japan-s-etf-market-might-not-be-enough-for-kuroda http://www.bloomberg.com/news/articles/2015-10-28/owning-hal...
- taneq 11y agoIt's interesting that the author equates "Japan has very high labor force participation and low unemployment." with "No laziness or idleness here." The Japanese workplace culture of the 'sarariman' who spends 14+ hours a day in the office, achieving almost nothing, is legendary.
- a_bonobo 11y agoJapan has so many of these depressingly useless jobs - drive past any quiet street construction site at night and you'll see 3-5 people whose sole job it is to wave a light stick. The job isn't needed at all, the guy who does it makes peanuts, but that's what drives up labor force participation.
- GreaterFool 11y agoNot exactly true. You'll see a weird mechanical contraption shaped like a person waving the stick. After living in a number of countries where construction works usually involve two or three people making loud mess for days I'm astonished how things work in Japan: a team of people shows up quietly, does the job efficiently and then disappears. You won't even notice them. There's a big-ish construction (they have heavy machines and dug up a big hole in the ground) going on nearby and I never heard any noise. And they're going with it really fast.
- a_bonobo 11y agoI guess it depends on the prefecture and the type of construction site - the guys I've seen were always humans, no machine can copy that bored face...
- phatfish 11y agoThere are a lot of safety personnel in larger London construction sites as well. I've seen men basically acting as barriers while their mate does work above a footpath. Also there are always people directing traffic in and out of a site, washing down every truck that leaves so there is no mud on the road, etc. I would assume it is more a case of construction in a large city is more difficult logistically as there are stricter standards for noise, mess and pollution. It was always my assumption that these type of jobs were on a rota. It would be pretty bad to make someone work the "human barrier/traffic light" job 52 weeks a year.
- GreaterFool 11y ago"The survey compared the incomes of the bottom 10 percent of households with children to the average income of 41 countries who are members of the OECD or the European Union. The income gap in Japan was found to be 60.21 percent, meaning the household income of the nation’s most underprivileged families with children was less than 40 percent of the average." I'm not sure how to read this. Income gap be damned, what is the minimum livable income? There's a difference between being poor relative to one's peers and being too poor to afford housing / food / education. I live in Tokyo at the moment. My experience (as a single person without kids) is that if one wanted to live frugal but happy-go-lucky life it could be done quite cheaply. "The income of the poorest fell from about ¥902,500 to ¥840,000 during the same period, according to data compiled by Abe of Tokyo Metropolitan University" So there are some numbers, but what is the cost of living and where? Moving from Tokyo to Osaka would probably cut my living expenses by 50% or more. What about living in a smaller Japanese town? The cost of living disparity between major urban areas and rest of Japan is probably gigantic.
- mkagenius 11y ago> ¥840,000 That's INR 8,597,047 in India. I think only top execs at a well established company make that much in India. Amazing.
- wineisamazing 11y agoYou mean 502,323 INR (as of now, using xe.com/ucc). Once you start factoring in living expenses (depending on location of course) the amount will seem really low.
- Pitarou 11y agoSee what ¥840,000 will buy you in Japan. :-)
- deleted 11y ago[deleted]
- cbowal 11y agoYou're off by a factor. ¥840,000 = INR 500,000
- cronjobber 11y ago> The report looked at the gap between the income of the poorest Japanese families with children and the average household income. This is the relative definition of "poverty". Throws me every time until I remember that in western political talk, "poverty" almost always means "relative poverty", which "is a measure of income inequality." (Wikipedia) Maybe we're looking at the rich country problem of the average household being overpaid. Sad they can't overpay every Japanese, but not exactly catastrophic either.
- _Codemonkeyism 11y agoBasically there are two definitions of poverty with two crowds of followers. 1. People are poor if they can't afford (basic) things. People are very poor if they go hungry to bed. 2. People are poor if they earn less [1] than the average (not median) household. From the article "The report looked at the gap between the income of the poorest Japanese families with children and the average household income." When does the poverty rate rise in 1. and 2.? 1. When peoples (real) income decreases (e.g. they lose jobs) and they can't afford (basic) things they could afford 10 years before. Or prices are rising to the same effect. The margin between income and costs gets smaller. 2. When some people get a lot richer (e.g. the "1%") then the income average rises and the poverty rate rises, although "poor" people might also have higher income or can afford more things than 10 years before (because of cheaper food, clothes, phone costs, energy they have more "disposable income"). I wish we would label these two types of poverty differently to have better discussions. [1] EDIT: a certain percentage
- GreaterFool 11y agoFrom what I've seen in USA and Japan I think USA is mostly 1 and Japan is mostly 2.
- artumi-richard 11y agoI think the two labels are "absolute poverty" and "relative poverty"
- _Codemonkeyism 11y agoI agree this could be the labels, but as the article does never mention 'relative' IMHO these types of poverty are not labeled.
- thaumasiotes 11y ago> People are poor if they earn less than the average (not median) household. From the article "The report looked at the gap between the income of the poorest Japanese families with children and the average household income." And I thought the US move to define the poverty line as the 40th percentile of income (or something lower; I don't remember this too well) was absurd. The average household income is, by necessity, well above the 50th percentile everywhere. There is no one seriously advocating that over 50% of every country's population is living in poverty.
- hudibras 11y agoOne thing that will help is the planned raising of the minimum wage in Japan, from around 800 yen/hour now to 1000 yen/hour in 2020. [0] The minimum wage in Japan is below-average by most measures for OECD countries. [1] [0] http://www.japantimes.co.jp/opinion/2015/12/11/editorials/much-needed-minimum-wage-hike/ http://www.japantimes.co.jp/opinion/2015/12/11/editorials/mu... [1] http://www.oecd.org/social/Focus-on-Minimum-Wages-after-the-crisis-2015.pdf http://www.oecd.org/social/Focus-on-Minimum-Wages-after-the-...
- Pitarou 11y agoVery poor article. I can list three widely touted explanations off the top of my head that the author doesn't touch upon. 1. strong insider / outsider effect in the labour market 2. high barriers to employment for mothers 3. weak social welfare system
- brandelune 11y agoThe author is stupid. "How about free-market policies? Here the story is more ambiguous, but I still see this as a minor factor at most." Because of such neoliberal policies, 40% of the work force is now on irregular lowest wage jobs with no job security whatsoever, no medical coverage/pension at all. Neoliberal policies of the last 2 decades are destroying what boosted Japan prosperity and stability. The author lives in a dream world where Japan has always been a country with low criminality, obedient citizen etc. But that is only the product of the after-war and the massive US investments to make Japan the first barrier against Asian communism. Now that the socialist block is dead, neo-liberals can destroy at will all the social policies that were created since the 40's.
- bcook 11y agoIf you removed "The author is stupid." from your post, I (and other "adults", assumedly) would be much more receptive to the rest of your post. (If you remove that line, I'll delete this post.)
- deleted 11y ago[deleted]
- brandelune 11y agoYou're free to look like an ass. But if you're suggesting that the author is not stupid, it either means that you've not read the article, or that you don't have a clue about the reality here in Japan, or that you're not very smart yourself.
- dang 11y agoThis comment breaks the HN guidelines that ask you to be civil and not to call names in arguments. Some of your other comments have done this as well. Please post civilly and substantively, or not at all. https://news.ycombinator.com/newswelcome.html https://news.ycombinator.com/newswelcome.html https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
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- nihonde 11y agoIt's depressing to read all the misguided commentary about Japan in western media. We're talking about one of the world's oldest continuous civilizations, which currently has the longest life expectancy, and one of the lowest crime rates. Japan will endure, as it has for thousands of years. I'm more worried about where America and Europe are headed. Prosperity is one thing. Greed, corruption, and exploitation are another. Anyway, in my experience, Japan today is a pleasant place to live. The lack of boom times here has rendered Japan more humble and practical than in the recent past. Most people in Japan ultimately enjoy a middle-class existence that would be the envy of the average American family. There are plenty of people who are struggling here, but Japanese people have endured far worse. Western commentators will tell us that huge bloc of elders are an impossible burden on Japanese society. I see it differently—those people are a treasure trove of hard-earned experience. We can learn from them, and they're currently doing an excellent job as stewards of this place. They've seen first-hand the folly of chasing America and Europe on their imperialist fancies. I would rather live in a "poor" Japan than in a "rich" America any day of the week. You can't put a price on peace of mind and the general atmosphere of civility and willingness to come together for a common cause.
- _Codemonkeyism 11y ago"They've seen first-hand the folly of chasing America and Europe on their imperialist fancies." Interesting view on history.
- fit2rule 11y agoI'd see it more as a comment on the here and now. History is one thing. The wanton destruction of other nation states at the present time, another thing entirely.
- nihonde 11y agoWell, it was intended as an "aside" comment, but it's still interesting, if controversial. I believe that there is an unbroken thread from the arrival of American ships in Tokyo bay in 1853 to the current day. If you look at the official US history of that event (it's here: https://history.state.gov/milestones/1830-1860/opening-to-japan https://history.state.gov/milestones/1830-1860/opening-to-ja...), it is characterized as a great opening of Japan to the world. In fact, it was in the pursuit of an arrogant imperialist notion of "Manifest Destiny" that Commodore Perry humiliated the Japanese and scared them into thinking that they needed to get into the expansion and conquest game in order to survive. It was a clear message from the Americans: we're coming in whether you like it or not. Some call it a wake up call; others call it a provocation. Reasonable men and women can disagree about it. There's no doubt that it directly led to the lowest and highest points of Japanese civilization in the 20th century, though. I think if people looked into the context of events with more curiosity, we would ultimately all benefit from the inquiry. (And yes, I do believe that America and much of Europe are still pursuing an imperialist agenda. Call me crazy, if you want.)
- dnautics 11y agoEasy glib explanation: negative interest rates (a wealth transfer from the poor to the wealthy) and crony capitalism.
- chvid 11y agoFirst off. Economists define "poverty rate" in a slightly cheeky manner: "The poverty rate is the ratio of the number of people who fall below the poverty line and the total population; the poverty line is here taken as half the median household income." This means that if the middle class is 5% better off after one year and the lower class is only 2% better off, then the poverty rate will go up. Eventhough all households are doing better. The same goes in reverse. If the middle class is 5% worse off after one year and the lower class is only 2% worse off, then the poverty rate will go down. Eventhough everyone is doing worse. This does not mean that the number is meaningless; it just cannot stand on its own. Secondly. Japan is much nicer with those bad things that hurt the lower classes in other societies: Crime is much lower, relatively few people in prisons. And the public school system is of very high standard.
- AnimalMuppet 11y agoIf I understand this correctly, basic income could eliminate poverty (by that specific definition). It would need to pay people half the median income, but tax the median income at a rate that means that exactly offsets the basic income payment (and, probably, tax higher incomes at higher rates).
- gozur88 11y agoJapan had a system in which the companies had a paternal relationship with their employees. Once you were hired, they kept you on even if they didn't need you. Even if you'd become too old to be productive (madogiwa zoku, or "window seat tribe"). The welfare system, such as it was, consisted of companies taking care of their employees with government bureaucrats and public opinion punishing transgressors. But that kind of system can only function when the economy is growing. When the recession started in 1989 Japanese companies found themselves in the position of either making people they didn't need redundant or going out of business. Since there isn't much of a social safety net for the unemployed, people who got laid off (and the growing ranks of part timers - "arubaito") didn't have anywhere to turn.
- bakhy 11y agoi don't know if i maybe missed something, but it does not seem like the inequality argument has been contested by anything in the text. in fact, the author states that in Japan, like elsewhere, despite a struggling economy, the rich are still getting richer. if all the other possible explanations do not work, then Japan is perhaps the best example of what Piketty wrote about.
- RobertoG 11y agoThe author says: unemployment is low in Japan and poverty is growing. A normal person would think automatically that wages are low or/and public spending in automatic stabilizers is low. It seems a professional economist prefer more exotic explanations. It's specially puzzling that Japan government prefer to buy financial assets that invest in their own people when, both, rates are very low and they are suffering deflation. But, of course, that would be redistributive and, even worst, it could work and create a bad precedent.
- arca_vorago 11y agoCentral bankers corrupt everything they touch, and Japan is no exception.
- xg15 11y ago"[The corporate-welfare system] has declined in the years since the administration of former Prime Minister Junichiro Koizumi ended a ban on the use of non-regular workers in manufacturing. But much of the shift to low-paid, insecure jobs has happened without major changes in policy. In particular, stringent government protections of regular workers have been kept in place." Am I reading this wrong? So the author acknowledges that there is a shift from regular to irregular jobs - and then wonders how that could lead to poverty as, after all, the regular jobs are still protected... This looks to me like seeing a conundrum where none actually is.