Feb 27, 2023
Connected Economies: The US-Japan Economic Relationship
The World Affairs Council of Philadelphia was joined by a panel of expert speakers to discuss the state of the economic friendship between the United States and Japan, and hear what practices can further advance its mutual benefit.
About the Event
Since the late 20th century, the economies of the United States and Japan have grown ever closer through trade, investment, and economic cooperation.
World Affairs Council of Philadelphia was joined by a panel of expert speakers to discuss the state of this economic friendship and hear what practices can further advance its mutual benefit. Topics included common economic problems following the Covid-19 Recession, the developing Indo-Pacific Economic Framework for Prosperity, the impact of demographic trends, Japan’s economic relationship with China, and much more. This event featured ample time for the audience to question the panelists, both in a formal setting and afterward at a tasting of Japanese food and drink. Guests had the chance to engage with Japanese culture intellectually, socially, and through cuisine.
The event began with an introduction by Deputy Chief of Mission Akira Endo, Honorary Consul Dennis Morikawa, and Dean Wilson of Temple University Japan Campus. Mr. Morikawa described the close connections between the US and Japan through business, trade, and diplomatic initiatives. Dean Wilson elaborated on the story of Temple University’s Japan Campus and how it pioneered the presence of US universities in Japan.
To begin the panel discussion, Shihoko Goto described the care that both countries have exercised to avoid economic conflict in the post-WWII world. At times, this relationship was strained, such as when Toshiba provided submarine technology to the Soviet Union and Congressmen expressed their anger by smashing Japanese-made products on the steps of the capital. In more recent times, the Abe administration set the goal of a “free and open Pacific” and the Kishida government hopes to solve disputes through trust and communication. David Boling elaborated on Japanese trade policy, noting that Japan salvaged the Trans-Pacific Trade Partnership after the US left. Although he expressed his support for the TPP, he acknowledged that the domestic political situation does not allow for tariff reductions and that the Indo-Pacific Economic Framework is the most pragmatic move forward.
The next topic in the panel discussion was the cause of Japan’s declining birthrate and its economic effects. Ms. Goto predicted that the trend would threaten the Japanese government’s expansion of its global presence because of restricted financial resources. She argued that the welfare state does not provide sufficient support for Japanese mothers and that cultural expectations make the burden even greater for working women. On the topic of Japan’s economic recovery from Covid, Mr. Boling explained that the mortality rate in Japan was far lower due to the adherence of its population to safety measures. He expressed doubt that the Kishida government can provide any new ideas with its “new form of capitalism” and predicted the continuation of Abenomics. Lastly, he elaborated on the low-interest rates that the Bank of Japan has adopted, an outlier among most developing countries, because of Japan’s past difficulties with deflation.
During the audience Q&A, participants asked the panelists about Japan’s reputation for technological innovation, and Mr. Boling attributed the reputation to Japanese perfectionism and precision. Ms. Goto stated that Japan’s positive relationship with most other Asian countries grants them opportunities for collaboration. When asked about rising Japanese income inequality, Ms. Goto noted that it is still far below American standards. She expressed her concern that in a globalized economy, innovative and successful individuals might move to other countries if they were not adequately rewarded at home. Mr. Boling agreed that inequality is not a major concern to the Japanese public at present and that inflation is considered a more pressing issue.
About the Speakers
David Boling, Director, Japan & Asian Trade, Eurasia Group
Shihoko Goto, Director for Geoeconomics and Indo-Pacific Enterprise and Deputy Director, Asia Program, Wilson Center
Matthew J. Wilson, J.D., Dean and President, Tokyo Campus, Temple University