Episode 21 – The Crash

For our final outline episode, we’ll be tackling the origins and effects of the real-estate bubble which devastated the Japanese economy in 1991, and which so brutally halted the story of Japanese growth. In particular, we’ll be focusing on the ways in which the various problems outlined last week were brought to the fore by the economic chaos of the 1990s.

Listen to the episode here.

Sources

Anchordoguy, Marie. Reprogramming Japan.

Pyle, Kenneth. Japan Rising.

Tett, Gillian. Saving the Sun: A Wall Street Gamble to Save Japan from its Trillion-Dollar Meltdown.

The full text of the Murayama Statement

Images (Courtesy of the Wikimedia Foundation unless otherwise noted)

The five men who negotiated the Plaza Accord in 1985. From left to right they are Gerhard Stoltenberg (German Federal Republic), Pierre Bérégovoy (France), James A. Baker III (United States), Nigel Lawson (United Kingdom), and Takeshita Noboru (Japan).
The five men who negotiated the Plaza Accord in 1985. From left to right they are Gerhard Stoltenberg (German Federal Republic), Pierre Bérégovoy (France), James A. Baker III (United States), Nigel Lawson (United Kingdom), and Takeshita Noboru (Japan).
The grounds of the Imperial Palace in downtown Tokyo. According to some estimates, during the height of the asset bubble this ~2 square mile area was worth more than the entire state of California.
The grounds of the Imperial Palace in downtown Tokyo. According to some estimates, during the height of the asset bubble this ~2 square mile area was worth more than the entire state of California.
The Ginza district of downtown Tokyo. In 1989, 1 square meter of this district would have run you $200,000.
The Ginza district of downtown Tokyo. In 1989, 1 square meter of this district would have run you $200,000.
Murayama Tomiichi, the last of the three non-LDP Prime Ministers of the 1990s. Murayama's most famous accomplishment during his year in office was the issuing of the Murayama Statement apologizing for Japanese behavior in World War II.
Murayama Tomiichi, the last of the three non-LDP Prime Ministers of the 1990s. Murayama’s most famous accomplishment during his year in office was the issuing of the Murayama Statement apologizing for Japanese behavior in World War II.
Hikikomori suffer from an accute form of social withdrawal in which they refuse to leave a confined area (usually either a house or a single room).
Hikikomori suffer from an accute form of social withdrawal in which they refuse to leave a confined area (usually either a house or a single room).
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3 thoughts on “Episode 21 – The Crash

  1. junior

    In this episode and a few before this one, US economic policy has been described as “deregulated.” This is an inaccurate representation of US economic policy. While the flowery language of free markets and deregulation is still popular among Republican (right wing) voters, the reality is that the US economy is regulated nearly on-par with other 1st world countries. The US has less regulation in some areas and more in others.

    To call US economic policy “deregulated” is to make the mistake of believing the political hype rather than looking at the actual laws and regulations being enforced.

    1. Thank you for getting in touch!
      You’re right to say that the United States economy is not absolutely deregulated, but please do keep in mind a few things:
      1) This is not an American history podcast but a Japanese history one; I made an authorial choice not to go into American political economy too deeply for that reason.
      2) This is a Japanese history podcast; compared to the Japanese economy, which functioned in the postwar era with very close state-business coordination, the United States is deregulated.
      3) I chose the term “deregulated” over less artful terms that would interrupt the flow of the show (“substantially less regulated”, “comparatively less regulated”) as a stylistic choice.

      I would love to do a long term digression into comparative US-Japan political economy, but a) I’m not sure that’s interesting to most people and b) it wouldn’t be appropriate for outline episodes designed to give you a general idea of how it all fits together. Instead, I relied on shorthand terms which are by their very nature inaccurate, because they generalize systems that are extremely nuanced and complex.

      I hope that helps to explain my reasoning for my use of terminology.

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