Japan’s Economic Crisis: More Chronic than Acute—So Far

Abstract

Japan’s crisis of 2011 stunned the world, as a massive earthquake followed by an equally massive tsunami killed more than 20,000 people in the poor northeast region, left hundreds of thousands homeless, and overwhelmed the defenses of many of Japan’s electric power plants, leading to power shortages and a meltdown at the Fukushima No. 1 nuclear power plant. The government’s faltering response to the nuclear meltdown further shocked the world. For many, both in Japan and abroad, these multiple crises seemed to symbolize and exacerbate Japan’s longer-term problems, including the decline of rural areas and the incompetence of the political system, which seemed even less capable under the Democratic Party of Japan (DPJ) than it had in the waning years of the Liberal Democratic Party (LDP) regime that had ruled Japan for almost all of the five decades before the DPJ gained control of the cabinet in 2009. Partisan transformation, far from leading to reform and renewal, seemed to have worsened Japan’s many woes, and the crisis in the northeast seemed to provide definitive proof of that failure.