Japan will recover and its economic achievements will once again earn the world's admiration, with sustained annual growth of three percent, perhaps more, well within reach. This is the confident forecast that begins Japanese Phoenix: The Long Road to Economic Revival by the author of Japan: The System That Soured, which several years ago accurately predicted Japan's current travails at a time when others were prematurely pronouncing full recovery. Katz warns however that there is bad news to go with the good. So deep-seated are Japan's dysfunctions that, even if it did everything right today, it would take at least five years for truly vibrant growth to take hold. But Japan will not do everything right. Opposition to reform is deep-seated and a myriad of vested interests and millions of jobs are at stake. Still he notes, there is little doubt that reform will succeed. Japanese Phoenix tells the story of the struggle between the forces of reform and the forces of resistance. It dissects Prime Minister Koizumi's role in the process, and explains why Japan is in so much trouble and what needs to be done. It explore the debates among economists and gives a careful progress report on all the moves made so far in the name of reform - from greater direct foreign investment, to the financial "Big Bang", to ending one-party rule by the Liberal Democratic Party. Katz concludes that this is just the second round of a 15-round fight. Japan is a great nation currently trapped in obsolete institutions. As it has before, Japan will find a way to surmount its problems and regain its forward progress.
1. Introduction; Part One: A Tale of Two Problems: Supply and Demand; 2. The Incredible Shrinking Japan; 3. Overcoming the Dual Economy: Backward Sectors Are the Key to Japan's Revival; 4. Anorexia: The Labors of Sisyphus; Part Two: Macroeconomic Policy Debates; 5. Fiscal Dilemmas; 6. Monetary Magic Bullets Are Blanks; 7. Japan Cannot Export Its Way Out; Part Three: Globalization: A Progress Report; 8. Globalization: The Linchpin of Reform; 9. Imports: Too Many Captives, not Enough Competitors; 10. Foreign Direct Investment: A Sea Change; 11. Financial Integration: The Iceberg Cracks; Part Four: Structural Reform: A Progress Report; 12. What Is Structural Reform? 13. Financial Reform: Big Bang vs. Financial Socialism; 14. Corporate Reform: No Competitiveness Without More Competition; 15. Competition Policy: Not Enough Competition; Even Less Policy; 16. Labor Reform: Mobility, Not Wage Cuts, Is the Name of the Game; 17. Deregulation and State Enterprises: The Momentum Is Clear, the Destination Is Not; 18. Tax Reform: Don't Exacerbate Anorexia; 19. Electoral Reform: Ending the One-Party State; 20. The U.S. Is Not Japan; 21. How the U.S. Can Help; 22. The Phoenix Economy