Monday, March 14, 2011

Why Johnny Can't Compete

The horrendous images of the Japanese earthquake and tsunami haunt my consciousness. We have friends there and as I said in an earlier post, our son is presently traveling there (he is safe and has been able to move south more out of harm's way).

Our prior travels in Japan are cherished memories. We developed the greatest respect for the Japanese people, a nation which seemed to reach its economic zenith during our stay as the New Year dawned in 1990. The Nikkei Dow touched 40,000 and Japan was booming. Our domestic press was full of stories about the Japanese having an unfair trade advantage and consequently how America was no longer able to compete with this economic juggernaut. Japan was said to be destroying American industry and would be buying up all our assets. Only a couple of months before the iconic Rockefeller Center complex was purchased by Japan's Mitsubishi Group. "Made in Japan" went from a joke in the 1950s to an economic threat by the end of the 1980s.

The dire forecasts concerning Japan faded over the next two decades as boom turned to bust and it fell into an ongoing deflationary spiral. But today we are saying the exact same things about China's unfair trade advantages, China buying up our assets and holding our debt, almost as if we are victims of outside forces and bear no responsibility for our own economic predicament.

While in Japan in 1990 I was invited to deliver a speech to the Rotary Club of Tokyo Koishikawa on the subject of US - Japan trade relations. When I returned home, I was asked to write an article about our experience, which for one reason or another was not published, probably because its contents did not blame Japan for our own failures.

I think the Japanese economy will recover from this tragedy, although it will take years. Our heartfelt hopes for recovery are with the Japanese people, and for a minimal loss of life and containment of what is appearing to be a serious threat from damage to several of its nuclear facilities. Please consider a donation to the Red Cross for those devastated in Japan.

I recently came across that unpublished article and was not surprised about how little has changed. One now only has to substitute "China" for some of the examples I used for Japan. Our fundamental problem about successfully competing remains: education. The irony is our best graduate schools are attended by some of the finest minds from overseas, but upon their graduation, we give them a diploma without a green card and send them on their way home. But the primary failure here is our public school system, the same failure I decried twenty plus years ago. Nothing has changed and it could be argued that they have worsened.

Given the folly in Wisconsin and the rhetoric of some of our politicians, one would think that our nation is going broke because we overpay our teachers. Of course the converse is true. Why go into teaching when one can become a master of the universe at an investment bank and rake in bonuses? We need great teachers and a better public education system to begin to reverse a continuing decline in our students' performance. "The three-yearly OECD Programme for International Student Assessment (PISA) report, which compares the knowledge and skills of 15-year-olds in 70 countries around the world, ranked the United States 14th out of 34 OECD countries for reading skills, 17th for science and a below-average 25th for mathematics."

The following is what I wrote in January 1990, in many ways as relevant today as it was then:

Why Johnny Can't Compete

In my capacity as president of an academic and professional book publishing company I have had the opportunity to visit Japan from time to time over the past 20 years. Even though our publications are in English, Japan has become our largest market outside of the United States. It has been an interesting sideline of these trips to be able to compare the economic, social, and educational progress of Japan with what I observe at home.

My most recent trip to Japan occurred over the Christmas and New Year holiday season, when many westerners who live in Japan return home, and Tokyo's hotels are given over to craft exhibits and festivals in celebration of the New Year. The Japanese New Year holiday is a major one: people stop working for nearly a week to greet the new year at shrines and temples, and to pay respect to their families. I made the trip this time with my wife and 13-year-old son, and we felt privileged to be there at this special time of year.

By prior arrangement with my Japanese host (the head of the company that distributes our books in Japan), I was to give a speech to the Rotary Club of Tokyo Koishikawa on the subject of U.S.-Japan trade relations as perceived by the American people -- a subject of great concern to the Japanese. I was aware of the symbolism of making such a speech at the end of this past decade. Japan has emerged as a leading economic power, while we, ourselves, perceive our own position to be in decline. While I made an effort to put what America had accomplished in the 1980's in the best possible light and to emphasize how the U.S. and Japan can become equal trading partners with the new opportunities in the 1990's, particularly those created by the decline of communism in Eastern Europe, in retrospect my words seem hollow. I returned with the realization that if we are to truly compete with Japan as the 21st century approaches, our nation will have to undergo radical changes by rediscovering many of the values embraced by Japan.

There is a cultural basis for Japan's success. The resolve to work hard, to be productive, to be well-educated, to respect one another, to be part of the team, and to be patient in attaining goals is the very essence of their culture. It little matters what one does, it only matters how well the work is done. In Japan, the marked contrasts to minimal working standards we have become conditioned to accept are everywhere. Is it no wonder we have difficulty in competing with a society that prides itself in being the best it possibly can be?

In a discussion with my host about such issues he asked, "Why is there a drug problem in the U.S.? Japanese people do not understand why such a problem should exist." "A feeling of-hopelessness," I replied. Thinking about that discussion, I believe that our future success or failure in restoring hope might be at the very core of competing with Japan. This can only be done by completely restructuring our educational system and giving it our highest societal priority.

Quality education is truly available to all in Japan and it is widely perceived to be desirable. Japanese teachers occupy a high status in society and are well paid. Illiteracy is virtually unknown. Even peasants were able to read and write by the nineteenth century. Japan ranked among the most advanced countries of western Europe in educational excellence.

Contrast this to our present situation. Our minimal educational standards have led to wide-spread illiteracy and millions are basically unemployable. The recently released report by the Secretary of Education estimates that 60% of our nation's 11th graders are barely able to read the most rudimentary documents. How and why does our society tolerate this perversion? Only by radically improving our educational system will we be able to ultimately remove the pervasive hopelessness that corrodes our land, drugs our children, and produces the type of wide-spread violent crime that is virtually unknown in Japan.

So, while we are urging Japan to make cosmetic changes to facilitate better U.S.-Japan economic relations, we must make mammoth changes to compete in the long run. What is needed is the equivalent of President Kennedy's pronouncement in the early 1960's that our national objective was to put a man on the moon by the end of that decade. Do we have the moral fortitude to declare that, as a national goal, we can and will create a public education system which is second to none by the end of this decade?

Only until we restore hope, the expectation that one generation can be better off than the previous one and people can find meaningful employment opportunities -- the very ideals which made this country the great melting pot of the 19th and early 20th centuries -- will we be able to successfully compete with Japan in the 21st century.

Things are by no means perfect in Japan. Their dedication to work borders on workaholism; individuals may not have the same degree of freedom to which we have become accustomed. However, for years Japan has been accused of copying the best of western business ways and technology and then improving upon them. In dealing with our economic dilemmas, the time has come for us to adopt some aspects of Japanese culture and, in so doing, rediscover many of the values that once made our country great.