{"id":1824228,"date":"2023-01-26T06:34:42","date_gmt":"2023-01-26T11:34:42","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1824228"},"modified":"2023-01-26T06:35:45","modified_gmt":"2023-01-26T11:35:45","slug":"economic-security-became-magic-words-in-japan-heres-why","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/economic-security-became-magic-words-in-japan-heres-why\/","title":{"rendered":"\u201cEconomic Security\u201d Became Magic Words in Japan. Here\u2019s Why"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">18<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Feconomic-security-became-magic-words-in-japan-heres-why%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1824228&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47-->\n<div><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2023\/01\/Biden-Kishida-GettyImages-1456222306.jpg\" class=\"ff-og-image-inserted\" alt=\"image\"   style=\"display:none\"><\/div>\n<p>Japan made <a href=\"https:\/\/www.ft.com\/content\/1180f72c-b7aa-48cc-817b-69e7400fc6d3?shareType=nongift\">global headlines<\/a> in December with its new National Security Strategy, which dropped the country\u2019s post-World War II pacifist posture to call for counterstrike capabilities.<\/p>\n<p>Less visible but in many ways more instructive for U.S. policymakers are Japan\u2019s economic security policies, which aim to shore up its national interests from an economic perspective. These policies were initially conceived by Japan\u2019s Liberal Democratic Party in 2019, with a <a href=\"https:\/\/kobayashi-takayuki.jp\/cms\/wp-content\/uploads\/2021\/02\/%E3%80%8C%E7%B5%8C%E6%B8%88%E5%AE%89%E5%85%A8%E4%BF%9D%E9%9A%9C%E6%88%A6%E7%95%A5%E7%AD%96%E5%AE%9A%E3%80%8D%E3%81%AB%E5%90%91%E3%81%91%E3%81%A6%EF%BC%88%E6%8F%90%E8%A8%80%EF%BC%89%EF%BC%88%E8%8B%B1%E8%AA%9E%E7%89%88%EF%BC%89.pdf\">formal recommendation<\/a> toward developing Japan\u2019s \u201ceconomic security strategy\u201d published by the party\u2019s Strategic Headquarters in late 2020. Over the last two year, implementation began. It includes funding to support supply chain resilience and promotion of crucial industries of tomorrow, as well as the participation of the corporate sectors. The most striking thing about Japan&#8217;s economic security is its focus on a government restructuring.<\/p>\n<p>The United States is only now becoming aware of the national security threats posed to its economic dependence upon China. In many ways, the United States has an enviable record of international security. <a href=\"https:\/\/tnsr.org\/2022\/12\/chinas-brute-force-economics-waking-up-from-the-dream-of-a-level-playing-field\/\">economic<\/a> <a href=\"https:\/\/itif.org\/publications\/2021\/01\/20\/remarkable-resemblance-germany-1900-1945-and-china-today-time-nato-trade\/\">war<\/a> China requires a wider definition of security than what the U.S. defense system was built for. Policymakers are becoming more aware of what is called the &#8220;The&#8221; \u201c<a href=\"https:\/\/chinashock.info\/\">China shock<\/a>\u201d as well as the loss of manufacturing jobs in China. But they are only just starting to address the national security implications that deindustrialization will have on them.<\/p>\n<p>China&#8217;s rise as an economic competitor to the United States requires a wider and more integrated strategic response than was traditionally the case in the United States. The concept of \u201cEconomic security\u201d All political parties will find it appealing. Japan offers a model of political leadership.<\/p>\n<hr class=\"thick-horizontal-rule\" \/>\n<div class=\"bolded-first-line\">\n<p>\u201cEconomic security\u201d The term &#8220;buzzword&#8221; is now popular in Japan. It can be seen on the evening news as well in government strategy documents. Its precise meaning varies; generally, it involves calls for reshoring or diversifying supply chains and promoting the growth of critically important industries\u2014particularly ones where private investment alone might be inadequate. These industries have dual-use applications, meaning they can be used for both military and civil purposes.<\/p>\n<\/div>\n<p>The country\u2019s new <a href=\"https:\/\/www.cas.go.jp\/jp\/siryou\/221216anzenhoshou\/nss-e.pdf\">National Security Strategy<\/a>The entire section of &#8216;The First in Nearly 10 Years&#8217; is included in &#8216;The First in Nearly 10 Years&#8217;. \u201cPromoting Economic Security Policies to Achieve Autonomous Economic Prosperity.\u201d It begins with:<\/p>\n<p>\u201cJapan will curb excessive dependence on specific countries, \u2026 promote capital reinforcement of private enterprises with critical goods and technologies, and strengthen the function of policy-based finance, in pursuit of protecting and nurturing critical goods.\u201d<\/p>\n<p>China is not specifically mentioned. This is common in discussions about economic security in Japan. The context is clear.<\/p>\n<p>Two major factors account for the rise of economic security in Japan, according to Akira Igata, a project lecturer at the University of Tokyo\u2019s Research Center for Advanced Science and Technology: \u201cOne is China. The other factor is critical emerging technology like quantum computing or drones that can be used for civilian purposes but also military purposes.\u201d<\/p>\n<p>Igata, who also advises the Inter-Parliamentary Alliance on China on economic security, points out that the Japanese government\u2019s intense focus on the topic has been progressing over the last few years, with implementation now accelerating. \u201cThe awakening began under the Abe administration three years ago,\u201d Igata made the statement, which was confirmed by the Suga administration. Yoshihide Suga\u2019s government identified 16 different areas that Japan needed to work on to improve its economic security. These <a href=\"https:\/\/kobayashi-takayuki.jp\/cms\/wp-content\/uploads\/2021\/02\/%E3%80%8C%E7%B5%8C%E6%B8%88%E5%AE%89%E5%85%A8%E4%BF%9D%E9%9A%9C%E6%88%A6%E7%95%A5%E7%AD%96%E5%AE%9A%E3%80%8D%E3%81%AB%E5%90%91%E3%81%91%E3%81%A6%EF%BC%88%E6%8F%90%E8%A8%80%EF%BC%89%EF%BC%88%E8%8B%B1%E8%AA%9E%E7%89%88%EF%BC%89.pdf\">included<\/a> Diversifying supply chains, preserving technological advantages and strengthening telecommunications network infrastructure are just some of the things that have been done. Many of these are the main focus of the current Kishida administration.<\/p>\n<p>Its definition can sometimes be vague, however \u201ceconomic security\u201d It is more than just a buzzword in Japan. It has led the government to reorganize, and even created a <a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2022-08-29\/japan-will-monitor-china-new-economic-security-minister-says\">minister of economic security<\/a> At the cabinet level, an economic division of the National Security Secretariat is responsible for planning, coordinating and monitoring economic security policies. There are also dedicated economic security divisions within other ministries or agencies, such as those in foreign affairs, defense and intelligence, financial services, and foreign affairs. These divisions are charged with defensive actions such as tech controls, visa screening, cybersecurity, and more\u2014but also with the enactment of industrial policies to grow critical new industries.<\/p>\n<p>The culmination of Japan\u2019s economic security policies has been the <a href=\"https:\/\/www.iiss.org\/publications\/strategic-comments\/2022\/japans-economic-security-promotion-act-and-the-implications-for-businesses\">Economic Security Promotion Act<\/a> (ESPA), which Japan\u2019s parliament passed in May 2022 and will be phased in over the next two years. It has four main themes: security of supply chains for critical materials, nondisclosure patents for security purposes, promotion of advanced technologies and infrastructure security.<\/p>\n<p>Economic security is clearly critical for Japan\u2019s defense industry. \u201cEconomic security is welcomed by the Ministry of Defense,\u201d Ryo Sahashi is an associate professor at University of Tokyo and a Japan scholar at Wilson Center. \u201cIt will contribute to improving defense capabilities, and it may also help support the production base for defense equipment.\u201d<\/p>\n<p>Economic security also plays a central role in the Kishida government\u2019s plans to revitalize Japan\u2019s economy. Japan has been through many difficulties. \u201clost decades\u201d There is almost no economic growth. Shihoko Goto, the director for geoeconomics and Indo-Pacific enterprise and deputy director for the Asia Program at the Wilson Center, described Japan\u2019s approach as \u201ctwo-pronged.\u201d \u201cThe bigger issue in economic security is not just about defense,\u201d Goto. \u201cIt\u2019s also about economic growth in the future.\u201d<\/p>\n<p>Goto says that the United States&#8217; economic security is about technology rivalry with China. Japan&#8217;s concept, while it does include semiconductors in its definition, is much more broad. \u201cIn Japan, it is looking at the domestic economy more broadly. It is an opportunity to think about how to make Japan economically competitive and relevant,\u201d Goto.<\/p>\n<p>Subsidy subsidies are used to encourage the private sector to be involved in economic security programs. While these do exist in the United States and most other industrialized countries as well, what is singular about Japan is the flexibility in what can garner a government subsidy\u2014namely, the presence of \u201cspecific critical materials.\u201d If at all, these are not clearly defined by the government. Igata said that this is part of the ESPA. \u201cthe private sector can submit a plan to the government about diversifying supply chains of \u2018critical materials,\u2019 however defined.\u201d Igata stated that if the government considers it important for economic security, they will provide a subsidy.<\/p>\n<p>While Japan has a comprehensive approach to economic security, it&#8217;s too early for us to know how effective these policies will actually be in changing corporate behavior, particularly with regard China. China remains Japan\u2019s largest trading partner, and many companies continue to manufacture there. The new ESPA was only very recently enacted, and its subsidies haven\u2019t yet taken full effect.<\/p>\n<p>Still, there has already been one tangible success in Japan\u2019s bid for economic security, in rare earths. Japan has been actively recycling these minerals and investing in new suppliers since before the new law was passed. \u201cJapan used to be over 90 percent dependent on China for rare earths. Now it is <a href=\"https:\/\/qz.com\/1998773\/japans-rare-earths-strategy-has-lessons-for-us-europe\">under 60 percent<\/a>,\u201d Igata stated. This was done over the past ten years.<\/p>\n<hr class=\"thick-horizontal-rule\" \/>\n<div class=\"bolded-first-line\">\n<p>Since possibly the War of 1812 (which was probably before World War I), the United States has never had to face real issues of economic security. The U.S. economy has always dwarfed those of its enemies since then\u2014double the size of the German economy in World War I and <a href=\"https:\/\/www.amazon.com\/Wages-Destruction-Making-Breaking-Economy\/dp\/0143113208\">nearly quadruple<\/a> Its size during the Third Reich. Although it did experience oil shocks from OPEC and other countries, it was not economically dependent on them for critical manufacturing or technology. The United States was almost completely independent of the Soviet Union in terms of economic interdependence. Japan is an ally, and Japanese manufacturing was outperforming U.S. production in particular in the 1970s. U.S. corporations have never outsourced manufacturing to Japan in large quantities, as they did with China.<\/p>\n<\/div>\n<p>The United States now faces China as a potential competitor. China is also its biggest ally. While the topic of economic security may not have reached the same level of public attention as it did in Japan&#8217;s case, the concept is slowly becoming more well-known, at least within the government. 2017 <a href=\"https:\/\/trumpwhitehouse.archives.gov\/wp-content\/uploads\/2017\/12\/NSS-Final-12-18-2017-0905.pdf\">National Security Strategy<\/a> It is stated that \u201ceconomic security is national security.\u201d Both the 2022 and 2023 <a href=\"https:\/\/www.whitehouse.gov\/wp-content\/uploads\/2022\/10\/Biden-Harris-Administrations-National-Security-Strategy-10.2022.pdf\">National Security Strategy<\/a>  <a href=\"https:\/\/media.defense.gov\/2022\/Oct\/27\/2003103845\/-1\/-1\/1\/2022-NATIONAL-DEFENSE-STRATEGY-NPR-MDR.PDF\">National Defense Strategy<\/a> continued with this theme, even if they didn\u2019t use the precise phrase \u201ceconomic security.\u201d<\/p>\n<p>While the actual implementation may not match the words of these documents yet, the United States is making progress toward economic security in tech competition with China. It has placed tariffs on Chinese products and exported controls on key technologies to China, notably semiconductors. Joe Biden, President of the United States, issued an <a href=\"https:\/\/www.nytimes.com\/2022\/09\/15\/us\/politics\/biden-china-tech-executive-order.html\">executive order<\/a> In September, the United States blocked Chinese investment in technology. <a href=\"https:\/\/www.wsj.com\/articles\/white-house-weighs-order-to-screen-u-s-investment-in-tech-in-china-other-countries-11662674581\">discussions<\/a> We are now addressing outbound investments in sensitive technology in \u201ccountries of concern.\u201d<\/p>\n<p>However, this strategic change has not been accompanied with a U.S. government reorganization. \u201cQuite a few of the existing players\u2014Defense, State, Commerce, NSC, NEC\u2014are thinking about economic security, but no one has been given the explicit mandate above all others,\u201d Michael Brown, who led the Defense Innovation Unit at U.S. Defense Department from 2018 to 2022, said. The U.S. government does not have a coordinating agency for its economic security, nor a cabinet minister for economic security like in Japan.<\/p>\n<p>Many legislative attempts have been made to establish new financing mechanisms in order to help scale up and market critical technologies in the United States. However, these efforts have not generally succeeded. <a href=\"https:\/\/govcon.mofo.com\/topics\/highlights-from-the-currently-stalled-small-business-administration-reauthorization-and-improvement-act-of-2019\">languished<\/a>. The United States does not have the same level of industrial policy expertise as Japan, but the success of <a href=\"https:\/\/americanaffairsjournal.org\/2021\/05\/inside-operation-warp-speed-a-new-model-for-industrial-policy\/\">Operation Warp Speed<\/a> Does point to U.S. capability.<\/p>\n<p>Pavneet Sing, who was a member of the National Security Council as well as the National Economic Council under the Obama administration, pointed out that the top economic officials in the United States have historically had a background in finance and not manufacturing. \u201cBasically, everyone in the Clinton and Bush administrations shepherding economic policy hailed from financial markets,\u201d Singh said. \u201cEconomic policy was governed by pro-financial market thinking to the detriment of thinking about industrial policy and a manufacturing base to compete.\u201d<\/p>\n<p>There have been significant shifts in policy under Biden&#8217;s administration. The <a href=\"https:\/\/americanaffairsjournal.org\/2022\/08\/where-the-chips-fell\/\">CHIPS and Science Act<\/a>The <a href=\"https:\/\/www.whitehouse.gov\/briefing-room\/presidential-actions\/2022\/09\/12\/executive-order-on-advancing-biotechnology-and-biomanufacturing-innovation-for-a-sustainable-safe-and-secure-american-bioeconomy\/\">executive order<\/a> on the promotion of biotechnology innovation and biomanufacturing. <a href=\"https:\/\/www.whitehouse.gov\/cleanenergy\/inflation-reduction-act-guidebook\/#:~:text=The%20Inflation%20Reduction%20Act%20is,technology%2C%20manufacturing%2C%20and%20innovation.\">the Inflation Reduction Act<\/a> These measures, which include provisions to create an economic clean environment, are all intended to boost domestic and U.S. competition in these industries.<\/p>\n<p>China\u2019s foundational industries\u2014<a href=\"https:\/\/foreignpolicy.com\/2020\/05\/19\/dont-let-china-steal-your-steel-industry\/\">steel<\/a>, <a href=\"https:\/\/www.areadevelopment.com\/OtherIndustries\/feb10\/US-glass-industry-innovation1166006.shtml\">glass<\/a>, <a href=\"https:\/\/www.bloomberg.com\/news\/newsletters\/2022-07-26\/supply-chain-latest-aluminum-makers-want-us-tariffs-removed\">aluminum<\/a>, <a href=\"https:\/\/www.theguardian.com\/cities\/2019\/feb\/28\/the-grey-wall-of-china-inside-the-worlds-concrete-superpower\">cement<\/a>, <a href=\"https:\/\/www.mckinsey.com\/industries\/chemicals\/our-insights\/chinas-chemical-industry-new-strategies-for-a-new-era\">chemicals<\/a>\u2014dwarf those in the United States. China now has a dominant position in advanced industries such as robotics, space and medical devices, high-speed railway, and technologically advanced ships.<\/p>\n<p>Although semiconductors, bio-, and clean technologies have been favored by U.S. policy (all of them with strong domestic lobbies), they are critical technologies. However, so is the hardware sector, where China is rapidly gaining market share. The United States must be competitive in these technologies if it is to ensure its economic security and to develop a strong strategy for advanced manufacturing to rebuild the industrial base. It is necessary to take a broader approach.<\/p>\n<hr class=\"thick-horizontal-rule\" \/>\n<div class=\"bolded-first-line\">\n<p>The U.S. approach has been technocratic in pursuing economic security. It includes tariffs and export controls as well as subsidies for semiconductors. The concept&#8217;s true value is primarily political. Economic security can unify disparate interests and factions across the political spectrum, which allows for a broad policy response. Perhaps the main lesson from Japan\u2019s approach to economic security is not any one particular tool or policy but rather the political prominence given to the issue, as shown in major <a href=\"https:\/\/www.japan.go.jp\/kizuna\/2021\/11\/the_first_policy_speech_by_kishida.html\">speeches<\/a> Fumio Kishida, Japanese Prime Minister. He has <a href=\"https:\/\/www.japantimes.co.jp\/news\/2021\/12\/06\/national\/politics-diplomacy\/fumio-kishida-second-policy-speech\/\">characterized<\/a> The two key pillars that he believes in are economic security as well as climate change \u201cnew model of capitalism\u201d growth strategy.<\/p>\n<\/div>\n<p>The United States uses the expression &#8220;The phrase&#8221; \u201ceconomic security\u201d Politically, could be galvanizing in a manner that is similar to but narrower concepts, such as \u201csupply chain resiliency\u201d  \u201ceconomic patriotism\u201d They have not been proven to be. Economic security can be defined in many ways. It can unify China hawks and those whose primary concern is financial security and the need to promote job quality. For those who were on the libertarian left, economic security can provide guidance and cover. <a href=\"https:\/\/www.washingtonpost.com\/business\/2020\/08\/26\/republicans-favor-industrial-policy\/\">skeptical<\/a> of industrial policy but who realize that today\u2019s geopolitics requires a new approach. And it can help military strategists to more fully consider the Defense Department\u2019s industrial policy potential and ability to shape markets.<\/p>\n<p>\u201cIn Japan, the [phrase] \u2018economic security\u2019 is a magic word,\u201d Igata stated that such a move leads to immediate government interest and grant applications. The United States requires an economic and political realignment to respond to the challenge from China\u2014so far, this hasn\u2019t happened. \u201cEconomic security\u201d They could also be magical words in the United States.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Japan made global headlines in December with its new National Security Strategy, which dropped the country\u2019s post-World War II pacifist posture to call for counterstrike capabilities. Less visible but in many ways more instructive for U.S. policymakers are Japan\u2019s economic security policies, which aim to shore up its national interests from an economic perspective. These &hellip;<\/p>\n","protected":false},"author":1,"featured_media":1824231,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[547],"tags":[4202,3751,4461,7661,3646],"class_list":["post-1824228","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-bongino-report","tag-economic","tag-heres","tag-japan","tag-magic","tag-security"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1824228","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1824228"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1824228\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1824231"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1824228"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1824228"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1824228"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}