A Return to 1970s Economic Levels?
In the U.S., Trump is barking loudly about tariffs! Tariffs! According to a table from the social security database investigated by DOGE (the Department of Government Efficiency), which aims to cut wasteful government spending, the U.S. has around 20 million people aged 100 or older (approximately 6% of the population—compared to just 0.07% in longevity-leading Japan), and pensions and other benefits are still being paid out. It seems that bureaucrats, no matter the country, are a species that comfortably engage in deception—turning a blind eye, a deaf ear, and keeping their mouths shut.
Japanese bureaucrats, too, seem to only think about the interests of their own insular communities. That’s why we need to take a serious look at Japan’s dire economic situation (which, by the way, is the source of your salary). Thinking about this issue means thinking about your future.
Aren’t you worried about Japan’s future? If so, why not take a moment to consider the current state of Japan’s economy? In fact, since 2021, Japan’s per capita GDP—a key measure of national wealth—has fallen below the average of the 38 countries in the OECD (Organization for Economic Cooperation and Development). Not only that, but Japanese wages have also dropped to the lowest among major OECD countries. When you see this situation, you might start wondering, “Can Japan really still be called a developed country?” The reality is that our politicians can no longer afford to recklessly throw around borrowed money.
A Return to 1970s Economic Levels?
Shockingly, Japan’s per capita GDP has now fallen back to levels seen in the 1970s. The gap with the U.S. is about 2.4 times, the same ratio as in 1971. While other countries have grown wealthier, Japan has remained stagnant.
The Reality Revealed by Comparisons with Neighboring Countries
South Korea has already surpassed Japan, and Taiwan is quickly catching up. South Korea, which had a per capita GDP of less than 10% of the OECD average in the 1960s, has since made enormous strides and now surpasses Japan. According to global economic research institutions, Japan is expected to continue stagnating while South Korea and Taiwan grow further, widening the gap. Seeing this, I couldn’t help but feel a surge of frustration—“What are we doing?!”
From Peak to Decline
Japan’s per capita GDP peaked in the mid-1990s, at around twice the OECD average. However, it has gradually declined since then. The trend follows a mountain-like curve, rising to a peak in 1995 before descending. If things continue this way, Japan’s per capita GDP could fall to less than half of the OECD average by 2030.
The Impact of a Weak Yen
A major factor behind this decline is the weak yen. When calculated based on market exchange rates, the depreciation of the yen has contributed significantly to the drop in GDP. However, the situation is not solely due to a weaker yen—other factors, such as a strong dollar, have also played a role.
Learning from the Success of Other Countries
Meanwhile, the U.S. and South Korea have achieved remarkable growth. In the U.S., the IT revolution of the 1990s led to the rise of companies like GAFA (Google, Apple, Facebook, Amazon), fueling a V-shaped economic recovery. South Korea, too, has experienced astonishing growth.
For the Future of Japan
Japan is now at a critical crossroads. We must not mistake rising prices for economic growth but instead focus on real indicators of wealth, such as per capita GDP in dollar terms. Understanding our current situation accurately and crafting forward-looking policies are essential.
Let’s all acknowledge this reality, think about a better future, channel our frustrations into productive action, and take the right steps forward together.