thumbnail of Power in the Pacific; No. 104; Power Without Purpose
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<v Speaker>Funding for power in the Pacific has been provided by the Corporation for Public <v Speaker>Broadcasting. <v Speaker>And by the financial support of viewers like you. <v narrator>September 1st, 1945, on the <v narrator>battleship Missouri. <v Speaker>I now invite ?inaudible? of the Emperor of Japan, find the ?inaudible? of surrender at the places <v Speaker>indicated. <v narrator>The end of the great Pacific War. <v narrator>Americans at the surrender felt the elation of absolute victory. <v Al Bartholomew>I looked at them just like they were nothing because we'd beat <v Al Bartholomew>them so bad. <v Al Bartholomew>I realized then that America was king, that we were, as we
<v Al Bartholomew>say, the top dog. <v narrator>At that moment no nation on earth had ever been as powerful as the United <v narrator>States. <v narrator>The vanquished nations set about rebuilding infant industries under the watchful <v narrator>eyes of the American occupiers. <v Speaker>The big problem in Japan is obtaining the raw material. <v Speaker>Any raw material. <v Speaker>Waste into wealth with skill and ingenuity. <v Speaker>From one normal sized can, three car bodies. <v Speaker>4000 of these tiny autos per day. <v Speaker>All metal turret top, just like the Detroit model. <v narrator>1990. Detroit reels as another 12 hundred Japanese cars <v narrator>arrive in Los Angeles. <v narrator>Japan is now the world's strongest exporter and leading predator. <v narrator>The United States is now the largest debtor nation the world has ever seen.
<v Al Bartholomew>It's amazing, I'm sitting here in this harbor were during the <v Al Bartholomew>war, in the early part of the war it was a main area for shipbuilding. <v Al Bartholomew>U.S. ships. Now, I look at all the Nissans and Japanese cars <v Al Bartholomew>around here and the Japanese freighter behind us. <v Al Bartholomew>I wondered sometimes whether we really won the war or not. <v narrator>This film is about economic power and the rise of Japan. <v narrator>A nation that holds that power in unsteady hands.
<v narrator>Times Square on V-J Day. <v narrator>Hundreds of thousands celebrated America's industrial and military victory <v narrator>over Japan. <v narrator>Forty five years later, the neon lights in Times Square proclaim victory <v narrator>of a different sort. <v narrator>Now, markets once controlled by U.S. <v narrator>companies are dominated by the Japanese. <v narrator>Every month, Americans buy from Japan four billion dollars more in <v narrator>goods, then they sell. <v narrator>In the 1980s, while Japan concentrated on expanding its export empire, <v narrator>the United States launched into the greatest peacetime military buildup in its history. <v narrator>Installations like Clark Air Base in the Philippines saw a dramatic rise in their
<v narrator>construction and operating budgets. <v narrator>But as military spending soared, events in the 80s redefined the <v narrator>meaning of power. <v Chalmers Johnson>I think there is no doubt that we are today returning to a period in which the true <v Chalmers Johnson>measure of national power is economic and technological prowess rather than <v Chalmers Johnson>standing armies. This is a lesson that the Russians and the Americans have both <v Chalmers Johnson>taught each other. This puts Japan in a very prominent <v Chalmers Johnson>position. But at the same time, Japan seems to be the world's leading <v Chalmers Johnson>number two. Japan is not number one. <v Chalmers Johnson>And it's enormously nervous at the thought that it might be number one. <v Chalmers Johnson>And it makes everybody enormously nervous. <v narrator>Wall Street. <v narrator>The Americans who work here are accustomed to being at the center of global finance,
<v narrator>stockbrokers respond to a dizzying barrage of financial data reflecting <v narrator>the health of individual companies and national economies. <v narrator>Each month, they wait for news of America's trade deficit. <v narrator>In April 1987, the figures were bad. <v narrator>The deficit with Japan was another four billion dollars. <v narrator>Many American businessmen were convinced that the Japanese were cornering U.S. <v narrator>markets by dumping goods at subsidized prices. <v Speaker>President Reagan agreed and responded with a 100 percent tariff <v Speaker>on a list of Japanese computers, television sets and power tools. <v Speaker>We had clear evidence that Japanese companies were engaging in unfair trade <v Speaker>practices that violated an agreement between Japan and the United States. <v Speaker>We expect our trading partners to live up to their agreements. <v Speaker>As I've often said, our commitment to free trade Israel show a commitment <v Speaker>to fair trade.
<v Speaker>The brokers on Tokyo's stock exchange were stunned. <v Speaker>The tariffs were America's toughest retaliatory action against Japan since <v Speaker>the war. <v Speaker>But President Reagan had overestimated the strength of his hand. <v Speaker>By 1987, Tokyo's moneymen had gained enormous power of their own. <v Speaker>They resented being blamed for America's poor economic performance. <v Speaker>I think Americans tend to look tend <v Speaker>to blame others on their own problems. <v Speaker>It is rather unfortunate in the sense that Japan has <v Speaker>been used as a kind of scapegoat <v Speaker>for the American economic should <v Speaker>shortcomings. <v Speaker>The primary shortcoming was that the United States government now spent four hundred <v Speaker>million dollars a day more than it took in in revenues.
<v Speaker>Much of the 150 billion dollar annual debt was financed here in Tokyo <v Speaker>through the purchase of U.S. Treasury bonds. <v Speaker>In effect, Japan had become America's banker. <v Speaker>The next Treasury bond auction was held within days of President Reagan's announcement, <v Speaker>the first day came and went and the Japanese bought no bonds. <v Speaker>A rumor spread that Japan was retaliating against the U.S. <v Speaker>by boycotting the auction. <v Speaker>Wall Street began to worry. <v Speaker>What am I supposed to do? <v Speaker>Without Japanese buyers, higher interest rates would be necessary to attract other <v Speaker>buyers. <v Speaker>Higher rates would cost American businesses and consumers billions of dollars. <v Speaker>Japanese investors, like all foreign investors, have the choice of coming into the dollar
<v Speaker>or keeping their money at home or going into third currencies. <v Speaker>Since the United States has to get 10 billion dollars a month of additional capital, we <v Speaker>have to be extremely sensitive to what motivates them, including trade issues. <v Speaker>Not going away. <v Speaker>The three day auction was nearing its end. <v Speaker>The Japanese were in a position if they chose to teach America a most <v Speaker>expensive lesson, six tasks, correct? <v Speaker>Some of the American people learn that <v Speaker>from a long American interest rates are no more interest <v Speaker>just to buy American monetary authorities. <v Speaker>But by Japanese institutional investors, other with the Japanese monetary <v Speaker>authorities. <v Speaker>Finally, on the last day of the auction, orders were phoned into New York by a Japanese <v Speaker>securities firm. A billion dollars worth.
<v Speaker>But the message, intended or not, had come through loud and clear. <v Speaker>The Japanese now had the power to push back and push back hard. <v Speaker>I would say that somewhere from the beginning of the 70s and certainly <v Speaker>by the 80s, Japan emerged as an economic superpower. <v Speaker>Global economic power. I think in the course of the 80s and certainly into the 90s, <v Speaker>we're seeing the emergence of Japan as a global political power, maybe <v Speaker>even superpower, not in the conventional sense, that is to say, a power of which basis <v Speaker>its capability on military forces, but one which has such enormous economic <v Speaker>power that it cannot help but have massive political influence. <v Speaker>Since 1987, Japan's wealth has increased even more dramatically <v Speaker>at a faster rate than any nation in history.
<v Speaker>The once bombed out city of Tokyo is now the most expensive piece of real estate <v Speaker>in the world. <v Speaker>The central Shiota district alone is worth more than all of Canada. <v Speaker>Every square yard commuters walk across is worth nearly two hundred thousand <v Speaker>dollars. <v Speaker>Lining the streets are branches of the world's 10 largest banks. <v Speaker>All Japanese. <v Speaker>This meteoric rise of economic power has surprised not only the West, <v Speaker>but the Japanese themselves. <v Speaker>This is a great problem as we suspect it's power without purpose. <v Speaker>They're not. They've not indicated what they want to do with it. <v Speaker>They're aware that this power does threaten the structure <v Speaker>of the world that they have profited from. <v Speaker>This is one of. This is why the world is today at a turning point is <v Speaker>to reconceive how we integrate a super rich <v Speaker>but politically very insecure and very nervous Japan.
<v Speaker>I think the true cause of fear is suspicion. <v Speaker>What Japan Japan's going to do with this economic power. <v Speaker>Formidable power. And the image of Japan is so big <v Speaker>in the eyes of Americans or Europeans. <v Speaker>Whereas in the eyes of Japanese image of Japan is not so big. <v Speaker>We have not said they'll come out of our own. <v Speaker>They miss a very small nation who was beaten in the war. <v Speaker>But this is the image much of the rest of the world. <v Speaker>Homes of Japan's. <v Speaker>A nation where wealthy businessman have gone on an international buying spree <v Speaker>in places such as Los Angeles. <v Speaker>Although he does always talk to Shagan Yota, don't say if I share a <v Speaker>joke since Handycam editorial player to Gurjit taking notes saying I do not demus, this <v Speaker>sales video for a Palm Springs home was made by American Jeffrey Gotthard,
<v Speaker>not Kinsky, in the studios of the video agency. <v Speaker>Potential Japanese investors sample Southern California homes that offer <v Speaker>the spaciousness lacking in crowded Japan. <v Speaker>Not great. Your living room. <v Speaker>Sure, he knows about. I'm in California. <v Speaker>Real estate agents find that targeting the Japanese market is their best hope for <v Speaker>the highest price. <v Speaker>And you can catch yourself. <v Speaker>Putu, your kois synonymous. <v Speaker>So where do I go? <v Speaker>We must go on a video. <v Speaker>So, as you will know, you are fully equal to us, are they? <v Speaker>Huckabee like goodness because they've had a chance to call Mitt the whole lot. <v Speaker>They may not you. <v Speaker>The Japanese have bought more than homes downtown Los <v Speaker>Angeles, the business hub of the West Coast. <v Speaker>One third of it is in Japanese hands. <v Speaker>And that percentage is rising.
<v Speaker>In the mid Pacific is the Hawaiian island of Oahu. <v Speaker>Just a few miles from Pearl Harbor. <v Speaker>Still, the U.S. Navy's Pacific headquarters lies Waikiki Beach. <v Speaker>Traditionally, it's a Pacific paradise for many retired American. <v Speaker>Now, each year, they're joined by more than a million Japanese tourists and <v Speaker>honeymooners. <v Speaker>With them come Japanese developers and investors. <v Speaker>They're on their way to controlling virtually every beach front, hotel, shop <v Speaker>and restaurant. <v Speaker>In the South Pacific is Australia's Gold Coast. <v Speaker>The Japanese liked what they saw. <v Speaker>Their money now supports more than half of all new tourist development in this beachfront <v Speaker>resort.
<v Speaker>Lone Pine Koala Sanctuary outside Brisbane, Australia, is another <v Speaker>favorite tourist stop where Japanese honeymooners and for 13 million dollars. <v Speaker>It's now owned by the Community Comfort Company. <v Speaker>Said to me, like the British and Americans before them. <v Speaker>The Japanese are now accused of buying little pieces of other nations <v Speaker>identities. <v Speaker>Columbia Pictures, an American dream badly. <v Speaker>Sony bought it or more than three billion dollars. <v Speaker>Rockefeller Center, one of New York's most popular landmarks, a monument to <v Speaker>the Rockefeller family whose name symbolizes American wealth. <v Speaker>In 1989, Mitsubishi, a state paid nearly one billion dollars to gain <v Speaker>control. <v Speaker>Such investments have led to a backlash that may put the West on a collision course
<v Speaker>with Japan. <v Speaker>As we continue to be in debt and deficit, we'll have to sell off the family jewels. <v Speaker>We've been selling off American companies, American real estate. <v Speaker>We'll have to continue doing that because the foreigners who keep financing us will <v Speaker>increasingly demand real assets. <v Speaker>They won't put their money into just Treasury bills and bank deposits forever. <v Speaker>They want real American assets, companies, real estate, property and <v Speaker>more and more, our country comes under foreign control. <v Speaker>This is leading up to the potentiality for very serious <v Speaker>damage to an extremely important alliance, an alliance that has <v Speaker>also made both Japan, the United States the richest people on Earth. <v Speaker>So that I regard it as simply irresponsible to allow <v Speaker>investment in America to go at this pace and uncontrolled. <v Speaker>Moreover, the reason I regard it as irresponsible is because we will in America <v Speaker>blame the buyer and not the seller. <v Speaker>And that is an error, in my opinion.
<v Speaker>There is no shortage of sellers lining up for a share of the Japanese miracle. <v Speaker>The annual Conference of Southeast Governors is one of many pilgrimages Western <v Speaker>politicians make to Japan's. <v Speaker>Three governors, along with dozens of staff members and local businessmen, <v Speaker>have made the journey to encourage Japanese investment in their states. <v Speaker>That's a very good job, making us welcome each. <v Speaker>Thirty eight American states maintain full time offices in Tokyo, <v Speaker>all vying with each other for a nod from the new financial power brokers <v Speaker>across the Pacific. <v Speaker>The governors can meet Japanese tycoons like a feel maldita, chairman of <v Speaker>the Sony Corporation studio. <v Speaker>Maybe I should ask Mr..
<v Speaker>All right. <v Speaker>Yes, me, too. <v Speaker>Gautreaux is another sought after dinner companion. <v Speaker>He's frequently asked to help find Japanese buyers for American property. <v Speaker>I now know about 100 such real estate items <v Speaker>that are up for sale, hotels and shopping <v Speaker>centers, things like that. <v Speaker>So I think Americans should be blamed for wanting to <v Speaker>sell what they own. <v Speaker>The governor's mission is not to sell individual properties, but their state, <v Speaker>their land and their labor force. <v Speaker>The ultimate prize is an investment like this ultra modern Toyota plant, an <v Speaker>exact replica of the factory in Nagoya, Japan, <v Speaker>four years ago. Governor Martha Collins of Kentucky led a successful competition
<v Speaker>to convince Toyota to build a new auto plant in her state. <v Speaker>While the Detroit car industry suffers a severe recession, this plant can't <v Speaker>keep up with demand. Buyers are waiting for every car on the assembly line <v Speaker>to Martha Collins. It's proof of success and quality. <v Speaker>I think it's important that we form strong partnerships with the Japanese and with other <v Speaker>Asian companies in countries, I should say, because <v Speaker>it makes us strong. It. <v Speaker>We learn a lot from each other. Management styles. <v Speaker>The competition is good. <v Speaker>But even before this site was chosen, the governor's opponents asked who would <v Speaker>really benefit. <v Speaker>Toyota drew up a short list of states in the American South where trade unionism <v Speaker>is weak. Than the real competition began. <v Speaker>To win the plant away from rival states, Kentucky gave Toyota on nearly sixty thousand
<v Speaker>dollars worth of tax breaks and land for every job created. <v Speaker>The tragedy of this whole situation in Kentucky is that it <v Speaker>should not have happened. Kentucky should not have to invest three or 400 million or a <v Speaker>half a billion dollars to attract the opportunity <v Speaker>to work for someone else. It's a it's a failure of national policy that allows the states <v Speaker>to compete against one another. And that's what's happened here. <v Speaker>What would we be talking about in Kentucky if Toyota hadn't come here? <v Speaker>It would probably be the unemployment rate. <v Speaker>And I'd much prefer to answer questions with regard to Toyota being here and talk <v Speaker>about the tremendous impact and influence that they've had, all the other companies <v Speaker>that have come then to be the moning, the fact <v Speaker>that we have a very high unemployment rate. <v Speaker>Toyota brought more than thirty five hundred jobs to Kentucky. <v Speaker>They re-created the Japanese economic model right in the middle of America's financially <v Speaker>depressed heartland.
<v Speaker>To ensure control over production, they saw to it that the plant was built and supplied <v Speaker>by Toyota's corporate partners from Japan. <v Speaker>The Japanese investment in Kentucky is a classic example of economic colonialism, <v Speaker>and we furnish labor to furnish land and we furnish <v Speaker>raw materials and finished product is exported, as is the profits from the venture. <v Speaker>These American capitalists are getting a free degree and capitalism from the Japanese. <v Speaker>The company that built the plant, the window manufacturers, the air conditioning <v Speaker>assemblers, the sunroof makers, the paint suppliers and 30 other <v Speaker>companies are all wholly or partially owned Japanese businesses that followed <v Speaker>Toyota into Kentucky to Toyota. <v Speaker>This was the best way of ensuring quality, but not to American investor <v Speaker>T. Boone Pickens.
<v Speaker>People in America are fed up with the Japanese and they're fed up with them for this <v Speaker>reason is because they don't feel that that we're getting <v Speaker>the same treatment in Japan as the Japanese get getting the United States. <v Speaker>I feel I have an open door to the United States and a closed door to Japan. <v Speaker>So I think the governors are starting to look at this a little different than maybe eight <v Speaker>years ago. And I think one of the reasons that they are on is one of the things that we <v Speaker>have pointed out that when you embrace these people, be sure that they have their arms <v Speaker>around you, too, and not around your neck. <v Speaker>Look at T. Boone Pickens was one of the key players during America's junk bond <v Speaker>and takeover mania of the 1980s. <v Speaker>In one maneuver, his bid to take over Gulf oil forced it to merge with Chevron <v Speaker>Oil in order to survive. <v Speaker>As a result of his financial manipulations, Pickens and his investors walked <v Speaker>away from the deal with more than 400 million dollars in profits. <v Speaker>What you want is now he would try to force his way into Japan's corporate system. <v Speaker>He bought a billion dollars worth of stock in point to a manufacturing
<v Speaker>maker of headlights for Toyota. <v Speaker>He then requested a seat on Koito board of directors. <v Speaker>I was trying to make a profit. It's what I was trying to do. <v Speaker>And the profit was one of long term. We totally were long term holders. <v Speaker>We weren't trying to green mailmen and that we would be constructive and helpful. <v Speaker>And we weren't trying to make a tender offer for the company. <v Speaker>But at the same time, they gave me a wonderful opportunity to prove <v Speaker>that corporate Japan is close to Americans. <v Speaker>No foreigner had made such a demand on a Japanese company. <v Speaker>The Koito board resisted. <v Speaker>My staff was with all companies to this day. <v Speaker>It's so hard to believe that a man like me taken with his bag in my hand <v Speaker>and with no experience in manufacturing, is <v Speaker>seriously interested in the management of our company. <v Speaker>How do you like this crisis? That is why we have denied his request <v Speaker>to go down at the next coital board
<v Speaker>meeting. <v Speaker>The dispute became an international media event, a showdown between divergent <v Speaker>views of capitalism. <v Speaker>Koito board members arrive to present a united front against Pickens. <v Speaker>To them, Pickens embodied America's failing economy, an economy <v Speaker>that had lost its strength through an obsession with short term profits. <v Speaker>To my knowledge, Mr. Pickens has never made corporations <v Speaker>if more effective and even about contributed to their society. <v Speaker>What he did may contribute to his pocket because as some arbitrages, <v Speaker>but I'm afraid that does never <v Speaker>make corporations more stronger where more effective. <v Speaker>Pickens flew in from Texas to press his demand to stop write <v Speaker>to him. The culprit was Japan, a nation that had become wealthy <v Speaker>by selling to foreigners whose own markets remain closed.
<v Speaker>I'm a free trader. I believe in free trade and the global economy. <v Speaker>But on a level playing field, and as long as it's not a level playing field, <v Speaker>I think our government is going to have to come forward with legislation to level the <v Speaker>field. <v Speaker>It's very much annoying to hear that we are playing on different rules <v Speaker>or we are behaving not fairly enough from the view <v Speaker>of the Americans that if we start talking about the uniqueness or <v Speaker>compare the uniqueness of each country, I can assure you that <v Speaker>the United States is one of the most unique countries in the lot. <v narrator> The Pickens affair has given ammunition to a new school of economic critics of Japan <v narrator>who have begun to dominate the debate. <v narrator>The movement's godfather is Professor Chalmers Johnson. <v Speaker>The truth of the matter is the reason why we do not single out English or Dutch <v Speaker>or Canadian investment in America, as is contrasted with Japanese investment, is because
<v Speaker>we know we have full reciprocity there. <v Speaker>You and I could open a business in Amsterdam tomorrow. <v Speaker>We found, as we see everyday in the paper, T. <v Speaker>Boone Pickens can't even buy a miserable little Japanese auto parts company without <v Speaker>the entire Japanese apparatus, including Toyota ganging <v Speaker>up on him and telling him he can't do this. <v Speaker>There's an even more extreme view that the Japanese power structure is obsessed <v Speaker>with gaining control of global finances. <v Speaker>The most radical exponent of this view has become an influential voice in Washington, <v Speaker>Dutch journalist Karel van Wolferen. <v Karel van Wolferen>Japanese administrators are moved ultimately by <v Karel van Wolferen>fears of disorder in the rest of the world and of a world that is <v Karel van Wolferen>unpredictable. Now they are trying to cope with this <v Karel van Wolferen>world, too, by increasing their own control over international economic <v Karel van Wolferen>processes, thereby bringing about the situation that they are most
<v Karel van Wolferen>fearful of. <v Speaker>According to van Wolferen, the Japanese fear disorder and chaos. <v Speaker>In Australia, a shipment of Japanese cement is met by Australian workers <v Speaker>afraid of losing their jobs. <v Speaker>As the Fiji angel approached the waft the crowd made its howls of protest. <v Speaker>In the United States recent opinion polls show a majority of Americans see Japan <v Speaker>replacing the Soviet Union as the biggest threat to their national security. <v Speaker>The trade frictions have ignited popular resentment in Japan, too.
<v Speaker>When the U.S. demanded that Japan buy American rice, the farmers took out <v Speaker>their anger on American goods. <v Speaker>In 1987, the U.S. Congress got into the act when Toshiba was found <v Speaker>to be selling American technology to the Soviet Union. <v Speaker>Helen Bentley was among a handful of congressmen who decided that a violent response <v Speaker>was called for. <v Rep. Helen Bentley>Japan is coming in and just taking off all of <v Rep. Helen Bentley>our most important prizes. <v Rep. Helen Bentley>They are moving in almost lock, stock and barrel as if they want to make the <v Rep. Helen Bentley>United States a colony of Japan. <v Rep. Helen Bentley>And that is really what's on the minds of a lot of people. <v Rep. Helen Bentley>Are we becoming a colony today? <v Speaker>The board of directors and chairman of Toshiba? <v Speaker>I have to say that there was a large supporting cast that <v Speaker>supporting cast-. <v Speaker>This hostility coming from a nation that is still the world's largest economy is seen
<v Speaker>by many Asians as irrational, even racist. <v Speaker>Probably go with it. Thank you. <v Lee Kuan Yew>The emotional reaction to Japanese investments <v Lee Kuan Yew>in America that I think is psychological <v Lee Kuan Yew>and inability to accept that our vanquished <v Lee Kuan Yew>World War Two adversary has caught up with them <v Lee Kuan Yew>and are now getting wealthy. <v Lee Kuan Yew>The Americans did not get excited when the Germans caught up with them. <v Lee Kuan Yew>Germans enjoy almost as large trace volumes of trade surpluses. <v Lee Kuan Yew>I think it's because they have always accepted the Germans as <v Lee Kuan Yew>equals of the Americans. <v Taizo Watanabe>What worries us is a certain segment of people <v Taizo Watanabe>still possess to is preconceived perception of others, <v Taizo Watanabe>culture, people, and that kind of suspicion might
<v Taizo Watanabe>destroy the base of relationship of trust. <v Speaker>Fears of being overwhelmed by a Japanese economic juggernaut reached a peak <v Speaker>in Australia in 1990. <v Speaker>Could we build a city of the future. <v Speaker>A technopolis right now, an international city based on how we will live and <v Speaker>work in the future. <v Speaker>It's an exciting. <v Speaker>The Japanese government proposed this high tech metropolis to be built in Australia. <v Speaker>A futuristic city that truly integrates lifestyle and wood patterns. <v Speaker>A city that will bring all aspects of being human. <v Speaker>The city called the multifunction polis was proposed as a co-operative Pan Asian <v Speaker>venture, but it became a call to arms for those who were unwilling to let go <v Speaker>of old racial animosities. <v Speaker>How many of you generally believe that this project is not going to benefit Australia, <v Speaker>but will benefit that the Japanese won't be prepared to share their technological secrets <v Speaker>with us? A large proportion of it.
<v Speaker>Does it strike? You want 50 to 100000 thousand Japanese migrants coming into the country? <v Speaker>No one mentioned it here tonight. I'm suggesting to you and I'm talking about Australia <v Speaker>out there because I think that completely out of touch we would want they. <v Speaker>We want a hole in the head to put it into the black. <v Speaker>Mr Okumura is paying a visit to a new NBC dealership. <v Speaker>He's Japanese firms are aware of their increasingly negative image abroad, have attempted <v Speaker>to calm Australian fears. <v Speaker>Desktop TV ads were designed to show that the Japanese are unthreatening <v Speaker>and adaptable to local customs. <v Speaker>It's the annual review of NBC computers, and it seems they're still the world's <v Speaker>biggest manufacturer of integrated circuits. <v Speaker>There's still one of the world's top 10 computer companies. <v Speaker>And here to report on the Australian market is Mr Okamura. <v Speaker>This document, Mr
<v Speaker>Pennisi, Japan's most experienced computer company, now very much at home in Australia. <v Speaker>It's the view of the same commercial was remade for New Zealand <v Speaker>as part of a public relations strategy to convince the whole region that its future <v Speaker>lies not with old friends, but with a new one. <v Speaker>And he had a report on the New Zealand market. <v Speaker>Is Mr Kiwi Muru Mr Key with <v Speaker>any? <v Speaker>Japan's most experienced computer company now very much at home in New Zealand. <v Speaker>To the extent that Japanese productivity exceeds that of the United States, <v Speaker>to the extent that Japanese financial strength exceeds that of the United States, <v Speaker>a point will be reached in which the United States will become less <v Speaker>relevant, more and more countries. And those countries, whatever it may be, their <v Speaker>preferences will be drawn more and more to Japan. <v Speaker>And I think this is happening in an unusual degree in Asia.
<v Speaker>The first political evidence of a shift was seen in New Zealand in 1984 <v Speaker>in response to popular protests. <v Speaker>The New Zealand government took an historic step by refusing to allow U.S. <v Speaker>nuclear vessels into its waters. <v Speaker>The U.S. attempted to get New Zealand to back down by severing all military <v Speaker>ties. But in a world where the importance of military power was declining. <v Speaker>New Zealanders solve little need for America's nuclear umbrella. <v Speaker>There is not and cannot be any security alliance between the United <v Speaker>States and New Zealand. <v Speaker>There simply can't be any going back to the way it works as between the <v Speaker>United States and New Zealand. <v Speaker>The security alliance is dead. <v Speaker>The U.S. government reacted with alarm to this erosion of American influence <v Speaker>in the Pacific. <v Speaker>What we have there is a country that has hurt itself very badly.
<v Speaker>They have some kind of really idiotic theory that <v Speaker>if they don't allow any new theater ships to protect themselves <v Speaker>and their and their harbors or whether they're nuclear or not, don't allow them in. <v Speaker>They think somehow they will become less of a target. <v Speaker>This is the same kind of philosophy Belgium had in two world wars, that if they were <v Speaker>neutral and disarmed, nobody would attack. It would attack them. <v Speaker>And it's just nonsense. <v Speaker>What concerned the Americans was the prospect that New Zealand's rejection of the <v Speaker>traditional military alliance would spread throughout the Pacific region. <v Speaker>That fear may well be justified. <v Speaker>Clark Airfield in the Philippines is America's largest overseas air force base <v Speaker>in the Pacific. <v Speaker>The rent it pays and the jobs it provides constitute about five percent of <v Speaker>the Philippines economy. <v Speaker>Cinnabar seven north, northwest, southeast orbit. <v Speaker>Today, Clark is a vital link in the supply and transfer of American troops <v Speaker>and weapons to the Persian Gulf. <v Speaker>Target USA three to the northern airfield there and the essay to the southern airfield.
<v Speaker>Still, it's only a matter of time before the U.S. <v Speaker>will be forced to leave its Philippine bases. <v Speaker>It makes the basic issues surrounding the presence of U.S. <v Speaker>bases. Here is the issue of sovereignty. <v Speaker>They are an affront to the sovereignty and independence of the Philippines <v Speaker>and therefore does not speak well of our country supposedly <v Speaker>being an independent country. <v Speaker>I think they are being not only naive, I think they are also hurting themselves very <v Speaker>badly because the Philippine economy is not one of the greatest in the world. <v Speaker>And it is. This is a these bases constitute major payroll. <v Speaker>But even the American economic relationship with the Philippines is being questioned. <v Speaker>For many Filipinos, work in clubs outside the U.S. <v Speaker>bases is their best opportunity to benefit from the American presence <v Speaker>on hallis city. Next to Clark Air Base thrives on the presence of thousands of
<v Speaker>free spending guys. <v Speaker>Should the base close, the town could be devastated. <v Speaker>The opponents of America's military presence say the bases add nothing to the long <v Speaker>term health of the economy. <v Speaker>Demonstrators rally repeatedly to get the American bases out <v Speaker>as Filipinos chant, Yankee, go home. <v Speaker>They have a different message for the new Pacific superpower. <v Speaker>Come in. Come <v Speaker>in. <v Speaker>Cebu, the second largest city in the Philippines. <v Speaker>Regional officials hosted a visit by potential Japanese investors 100 percent. <v Speaker>The visitors are anxious to see what the Philippines has to offer. <v Speaker>So you're exempted from building any local and provincial taxes,
<v Speaker>but are fighting the companies that the right thing? <v Speaker>So you will be paying any income taxes for <v Speaker>the first six years of inflation. <v Speaker>So the presentation must be effective. <v Speaker>In the last two years of Japanese investment in Cebu has increased by 5000 <v Speaker>percent. <v Speaker>The indication said that in the Philippines they're going to replace one day the <v Speaker>Americans as the number one investors in the country. <v Speaker>And for that matter, even the Taiwanese investors are coming in heavily. <v Speaker>So what Japan did not that see during the war through <v Speaker>a very painful period of occupation of the Philippines is being achieved economically <v Speaker>right now. <v Speaker>The highlight of the Japanese tour is a trip to a brand new electronics factory <v Speaker>owned and operated by the Mitsubishi company. <v Speaker>Thirty four hundred Filipinos who work here consider themselves fortunate to have these <v Speaker>jobs.
<v Speaker>They assemble components that will later be used in radios and television sets with <v Speaker>names like Sony and Iowa. <v Speaker>They are at the bottom rung in a Japanese controlled assembly line that stretches from <v Speaker>the Philippines to Thailand and Malaysia. <v Speaker>Over the years, Japan has been shifting labor intensive and relatively <v Speaker>cheaper types of industries from Japan to host countries like the Philippines. <v Speaker>So Japan will retain high technology type industries <v Speaker>and shift the low cost and labor intensive activities <v Speaker>to countries like the Philippines. <v Speaker>Like American and European companies before them. <v Speaker>Japanese manufacturers are discovering the benefits of foreign labor <v Speaker>by paying the minimum wage. The Japanese owners get manual labor at less than <v Speaker>one tenth the cost in Japan. <v Speaker>What we see happening here is an extension of Japan's economy.
<v Speaker>And if it's an extension of Japan's economy, then the obvious conclusion is that these <v Speaker>industries will not make the Philippines any more independent <v Speaker>in terms of developing a self-reliant and self generating economy <v Speaker>after a century as America's colony and client state. <v Speaker>The Philippines is still one of the poorest nations in Asia. <v Speaker>One half of Filipinos live below the poverty line. <v Speaker>Now the United States is asking Japan to give the Philippines the aid the <v Speaker>U.S. can no longer afford. <v Speaker>And many hope that Japanese investment will be successful after so many years <v Speaker>of American failure. <v Speaker>Yet throughout the region, there's a deep seated fear of Japan's increasing presence. <v Speaker>We are quite apprehensive in the light of our historical experience as <v Speaker>having been invaded by the Japanese.
<v Speaker>We always feel that the economic potential is convertible <v Speaker>into militated by what we did. <v Speaker>And if Japan becomes the dominant power in Southeast <v Speaker>Asia, the memory of the <v Speaker>40s would always truncal. <v Speaker>There are still people like us who belong to that generation that went through <v Speaker>that horrible period of Japanese occupation. <v Speaker>The young generation of Filipinos has little memory of the past. <v Speaker>They're more than willing to cast their lot with the Japanese. <v Speaker>Ironically, they are presenting one of the greatest challenges to Japan's new identity <v Speaker>as a global power. <v Speaker>In the last two years, tens of thousands of young Filipinos have decided to leave <v Speaker>the poverty in Manila for the prosperity in Japan. <v Speaker>I am I am a father of two kids. <v Speaker>And in coming there, my country becomes insufficient to balance
<v Speaker>a family. So a job. I tried my luck going out. <v Speaker>Trouble first in Bangkok, then Singapore and Singapore. <v Speaker>I've learned that many foreign workers had been going <v Speaker>to Japan because Japan dense economy hasn't been rising <v Speaker>so hot so fast. So I come here to Japan to try <v Speaker>Malath. <v Speaker>Ruben Rivera and his friend JJ R.A. <v Speaker>are two of the estimated 400000 illegal migrants who have shown up <v Speaker>on Japan's doorstep. <v Speaker>The Japanese economy has grown so strong that their labor is essential. <v Speaker>Still, some Japanese make foreign workers aggressively unwelcome, <v Speaker>walking around Yokohama, especially in the shopping areas. <v Speaker>There are some stores even by now do not accept <v Speaker>Muslim Filipinos in their shop. <v Speaker>We don't know the reason why, but when they say that you are Filipino,
<v Speaker>they will tell you that Filipinos are not allowed. <v Speaker>That hurts our feelings of course. <v Speaker>The traditional Japanese view is that their economic success and their racial purity <v Speaker>are inseparable. <v Speaker>They have been an insular and homogenous nation for centuries. <v Speaker>Now, the widespread presence of foreign workers is shaking long held assumptions. <v Speaker>As Japan's economy becomes increasingly international, they're forced to reassess <v Speaker>their old sense of separateness. <v Speaker>This is the first broadcast of a current affairs program called The Scoop.
<v Speaker>The topic for this premiere show, the impact of foreign immigrants. <v Speaker>Shows like these are common in the West, but in Japan, they are a sign of dramatic <v Speaker>change. <v Speaker>[Speaks in Japanese] <v Speaker>Japan's economic might is forcing it to reevaluate its relations with its <v Speaker>weaker neighbors. <v Speaker>But that same mite is enabling Japan to reevaluate other relationships to <v Speaker>others, including the 40 year partnership that has been the pillar of the postwar Pacific <v Speaker>order.
<v Speaker>[Speaks in Japanese] <v Speaker>At Chitose, say Air Force Base, Japanese pilots fly defense missions in American <v Speaker>designed warplanes. <v Speaker>The F 15 and the F-16 are among the most sophisticated fighters in the <v Speaker>world. <v Speaker>Japan envisioned a new technologically superior generation of jetfighter, <v Speaker>one that would be worthy of Japan's new role. <v Speaker>You could play your role. How many Japanese designers gave TV viewers a preview <v Speaker>of how they could remodel the F-16 into a new fighter called the FSS <v Speaker>X? Although it did not <v Speaker>work, the Pentagon officials were anxious to add the plane with its new Japanese <v Speaker>technology to the Western arsenal. <v Speaker>They agreed to a transfer of American Aerospace Know-How. <v Speaker>The overriding consideration ought to be the the kind of security that
<v Speaker>that kind of security relationship that we need. <v Speaker>And in the case of the FSS X, we had a signed agreement with <v Speaker>the Japanese government, negotiated very carefully difficult agreement to negotiate, <v Speaker>one that gave us everything that we needed. <v Speaker>That is co-production in the sense of signing to the United States <v Speaker>billions of dollars worth of Japanese purchases and gave us access to Japanese avionics <v Speaker>and electronics technology, which we've never had before. <v Speaker>And in every way they were. <v Speaker>It was an agreement that was, I think, entirely satisfactory to both sides, <v Speaker>but it was not satisfactory to many congressmen who were growing increasingly angry <v Speaker>over Japan's industrial triumph. <v Speaker>They saw the FSX as a scheme by the Japanese to use America's own technology <v Speaker>to challenge yet another American industry. <v Speaker>The FSX will allow them to take away one of our last industries. <v Speaker>The last one that we are superior in, and that is
<v Speaker>airplane manufacturing. <v Speaker>Natalie and her colleagues demanded that the Bush administration negotiate substantial <v Speaker>changes in the FSX agreement. <v Speaker>It was the first time that a defense issue was forced to take a back seat <v Speaker>to trade concerns in America's dealings with Japan. <v Speaker>The problems today between Japan and America reflect the vested interests <v Speaker>that were created back in the early 1950s. <v Speaker>In the case of America, these are vested interests in essentially <v Speaker>defensive security definition of our relationship with Japan. <v Speaker>A refusal to link security issues and economic issues. <v Speaker>They are starting to be linked today, but they were not for many, many years <v Speaker>with the FSX. <v Speaker>The issue has become more than Japan learning America's secrets. <v Speaker>The Japanese were beginning to feel that in technology, as in finance, they <v Speaker>were now the dominant partner.
<v Speaker>The aircraft carrier Eisenhower is a quintessential symbol of American power. <v Speaker>Critical electronic components are now dependent on tiny microchips developed <v Speaker>and produced exclusively in Japan. <v Speaker>This technology is deeply associated <v Speaker>with how to procure the components of <v Speaker>American weapons. That is dependance on Japan's technology. <v Speaker>Therefore, one fear we rely in the possibility <v Speaker>that what would happen to American security power <v Speaker>if such dependance on Japanese technology may not <v Speaker>is not available. <v Speaker>I think that if the Japanese keep talking about it, we ought to be concerned about it <v Speaker>because it cannot be healthy that the United States is dependent for a key <v Speaker>element of its defense technology on any foreign country, no matter
<v Speaker>how benevolent that country is. <v Speaker>In a bestselling book called The Japan that Can Say No. <v Speaker>A prominent politician raised the specter of withholding essential microchips from the <v Speaker>Americans and selling them to the Soviet Union. <v Speaker>It is a striking example of how a split between the U.S. <v Speaker>and Japan could have international repercussions. <v Speaker>There is always a danger if some of the friction <v Speaker>is not well managed contained. <v Speaker>There will be some danger of much confrontational. <v Speaker>The situation may take place, but this is detrimental to the <v Speaker>Japanese, but also very much damaging to the Americans <v Speaker>as well, and also very much have <v Speaker>negative impact on the world in general. <v Speaker>I would argue that the consequences of conflict between <v Speaker>the United States and Japan in any field would be so serious for both countries
<v Speaker>that they have an extraordinary incentive to cooperate. <v Speaker>The foreign currency exchange in Tokyo is where investors change tens of billions <v Speaker>of yen into dollars every day. <v Speaker>Many of those dollars are used to finance much of the debt of the U.S. <v Speaker>and other Western nations. <v Speaker>In turn, those nations trade is the lifeblood of the Japanese economy. <v Speaker>Japan depends on us for markets. <v Speaker>Technology for defense. <v Speaker>The United States continues to depend on Japan for technology and particularly on <v Speaker>financial inflows. Japan is the world's largest creditor country where the world's <v Speaker>largest debtor. They are our main financier. <v Speaker>That sets up an interdependence of power. <v Speaker>If Japanese capital stops flowing into the United States, our interest rates soar and our <v Speaker>economy is in trouble. On the other hand, if our economy gets in trouble, it's difficult
<v Speaker>for the Japanese. They have over 300 billion dollars invested here at an extreme. <v Speaker>We could even expropriate or take over their investments. <v Speaker>The worst scenario is that the unrest will continue to grow further, domestic <v Speaker>pressures may force governments to enact even more punitive trade sanctions. <v Speaker>The effects could mirror those of a military confrontation. <v Speaker>The economic relationship between the United States and Japan is now somewhat akin <v Speaker>to the military relationship between the United States and the Soviet Union, at least <v Speaker>until recently. We had a military situation of mutual assured destruction <v Speaker>where the United States and the Soviet Union could destroy the other. <v Speaker>And therefore the incentives were enormous to avoid a breakdown and a relapse into <v Speaker>conflict. Something the same occurs now in the economic sphere as <v Speaker>in nuclear war. <v Speaker>It's not just the superpowers that could be affected. <v Speaker>The danger is the disintegration of the world's economic system into a competing
<v Speaker>trading blocs, all fighting to survive. <v Speaker>For this scenario to be avoided, American policy is that Japan must concern <v Speaker>itself with more than its own economic growth. <v Speaker>It's got to become a world leader, not on its own, but jointly with America and probably <v Speaker>a uniting Europe to form a triumvirate that will collectively manage, collectively <v Speaker>manage the world economy, to maintain open trade, to maintain open capital markets, <v Speaker>to stabilize and support a prosperous world through joint economic leadership. <v Speaker>That's the only possible model I can see for the 21st century. <v Speaker>And our countries should set about constructing it right from now. <v Speaker>Sharing burden is in a sense, easy to say, <v Speaker>but sharing power is really transforming <v Speaker>part of the power you have already held to other <v Speaker>persons. <v Speaker>The United States tends to act like a big brother <v Speaker>to many countries because we tend to believe
<v Speaker>that our institutions are universally relevant. <v Speaker>And secondly, because the American public has not yet learned that in some <v Speaker>areas we are no longer competitive. So we are no longer that big brother with <v Speaker>some of the American public still thinks we are dominant in every category. <v Speaker>Yes, America, too, has to make an adjustment and learn <v Speaker>to deal with Japan on the basis of equality. <v Speaker>In 1945, at the Potsdam Conference, the victorious superpowers met <v Speaker>to divide postwar Asia. <v Speaker>They shaped the region into sharply defined spheres of influence and power blocs. <v Speaker>Japan's economic success coincides with an historic breakdown of that <v Speaker>global order. <v Speaker>Some of the most basic parameters are starting to change. <v Speaker>Today, the United States is no longer a hegemonic power. <v Speaker>It's an ordinary nation.
<v Speaker>We've also had revealed remarkably and unexpectedly how <v Speaker>decrepit the USSR actually is. <v Speaker>We have the emergence of of a common market in Europe. <v Speaker>The timing of which is clearly a reaction to Pacific economic <v Speaker>dynamism. It is these it is the combination of these forces that seems to <v Speaker>me lead us to recognize that the old paradigm, the old <v Speaker>order, the old conception that made sense out of the world is today <v Speaker>anachronistic, is outdated. <v Speaker>We don't yet know what's going to replace it, but we're all thinking very hard about it. <v Speaker>What we do know is that even as the Cold War ends, new conflicts are emerging. <v Speaker>Can the United States afford to remain the world's leading military power? <v Speaker>And what role will Japan play as it moves beyond the pursuit of its own economic <v Speaker>destiny? <v Speaker>The answer to these questions may define the meaning of power in the Pacific
<v Speaker>and around the world.
Power in the Pacific
Episode Number
No. 104
Power Without Purpose
Producing Organization
KCET (Television station : Los Angeles, Calif.)
Australian Broadcasting Corporation
Contributing Organization
The Walter J. Brown Media Archives & Peabody Awards Collection at the University of Georgia (Athens, Georgia)
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Episode Description
"POWER WITHOUT PURPOSE, episode four of the 4-part series 'Power in the Pacific,' details Japan's economic rise during the last two decades to become the world's largest creditor. Narrated by noted Asian affairs journalist, Ken Kashiwahara, the program shows how during the 1980's while America's peacetime military spending soared, Japan was concentrating on expanding its export empire. In 1987, the U.S. first became aware of Japan's economic muscle, the program explains, when America's trade deficit to Japan reached $4 billion/month and President Reagan decided to put 100% tariffs on goods most frequently imported from Japan. Japanese wealth was increasing at a faster rate by 1987 than any nation in history and the world's 10 largest banks were all Japanese - a phenomenal growth that surprised the Japanese themselves. "The program features interviews with leading players in the military and economic power structures of the Pacific, including former Secretary of State Henry Kissinger; top economists Masaru Yoshitomi, Makoto Kuroda and Naohiro Amaya; Taizo Watanabe of the Japanese Ministry of Foreign Affairs; American industrialist T. Boone Pickens; Lee Kuan Yew, Prime Minister of Singapore; former Secretary [of Defense] Caspar Weinberger; and Chalmers Johnson, Professor of Pacific International Relations at the University of California, San Diego, among others."--1990 Peabody Awards entry form.
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Producing Organization: KCET (Television station : Los Angeles, Calif.)
Producing Organization: Australian Broadcasting Corporation
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The Walter J. Brown Media Archives & Peabody Awards Collection at the University of Georgia
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Chicago: “Power in the Pacific; No. 104; Power Without Purpose,” 1990-11-06, The Walter J. Brown Media Archives & Peabody Awards Collection at the University of Georgia, American Archive of Public Broadcasting (GBH and the Library of Congress), Boston, MA and Washington, DC, accessed June 26, 2022,
MLA: “Power in the Pacific; No. 104; Power Without Purpose.” 1990-11-06. The Walter J. Brown Media Archives & Peabody Awards Collection at the University of Georgia, American Archive of Public Broadcasting (GBH and the Library of Congress), Boston, MA and Washington, DC. Web. June 26, 2022. <>.
APA: Power in the Pacific; No. 104; Power Without Purpose. Boston, MA: The Walter J. Brown Media Archives & Peabody Awards Collection at the University of Georgia, American Archive of Public Broadcasting (GBH and the Library of Congress), Boston, MA and Washington, DC. Retrieved from