Whither the Japanese “Circles of Compensation” in the era of globalization? Kent Calder, one of the most influential Japan specialists, talked for College of IR
On June 7, College of International Relations and the International Studies Association at Ritsumeikan University invited Dr. Kent E. Calder as the first guest speaker for its 30th anniversary special lecture series. Dean Akihiko Kimijima of College of IR introduced Dr. Calder as one of the most important Japan and Asia specialists, and emphasized his unique career as a researcher, as an educator at prominent schools, and as a practitioner. Dr. Calder has served as Special Advisor to the US Ambassador to Japan (1997-2001) and Japan Chair at the Center for Strategic and International Studies (1989-1993 and 1996). He is currently Professor and Director of the Edwin O. Reischauer Center for East Asian Studies at Johns Hopkins’ School of Advanced International Studies (SAIS) in Washington, D.C., and will assume the Vice Dean at SAIS on July 1, 2018.
Many students from College and Graduate School of International Relations, include its Global Studies Major and American University Ritsumeikan University Joint Degree Program joined the lecture to learn from the well-known Japan specialist.
Dr. Calder’s talk was mainly about his latest book, Circles of Compensation: Economic Growth and the Globalization of Japan, published by Stanford University Press. This book can be understood as an updated and combined version of his earlier masterpieces, Crisis and Compensation: Public Policy and Political Stability in Japan, 1949-1986 and Strategic Capitalism: Private Business and Public Purpose in Japanese Industrial Finance, published in 1988 and in 1993 respectively by Princeton University Press.
What Dr. Calder tries to explain through the concept of “Circles-of-Compensation (CoC)” is how CoC in the Japanese society have internalized the benefits they can produce and how costs have been externalized to players who remain outside CoC. For instance, Kansai International Airport’s landing fee is much higher than other major international airports in the region such as Incheon International Airport. However, in the context of CoC, high price has not been regarded as a negative thing. Instead, higher price has been transferred to benefits that CoC can share together whereas external players should pay the higher cost. The question he wants to raise is whether CoC can be sustainable and continuously successful in the era of globalization when the rest of the world is competing by lowering price and rapidly changing.
Dr. Sumiyo Nishizaki, who is currently Assistant Professor of College of IR at Ritsumeikan University and served as the commentator of Dr. Calder’s talk, emphasized that CoC mechanism used to function very well as the stabilizer of the society in the era of Cold War when the Japanese economy was dramatically changing and when ideological conflict was serious enough to cause a domestic political crisis.
Dr. Calder does not disagree with Dr. Nishizaki’s view; he also admits historical contribution of CoC. Nonetheless, he continues that CoC are unlikely to work as effectively as before because CoC can keep making it difficult to reform the Japanese society and to adopt innovative changes the rest of the world would make. Abenomics’ third arrow, structural reform, remains as the most challenging task because of CoC, according to Dr. Calder.
His prescription, however, is neither collapse nor dismantling of CoC because it can be counter-productive. Rather, he suggests the following two: first, CoC can broaden the scope and be more inclusive to other domestic players; and second, CoC can also broaden the scope with cross-bordering players, internationally. His concluding remark was inspirational to Ritsumeikan Community who have been pursuing cosmopolitanism and innovation.