Yu Serizawa and her team worked on some great slides including the problems that we all traditionally talk about, a picture of Koizumi-san trying to attack the difficult problems on the surface, and the dysfunctional democracy which resists change.
The members of the panel were Carlos Ghosn, President of Nissan, Nobuyuki Idei, Chairman and CEO of Sony, Jiro Tamura Professor of Law, Keio University, Motohisa Furukawa, politician, Oki Matsumoto, the CEO of Monex and me. The Moderator was Karl T. Greenfeld, Editor of Time Asia.
Here are some of my thoughts from the panel.
Japan has tended to talk about problem in Japan that are easy to understand in the Western context and doesn't generally discuss domestic issues at Davos. Today, discussed some of the more complex issues that are very important and are the cause of some of the more well known problems. Japanese tend to feel to feel that social issues are best discussed and solved at home in a more gradual way and that the West would never understand them. I think that trying to help the world understand the issues that Japanese believe only Japanese would understand is an important step in opening up Japan.
After we spent close to 40 hours trying to come up with a blueprint for Japan, we realized that the plan was the same plan that everyone always comes up with. Actually, most people in Japan agree on the plan. The problem (as Mr. Ghosn pointed out later) is that 95% of the issue is execution. The problem is that Japan has a system that is resistant to change and has given most of its execution authority to the administrative branch. (As Tamura-san explained eloquently.) We need to focus on the basic cause of the problems which we have identified as a dysfunctional democracy and a lack of diversity. We must also understand the reason Japan has such execution problems. Idei-san talked about Japan being a refrigerator where domestic companies and the administration freeze change. He also talked about Japan's "middle age crisis". I thought this was a great phrase.
Tamura-san and I talked a lot about democracy. Multiple points of authority, competition of ideas, critical debate. Tamura-san mentioned that the judiciary in Japan is neutral and fair, but so small that it is weak.
Carlos Ghosn said that he thought the problem was that the vision for Japan was not clear.
Anyway, I said what I usually say here which is that we need a revolution, not reform. To use Idei-san's words, a quantum leap. Democracy requires that you trust the people. Mass media focuses on ratings and then cause a kind of populism that makes people feel negative about the ability for people to be rational. In fact Japanese are rational and all we need is the media (or the Net) to focus on the real problems and wake the people up. Carlos Ghosn said that EVERYONE at Nissan knew that they were on a burning platform. After they got all of the facts out, it was all-hands-on-deck getting the company running. No bullshit. Idei-san suggested we focus on tax issues. I agree that this may be good. Follow the money. Tax is what fuels the administrative power. Shed light on the relationships. Show where peoples' money goes. Then maybe people will wake up and have a Boston tea party. I think that it is, at the end of the day, about trusting the public and empowering them. Tamura-san said that we already have all of the laws of a democracy. Just no power or will to execute.