Terrie's Take 881 -- How Japan Needs to Appease Trump, e-biz news from Japan

Terrie's Take terrie at mailman.japaninc.com
Sun Jan 29 23:40:52 JST 2017

* * * * * * * * TERRIE'S TAKE - BY TERRIE LLOYD * * * * * *
A weekly roundup of news & information from Terrie Lloyd, a long-term 
technology and media entrepreneur living in Japan. 

General Edition Sunday, January 29, 2017, Issue No. 881

- What's New -- How Japan Needs to Appease Trump
- News -- Rental housing building boom
- Upcoming Events
- Corrections/Feedback
- Travel Picks -- Tranquility in Karuizawa, Best Tsukemen in Tokyo
- News Credits

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With the global media so focused on the policy "hand grenades" that the 
Trump administration is tossing out day after day, we thought it would 
be interesting to try to predict what effect the new administration's 
tactics of bullying will have on Japan. We also go into a little of the 
psychology of bullies, since President Trump clearly plans to run things 
his way, and therefore for the time being at least the man will be the 
nation's primary source of policy.

We'll say up front that we don't like bullies, having had to deal with 
far too many of them both at school and later in business. But given 
that Donald Trump has on numerous occasions as a businessman used 
bullying as an effective tactic to get what he wants, it's unlikely that 
he will change his methodology now that he is president. To the 
contrary, he was voted in precisely because he's used to getting his own 
way and therefore voters would have been betting that he'd become a 
quick and effective (destructive) agent of change in Washington. In his 
first ten days, he's certainly fulfilling that hope.

Psychologists generally agree that bullies are driven by envy, 
resentment, and a need to build up self esteem by demeaning others. 
Bullies are easily offended by criticism and lack of deference by other 
people, reacting with verbal or even physical violence and insults. 
Worryingly, successful bullies tend to surround themselves with others 
swayed/influenced by his/her toxic behavior and who wind up replicating 
such behavior. Taken the extreme, the abusive behavior becomes the new 
normal in the bully's sphere of influence (such as government 
institutions) and susceptible individuals ratchet up the bullying 
behavior to ingratiate themselves with the leader. Throw in Trump's 
narcissism and you have a veritable cocktail for abusive behavior 
towards others.

On the other side of the equation, there are the victims.

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Research shows that, perhaps surprisingly, adult bullies usually pick on 
competent but non-mainstream individuals as targets. They rely on their 
ability to sway the opinions of others in the workplace to ostracize 
that target and thus establish dominance. Frequently scapegoating is 
used to speed up the process of isolation and indeed, we are seeing 
scapegoating of a global nature that hasn't been seen in the West for 15 
years -- picking on Muslims and "unfair" Asians in particular.

Generally, there are three ways to deal with a bully: 1) Run, 2) Fight, 
3) Suffer and appease. In our 2017 predictions post several weeks ago, 
we said that the Chinese will fight back, while the Japanese, having a 
bullying culture already, will go for appeasement. As of this weekend, 
it looks like the UK's PM, Ms. Theresa May, will opt for the first option.

And so it is that we are seeing PM Abe head to the USA for a second time 
in a couple of months, to meet with President Trump. Abe's mission will 
be to try to convince Trump that Japan is one of the good guys, and that 
Trump, if he has to kick a neighborhood dog, should pick on the Chinese 
instead. This is actually a great strategy if Abe's team can get it 
right. However, we think they don't yet realize the psychology involved 
- particularly that they need to feed Trump's ego publicly. Our advice 
is that they'd  better do a quick study on how to appease bullies.

Appeasement is an interesting concept. There are some very good 
scientific papers on the subject of appeasement and embarrassment (such 
as caused by watching someone engage in appeasement) by Dacher Keltner, 
a Professor at UC Berkley, and his various collaborators.

http://bit.ly/2kHiB2P (Keltner's Wikipedia bio)

In one such paper, specifically written about appeasement and related 
human emotion and social practice, Keltner reminds us that many human 
behaviors can be traced back to our animal ancestors, including emotions 
such as shame and embarrassment. He identifies two general classes of 
human appeasement: 1) reactive, where a person provides appropriate 
responses specifically AFTER incidents where they transgressed morals or 
conventions. According to Keltner, in normal individuals these responses 
are usually public displays of embarrassment and shame. And, 2) 
anticipatory appeasement, where a person engages in certain strategies 
BEFORE, or to PREVENT, aggression by a bully. Just like our animal 
ancestors, these responses involve distributing to the bully resources 
such as food, physical space, or social attention. Polite modesty and 
shyness are also considered anticipatory appeasement.

http://bit.ly/2kBkkXY (Keltner's appeasement paper)

So Keltner is saying that to deal with a bully before the fact, you need 
to appease them with gifts of value AND to be seen to be doing so very 
publicly, so that the bully has an aggrandizement "high". This means 
that the ministry of transport's declaration on Friday that they are 
already giving U.S. automobile makers preferred access to the Japanese 
market is the wrong strategy for Trump. He is not interested in being 
told that the Japanese market is open and U.S. auto makers are unable to 
make the needed small, economical, attractive, and value-for-money 
products desired by picky Japanese consumers. Instead, if Abe wants to 
curry Trump's favor, he needs to give Trump a big public win, something 
that Trump can hold up and say, "See, I did that - I pressured those 
sneaky Japanese into playing our game."

An appropriate gift to Trump would be a LARGE order of autos by the 
Japanese government, to show that if the government uses these vehicles, 
then the public will surely see how great they are and be motivated to 
buy them as well. Although ordinary U.S. vehicles are unpopular in 
Japan, there are some niche products that would do very nicely and which 
could support a big injection (say, 10,000 units) of U.S. vehicles. Such 
niches would include small trucks, military trucks, delivery vans, and 
for those of us in the tourism industry, camper vans.

Actually, U.S. camper vans are highly sought after in Japan, and with so 
many tourists coming, the strategy of moving those tourists into the 
countryside and giving them an alternative to the accommodation shortage 
in the major cities -- means that camper vans distributed through the 
top four rental companies around the country would surely be a hit. 
Making this idea even more relevant is the fact that the biggest 
complaining U.S. auto maker, Ford, recently invested in a camper van 
company called "Livin Lite" and they make some very decent compact campers.

But back to bullying. What we see happening in the next four years is 
the Japanese leading a long procession of global leaders traveling to 
Rome (uh, sorry, Washington) to meet the new leader. They will bring 
gifts to entertain his ego, and they may even buy into "build in 
America" more than they do already, but in reality, this type of 
imperial rule will cause all kinds of distortions and illicit behavior 
by these same companies, the bureaucrats involved in policing border 
taxes and penalties, and even the people working at manufacturing 
companies lucky enough to receive Trump's largesse.

For example, there was a recent study of bureaucratic bullying of 
entrepreneurs in Russia. The outcome was an increase in bribes to the 
officials gating each business registration/license process, rampant 
mislabeling of resources, bankrupting of companies that had been 
targeted and starting new ones to avoid taxes, replacing expensive human 
labor with off-shoring (Detroit auto line workers are 400% more 
expensive than Mexico), and generally cutting corners to support the 
increased costs of doing business. Of course, the U.S., unlike Russia 
also has a very active legal system, so in addition we will see a lot 
more litigation and thus demand for legal services.

Then, with the clamp down on immigration, Trump is scapegoating the 
entire immigrant population by saying they are taking U.S. jobs (even as 
U.S. unemployment levels are at a 9-year low - but hey, who cares about 
facts, it's the narrative that matters). This means that U.S. technology 
companies, instead of increasing U.S. business with the Trump moves, are 
more likely to speed up their diversification to sites elsewhere in the 
world. This represents an exciting opportunity for Japan, since it, 
unlike most other countries in the world, is making it even easier for 
technology professionals to move here. While Japanese speakers in a 
foreign operation in Japan are a must today, we foresee in the near 
future that there could be entire corporate campuses springing up in 
Japan where the primary language is English. This has already happened 
at Niseko as a holiday destination, so there is no reason why it won't 
happen with tech firms looking for a stable environment to put their 
non-US employees. Okinawa or Fukushima maybe?

The Japanese are paranoid about the defense relationship with the USA, 
and will do whatever it takes to keep the goodwill flowing. But even as 
this effort is going on, Trump has now given Abe a mandate to build up 
Japan's military might so that it can look after itself. This process 
will take at least a decade, but at least the political environment now 
makes the effort possible. Also, it's not hard to imagine that if Trump 
does decide to isolate the Chinese militarily over the Spratleys, as 
Bullies are wont to do he will probably make Japan play along in a kind 
of initiation rite to join the Trump "in" club, such as forcing them to 
participate in whatever military adventure he has in mind.

And that would certainly make things very difficult for the Japanese.

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+++ NEWS

- Japan having an immigration boom
- Embarrassing diplomatic theft case
- U.S. auto companies already have favorable import rules
- Casino operators wooing JP authorities
- Rental housing building boom

=> Japan having an immigration boom

The Abe government is showing us how to have an immigration boom without 
drawing attention to the fact. The labor ministry has published data 
that up until October 2016, Japan's population of foreign workers passed 
1m people for the first time. The number of foreign workers rose 20% 
over the same period a year earlier, and many were in the skilled and 
semi-skilled labor categories. For example, there were 29,000 foreign 
workers in construction in 2015, and this number jumped to 41,000 in 
2016. ***Ed: Many of the workers are being brought in surreptitiously as 
"trainees," with the number of people in this category increasing to 20% 
of the 1m-person total in 2016.** (Source: TT commentary from 


=> Embarrassing diplomatic theft case

Japan and Thailand, normally the best of friends at a diplomatic level, 
had an embarrassing moment two weeks ago when a Thai Intellectual 
Property Department senior official was arrested in Japan on suspicion 
of stealing three paintings from a Japanese hotel. The Thai official was 
detained for ten days and finally released after the Royal Thai 
Consulate in Osaka intervened and negotiated for him to compensate the 
hotel for the theft. The paintings in question were worth JPY15,000. 
[Ed: Yes, that is not a typo...!] Source: TT commentary from review


=> U.S. auto companies already have favorable import rules

In an appeal to reason, the government is saying to U.S. trade 
authorities that U.S. auto imports to Japan already have favorable 
terms, including pre-acceptance of U.S. safety checks and of course no 
tariffs. The Japanese side started these import speed-up concessions in 
preparation for adoption of the Trans-Pacific Partnership (TPP), which 
has now been scrapped by the new Trump administration. ***Ed: The 
problem the Japanese are dealing with, and they should get a clue as 
quickly as possible, Trump is a populist and not interested in cold 
details, only bold ones. If the Japanese want to get his attention, they 
have to grab the headlines with a bold move doing something that makes 
Trump look good.** (Source: TT commentary from the-japan-news.com, Jan 
28, 2017)


=> Casino operators wooing JP authorities

Now that casinos are legalized in Japan, the race is on by casino 
operators to be one of the first to gain a license once the new 
regulations are finalized in December. In the race are familiar faces 
including MGM Resorts, Hard Rock Cafe International, Las Vegas Sands, 
Genting Singapore, and Boyd Gaming. Sources say that there will be 2-3 
casinos approved initially, and that these will approved in 2019 and 
ready for operation by 2023. Investment bank CLSA reckons that Japan 
will be a rich market, and that just two casinos would earn about 
JPY120bn in annual revenue between them. Other analysts are saying the 
revenues could be up to four times that amount. ***Ed: Perhaps more 
important will be WHERE these casinos will be built. While we've heard a 
number of locations, the initial consensus is that Tokyo will not be in 
the first wave, since the city will have its hands full with Olympics 
preparations.** (Source: TT commentary from reviewjournal.com, Jan 27, 2017)


=> Rental housing building boom

Data from the land ministry (MLIT) shows that the number of new rental 
housing apartment buildings being constructed in Tokyo has risen 
significantly, even as consumer demand for new housing is tailing off 
due to the greying of society. Apparently the number of new rental 
building starts jumped by 10% to 420,000 dwellings, comprising about 40% 
of the overall total of new dwellings built (i.e., including owner-built 
residences). The reason for the surge is that the taxable assessable 
value of land is lower for rental buildings, thus causing people 
concerned about inheritance tax to put up rental apartments rather than 
leave the land vacant or owner-occupied. Needless to say, this 
phenomenon is distorting the market, causing vacancy rates for rental 
units to jump to 35% in Tokyo, Kanagawa, and Chiba. ***Ed: When you have 
nowhere else to put your money productively, you look for any gap 
available. This is another story of unintended consequences caused by 
legislative tinkering that had no real substance.** (Source: TT 
commentary from nikkei.com, Jan 28, 2017)


NOTE: Broken links
Some online news sources remove their articles after just a few days of 
posting them, thus breaking our links -- we apologize for the inconvenience.



No events to announce this week.



=> Last week we discussed how to control the perils of backcountry 
skiing while still allowing people to continue doing it. One reader 
living in Niseko put the solution rather succinctly:

*** Reader Comment:
In Niseko we have local rules and manage the risk. Look for Niseko local 
backcountry rules (http://bit.ly/2jrSvzJ) and you will see we manage it 
here. That's part of the reason why Niseko is so popular. [Ed: We note 
that visitors breaking the Niseko backcountry skiing area rules WILL in 
fact be charged for Search & Rescue.]

=> In TT-799 we relayed a news item about someone freeing dolphins 
penned up at the infamous Taiji Cove (at a stock holding area, not for 
butchering). A reader in Hawaii relates how the whole aquarium 
experience there is being questioned.

*** Reader Comment:

Just a comment on the dolphin item. A new resort being developed in Ko 
Olina on Oahu, Hawaii, has cancelled plans to include captive dolphins 
as a source of entertainment. There are also debates about outlawing 
"dolphin swims" off Oahu because the particular dolphin species is 
nocturnal and trying to rest when the tourists come to play.

The Honolulu Zoo has also had management trouble in recent years and 
many voices have called for just shutting it down.

I live within a seal's shouting distance of Sea Life Park where they 
have dolphin shows (along with the barking seals) and occasionally visit 
the Japanese-owned Kahala Hotel where captive dolphins do tricks and 
give rides to part well-heeled guests from their money.

I sense that in Hawaii, at least, there is a gradual shift against 
captive animal entertainment, whereas in Japan captive animal 
entertainment may actually help prevent captive animal consumption. 
Personally, I think zoos, aquariums and dolphin shows do much to protect 
wild animals by fostering familiarity and concern among us primates.



=> Kumobaike Pond in Karuizawa, Nagano
A peaceful stroll in nature

The small but long pond of Kumobaike is sometimes called a "swan lake". 
We didn't notice any swans, only ducks, and the Japanese maples had 
already dropped their leaves. The autumn foliage can be seen from 
mid-October to early November. Nevertheless, the serene nature in 
December was wonderful. We could relax while strolling along the pond 
and breathing in the crisp but-not-too-cold winter air. The blue sky 
with white clouds provided a wonderful chance for a good photo session. 
The pond is located not far from a luxurious neighborhood in Karuizawa, 
about 1.2 km northwest of Karuizawa Station. I recommend going by car or 
by bicycle. For drivers, there is a parking lot not far away.


=> Tsujita, Iidabashi
The best tsukemen in town

I used to teach English at a language school in Iidabashi. I would pass 
this noodle shop that almost always had a long line outside it around 
lunch or dinner time. It was a nondescript place from the outside. I 
would see men with towels tied around their heads preparing bowls of 
noodles amid steam rising from what I assume are vats of boiling water 
or stock. The customers sat on stools around the counter. One day, I 
finished my class at four in the afternoon and when I went passed the 
noodle shop, there were a lot of empty seats and no line outside so I 
decided to find out what the fuss is all about.

This noodle shop's bestseller is tsukemen ("dipping noodles"), which I 
had never had before. It took about ten, maybe fifteen, minutes before 
they served me with a big bowl of dry noodles topped with a sheet of 
nori (seaweed) and a half slice of lime on top. Then they served a 
smaller bowl of thick soup with slices of meat and menma (bamboo shoots) 
and cautioned me that the bowl was hot. I tried the noodles first. They 
were satisfyingly thick, thicker than regular ramen, and gratifyingly 
chewy or as with pasta, al dente. Then I tried the soup. The dense 
flavor was an amazing combination of pork and dried fish. I took a 
chopsticks' worth of noodles and dipped them in the soup. From that very 
moment, I was converted.




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Written by: Terrie Lloyd (terrie.lloyd at japaninc.com)

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