Japan wasn't "destroyed" - they fell into the same trap that most emerging countries fall into eventually. Massive economic growth -> people become more wealthy -> they put it all into real estate -> real estate market collapses -> people are disillusioned, stop spending and growth crumbles. Happens to many nations that try to enter the group of high-income economies, same with China. The problem is that people don't trust any other asset besides housing to put their savings in. That creates a bubble and a lack of private investment in other parts of the economy.

▲

dworks 4 days ago | parent | next [-]

look up the plaza accord. It led to a bubble that eventually burst and an uncompetitive export industry as the JPY doubled.

▲

jcfrei 4 days ago | parent [-]

Two sides of the same coin. The yen appreciation didn't change the trade deficit the US had with Japan substantially. Japan's own actions after the plaza accord (very loose monetary policy) lead to the asset bubble I described. That's because domestic consumption was weak and everyone used excess savings for the housing market - rather than buying more goods domestically. Which lead to the bubble I described.

	▲	dworks 4 days ago \| parent [-]
		If you read the Wikipedia article more carefully you would have understood that the loose monetary policy was an effect of the Plaza Accord, hence why I mentioned it.

▲

paganel 4 days ago | parent | prev | next [-]

China is ten times bigger than Japan was at the time, a big enough difference in quantity has its own quality. China also has a much easier/cheaper access to natural resources compared to Japan, both internally and from external partners that are shunned by the US (think Russia or Iran).

▲

hollerith 4 days ago | parent | next [-]

That's not an effective reply to GP because during the process GP describes ("Massive economic growth -> . . .") Japan has enjoyed complete freedom to engage in ocean shipping and ocean trade unless perhaps you want to argue that the knowledge that this freedom to trade could stop at any time (e.g., because of a new world war) prevented Japanese decision makers from making full use of ocean trade.

Also, China would not have been able to rise anywhere near as high as it has without intensive use of ocean trade.

In other words, although national economic independence matters a lot, it matters only in specialized circumstances, namely, war that is not restricted to only a few countries, but rather spreads to cover large areas of ocean; Washington's deciding to stop policing the world ocean; or Washington's deciding to stop enforcing a policy of freedom of shipping and freedom of ocean trade for every nation (modulo US sanctions).

	▲	dworks 4 days ago \| parent [-]
		The US cannot sanction China's shipping of goods.

▲

alephnerd 4 days ago | parent | prev [-]

The median Chinese in 2025 is also much poorer (edit: and much older [2] and less educated [3]) than the median Japanese in the 1980s or 1990s.

China has built a successful tech pipeline, but it doesn't translate to significant prosperity in a country where median disposable household incomes are around $400/mo [0] - much lower than their peers in Thailand [1]. And China's HDI only caught up with Thailand's over the past 2-3 years, and China's GDP per capita has been stagnant for 4 financial years now.

This does NOT imply Chinese collapse, but it does highlight real issues that exist with the China story.

From a power projection perspective, China has capabilities that very few nations have and can tie with the US, but that has not translated to mass prosperity in the way growth in 1970s and 1980s Japan did. It is still an open question about whether or not China "Japanifies" or not.

China is now at a crossroads, similar to what South Korea, Thailand, and Malaysia faced in the 1990s.

As long as the Xi admin remains avowedly opposed to what he termed "Welfarism" ("福利主义典范国家，中产塌陷、贫富分化、社会撕裂、民粹喧嚣，这不乏警示— 防止落入“福利主义”养懒汉陷阱"), Chinese growth will sputter.

[0] - https://www.stats.gov.cn/english/PressRelease/202501/t202501...

[1] - https://www.nso.go.th/nsoweb/storage/survey_detail/2023/2023...

[2] - https://ourworldindata.org/grapher/median-age

[3] - https://globaldatalab.org/shdi/table/msch/CHN+JPN/?levels=1+...

▲

paganel 4 days ago | parent | next [-]

> The median Chinese in 2025 is also much poorer than the median Japanese in the 1980s or 1990s.

Yes, and that’s a big plus for China, it means that there’s still room for productive growth. The also means that the price of labor will still continue to be competitive.

	▲	alephnerd 4 days ago \| parent [-]
		> it means that there’s still room for productive growth The median Chinese in 2025 is also much older than the median Japanese was in 1990 when their bubble burst. Without welfare expansion and a broad project to increase the prosperity of the median Chinese household, growth will sputter - as it already is [0] Xi's admin remains avowedly opposed to what he termed "Welfarism" ("福利主义典范国家，中产塌陷、贫富分化、社会撕裂、民粹喧嚣，这不乏警示— 防止落入“福利主义”养懒汉陷阱") [1], and almost all stimulus provided is supply-side. Chinese households need to either earn enough so they can save for a rainy day and consume, or the state needs to dramatically increase the scope of it's social safety net to incentivize spending. China needs a "New Deal" style welfare reform if it wants to escape Japanification at this stage. > The also means that the price of labor will still continue to be competitive. It's isn't anymore. China's costs have caught up with those of Mexico and Malaysia's, so cost sensitive manufacturing began leaving over a decade ago to Vietnam, Mexico, and India. High value manufacturing has taken off in China, but generates very few jobs, because a heavily automated factory requires much fewer and much more educated employees, which locks out a large number of Chinese as the average age of schooling amongst working age Chinese is around 8-9 years [2] [0] - https://www.reuters.com/world/china/chinas-economy-slumps-au... [1] - http://theory.people.com.cn/n1/2021/1116/c40531-32283350.htm... [2] - https://ourworldindata.org/grapher/average-years-of-schoolin...

▲

dworks 4 days ago | parent | prev [-]

It definitely has resulted in mass prosperity.

▲

csomar 4 days ago | parent | prev [-]

I kinda feel their bubble burst would have happened anyway but they wouldn’t treat themselves to a plaza accord kind of deal.