I once put together a comparison of Chinese and Japanese industries on a forum while answering a question. What’s happening with Honda is probably just the beginning — the bigger signs of decline aren’t limited to the auto industry. Japan’s space program, for example, has had several launch failures in a row, it has been mostly absent in the current AI wave, and there was even recent news about a so-called Japanese AI model that turned out to be built directly on top of DeepSeek.

Japanese society has long been romanticized in the West, but once you start noticing certain details, a different side becomes visible. A simple example: about a century ago, the average height of Japanese men and women was actually higher than that of Chinese and Koreans, but later the growth basically stalled, and in some periods even declined. It’s not that Japan is poor. It feels more like there are strong, invisible social expectations — women are not supposed to grow too tall, men don’t seem comfortable standing out physically, and people live within a very tight set of unwritten rules about what you should and shouldn’t do.

This is the same kind of thing people notice when they joke that Japan still uses Yahoo or fax machines. That discipline creates stability, and from the outside it can look orderly and even admirable. But when you look more closely, it can also feel restrictive, even a bit unsettling. It’s hard to believe that this kind of social atmosphere wouldn’t affect corporate culture as well. In that sense, it may help explain why Japan, which once dominated the global auto industry, hesitated for so long on electric vehicles and ended up being overtaken by China in the new wave of technology.

Another thing is that Japan can be very unrealistic. You can see this in their movies, anime, and literature — there’s this strong belief in the power of belief itself, like if you just believe hard enough, things will work out. That mindset shows up in real issues too, like rare earth supply, military readiness, and national strategy. Japan might actually be one of the countries with the strongest information bubbles in the world. From top to bottom, people tend to believe what they want to believe, even when reality says otherwise. And when reality does show up, the reaction is often to pull back quickly and say the problem isn’t real.

You could already see this mentality during World War II, especially with the attack on Pearl Harbor. After that, Japan’s postwar industrial success made the illusion even stronger. If a company messes up, they apologize, and everyone forgives them. Toyota is number one in the world and will always be number one — no need to worry. That kind of thinking is exactly why Japanese industry has been declining for a long time without people really feeling a sense of crisis.

You can even see Germans openly complaining about their country’s problems, but you don’t see that very often in Japan. As long as they still have Excel, Word, and loppy disk ,or some japan made code editor, everything feels fine, so there’s no need to feel anxious.

And if there were ever a war over China and Taiwan, most people in Japan might even think: as long as we take action, China will definitely lose.It’s just like the recent Iran war. many japanese people believe that China will collapse first, because China is too dependent on Middle Eastern oil, even though the real data shows that Japan is actually more dependent.

(write by me and translated by GPT)