Why Feminist Capitalism Will Not Save Us: Structural Reforms in Japan

I was watching a panel discussion by US economists, who were trying to give advice to the Japanese government to undertake structural reforms in order to increase economic growth in the chronically stagnant country. The essence of stuctural reform often is very diffuse, but they all have to do with weakening regulations surrounding the basic tenets of Japan’s economic institutions. The economists want the Japanese government to loosen restrictions on agricultural imports in order to reduce food prices, which will apparently boost the purchasing power of Japanese consumers. They want the government to loosen immigration restrictions to allow the most capable and skilled workers to enter Japan, which will enhance the country’s productivity. Thirdly, they want a loosening of restrictions on women’s economic advancement to ensure that more women participate in the paid labor force and take on managerial positions. By having more women as workers and consumers, the country can increase economic output.

How much better off the Japanese would be if they followed this advice. How smart these economists are! How short-sighted these Japanese politicians are! But let us not think too fast here. It is true that the Japanese government is trying everything that it can in order to boost economic growth, because that is what it takes to reduce the enormous debt burden facing the state. We are reminded again of James O’Connor’s argument about the fiscal crisis of the state: the state has the duty to maintain a high level of economic growth (accumulation) so they can raise sufficient revenues to retire old debts and keep their civil servants fed. In addition they have to make social expenditures in order to maintain domestic social peace (legitimation).

If raising economic output is the main goal of Japanese policymakers, it is difficult to dispute these policy recommendations except that taking single-minded steps to restore capital accumulation could itself trigger a legitimation crisis. Let’s look at it carefully. By deregulating food imports, the price of food will decrease, so consumers will be happy. But farmers will be very unhappy, because they won’t be able to compete with the food imports. The farmers are a very important constituency in Japan, and dislocating so many farmers at the same time will create a legitimation crisis, and will force the Japanese government to increase welfare spending on an already overstretched budget.

Immigration sounds like another great avenue for deregulation, but it should not be forgotten that Japan is still a very homogeneous society, and kept the social peace by keeping it that way. The largest immigrant community in Japan are the Koreans, who have lived there for many generations. These Koreans in Japan can trace their ancestors to the early colonial days of Japanese in Korea. As far as I know, these Korean immigrants have still not received full citizenship rights and are still discriminated in employment. Given that there is some cultural proximity between Korea and Japan, one can only imagine what would happen if a large number of non-East Asian immigrants were to enter the country. It would create a crisis of legitimation, which no Japanese government has been willing to accept.

And now the women. Let us integrate them completely into the workforce! It should first be noted that women are the peripheral workers in the Japanese economy, i.e. the last hired and first fired, which is especially the case during economic downturns and periods of economic uncertainty. Japanese companies try to hold onto their core sector workers (or the internal labor market, according to Piore and Doeringer), mostly elderly men, and have to pass on the cost of downsizing onto the peripheral workers, mostly women and young people. Given that the problem in Japan is an overall lack of employment opportunities it is hard to conceive of bringing more women into the labor force. The hope of the economists seems to be that as these women enter the labor market and compete for male jobs, it will lower the reservation wage for all workers, and providing labor as cheap as possible will create the kind of full employment paradise that all mainstream economists have dreamed about.

But let us now assume that these concerns are not serious enough, and that we can integrate women into the workforce, they are a new source of labor power and a new set of consumers with purchasing power (think of beauty poducts, make-up, lipgloss, skirts etc.), does that mean that we can achieve more gender equality? It is certainly conceivable that as women become more economically independent they will be more able to become financially independent of their husbands, and they will assert their rights much more forcefully than they currently do. But I think we are missing another major point here: the reason why women were pulled into the labor force to begin with is to ensure the capital accumulation process. To the extent that capital accumulation remains the goal in the economy, I very much doubt that gender equality can be the ultimate end goal.

One could even argue the opposite, that as more and more women enter the labor market the old patriarchal patterns of inequality can further become reinforced. Capitalism needs more workers, including women, but it can not succeed if workers are all equal. The equality of workers can not be achieved within the logic and the rule of the markets, but has to be actively brought about via class struggle and solidarity among all the workers. The most ideal condition to establish a framework favorable toward capital accumulation is if workers remain divided among each other: male vs. female, black vs. white, skilled vs. unskilled etc. Any form of division among workers has to be exploited by the capitalists. Differential wages for the same task to the benefit of men are only apparently stroking the male ego, but are really the entrenchment of capitalist interest. Factory owners in developing countries specifically favor women workers, because they are more obedient. Women are considered the primary caretakers in the family, and so they are less likely to go on strike, and accept the very low wages to ensure that their family’s needs are met. The nurturing woman is the ideal victim of capitalist exploitation.

Where does that leave the struggle for women’s rights? Women’s rights still need to be struggled for, and it is clear that it is not sufficient for women to simply join the labor force, though I will concede that economically active women have a better fighting chance to reduce sexism and discrimination than if they stayed at home.

What we also need to understand with all certainty is that no matter what economic steps are taken in order to revive a sluggish economy, there is nothing that can fundamentally be done to permanently generate elevated rates of economic growth. Any “structural” reform, no matter how profound it is perceived to be, serves as another lease of life to capitalism. If Japanese policymakers are head-on willing to still embrace measures to reduce “structural” barriers to continued capital accumulation, they should at least be worried for a moment about whether their reforms will not create a legitimation crisis of epic proportions.

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