Standing Up to Japan : America Can Reverse Its Decline the American Way, Not by Copying the Japanese

James Fallows has reported from Asia for The Atlantic for the past three years. This article is adapted from his book "More Like Us: Making America Great Again," to be published this month by Houghton Mifflin.

CALIFORNIANS MAY think they're part of the new Pacific Rim, even its leaders. But what does the Pa cific Rim think of them?

In some ways, California in general, and greater Los Angeles in particular, still represent the pinnacle of glamour and excitement. Half of the commercials on Japanese TV seem to have been filmed on Southland beaches, among the roller-skaters of Venice or in mansions in Beverly Hills. Half the cars on the road in Kuala Lumpur have "L.A.--I'm on My Way!" bumper stickers, put there when Malaysian Airlines inaugurated its Kuala Lumpur-Los Angeles route. I've seen "California Style" used as an advertising slogan, a restaurant name and a general classy motto practically everywhere in Asia, including China.

But there is another edge to the fascination with California, which is an intensified version of the Asian interest in America as a whole. Carefree and exciting California may be--but, Asians say to themselves, isn't it also becoming decadent and over the hill? Asians often regards Californians in the way that nice, wholesome middle-class teen-agers look on the rock singer Prince or on the dope-head rock groups of yesteryear: diverting, because they are so naughty and irresponsible but not any guide as to how to build a stable future for yourself. Let's watch the Californians frolic in the sun for a while, the Koreans, Taiwanese and Japanese seem to say. Then we'll head back to the library and the workshop.

In January, after Emperor Hirohito's death, Japanese TV ran round-the-clock newsreels of the early days of his reign, including Japan's attempt to erect a puppet state in Manchuria in the 1930s. The relentlessly sober-minded documentaries drove millions of people to Japan's video-rental stores, which did their biggest-ever business in the two days after Hirohito's death. But they also prompted the inevitable jokes about how Japan could avoid such mistakes in the future. "Next time, no Italians!" a Japanese man says to a German in a standard joke about the weak link in the World War II Axis lineup. "California will be our new Manchuria--this time without guns," goes another line.

The very things that seem exciting about California--and by extension, America--also look like its fatal weaknesses to those on the other side of the Pacific. Californians are casual, they are fun-loving, they are open-minded--and that's why Asians can sell them so many VCRs and buy so much of their real estate. (Although the Japanese shrink from the thought of buying or eating rice grown in any alien soil, several Japanese sake breweries are doing a handsome business in California's Central Valley, using California rice.) California is dreamland, rather than work-land, which is why Asians believe they are bound to succeed.

Beyond this conception is the very Asian idea that cultural values, rather than government policies or straightforward business decisions, are the ultimate reasons for a society's economic success. Why has Japan come so far in the semiconductor business? One columnist recently declared in a major Tokyo paper that it is because of the Japanese /Shinto custom of "cleanliness and purification." When chips passed the "1-micron barrier" in miniaturization, he said, Westerners, with their different, impure traditions, simply couldn't keep up. Behind this idea, in turn, is the firm belief that the distinctive cultural traits of Japanese, Korean and Chinese societies now constitute a huge competitive advantage--Confucian-based traits such as obedience, reverence for tradition and fierce loyalty to the family, which in the case of Japan extends to the nation-family as a whole.

Perhaps more than any nation on earth, Japan has succeeded by making sure that people stick to their proper place in the great national hierarchy. Even now, at least 25% of Japanese marriages are "arranged," to ensure that partners meet others from the proper social and economic level. Even now, most promotions within companies are made on the basis of seniority--as at a boarding school where members of each class lord it over the ones below them while fighting among themselves for positions as class officers. It is all but impossible for professional workers to switch from one large company to another after their mid-20s, or for women to find a place in the corporate world. Whether or not it pleases the individual Japanese worker, the system has undeniably been useful in building Japan's trade surpluses. Factories run more smoothly when no one dreams of challenging the boss.

Californians aspire toward just the opposite traits, summed up as "I gotta be me." Therefore, in the Asian view, California and the nation it's attached to are doomed to decline. In three years of interviewing Japanese and Koreans, I've heard "American decline" and "lazy Americans" used so often that the words seem to form natural compounds, like "brazen hussy" or "fellow traveler."

But the Asian theory of "American decline" is dangerous, since everyone involved may find it too convincing. For the Japanese, the main risk is of becoming too contemptuous of the America they now believe they have defeated economically. For Americans, the risk is that we may come to scorn what is most important and valuable in our national character. If the Japanese and other Asians have piled up such vast profits and controlled such ever-growing market shares, shouldn't we try to be more like them?

No, we shouldn't. Japan and Korea may be successes on their own terms, and there are certain policies and institutions that might set valuable examples for the United States. The very high personal-savings rate in Japan and Korea, for example, may have something to do with quasi-Confucian values, but it is more obviously and immediately influenced by tax laws, meager public pensions and other factors that give people a strong incentive to save. Similar policies might have a similar effect in America, but the basic values of Asian cultures cannot be exported to ours. Discipline, order and obedience may be appropriate values for some Asian societies, but they would spell only stagnation for America.

In many ways, American society is as healthily unstable as ever before. From the beginning, the genius of America has lain in exactly the traits that make Southern California distinctive now: the lack of tradition, the freedom for people to start over, the influx of people looking for a better life than what they had in Saigon, Sonora or Schenectady. Throughout the 19th Century, European visitors to America described Philadelphia, Baltimore and Cincinnati in just the terms that have been applied to Los Angeles in the past generation: There was no downtown, no established institutions, no standards of taste or dress (but lots of wacky religions). All these, of course, were signs of a society rapidly reinventing itself and making room for newcomers. What it lacks in good taste it makes up for in sheer energy, which is the story of America throughout its history and of Southern California now. Only in such circumstances could the real American dream take hold: the idea that people could keep having second chances until the day they die. (The idea of endless possibility was a powerful but rarely discussed element in Ronald Reagan's popularity, I believe. He was washed up in his late 40s, yet still he would be able to invent a new life for himself.)

This part of the California story has been intensely important to me, since it was the plot line of my family's life. Just after the Korean War, my parents moved from the suburbs of Philadelphia, where they'd both grown up, to Redlands, in the part of San Bernardino County that likes to call itself the "Inland Empire." They brought three preschool children along with them, one of whom was me; they also brought a belief that they could invent a new life for themselves in an environment where they had no background, no connections, no obligations. This is the California cliche: the new start in the new land.

There is, of course, a vulgar side to the California cliche, which writer Joan Didion once vividly described. In the mid-1960s, Didion came to my beloved hometown to cover a lurid murder trial. The Inland Empire, as she portrayed it, became a kind of co-defendant in the case. The small-town Southern California culture, she said, amounted to "the last stop for all those who came from somewhere else, for all those who drifted away from the cold and the past and the old ways. . . . This is the country of the teased hair and the Capris and the girls for whom all life's promise comes down to a waltz-length white wedding dress and the birth of a Kimberly or Sherri or a Debbi and a Tijuana divorce and a return to hairdressers' school. . . . The future always looks good in the golden land, because no one remembers the past."

What Didion wrote was accurate enough, but it was not the only meaning of the no-tradition, wide-open Southern California life. There was another side to it that was not contemptible--that was, in fact, magnificent, because it went far toward freeing people from the constraints of class. In a small town like Redlands, where there was only one public high school (and few parents even thought of private school), there was a limit to how far one social class could separate itself from another. My schoolmates in the 1950s and 1960s included people who ended up as auto dealers, doctors, labor organizers, actors in TV commercials, blackjack dealers, schoolteachers, rock musicians, tennis coaches, bartenders, orange growers, librarians, contractors and art historians. They obviously had different amounts of money and different chances in life, but social pressures minimized rather than exaggerated that distance.

In "The Bonfire of the Vanities," Tom Wolfe wrote that "insulation" is the key to an endurable life in New York: If you separate yourself from everyone who is unlike you, you can survive. In small towns like mine, the insulation was stripped off. People dressed the same and had similar manners and drove similar cars. People spoke with more or less the same accent--a phenomenon that I, like most Californians, took entirely for granted until I went off to universities, first in Boston and then in England. In the old cities of the East Coast, as in much of the Old World, people's accents told their life story. The instant someone opened his mouth, you had a good idea of how much money his parents made, whether he'd been to college, where he'd end up in life. Small-town California had its class barriers, of course, but its appearance of democracy reduced their importance. Because it seemed more fair, it was more fair. More people were encouraged to think they had a chance. They tried harder and rose higher than they would have if people continually had their noses rubbed into the inborn differences that come from social standing.

More than any other nation, the United States has thrived by making its society flexible. The most daring step toward flexibility, our ultimate weapon against the Asian economies, is one that most Americans barely notice: the idea that people can come from foreign cultures and voluntarily make themselves Americans, without relying on the ethnic bonds that hold most other societies together. The most controversial aspect of today's immigration--the question of Spanish-language separatism--only emphasizes how unusual and optimistic the American attitude is. In most Asian countries, people wouldn't care what language the newcomers spoke: They would object to them on purely ethnic grounds.

But two forces threaten to make our society more rigid than it has been before. One, of course, is the growing exclusion of an urban black underclass, with less and less connection, except via crime, to anyone else's lives. The other is a change in American education, but not the one discussed in the typical "Crisis in Our Schools" report. It is the rise of a status system based on intelligence, education and academic credentials, which has created another form of American snobbery, another kind of caste division.

This new status system is related to some of the more familiar forms of snobbery, since people with the most money and with what are considered the best family and racial backgrounds usually have the most education, too. But it has special dangers. Discrimination based on intelligence seems more legitimate than other forms. Most college graduates try to conceal their racial or religious prejudices but are not embarrassed to sneer at high-school dropouts. A social hierarchy built largely on academic degrees is fine for Asia. Everyone understands and accepts the ranking system--the mandarins of China, after all, were those who knew more written characters than anyone else. Even now, the commanding heights of Japanese business and government belong to those who did best on university-admission exams, although everyone admits that such tests of memorized facts have little or no relation to on-the-job skills. But a system implying that people with more brains and more schooling are better people is a problem for America. It is a direct threat to the essential American idea that anyone can make a new start.

Until well into this century, schooling was only loosely connected to social mobility and occupational success in the United States. Before World War II, less than 10% of the population went to college. The "college boy" was an F. Scott Fitzgerald character, and admission to an elite school was largely a sign of having been born in the upper class, rather than a means of getting there. While diplomacy and belles-lettres were reserved for the college-educated class, many of America's most lucrative jobs were not. Before World War I, not a single U.S. state required its lawyers to have attended law school; they learned as apprentices. Until the turn of the century, medicine worked more or less on open-market principles: There were many gradations, from quack to nurse to fully qualified MD, and a patient was free to choose from among them at his or her own risk. Until the early 1960s, candidates for managerial jobs did not have to prove that they'd been to college or business school.

With the great spread of education after World War II, the connection between schooling and success has become more intimate and intense. In many cases, school offers a way to get ahead for people who would otherwise be kept behind: This is the classic immigrant dream. But it also has built a new rigidity into American life, because people who did not make the correct move at age 20 have more trouble shifting jobs at age 40 than they would have in an earlier generation.

Despite Americans' traditional, down-to-earth skepticism about pointy heads and ivory tower experts, there are indications that people at all levels of society take their IQ scores and their schooling as valid judgments of their ability. The officials who create and administer IQ tests no longer say what the pioneers of "mental measurement" did at the turn of the century: that what they are quantifying is innate, immutable, unaffected by such factors as family income and childhood advantage.

Representatives of the College Board and the Educational Testing Service carefully point out that the tests are intended for one purpose only: to predict who will get good grades in college, so that colleges can make informed decisions about whom to admit. That is, in fact, what the tests do. But few people who take or design the tests seem to believe it deep inside. ETS officials themselves, at least those I've interviewed, are not eager to reveal their SAT scores.

"IQ is enormously influential in formation of self-image," Howard Gardner, of Harvard's psychology department, said in 1987. "It seems that as many people remember their Scholastic Aptitude Test scores as remember their Social Security numbers."

IQ and SAT scores have become destiny for many Americans, as biology was once thought to be destiny for women. The result, a meritocracy based on educational degrees and test-score intelligence, sounds as if it is the epitome of American fairness, but it can turn out to be as stifling as a highly stratified class system has been for England. In Somerset Maugham's novel "Of Human Bondage" the protagonist is an orphan, Philip Carey, who wishes he had been born into the upper class. His resentment increases when he ends up at a school with his social betters. One of them takes him aside for a little chat on career choices. If Carey had been born an aristocrat, the friend says, only certain callings would suit him--the church, the army, banking, the bar. But since he didn't have a family name to protect, Carey was free to do what he wanted--even, in theory, to go into trade. Clearly the friend wished no such humiliating freedom for himself.

Outsiders can instantly see how such prejudices weakened England. There is nothing necessarily wrong with the handful of professions considered acceptable to the upper class. A country needs competent clergymen, soldiers, financiers and lawyers. But the whole idea of "gentlemen's work" pushed much of England's best-trained talent into a tiny funnel, diverting it from science and, most of all, from manufacturing. England would be healthier today if its most fortunate people felt they had more choices in life.

Now, certain occupations, mainly the legal and medical professions, have come to be the American version of "gentlemen's work." For smart young people with high SAT scores and the right college degrees, law and medicine offer the most secure and predictable financial returns and the most prestige. As with "gentlemen's work" in England, there's nothing inherently wrong with these professions. But as was the case in England, this sort of snobbery narrows choice and ultimately weakens the country. It steers well-trained people away from some of the most creative and useful jobs; it undermines the American belief that anyone can do anything.

Like inherited money or family position, intellectual merit should always be liberating. But like money and family, often it is not. All of these forms of inherited advantage should make it easier for people to start over, to recover from early mistakes, to define roles for themselves. But in practice, each can be constricting. The rewards of advanced education and intellectual ability can be great--if you stay on a certain path. When I was living in England, I saw a catty story in a London paper about Johnny Carson. He was annoyed to find that when he walked down the street in London, nobody noticed him. Since the "Tonight" show was not shown in England in those days, Carson, who was lionized at home, in London became merely another American tourist. There's a similar phenomenon with intellectual merit. In certain quarters, it entitles people not simply to respect but also to a good living. But outside those quarters--anywhere except America, to use the Carson metaphor--the financial reward dramatically falls off. In business, teaching, politics, publishing, the arts and most forms of science, a good educational pedigree cannot be predictably converted into high earnings. In law, medicine and a few other licensed professions, it can: Getting into one of the professions puts you on a particular plateau. Professionals don't become the richest people in America, but they have a more risk-free place near the top than almost anyone else.

As a result, the "best," most talented people in America are offered a bargain attractive to themselves and distorting for the country. It's a temptation rational people find hard to resist. In theory, Rhodes scholars, like prewar English aristocrats, should have limitless freedom of occupational choice. But, in practice, at least one-third of them use that freedom to become lawyers. (In the 1940s, it was only one-eighth.) Similarly, Phi Beta Kappa members should have wide opportunities in a society that emphasizes academic preparation. Of Phi Beta Kappa members who graduated from college in the late 1940s, 5% became lawyers or judges. Of those who graduated in the late 1970s, 20% did.

There is nothing wrong with people becoming lawyers or doctors. It could also be argued that, since so many well-trained people are shunted away from the hard sciences, teaching, manufacturing and so forth, there's more room in these fields for ambitious newcomers, immigrants and members of the "untalented" class. Still, no one contends that, in the abstract, America should be sending so many of its best-educated young people into such a narrow range of professional jobs. From the country's point of view, the incentives are perverse--as they were for England, when the best trained people were diverted from careers in business or technology. The rewards offered for education and ability are greatest and most reliable in the narrowest, most conventional range of jobs. Societies work best when individual and collective interests overlap. The temptations of an aristocracy based on intellectual merit make them diverge.

American society is healthier and more successful when our culture suppresses the instinct to set ourselves apart from one another. A sense of fairness and possibility is America's counterpart to the Asians' sense of order and discipline. It's the cultural value that has made American society work. It--more than beaches or freeways or film studios--is what makes California different from all the rest of the Pacific Rim. California's and America's brightest moments have occurred when people did not know their place and were free to invent new lives for themselves. America would be as lost without its sense of possibility as Japan would be without its sense of order and ethnic unity. That is why a shift in America's status system, toward less flexibility and more rigid separations, toward a meritocracy built on academic pedigrees, is so dangerous. If California or the United States were to end up as Japan's new Manchuria, this artificial stratification would be an important reason why.

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