Japan – land of the rising or setting sun?

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“We Japanese enjoy the small pleasures, not extravagance. I believe a man should have a simple lifestyle -- even if he can afford more.” Massaru Ibuka, founder of the Sony Corporation

News
The Economist this week asks what lessons will be learned from Japan as it is the first major country to face up to a rapidly declining population from natural causes.  Its 127 million inhabitants will shrink to 89 million by 2050, as Japan’s birth rate of 1.4 children per woman is far below the replacement rate.  As the country ages the number of people in work for every retired person will fall from 4 in 1995 to 2 by 2020, putting huge strains on the social security system.

Normally this is presented as an economic problem, with social implications.  We would argue that it’s the other way round: behind the demographic and economic issues are relational ones, particularly those that contribute to the low birth rate.

98% of children are born to married couples in Japan, and the average couple has two children.  However, more and more people are not marrying, or marrying late.  In part corporate culture is to blame: women are implicitly discouraged from returning to their jobs after having children, which forces them to choose between family and career.  Then the greater respect for older people in Japanese culture means that during a period of economic stagnation younger men face higher unemployment and lower incomes – which delay family formation.

Finally, the culture of very long working hours leaves little time for people to build relationships leading to marriage – a problem faced by many other countries pursuing high economic growth rates.  Driving this is the strong collective ethos which leads to intense national pride, often focused on economic prowess.

The challenge facing Japan is to reconsider what really constitutes success as a nation.  Unless that includes relational wellbeing and social sustainability, alongside economic growth, the sun will start sinking on the Japanese nation.

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Yesterday, British prime minister David Cameron announced that his government is launching a new national measure for wellbeing, in recognition that GDP alone is an inadequate measure for national success.  Read his explanation of why this is important here: www.number10.gov.uk/news/speeches-and-transcripts/2010/11/pm-speech-on-well-being-57569

Walk the talk

The perennial question of work-life balance needs revisiting regularly.  It’s not as simple as reducing long working hours, but rather to think of how our present lifestyle and time commitments reflect the importance we attach to various relationships.  Is there one thing which you have been thinking you ought to do, but haven’t got round to, that would invest time in one of your most important relationships?  Why not resolve to do it now?

The last word

From the Bible, Psalm 127, verse 3: "Sons are a heritage from the Lord, children a reward from him."

The Irish debt crisis: lessons in lending

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“A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.”  Mark Twain.

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The Euro has taken another knock this week as the Irish government is struggling to support its ailing banks, having promised to guarantee all their loans in 2008 during the credit crisis.  This has left the country with the highest public deficit in the eurozone this year, at 14.3% of GDP.

Politicians, bankers and journalists have been scurrying back and forth between Dublin, Brussels and other European capitals; Ireland says it does not need a bailout, some EU leaders think otherwise.  A relational perspective on the financial crisis over the last two years emphasizes one of its underlying causes. 

Despite attempts in recent years to treat debt as a commodity, in reality any loan is a relational transaction: one person lends some of his or her money to another person, who promises to repay it by a certain date.  The bank is the go between, acting in the interests of both parties (and their shareholders).  There is trust involved, and risk and uncertainty with any loan; these issues can be assessed and monitored provided there is genuine knowledge and relationship between the banks and their customers.

However, when loans are commoditised and sold on, the connection between borrower and lender becomes remote and accountability falls away.  The less relational lending becomes, the higher the default rate tends to be: banks are more likely to make loans that haven’t been properly evaluated, and borrowers can more easily get away with defaulting on their debts.

When the boom years came to an end in the Irish property market, the credit which financed it still had to be paid.  The Irish government decided at the time to protect bank depositors from any loss, so the banks turned to the state; the government has underwritten the banks but now has an unsustainable deficit.  Who will pay for the Irish bad debts?  It appears, ironically, that those at the furthest distance relationally from Ireland – taxpayers from across the EU – may ultimately end up paying for the remoteness between borrower and lender in the Emerald Isle.

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Dr Paul Mills is a senior economist in one of the international financial institutions; over the last 20 years he has studied alternatives to debt-based financial systems, including Islamic banking.  The following Cambridge Paper explores the reasons why interest was banned in Old Testament Israel, and what lessons can be drawn from this today. http://www.jubilee-centre.org/document.php?id=3

Walk the talk

The obligation to repay every debt should be taken very seriously, but so too the obligation to cancel a debt when the borrower is clearly unable to repay the loan.  Is there a debt which you need either to be more diligent in repaying, or else to be willing to forgive?

The last word

From the Bible, Proverbs 22 verse 7: “The rich rule over the poor, and the borrower is slave to the lender.”
Romans 13 verse 8: “Let no debt remain outstanding, except the continuing debt to love one another”.

What’s in a symbol? Poppies in Britain and China

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“In Flanders fields the poppies grow
      Between the crosses, row on row,
   That mark our place; and in the sky
   The larks, still bravely singing, fly
Scarce heard amid the guns below.”

John McCrae, Canadian military doctor, 1915.

News
Wreaths of poppies were laid at various war memorials in Britain and the Commonwealth over the last few days, as symbols of gratitude and remembrance of those who laid down their lives to defend their country during the two world wars and subsequent conflicts.  In countries allied to Britain in the two world wars, the poppy has become a deeply meaningful symbol of sacrifice for others.

In China, however, the poppies worn by UK prime minister David Cameron and his delegation last week symbolised something quite different.  During the opium wars in the mid 19^th century, Britain used superior military power to force Chinese markets to accept their imports – particularly opium, which was illegal in China – in order to pay for the huge exports of tea to the British Empire.  Currency wars today carry echoes of these opium wars in the past.

This humiliating memory (for both nations now), rather than soldiers’ lives laid down in the 20^th century, is the one recalled by the Chinese when they see British people wearing red poppies.

In seeking to build strong and healthy relationships between nations, the preconditions of directness of communication, continuity of relationship over time and parity of power play a major part (these are three of the five pillars of Relational Proximity).  Knowing the history of relations between two nations is essential for leaders to understand how to conduct the present relationship in an appropriate and sensitive way. 

While China continues to gain the ascendancy over Britain in economic, financial and military terms, ‘parity’ does not have to mean equality in these areas.  Rather, shared participation in decisions, fairness in application of ethics and respect for the values of the other country are the key ingredients of parity in any relationship between two nations, if they are to move towards lasting peace and prosperity.

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Jeremy Ive wrote an insightful chapter on International Relations in the Jubilee Manifesto, the landmark book presenting a relational basis for Christian social reform, edited by Michael Schluter and John Ashcroft.  You can read it on our website here: www.relationshipsglobal.net/Web/OnlineStore/Product.aspx?ID=52   

Walk the talk

Almost all cultural symbols, such as the poppy worn around Remembrance Day, have a story behind them.  Think of someone you know, originally from a different culture to you, who has worn or displayed a symbol you know little about.  Why not make an opportunity to enquire about the story behind that symbol, so as to understand the person and their culture more fully?

The last word

From the Bible, Ecclesiastes 10, verse 4: “If a ruler's anger rises against you, do not leave your post; calmness can lay great errors to rest.” 

Gambling and the lottery: usual losers and unusual winners

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“Gambling is the son of avarice and the father of despair.”  French proverb

“Horse sense is the thing a horse has which keeps it from betting on people.”  W.C. Fields

News
Journalists have been rushing headlong to speak to a retired couple in Canada this week, when it was revealed that they had given away 98% of their £6.7million lottery jackpot from July.  After giving something to each family member, Allen and Violet Large donated the rest to churches, hospitals, fire departments and other good causes. They bought nothing for themselves, keeping back only £120,000 of their winnings for a rainy day. 

When interviewed, the retired welder and his wife stated that they were quite content with their modest home and had everything they needed.  The international media were intrigued to find people who are apparently immune to the lure of unearned wealth, and who used their windfall to favour other people and build relationships. 

Contrast this with the more common negative effects of gambling, and its rapid growth online, which is more likely to lead to problem gambling (defined as “gambling to a degree that compromises, disrupts or damages family, personal or recreational pursuits”).  Problem gamblers are twice as likely to divorce, 20 times more likely to attempt suicide, and have higher levels of debt than non gamblers; two thirds of them commit crimes to support their habit.

The number of such gamblers is around 0.5% of the population in UK.  Although this is lower than in Hong Kong (5.3%), USA (3.5%) or South Africa (1.4%), it still amounts to 250,000 people – compared with 327,000 problem drug users in the UK. 

Despite the uplifting story from Canada, the reality is that addictive gambling produces two groups of losers: not just the majority of gamblers who lose their bets, but the far greater number of third party losers - partners, families and friends who must suffer financially, physically or relationally as a consequence.

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When the British government was debating whether to start a national lottery in the 1990s, our colleagues at the Jubilee Centre reviewed the arguments for and against such an initiative; although the statistics in their report are dated, the principles of the argument are still relevant today; see http://www.jubilee-centre.org/resources/the_case_against_the_national_lottery

Walk the talk

None of us sets out to become a problem gambler; it happens when we cross several small boundaries.  Some of the warning signs are hiding from others the amount spent, starting to borrow in order to gamble, difficulty in saying no, or needing to bet more and more to satisfy the urge.  If you gamble regularly, no matter how harmless you think it is, choose to make yourself accountable to someone else, who can detect any warning signs in time.

The last word

From the Bible, 1 Timothy 6:9 “But those who are determined to be rich fall into a temptation and a snare and many foolish and harmful lusts, such as drown men in ruin and destruction.”