Richard Katz

Expertise: Japan economy, Japan politics, U.S.-Japan relations

Richard Katz is Editor of The Oriental Economist Report (TOE), a monthly newsletter on Japan published by Japan Watchers LLC, the semi-weekly TOE Alert, and a New York City correspondent at Weekly Toyo Keizai, one of the three leadings Japanese business magazines.

Mr. Katz has taught about Japan’s economy as an Adjunct Associate Professor at the New York University Stern School of Business, and as a Visiting Lecturer in Economics at the State University of New York (SUNY) at Stony Brook.

Mr. Katz is the author of two books on Japan's economic travails. The first was Japan: The System That Soured--The Rise and Fall of the Japanese Economic Miracle (M.E. Sharpe 1998). A Japanese edition was published in 1999 under the title Kusariyuku Nihon To Iu System (Toyo Keizai Shimposa).

The book received favorable reviews from such publications as the Wall Street Journal, Business Week, Nihon Keizai Shimbun, Asahi Shimbun, Toyo Keizai, The Japan QuarterlyThe Journal of Japanese Studies and the Far Eastern Economic Review, among others. Toyo Keizai named it "one of the 20 books needed to understand the 21st century." In 2002, his second book was published, entitled Japanese Phoenix: The Long Road to Economic Revival (M.E. Sharpe) in English and Fushicho no Nihon Keizai (Toyo Keizai) in Japanese. It also received favorable reviewsBoth books have been widely used in university courses.

He has testified several times about Japan and Asia to Congressional committees. He has frequently been invited to meet with senior officials in both the US and Japanese governments to provide analysis. In the year 2000, he served on the Council of Foreign Relations' Task Force on the Japanese economy. He regularly lectures at universities and conferences.

Mr. Katz’s essays have been published by Foreign AffairsThe Washington Quarterly, The International Economy Magazine, Current History, Challenge and The American Prospect. Op‑eds have appeared in such papers as the New York Times, London Financial Times, Asian Wall Street Journal, Asahi Evening News, Christian Science Monitor and the Investors Business Daily. He is the author of the article on the Japanese economy in the Microsoft Encarta Encyclopedia. Mr. Katz's comments on Japan are frequently quoted in major publications, including the Washington Post, Wall Street Journal, New York Times, Los Angeles Times, London Economist, London Financial Times, Chicago Tribune, Time Magazine International, Newsweek International, and the San Jose Mercury, and he has been interviewed on CNN, The PBS Newshour with Jim LehrerMarketplace, Bloomberg TV, and BBC's The World.

Having received his B.A. degree in History from Columbia University in 1973, Mr. Katz went on to obtain his M.A. in Economics at New York University (NYU) in 1996.

Japan will eventually reform and revive. Its tragedy is that it is filled with smart, ambitious, creative individuals who are trapped in once vibrant but now ossified political and economic institutions. The whole is so much less than the sum of its parts. The country will revive when it finally undertakes the necessary institutional overhaul. But that takes a visionary leader; Shinzo Abe is not that leader.
Hits:
  • Japan’s economy could not recover without structural reform and structural reform would not occur until the emergence of genuinely contested elections.

  • The Koizumi economic boom would not last; there was less economic reform than analysts claimed

  • The JGB market would not crash (several times over the past decade or so when stories about imminent crashes emerged)

  • There would be no run on the banks in 2003

  • The rescue of Resona Bank in 2003 was the beginning of a real change toward solving the nonperforming loan crisis

  • The “decoupling” theory popular in 2006-07 was wrong and a recession in the US would cause a horrific recession in Japan, as it did in 2008-09

  • The Democratic Party of Japan (DPJ) would lose power if it passed the consumption tax

  • All of Japan’s nuclear plants would end up being shut down in the aftermath of the Fukushima disaster

  • China would not intentionally use military force to take Senkaku Islands and would pull back on economic pressure because it needs Japan just as much as Japan needs China

Misses:
  • While the Koizumi boom did peter out, as predicted in 7b, it took longer to occur than I had predicted

  • The DPJ would gain a single-seat majority in the Upper House in the 2010 elections (made shortly after the DPJ’s big Lower House win in 2009

  • The DPJ would not pass the consumption tax out of fear of losing power

  • The 2009 DPJ victory meant the emergence of a genuine two-party system in Japan (hinged on prediction a being correct) and, if the DPJ won the 2013 Lower House election, the Liberal Democratic Party (LDP) disappearing

What I Learned:

Foreseeing the direction of events is one thing; timing is a lot harder

Key points covered in this report are, - The Hill headline—Hatch: TPP deal will get done in lame-duck session—goes too far - What Hatch said was “I think we’re going to get it done in the lame duck” providing that the Administration meets his conditions, including 12 years of data exclusivity for biologics; informed observers tell us hatch has not changed his position - Hatch said other mechanisms beside “side letters” could be used, but he has said that before as well
The keypoints of this report include, - The Bank of Japan has abandoned the pretense that it can achieve its 2% inflation target in two years, or any other particular timeframe - In the face of pressure from private banks, it refrained from going more deeply into negative rate territory regarding bank reserves at the BOJ - In another so-called “new framework” it has switched its main operating target: from an increase in the monetary base to keeping 10-year bond yields at zero - The BOJ also issued a Comprehensive Assessment of why it failed to meet its 2% target, but there is not a lot of culpa in its mea culpa; it keeps insisting that its policy will eventually work - There is no talk of what is really needed: a fiscal-monetary combination
Key points included in this report are, - Ryan tells GOP members of House Obama has run out of legal time to force TPP ratification vote this year - Froman hosts breakfast of TPP Ambassadors and says US will not reopen settled issues - US gave up little in market-opening in return for the concessions it demanded of others; ITC says TPP will boost America’s global exports by just 0.2% of GDP - US could have lifted imports five times as much if it further opened government procurement, but it could not do so because Congress would have rejected the pact - Imagine the resentment of others at both the way the US negotiated and now the notion that it will talk away from a pact it virtually wrote - American state losing ability to corral special interests to compromise for the broader national interest
Key points included in this part three of the report are, - Hatch says “progress” in talks with White House on 12 years for biologics, but he said something similar in the spring and it went nowhere - Hatch claims some TPP countries will to go to 12, but informed sources call this “unrealistic” - Not clear whether Obama Administration is even asking anyone for 12 years - Number two and three GOP leaders in Senate (Cornyn and Thune) seem unaware of any WH-Hatch talks, and say concessions on tobacco also needed; Thune says “odds are not good” - Hatch says, even with biologics solution, hard to get ratification - How could Froman ask other countries to make new concessions if he cannot reassure them it will lead to ratification?
Key points included in this report are, - We were cautioned by some pro-TPP players “never say never,” so let’s put odds of TPP ratification in lame duck at 10-15% ​- Many normally pro-trade members of Congress on both sides of the aisle are deserting the TPP, either opposing it outright or saying they are “studying” it

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October 09, 2014

A Question on Japan's Food Prices

A fellow-reader wrote in with a question that probably a number of you have:

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January 23, 2014

Why Chinese-Japanese Economic Relations Are Improving

In this article on the  Foreign Affairs website, Japan expert and EconVue contributor Richard Katz argues  that China has been delinking an increasingly softer stance on economic ties with Japan, even as political ties between the two countries between increasingly brittle. 

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Expert Information

Sample Reports

Resources

Expertise

Japan economy, Japan politics, U.S.-Japan relations

Location

United States

Experience

Current Experience

Editor of The Oriental Economist Report

Past Experience

  • Visiting Lecturer in Economics at the State University of New York at Stony Brook.

Education

  • M.A. in Economics at New York University