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Why Japan's Number 3

GlobalPost: Mosque controversy threatens America's foreign policy. FT: Despite a weak state, India grows and grows. China Post: China's diversity of voices reflect the nation's complexity.

Policy differences reflected in China and Japan’s economies

An editorial in the Wall Street Journal argues that China has replaced Japan as the number two economy in the world due to a mixture of policy and will. China opened itself to the world, cut tariffs, joined the World Trade Organization and encouraged entrepreneurialism. Japan, on the other hand, has focused too much on government spending and has failed to make necessary reforms to encourage competition.

QUOTE: Now Japan's population is aging, and older countries tend to be more risk-averse. Unlike the US or Australia, Japan has never welcomed immigrants who could supply a younger generation of workers. Its political system seems unable to return to a pro-growth agenda.

China’s growing energy needs cause an increase in accidents

Author Sam Chambers writes in the International Herald Tribune that China surpassed the United States in energy consumption just as the Asian nation suffered its worst oil spill in history. He argues that the surge in energy needs has caused an increase in industrial accidents.

QUOTE: In the space of decade China has built up an incredible array of infrastructure to handle its seaborne oil trade. No one has ever assembled a tanker fleet or string of terminals of such scale in a similar time frame. But such speed does bring problems — as the Dalian disaster shows.

Mosque controversy threatens America’s foreign policy goals

Columnist H.D.S. Greenway writes in GlobalPost that the United States has been engulfed in a debate over the building of a mosque near the World Trade Center site in New York. He argues that the controversy threatens to hurt America’s foreign policy as it conveys the message that the West perceives all Muslims as terrorists.

QUOTE: It gives strength to Osama bin Laden’s contention that the West is at war with Islam, and it is the duty of every Muslim to resist.

Despite a weak state and rampant corruption, India grows and grows

Arvind Subramanian, a senior fellow jointly at the Peterson Institute for International Economics and the Center for Global Development in Washington DC, writes in the Financial Times that India is still plagued by a weak state, a high level of corruption and violent internal conflicts. He argues that the country has managed to maintain a high level of economic vitality because growth “is begetting more growth.”

QUOTE: Growth for three decades has widened entrepreneurship, and made the pursuit of money-making respectable. India, in the words of political scientist Devesh Kapur, is now a new nation of hustlers, constantly searching for economic opportunities – including ways of circumventing onerous rules – that, in turn, keep the growth engine purring along.

Cambodia must hold senior Khmer Rouge leaders responsible

Lawyer and author Theary Seng writes in the Wall Street Journal that it is not enough to convict Kaing Guek Eav or Comrade Duch as senior Khmer Rouge leaders must also be held responsible for the atrocities they committed.

QUOTE: Should this Cambodian government make Comrade Duch the sole scapegoat by obstructing the start and completion of Case 002, the tribunal will be considered a failure for the millions of dollars wasted and the irreversible cynicism it has embedded in a society already fractured by fear. If that is the case, let the record show that we survivors have registered our deep disappointment.

Diversity of voices in China reveals nation’s complexity

Frank Ching writes in the China Post that there are a growing number of voices in the local press pushing China to calm its aggression and keep a low profile. They argue that China is not yet ready for global responsibilities.

QUOTE: The emergence of these different voices in China underlines the complexity of the country today. Clearly, there are divisions not only within the government but within the people as well.

Japan’s growth was motivated by fear

Commentator Peter Popham argues in the Independent that economists tend to overlook a key reason why Japan’s economy stalled after the Cold War: for the first time since the 1850s, the nation has not had to fear dominance from foreign powers. 

QUOTE: In the mid-19th century, Japan worked out that the only way to avoid going the way of India and China and disappearing down the imperialists' maw was to industrialize in a hurry. Modernization was thus motivated by fear: the only hope of remaining independent was to beat us at our own game.

Democrats will lose their control this election

William Galston, a senior fellow at the Brookings Institution, writes in the Financial Times that the election in November will end the Democrats’ single-party control over Washington. Americans are upset with the Democrats over the oil spill, the economy and what they consider a growth of state power.

QUOTE: A majority now thinks “government is doing too many things.”  The shift is especially sharp among independents.

Pakistan’s floods threaten its economy and presidency

Omar Waraich writes in TIME that the floods in Pakistan threaten to destroy not only the nation’s economy for the near future but also the presidency. If President Asif Ali Zardari wants to show he is a real leader, he will have to rebuild the economy, secure international aid and help millions affected by the disaster.

QUOTE: There is little prospect of a change in government. The opposition has to avoid being seen as exploiting a national tragedy, and the army is too overstretched to resort to a coup. But while Zardari is likely to remain in power, he may be left too weak to exercise it usefully.

Who will assume responsibility for global finance?

Author Mario Margiocco contends on Project Syndicate that America’s public debt has reached about 140 percent of gross domestic product. He calls this figure “staggering” and argues that it will have a huge impact on the global economy.

QUOTE: Where does that leave the world economy? There is no newly emerging Great Power that can assume responsibility for global finance, as there was in 1914. Back then, Wall Street was ready for the job. Someday, Shanghai and Hong Kong might be ready, but that possibility is of little help now.