Why nations triumph

Except for an abundance of natural harbors, Japan has little in the way of natural resources. It more than makes up for that in human resources: With a long tradition of respect for education that borders on reverence, Japan possesses a large pool of literate, educated, and increasingly skilled people.

Japanese companies upgrade and specialize that education through an intense commitment to training. Much of Japan's success can be traced to the country's economic disadvantages. Lacking resources, Japanese firms were forced to develop the skills and technologies needed to process its precious resources into higher- value goods.

Japan began with a large pool of unemployed workers after World War II. By the late s, however, labor shortages forced wages up. The paradoxical result: Many Japanese companies automated away one of their early advantages over Western companies -- cheap labor. The shortage of usable land makes real estate costs extremely high.

This not only affects demand conditions by favoring compact and space-efficient goods, but also leads Japanese companies to shorten production lines and avoid unnecessary inventory. Hence just-in-time manufacturing. Finally, the rise of the yen and a succession of two oil shocks advanced Japanese efficiency rather than retarding it.

Conversely, U. Revaluation and high energy prices led Japanese companies to compensate feverishly. Japan's rebound from the oil shocks happened with remarkable speed.

Indeed, had the shocks not occurred, Japan would have been wise to invent them. In a remarkable number of the industries in which Japan has achieved strong positions, the home market -- large, homogeneous, and concentrated -- provides a unique stimulus to Japanese companies.

Japan's secret weapon may be its consumers and the way they live. The Japanese have a voracious appetite for the latest gadgets. They are constantly seeking something new and different, and, of course, they insist on absolute quality.

Japan also has a curious combination of advanced and backward infrastructure. For instance, telecommunications are superb, but poor Japanese roads -- and the tendency to overload vehicles -- means that trucks built for the Japanese home market are well suited to developing countries elsewhere in Asia.

Japan's crowded living conditions stimulate demand for products that are compact, light, and multifunctional -- characteristics of Japanese consumer electronics that now appeal to customers around the world. Among industrial buyers, if one important company buys a new product or service, competitors quickly follow.

Among consumers, rapid information from Japan's highly developed media feeds the desire for the latest models for status reasons. That in turn causes companies to turn out ever newer and better products. Japanese companies do particularly well in industries where introducing new models frequently is important to competitive advantage -- notably cars and consumer electronics.

The corollary of rapid market penetration is early saturation, which invariably provides the impetus for a major export drive as companies scramble to replace lost domestic volume and fill excess capacity. In nearly every Japanese industry we studied, exports increased substantially only when the domestic market became mature.

As Japanese industry has developed, the quality of domestic demand has improved even further. In a growing number of industries, such as robotics and advanced materials, Japanese companies are the world's most sophisticated buyers of industrial goods. Related and supporting industries play a striking part in the Japanese , national competitive advantage. Strong clusters characterize Japanese industry. Relationships between suppliers and manufacturers are enduring. That encourages cooperation on innovation.

Even though workers have lifetime employment, companies become more efficient and generate excess labor. To protect employees, many companies in the base industry then enter a related industry almost simultaneously.

Remember the tendency of Japanese companies to imitate each other. This produced a flood of new entrants into fax machines, for instance. Each company brings with it a reservoir of skill and technology -- optics, for example, in Canon's case -- that it then transfers to the new business. Such is the intensity of domestic rivalry that companies continually compare market share.

Loss of share is cause for embarrassment and evokes an aggressive response. Too much has been made of cooperation between Japanese companies, some of it in concert with government, as a key to success. There are major machine-tool makers. In the past three years, three different companies have led in fax market share.

Rivalries are intensely personal. In fields such as construction, agriculture, food, paper, commodity chemicals, and fibers, Japan has little competitive advantage. These industries have one thing in common: cartels and other restrictions on competition, some sanctioned by government.

Japan is also weak internationally in services of nearly all types. All this is a growing constraint on future Japanese prosperity.

Porter concludes with an agenda for each of the nations he studied. His prescription for the U. Such a view is incomplete, to say the least. It has led to relaxing regulatory standards and allowing horizontal mergers, which usually undermine rather than help U. Both American firms and the government need a new and richer view of the underpinnings of national advantage.

Nothing has contributed to the drift in American industry more than ebbing rivalry. A long period during which U. In the s mergers began consolidating many industries. Relaxation of antitrust enforcement allowed leading competitor to buy leading competitor. Ironically, such transactions are justified as enhancing competitiveness. All three have been focused entirely on short-term rewards.

A new approach to corporate governance and taxation is necessary that makes long-term prosperity a central concern. Revision or elimination of long-term capital gains taxes is a good place to start. Permitting banks to own equity shares would promote deeper long-term relationships between investors and managers. Companies must make a greater investment in employees and not treat them like disposable assets. Mergers and alliances among leading competitors should be prohibited.

The same standards for mergers among U. At the same time, antitrust constraints on the activities of trade associations should be loosened, with safeguards against collusion or monopolization. The associations can play a constructive role in training and research. Demand conditions in the U. The regulatory environment, or lack of it, has seriously hindered the demand side.

A good example was the Reagan Administration's move to relax federal gas mileage standards at a time when energy imports are substantial and gasoline combustion is creating major environmental problems. Without advanced regulations, U. Stringent standards for products, environmental quality, and the like not only serve the public good but are vital to economic success.

By the same token it is time for a systematic overhaul of the U. Tamura and Hooley traded penalties in the final minutes of the half for Japan to turn ahead. Japan made another explosive start to the second half with an inside pass from Tamura sending Ryohei Yamanaka over. Fukuoka then latched on to a wayward American kick on the Japan 22 to spark a counter-attack that swept 80 metres, with Leitch on hand at the finish to score his second try.

The introduction of replacement forwards worked to the USA's advantage, with a superior scrum resulting in a late try to Hanco Germishuys. The content you requested does not exist or is not available anymore. ON TV. But in North America the mountains rise up on each coast, and from them the land slopes gradually together in one valley, offering to commerce many thousand miles of navigable streams. The map thus proclaims the unity of North America, for in this great central basin, three million square miles in extent, free from impassable rivers or mountain barriers great enough to hider free intercourse, political integration is a necessity and consolidation a certainty….

The unity of the American people is further powerfully promoted by the foundation upon which the political structure rests, the equality of the citizen. There is not one shred of privilege to be met with anywhere in all the laws. The flag is the guarantor and symbol of equality.

The people are not emasculated by being made to feel that their own country decrees their inferiority, and holds them unworthy of privileges accorded to others. No ranks, no titles, no hereditary dignities, and therefore no classes. Suffrage is universal, and votes are of equal weight. Representatives are paid, and political life and usefulness thereby thrown open to all. Thus there is brought about a community of interests and aims which a Briton, accustomed to monarchial and aristocratic institutions, dividing the people into classes with separate interests, aims, thoughts, and feelings, can only with difficulty understand.

The free common school system of the land is probably, after all, the greatest single power in the unifying process which is producing the new American race. Through the crucible of a good common English education, furnished free by the State, pass the various racial elements — children of Irishmen, Germans, Italians, Spaniards, and Swedes, side by side with the native American, all to be fused into one, in language, in thought, in feeling, and in patriotism.

The Irish boy loses his brogue, and the German child learns English. There is no class so intensely patriotic, so wildly devoted to the Republic as the naturalized citizen and his child, for little does the native-born citizen know of the value of rights which have never been denied.

Only the man born abroad, like myself, under institutions which insult him at his birth, can know the full meaning of Republicanism…. It is these causes which render possible the growth of a great homogeneous nation, alike in race, language, literature, interest, patriotism — an empire of such overwhelming power and proportions as to require neither army nor navy to ensure its safety, and a people so educated and advanced as to value the victories of peace. The student of American affairs today sees no influences at work save those which make for closer and closer union.

The Republic has solved the problem of governing large areas by adopting the federal, or home-rule system, and has proved to the world that the freest self-government of the parts produces the strongest government of the whole.

Industrialization and Urbanization. The Triumph of America. The Race Problem in America. Science and Theology. The Moral Theory of Civil Liberty. Herbert Spencer and the Doctrine of Evolution. Oration in Memory of Abraham Lincoln. On Being Born Again. Reynolds v. United States.

Philosophy in the United States. State of the Union Address First Inaugural Address The Ghost Dance Religion among the Sioux. Plenty Horses Kills Lieutenant Casey. Address Delivered at Hampton Institute. Prayer to the Virgin of Chartres. Lift Every Voice and Sing.

Stimulants and Narcotics.