Japanese economic miracle - Lessons from Japan

I happened to receive a paper on Japanese economic miracle by Koichi Hamada of Yale University in August 1996 where he details the political and economic situation during the start of the great economic miracle of Japan in 1968.
Progressive ideas have gained traction in Japan during that time and the government was fighting against both leftist and conservative movements threatening to tear the country apart.Here are a few excerpts from the paper
"So much for the ideological and intellectual background around 1968.Now let us turn to the political situation in Japan during the decade. At the beginning of the decade, Prime Minister Hayato Ikeda, of LDP,7 started his "doubling the income" plan. This was the beginning of the decade of the "economy" as opposed to the decade of "politics." Let us roll back the film of history a little further in order to understand the background of the miraculous growth of Japan.
(a file photo of Hayato Ikeda)
The decade of the 1950s can be regarded as the period of preparation and transition (from the postwar reconstruction period) to the golden era of high speed growth after 1960. Resources were transferred from less productive to more productive sectors, and the pace of progress quickened through import of foreign technology. GNP exceeded the prewar level in 1953. The 1956 Economic White Paper of the Economic Stabilization Board stated: "We are no longer in the postwar reconstruction period."
In 1960, protests against the revised extension of the Japan-U.S. Mutual Cooperation and Security Treaty roared on the streets of Tokyo. The treaty was to put Japan under the U.S. (nuclear)umbrella. In retrospect, because of the Treaty, Japan could enjoy some free-ridership in defense in exchange for various benefits for the U.S. forces that were stationed in Japan. In any case, demonstrations echoed in the streets of Tokyo. Prime Minister Nobusuke Kishi planned to invite President Eisenhower to Japan for signing the extension of the Mutual Security Treaty, but he gave up the plan when the U.S. Press Secretary, James Haggarty, had to be flown by helicopter from the airport to the guest house, and when the police crushed rioters and killed a woman who was a student from the University of Tokyo.9 Kishi10 resigned soon after the cancellation of the President's visit.Moreover, labor relations were also severely strained. A long strike was going on in Miike Mining in
Kyushu (Southern) island"
- A corollary can be found between Japan then and India now,we have the same labor tensions and leftist movements like Maoists in present India.Lets see how Japan dealt with it.
"The reaction of Hayato Ikeda, the successor of Kishi, to this highly politicized situation, was to direct the attention of the people to the economy. Income Doubling Plan11 opened the way to the era of high-speed growth during the 1960s12). Ikeda forecasted that real GNP would be doubled in the following ten years. People hardly believed that the plan would be realized; nominal income might be doubled, they thought, but inflation would wipe out the nominal gain."
- The same fears about India now with such rising food inflation will wipe out any income growth in India's poor.
"To the surprise of the public,real income more than doubled in the next decade, and per capita real income even tripled between 1960 around 1973. The 1960s was the most remarkable decade of the Japanese economy as far as the real growth rate is concerned. The unemployment rate was low, around 1.1-1.3%, except for 1960 when it was 1.6%. 1968 was in the middle of the most rapid growth period of the Japanese economy. This period (1966-69) was called the Izanami period (meaning "the best period since Izanami").Izanami and Izanagi were the goddess and the god who supposedly mated and gave birth to the Japanese islands.) As was already mentioned, the first time, Japan's GNP exceeded Germany's and Japan's GNP became second in the world, though per-capita GNP was still lower than many industrialized countries.13 In Fiscal Year 1968, Japan's GNP reached about 152 billion dollars which exceeded that of West Germany. West Germany's population was slightly more than half of Japan's.The per capita income in Japan was about a half of that in West Germany. The comparison of the living standard follows, approximately, from the per ca pita income comparison. The centennial year of the Meiji Restoration in 1868 became memorable in this respect as well."
--- Will India have their "Izanami period" , we are already in the Izanami period but our problem is that we need 50 years of Izanami period rather than 13 years for Japan cause of our large unproductive population. But even by then Indias per capita income is expected to be lower than Iran in 2050.Sustained high growth is the bare minimum we need and unfortunately thats the best any country can do.