Bright lights, big city: a bustling crossing in the Shibuya ward of Tokyo in 2013. Photo: MARTIN ROEMERS / PANOS
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What the west can learn from Japan’s “lost decades”

Roland Kelts wonders whether Japan-style stagnation would really be so bad in the west.

I travel back and forth between Japan and the United States, mostly Tokyo and New York and a few other American cities, several times a year. The contrast is jarring. Arriving in the US can feel like rolling back a decade or more, returning to a time when information was scarce, infrastructure was creaky and basic services such as ground transportation were chaotic and unreliable.

I steel myself before landing, my mind tallying variables and unknowns: will my luggage land with me and emerge on the dingy carousel? Will the taxi that I booked online in advance arrive on time, at the right terminal, or at all? Will traffic impede me on my journey?

And then there’s the view. Whether it’s the outskirts of Queens on the way from New York’s JFK International Airport or the fringes of the Los Angeles highway off-ramps by LAX, everything seems a bit run down and decrepit.

Landing in Tokyo, though, is a breeze.  All the travelators and escalators glide silently; the wall-mounted clocks, digital and analogue, tell the right time. When I reach the baggage carousel, my suitcase is already circling. Trains and buses depart punctually. I don’t have to pre-book because they’re scheduled minutes apart. I don’t have to think of anything beyond the last book I was reading during touchdown, fishing out my passport at immigration and what I might order for dinner that evening once I reach my apartment. Everything seems to be taken care of and nothing is broken. As I ease into town, usually on the limousine bus service, the streets outside are teeming with well-dressed urbanites heading home from work or out to restaurants, everyone in motion with purpose and meaning.

But that’s not what the papers say. Japan has experienced more than two decades of a stagnant-to-recessionary economy since its 1989-90 bubble burst. It has become the world’s economic whipping boy, described repeatedly as “the sick man of Asia”, incapable of revival, doddering off into the sunset.

The reports of Japan’s societal stagnation are no prettier. Stories about the country’s ageing population and plummeting birth rate abound – with the latter hitting a record low last year amid dire predictions of a disappearing Japan. At current rates, demographers estimate that the overall population will drop by 30 million by 2050.

Japan’s 2014 fertility rate is low – 1.4 births per woman – but David Pilling, a former Tokyo bureau chief of the Financial Times, notes that South Korea’s is lower and those of other developed countries, from Taiwan and Singapore to Germany and Italy, are similarly low. “Much of the world is going Japan’s way,” says Pilling. “If Japan is doomed, so are many others.”

However, Pilling adds, the alternative isn’t necessarily better. “Can we really only conceive of a successful economy as one where the population increases year after year? By this measure, Pakistan and many African countries should be screaming success stories. They’re not.”

Japanese men and women, meanwhile, are tagged as “sexless”, caught up in a “celibacy syndrome” (sekkusu shinai shokogun) that has both the married and the single declaring their lack of interest in sexual relations. Japan’s young shut-ins (hikikomori) are socially withdrawn digital hermits who confine themselves to their bedrooms, video games and online chats. The so-called herbivore or “grass-feeding” men (soushoku danshi) avoid competition in any arena, be it romantic or professional. Their female counterparts greet them with a shrug, collect their pay cheques and dine out with their girlfriends.

Intuitively, you might think that this shrinking, even disappearing Japan should not look and feel as good as it does. To visitors, expats and residents alike, Japan is still one of the richest, most civilised and convenient countries in the world. There should be potholes in its streets and pickpockets in its alleys. Shops, restaurants, bars and factories should be darkened and idle. Trains should be late and the passengers poorly dressed and busking for change.

The 2015 Economist Intelligence Unit’s annual ranking of the safest major cities in the world put Tokyo on top, with Japan’s second city, Osaka, at number three. While smaller and mid-sized Japanese cities betray some of the conventional signs of economic hardship (boarded-up storefronts and sparsely populated shopping malls), in a world beset by rising fanatical violence and rancorous racism and inequality, safety is nothing to sneeze at.

In his 2014 book Bending Adversity, Pilling grapples with the cognitive dissonance at the heart of 21st-century Japan: is it a harbinger of global stagnation? Or is it a model of global sustainability? In the book’s most-quoted passage, a British MP, on arriving in Tokyo in the early 2000s and surveying its lively environs, is reported to have said: “If this is a recession, I want one.”

I caught up with Pilling, who is now based in Hong Kong but frequently returns to Tokyo, to ask if he has had a change of heart about the resilient, sustainable Japan that he outlines in his book. He remains deeply sceptical of the knee-jerk pejoratives associated with stagnancy.

“Do rich societies really need to get richer and richer indefinitely?” he asks. “A lot of improvements in standard of living come not through what we normally consider as growth but through technological improvements.”

Pilling considers Japan’s stagnant years as a time of remarkable domestic growth, if not the kind associated with standard economic measurements such as GDP. “Many would agree that the standard of living, particularly in big cities like Tokyo, has improved significantly in the so-called lost decades. The city’s skyline has been transformed; the quality of restaurants and services improved greatly. Despite the real stresses and strains and some genuine hardship, society has held together reasonably well. If this is what stagnation looks like, humanity could do a lot worse.”

 

***

 

What makes one society hold together “reasonably well”, while others fail? You have only to look to the Japanese language for insight. Common words such as ganbaru (to slog on tenaciously through tough times), gaman (enduring with patience, dignity and respect) and jishuku (restraining yourself according to others’ needs) convey a culture rooted in pragmatism and perseverance.

After the March 2011 earthquake, tsunami and nuclear disaster in northern Japan, the international media were awash with stories about the dignity and almost super­human patience of survivors, many of whom peacefully waited hours in single-file lines for relief supplies, only to be turned away in the frigid weather and asked to try again the next day. No one rushed to the front; no one rioted. In shelters, meagre foodstuffs such as rice balls were split in half or into quarters to make sure that
all had something to eat.

Nearly everyone was on the same page: Japan’s population is 98.5 per cent Japanese, as defined by citizenship. While ethnic diversity has its advantages (and some academics point out that, when you analyse the population’s regional roots, Japan is quite diverse), a set of common cultural values, instilled from birth, may strengthen resilience in the face of crisis and adversity.

The journalist Kaori Shoji tells me that having little to hand and learning to make the most of it are essential components of the Japanese character. “The Japanese temperament is suited to dealing with poverty, scarcity and extremely limited resources. If [the American commodore Matthew Perry’s] black ships didn’t show up [to open Japan to western trade] in the 19th century, we’d still be scratching our heads over the workings of the washing machine or the dynamics of a cheeseburger. On the other hand, with . . . centuries of frugality behind us, we have learned to be creative. Frugality doesn’t have to mean drab stoicism and surviving on fish heads.”

Japan’s stagnation, pilloried by economists and analysts in the west, may turn out to be the catalyst for its greatest strengths: resilience, reinvention and quiet endurance.

Until a couple of years ago, I lectured Japan’s brightest and best at the University of Tokyo. My Japanese students were polite to a fault. They handed their essays to me and to my teaching assistant with two hands affixed to the paper, as if they were handling sacred artefacts. They nodded affirmatively when I asked them if they had understood what I’d said, even when they hadn’t. They were never late to class and they never left early.

When I pressed them on their future plans, however, they expressed a kind of blissful ambivalence. “I’d like to help improve Japan’s legal system,” Kazuki, a smart and trilingual student from Kyushu told me. “But if that doesn’t work out, I just want to be a good father.”

Sayaka, a literature major from Hokkaido, asked me if I understood her generation’s dilemma. “We grew up very comfortable,” she said. “We learned not to take risks.”

The lack of risk-taking – anathema to today’s “fail-fast” Silicon Valley culture – would seem to indicate stagnation writ large. But what if it’s a more futuristic model for all of us, even superior to Japan’s sleek, sci-fi bubble-era iconography: all hi-tech and flashy yen but no soul?

The Waseda University professor Norihiro Kato, a columnist for the New York Times, sees a radical example in Japanese culture that he describes as a model of “de-growth”, of returning to other measures of growth that transcend stagnancy, focused instead on quality of life.

“The shape of wisdom as well as self-worth has drastically changed,” he tells me at his office in Takadanobaba, north-west Tokyo. “We can point to periods of change: the late 1980s with Chernobyl, or the early 1990s with the end of the USSR and communism, or the early 2000s with 9/11. And finally, the early 2010s, with 11 March 2011 and Fukushima Daiichi.”

Kato sees our world as one of fundamental transition, from dreams of the infinite to the realities of the finite – a transformation that Japan grasps better than most. “I consider younger Japanese floating, shifting into a new qualified power, which can do and undo as well – can enjoy doing and not doing equally.”

I ask him if Japan’s model of stagnancy as strength can educate the rest of the world in the possibilities of impoverishment. “Imagine creating a robot that has the strength and delicacy to handle an egg,” he says. “That robot has to have the skills to understand and not destroy that egg. This is the key concept for growing our ideas about growth into our managing of de-growth.”

Handling that egg is tricky. A spike in volunteering among young people in Japan after the nuclear disaster suggests that, despite the global hand-wringing over their futures, they are bypassing the old pathways to corporate success in favour of humbler forms of participation.

In 2005, the Tokyo University graduate Mitsuru Izumo, who had a cosy law firm gig in his lap, left to found a start-up, Euglena.jp – a way of feeding the world’s poorest using algae hybrids. A Keio University graduate is now selling stitched bags from Ethiopia. Haruka Mera of the website Ready For? is thriving by facilitating global crowd-funding campaigns for Japanese start-ups.

Mariko Furukawa, a researcher for the Japanese advertising firm Hakuhodo, thinks that the “think small” mentality of young Japanese is turning stagnancy into sustainability. She cites the proliferation of agri-related start-ups – peopled by young Japanese who are leaving the cities for rural environs, despite the low returns, and who don’t seem to care about globalisation.

“These small techs should really add up to something and we may be able to replace [stagnation] with new innovation, not necessarily new technology,” Furukawa says. “I think the Japanese ability to innovate in such things is very strong. And so, because these city planners and urban designers are talking about downsizing the cities, wrapping up into smaller furoshikis [rucksacks], so to speak, the awareness is there; they know what needs to be done. In this sense, we may be at the forefront of developed economies.”

Furukawa notes that many European nations facing similar dilemmas don’t have the same tools to address them. “Europe has been suffering from low growth. But I don’t know if they are that innovative at new ways of living.”

Japan’s Blade Runner image of yesteryear – a futuristic amalgamation of hi-tech efficiency coursing through neon-lit, noirish alleyways in sexy, 24-hour cities – was really a blip in the nation’s history. Today, the country is more about quality of life than quantities of stuff. In its combination of restraint, frugality and civility, Japan may serve as one of our best societal models of sustenance for the future.

Roland Kelts is a contributing writer for the New Yorker and the Japan Times and the author of “Japanamerica” (Palgrave Macmillan)

This article is published simultaneously as part of the “Stagnation” season of the Long + Short, Nesta’s free online magazine of ideas and innovation: thelongandshort.org

This article first appeared in the 19 March 2015 issue of the New Statesman, British politics is broken

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Are smart toys spying on children?

If you thought stepping on a Lego was bad, consider the new ways in which toys can hurt and harm families.

In January 1999, the president of Tiger Electronics, Roger Shiffman, was forced to issue a statement clearing the name of the company’s hottest new toy. “Furby is not a spy,” he announced to the waiting world.

Shiffman was speaking out after America’s National Security Agency (NSA) banned the toy from its premises. The ban was its response to a playground rumour that Furbies could be taught to speak, and therefore could record and repeat human speech. “The NSA did not do their homework,” said Shiffman at the time.

But if America’s security agencies are still in the habit of banning toys that can record, spy, and store private information, then the list of contraband items must be getting exceptionally long. Nearly 18 years after TE were forced to deny Furby’s secret agent credentials, EU and US consumer watchdogs are filing complaints about a number of WiFi and Bluetooth connected interactive toys, also known as smart toys, which have hit the shelves. Equipped with microphones and an internet connection, many have the power to invade both children’s and adults’ private lives.

***

“We wanted a smart toy that could learn and grow with a child,” says JP Benini, the co-founder of the CogniToys “Dino”, an interactive WiFi-enabled plastic dinosaur that can hold conversations with children and answer their questions. Benini and his team won the 2014 Watson Mobile Developer Challenge, allowing them to use the question-answering software IBM Watson to develop the Dino. As such, unlike the “interactive” toys of the Nineties and Noughties, Dino doesn’t simply reiterate a host of pre-recorded stock phrases, but has real, organic conversations. “We grew it from something that was like a Siri for kids to something that was more conversational in nature.”

In order for this to work, Dino has a speaker in one nostril and a microphone in the other, and once a child presses the button on his belly, everything they say is processed by the internet-connected toy. The audio files are turned into statistical data and transcripts, which are then anonymised and encrypted. Most of this data is, in Benini’s words, “tossed out”, but his company, Elemental Path, which owns CogniToys, do store statistical data about a child, which they call “Play Data”. “We keep pieces from the interaction, not the full interaction itself,” he tells me.

“Play Data” are things like a child’s favourite colour or sport, which are used to make a profile of the child. This data is then available for the company to view, use, and pass on to third parties, and for parents to see on a “Parental Panel”. For example, if a child tells Dino their favourite colour is “red”, their mother or father will be able to see this on their app, and Elemental Path will be able to use this information to, Benini says, “make a better toy”.

Currently, the company has no plans to use the data with any external marketers, though it is becoming more and more common for smart toys to store and sell data about how they are played with. “This isn’t meant to be just another monitoring device that's using the information that it gathers to sell it back to its user,” says Benini.

Sometimes, however, Elemental Path does save, store, and use the raw audio files of what a child has said to the toy. “If the Dino is asked a question that it doesn’t know, we take that question and separate it from the actual child that’s asking it and it goes into this giant bucket of unresolved questions and we can analyse that over time,” says Benini. It is worth noting, however, that Amazon reviews of the toy claim it is frequently unable to answer questions, meaning there is potentially an abundance of audio saved, rather than it being an occasional occurrence.

CogniToys have a relatively transparent Privacy Policy on their website, and it is clear that Benini has considered privacy at length. He admits that the company has been back and forth about how much data to store, originally offering parents the opportunity to see full transcripts of what their child had been saying, until many fed back that they found this “creepy”. Dino is not the first smart toy to be criticised in this way.

Hello Barbie is the world’s first interactive Barbie doll, and when it was released by Mattel in 2015, it was met with scorn by parents’ rights groups and privacy campaigners. Like Dino, the doll holds conversations with children and stores data about them which it passes back to the parents, and articles expressing concerns about the toy featured on CNN, the Guardian, and the New York Times. Despite Dino’s similarities, however, Benini’s toy received almost no negative attention, while Hello Barbie won the Campaign for a Commercial-Free Childhood’s prize for worst toy of the year 2015.

“We were lucky with that one,” he says, “Like the whole story of the early bird gets the worm but the second worm doesn’t get eaten. Coming second on all of this allowed us to be prepared to address the privacy concerns in greater depth.”

Nonetheless, Dino is in many ways essentially the same as Hello Barbie. Both toys allow companies and parents to spy on children’s private playtimes, and while the former might seem more troubling, the latter is not without its problems. A feature on the Parental Panel of the Dino also allows parents to see the exact wording of questions children have asked about certain difficult topics, such as sex or bullying. In many ways, this is the modern equivalent of a parent reading their child's diary. 

“Giving parents the opportunity to side-step their basic responsibility of talking to, engaging with, encouraging and reassuring their child is a terrifying glimpse into a society where plastic dinosaurs rule and humans are little more than machines providing the babies for the reptile robots to nurture,” says Renate Samson, the chief executive of privacy campaign group Big Brother Watch. “We are used to technology providing convenience in our lives to the detriment of our privacy, but allowing your child to be taught, consoled and even told to meditate by a WiFi connected talking dinosaur really is a step in the wrong direction.”

***

Toy companies and parents are one thing, however, and to many it might seem trivial for a child’s privacy to be comprised in this way. Yet many smart toys are also vulnerable to hackers, meaning security and privacy are under threat in a much more direct way. Ken Munro, of Pen Test Partners, is an ethical hacker who exposed security flaws in the interactive smart toy “My Friend Cayla” by making her say, among other things, “Calm down or I will kick the shit out of you.”

“We just thought ‘Wow’, the opportunity to get a talking doll to swear was too good,” he says. “It was the kid in me. But there were deeper concerns.”

Munro explains that any device could connect to the doll over Bluetooth, provided it was in range, as the set-up didn’t require a pin or password. He also found issues with the encryption processes used by the company. “You can say anything to a child through the doll because there's no security,” he says. “That means you've got a device that can potentially be used to groom a child and that's really creepy.”

Pen Test Partners tells companies about the flaws they find with their products in a process they call “responsible disclosure”. Most of the time, companies are grateful for the information, and work through ways to fix the problem. Munro feels that Vivid Toy Group, the company behind Cayla, did a “poor job” at fixing the issue. “All they did was put one more step in the process of getting it to swear for us.”

It is one thing for a hacker to speak to a child through a toy and another for them to hear them. Early this year, a hack on baby monitors ignited such concerns. But any toy with speech recognition that is connected to the internet is also vulnerable to being hacked. The data that is stored about how children play with smart toys is also under threat, as Fisher Price found out this year when a security company managed to obtain the names, ages, birthdays, and genders of children who had played with its smart toys. In 2015, VTech also admitted that five million of its customers had their data breached in a hack.

“The idea that your child shares their playtime with a device which could potentially be hacked, leaving your child’s inane or maybe intimate and revealing questions exposed is profoundly worrying,” says Samson. Today, the US Electronic Privacy Information Center (EPIC) said in a statement that smart toys “pose an imminent and immediate threat to the safety and security of children in the United States”. 

Munro says big brands are usually great at tackling these issues, but warns about smaller, cheaper brands who have less to lose than companies like Disney or Fisher Price. “I’m not saying they get it right but if someone does find a problem they’ve got a huge incentive to get it right subsequently,” he says of larger companies. Thankfully, Munro says that he found Dino to be secure. “I would be happy for my kids to play with it,” he says. “We did find a couple of bugs but we had a chat with them and they’re a good bunch. They aren’t perfect but I think they’ve done a hell of a lot of a better job than some other smart toy vendors.”

Benini appears alert to security and the credibility it gives his company. “We took the security very, very seriously,” he says. “We were still building our systems whilst these horror stories were coming about so I already set pipelines and parameters in place. With a lot of devices out there it seems that security takes a backseat to the idea, which is really unfortunate when you’re inviting these devices into your home.”

As well as being wary of smaller brands, Munro advises that parents should look out for Bluetooth toys without a secure pairing process (ie. any device can pair with the toy if near enough), and to think twice about which toys you connect to your WiFi. He also advises to use unique passwords for toys and their corresponding apps.

“You might think ‘It's just a toy, so I can use the same password I put in everything else’ – dog’s name, football club, whatever – but actually if that ever got hacked you’d end up getting all your accounts that use that same password hacked,” he says.

Despite his security advice, Munro describes himself as “on the fence” about internet-connected smart toys as a whole. “Most internet of things devices can be hacked in one way or another,” he says. “I would urge caution.”

***

Is all of this legal? Companies might not be doing enough ethically to protect the privacy of children, but are they acting responsibly within the confines of the law?

Benini explains that Dino complies with the United States Children's Online Privacy Protection Act (COPPA) of which there is no real equivalent in the UK. COPPA says that companies must have parental permission to collect personal information over the internet about children under 13 years of age. “We’ve tried to go above and beyond the original layout of COPPA,” says Benini, when describing CogniToys transparent privacy documents. Parents give their consent for Elemental Path to collect their children’s data when they download the app that pairs with the toy.

Dino bears a striking similarity to Amazon Echo and Google Home, smart speakers that listen out for commands and questions in your home. Everything that is said to Amazon Echo is recorded and sent to the cloud, and an investigation by the Guardian earlier this year discovered that this does not comply with COPPA. We are therefore now in a strange position whereby many internet of things home devices are legally considered a threat to a child’s privacy, whereas toys with the same capabilities are not. This is an issue because many parents may not actually be aware that they are handing over their children’s data when installing a new toy.

As of today, EU consumer rights groups are also launching complaints against certain smart toys, claiming they breach the EU Unfair Contract Terms Directive and the EU Data Protection Directive, as well as potentially the Toy Safety Directive. Though smart toys may be better regulated in Europe, there are no signs that the problem is being tackled in the UK. 

At a time when the UK government are implementing unprecedented measures to survey its citizens on the internet and Jeremy Hunt wants companies to scour teens’ phones for sexts, it seems unlikely that any legislation will be enacted that protects children’s privacy from being violated by toy companies. Indeed, many internet of things companies – including Elemental Path – admit they will hand over your data to government and law enforcement officials when asked.

***

As smart toys develop, the threat they pose to children only becomes greater. The inclusion of sensors and cameras means even more data can be collected about children, and their privacy can and will be compromised in worrying ways.

Companies, hackers, and even parents are denying children their individual right to privacy and private play. “Children need to feel that they can play in their own place,” says Samson. It is worrying to set a precedent where children get used to surveillance early on. All of this is to say nothing of the educational problems of owning a toy that will tell you (rather than teach you) how to spell “space” and figure out “5+8”.

In a 1999 episode of The Simpsons, “Grift of the Magi”, a toy company takes over Springfield Elementary and spies on children in order to create the perfect toy, Funzo. It is designed to destroy all other toys, just in time for Christmas. Many at the time criticised the plot for being absurd. Like the show's prediction of President Trump, however, it seems that we are living in a world where satire slowly becomes reality.

Amelia Tait is a technology and digital culture writer at the New Statesman.