Japan-watchers may be forgiven for coming to believe that the tight connections between the Japanese government and businesses, long referred to as Japan Inc., have unraveled over the years. Or at least been relaxed.
But today’s news that the Japanese government has seized the lead role in buying Toshiba’s semiconductor business shows that old tendencies die hard. It’s not the old Ministry of Trade and Industry (MITI) that is orchestrating the purchase. It’s one step more subtle. The government-backed investment fund, Innovation Network Corp. of Japan, is taking the lead in buying the chip business with financial support from the Development Bank of Japan, which is government-owned.
It’s hard to fault the Japanese government for being worried that the semiconductor technology could be purchased or otherwise obtained by the Chinese, giving a major boost to the mainland’s semiconductor industry. The Chinese government is spending billions of dollars in an effort to upgrade its domestic semiconductor industry and escape dependence on foreign chip firms that still dominate the Chinese market.
I only wish that we Americans would think a bit more strategically about our own technology. At a Silicon Dragon event yesterday in New York, I learned that the Chinese have penetrated the American technology base and are spending billions of dollars to obtain control of technologies associated with semiconductors, artificial intelligence, autonomous driving, virtual reality, robotics and other technologies of the future.
Rather than faulting Japan Inc., as I did in the old days, I’ve come to believe that it is only sensible for a nation to defend strategically sensitive technologies. We need to break through our ideological confusion and recognize that we need an America, Inc.