This article presents a detailed examination of Japan’s accelerating manufacturing decline and the structural weaknesses of its domestic capital investment, based on Hideo Tamura’s Sankei Shimbun column.
It highlights how Japan’s manufacturing capital stock has stagnated and shrunk compared with the United States, placing the nation’s industrial foundation at serious risk.
The analysis also explores the growing burden of large-scale Japanese investment flowing into the United States, the strategic pressure exerted by China over technology and resources, and the urgent need for a Japan-first economic strategy centered on domestic manufacturing revitalization.
Reviving Japan’s industrial base, strengthening domestic investment, and restoring economic security are presented as indispensable conditions for Japan’s long-term national survival and independence.

The following is from Hideo Tamura’s regular column published in the Sankei Shimbun on February 14.

As readers know well, I have repeatedly stated—if I may speak in the strongest possible terms—that without Mr. Yoichi Takahashi and Mr. Hideo Tamura, there would be no genuine economists or economic commentators in Japan.

The conclusion of this essay lays bare, with searing clarity, the gravity of Fumio Kishida’s decision to nominate Shigeru Ishiba as prime minister, the gravity of Shigeru Ishiba becoming prime minister, and the profound culpability of both Kishida and Ishiba.
All Japanese citizens must read this essay with the utmost seriousness.

At the same time, in the party presidential election at that time, Sanae Takaichi ranked first by an overwhelming margin in votes from LDP party members.
Everyone believed that this time, at last, Sanae Takaichi would become prime minister.
Just when people thought so, that unbelievable reversal occurred.
In other words, Fumio Kishida issued instructions to all LDP members under his influence to vote in a certain way.
While he spoke of crushing the Abe faction and dissolving factions, he preserved his own faction.
He is a truly despicable man.
A man like him is what one calls contemptible beyond words.
In terms of expression, there is hardly anyone more contemptible.
It is no exaggeration to call him a traitor to the nation.
The result has made it patently clear that terms such as traitor or betrayer of the nation are entirely appropriate.

Why did Fumio Kishida, of all people, issue instructions to vote for Shigeru Ishiba?
It has long been posted on social media that many Chinese donors attend fundraising parties of the Kishida faction—meaning there are many Chinese contributors.
Concerns have been repeatedly expressed.
Is the Kishida faction being influenced by China?
Then came the assassination of Mr. Abe…
Then the directive to vote for Shigeru Ishiba…
China’s extraordinary efforts to prevent the birth of a Takaichi administration have now become unmistakably clear, as seen in China’s outrageous conduct in response to Prime Minister Takaichi’s entirely reasonable answers in the Diet to the strangely persistent questioning of Aeon’s Okada.

Even now, at the United Nations and international conferences, those people attack Japan, calling it militaristic and worse, exposing themselves to the world as a nation of bottomless malice and hypocrisy—yet they remain oblivious to this fact while continuing to assault Japan.
This intolerable reality was created by none other than Fumio Kishida and Shigeru Ishiba.
The final passage of this essay must be read with utmost seriousness by all voters who supported Kishida, and by all LDP members who, under his instruction, voted for Ishiba.
If they still cannot understand, then they should open their bellies and apologize to the people, to the world—that is, to humanity itself.

Hideo Tamura
Reviving Manufacturing Under a Japan-First Strategy

Japan’s economic revitalization under the Sanae Takaichi administration, which achieved a historic victory in the House of Representatives election, cannot wait.
In particular, the key lies in revitalizing domestic capital investment in manufacturing.

The graph compares the trajectory of manufacturing capital stock in Japan with that of the United States.
Capital stock refers to the total value of assets that support production—such as corporate equipment and buildings—calculated by subtracting depreciation from the cumulative total of past investments.
The index was created based on nominal data selected from Japanese and U.S. statistics by CEIC, a U.S. international economic data service company.

Economic dynamism, including innovation and technological advancement, is accompanied by growth in manufacturing capital stock.
Generally, many believe that Japan retains strength in manufacturing while the United States is in decline.
U.S. President Donald Trump, who proclaims “MAGA” (Make America Great Again), aims first and foremost to restore manufacturing.
Yet when one looks at the graph, it is Japan—not the United States—that is in marked decline, while the U.S. remains full of vitality.

With 2010 set at 100, the overall manufacturing capital stock index stood at 185 in the United States in 2024, whereas Japan’s figure had shrunk to 92 by September 2025.
By company size, large enterprises (capital exceeding ¥1 billion) stand at 94, but small and medium-sized enterprises (capital between ¥10 million and ¥100 million) are in a disastrous state at 82.

Yasuko Kato, an industrial historian and Cabinet Office advisor to the Takaichi administration, notes:
“Small and micro enterprises form the foundation of key industries such as automobiles, with representative sectors being casting and forging. None of them have been able to renew their equipment for more than 30 years; they have somehow managed by repeatedly repairing and continuing to use outdated machinery.”

Large corporations have shifted production overseas to the United States, China, and elsewhere, while domestic small and micro enterprises are forced into severe cost-cutting.
Even when they attempt to invest in equipment renewal, there is no prospect of profit to support such investment.
From automobiles to aerospace, the molds and components indispensable to production depend on precise, high-quality casting and forging technologies.

This shrinking trend signals an existential crisis for Japan’s manufacturing sector as a whole, yet government, bureaucracy, and industry have remained consistently without effective policy response.
On the contrary, the outward orientation remains unchanged.
Toyota Motor is constructing a state-of-the-art plant in China.

China’s Xi Jinping administration, aiming for global manufacturing hegemony, demands the transfer of cutting-edge technologies and restricts supplies of rare earths essential for manufacturing electric motors, semiconductors, and other key products if companies refuse.
Not only the United States but Japan itself depends on these resources.

Japanese companies have contributed in no small measure to the upward trend in U.S. capital stock, yet the Trump administration is not satisfied with that alone.
In 2025 it pressured the previous Ishiba administration with the threat of high tariffs and extracted a commitment of $550 billion (approximately ¥84 trillion) in investment and financing for the United States by January 2029.

For major projects selected by the Trump administration, Japan must transfer the necessary funds to U.S. bank accounts designated by the American side by specified deadlines.
To meet these obligations, Japan’s government-affiliated financial institutions—the Japan Bank for International Cooperation and Nippon Export and Investment Insurance—will provide financing and guarantees, while private financial institutions will lend to the projects.

Projects currently under consideration include gas-fired power generation for data centers, crude oil export terminals, and synthetic diamond production plants required for semiconductor manufacturing and related industries.
The stated objective is to strengthen the economic security of both Japan and the United States in fields such as energy and semiconductors.
However, the risk of investment and financing losses will be borne almost entirely by Japan’s government-affiliated financial institutions.

Another concern is the scale of investment and financing directed toward the United States.
To fulfill the approximately ¥84 trillion commitment within the remaining three years, Japan must supply more than ¥20 trillion annually to the United States.
Japan’s total domestic capital investment amounts to roughly ¥100 trillion per year, yet net investment—after subtracting depreciation, that is, the increase in capital stock mentioned above—does not even reach ¥10 trillion.

Major manufacturing firms are turning away from domestic investment and actively investing in the United States, attracted by its growth potential, while banks promptly provide financing within an established framework.
Moreover, government-affiliated financial institutions and private banks alike are being mobilized to further expand the flow of funds to the United States.
Under such circumstances, it is difficult to imagine that the Takaichi administration will be able to promote domestic growth investment.

Prime Minister Takaichi is scheduled to visit the United States on March 19.
While strengthening the Japan-U.S. alliance and confronting the Chinese threat will be the main themes, the prime minister should state frankly to President Trump the following:

Japan’s manufacturing sector is, in reality, continuing to decline to a degree incomparable with that of the United States.
A system in which Japan continues to supply growth capital to the United States is therefore unsustainable.
What is important is to bring back to Japan the investment returns that Japanese companies are generating in the United States and to encourage advanced U.S. technology industries to increase investment in Japan more than ever before.
Otherwise, the revitalization of Japan’s economy will become difficult and, in the end, Japan will be forced to yield to economic pressure from China.

(Editorial Writer)