Slow Nuclear Legacies

For those driven from their homes by the atom, whose home is now the sky and the sea

Nuclear disasters do not occur in a single dramatic moment; that is merely how history book authors describe them. A flash, an almost instantaneous explosion (think of Hiroshima and Nagasaki), followed by a massive “mushroom-shaped” cloud of smoke. When the Fukushima nuclear reactor exploded on March 11, 2011, the world immediately began counting the direct victims, the rubble, and the material damage. Every news report focused on this. Yet this was only the first, visible layer of the disaster.

However, we come to understand the nature of nuclear disasters much later.

This essay, the fourth and final part of the history of the “friendly” atom, argues that the victims of the Chornobyl and Fukushima nuclear accidents are not only those who lost their lives amid the rubble, but also the invisible, stigmatized generations whose daily life is defined by chronic illnesses and the paralyzing weight of sociopsychological traumas.

The legacy of nuclear disasters kills slowly—not only cells, but also communities, trust, and identities once taken for granted.

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In 2025, a total of 408 nuclear power plants were in operation across 31 countries, with a combined capacity of 367 GW.

For comparison: China, where the most nuclear power plants are currently under construction (36), operates 60 plants with a combined capacity of 57 GW. However, thanks to its solar panels, China generates 1,234 GW of electricity, accounting for half of the world’s total solar capacity.

Prior to the triple disaster in Fukushima, most of the world’s nuclear power plants were operating in the United States, France, and Japan.

Since 2011, the construction of new nuclear power plants has declined significantly. In Germany, all nuclear power plants have been shut down following a government decision made after the Japanese nuclear accident.

Despite all this, nuclear power plants remain popular in many countries worldwide, at least compared with traditional energy sources (coal, oil, natural gas). That broader dependence helps explain why their presence remains so persistent.

The map at the end of this article shows all of the world’s nuclear power plants, broken down by country. Two continents (South America and Africa) have the fewest nuclear power plants.

The Victims of the Chornobyl and Fukushima Nuclear Accidents

The methods used to treat people who fell ill as a result of the two nuclear accidents are largely based on the experiences of survivors of the atomic bombs dropped on Hiroshima and Nagasaki; for this reason, Japanese doctors who have been providing volunteer medical care for decades in both Ukraine and Belarus have also been involved. From this medical legacy, the discussion turns to those whose suffering came later and more quietly.

The indirect victims of nuclear power plant disasters—that is, those who fell ill many years later due to radiation exposure—remain anonymous regardless of the political system in question, whether their treatment was successful or less so. Every nuclear disaster, sheltered beneath the sarcophagus of news blackouts and information bans, serves to preserve—and, not least, protect—political and institutional power.

Moreover, even the average media consumer knows far more about the victims of Chornobyl and Belarus than about the illnesses and deaths following the Fukushima accident.

The toxic effects of radioactivity on the human body—aside from the immediate effects of massive doses of radiation, such as those experienced in Hiroshima, Nagasaki, and at the Chornobyl nuclear power plant—only manifest four or five generations later in the form of various diseases. This is known as the indirect pathogenic effect of radioactivity.

The most common are thyroid cancer, leukemia, cardiovascular diseases, and more severe forms of depression. For this reason, both nuclear accidents were followed—primarily in Japan—by suicides among older people who had lost everything and been evacuated.

The cleanup workers (liquidators) in Chornobyl and Fukushima

Contrary to portrayals in various feature films and documentaries, the greatest—and longest-lasting—risk was borne not by the engineers or specialists working at the power plants, but by the tens of thousands of anonymous people who actively participated in clearing the rubble of the severely damaged nuclear power plants.

Gorbachev’s government mobilized 600,000 people for the ongoing decontamination of the exploded nuclear power plant—since the uranium is still burning—and the heroic struggle of more than half a million people led, years later, to serious, largely incurable illnesses. Even so, forty years after the disaster, there are still no reliable estimates—not even approximate ones—of how many people became indirect victims of the accident. According to one relatively reliable survey, two million people became victims of the nuclear disaster in Ukraine and Belarus 10 to 15 years later.

In every country in the world with multiple nuclear power plants, the maintenance and cleaning of these plants have for decades been carried out largely through temporary contracts; this work is performed by “nomads” (as is the case in France, for example), meaning that employees move from one nuclear power plant to another. These nuclear nomads—or, as they have been called in Japan since the 1970s, “nuclear gypsies”—are unsung heroes, even though they perform this extraordinarily dangerous work on a contract basis.

This work requires little expertise, the cost is very low, and the number of workers performing routine maintenance and cleaning is four times the number of specialized staff at nuclear power plants.

In Japan, although the term “liquidator” was frequently used following the severe damage to the Fukushima power plants, the “nuclear accident”—as it is called in Japanese (jiken, pronounced “jiken”)—involves clearing away the rubble, draining the radioactive water contaminated with cesium, and “neutralizing” the complete meltdown to prevent an explosion similar to the one in Chernobyl. In short, all the work that the Japanese language expresses with three words required a significant workforce immediately. This work is exhausting, dirty, and risky (kicui, kitanai, kiken in Japanese).

Japan (as in many other areas) was already a leader in this field by the late 1970s, as the proportion of workers performing hazardous tasks exceeded 90 percent of the total workforce at nuclear power plants.

In this sense, the Japanese economy was the first in the world to rely predominantly on temporary workers to perform maintenance, cleaning, and other tasks that rarely require specialized expertise.

Starting in the mid-1970s, companies in the nuclear sector (TEPCO, KEPCO) found it increasingly difficult to operate efficiently without the cheapest labor—industrial day laborers. They performed the dangerous jobs in the construction industry, just as they predominantly carried out the risky, exhausting, and often unsanitary tasks at nuclear power plants.

Their wages are paid daily; they are not entitled to health insurance (not even in the event of an accident while working at heights), and pension insurance is out of the question.

These industrial day laborers consist predominantly of the unemployed, people who are “unknown” to the majority of society because they live in large urban neighborhoods that are closed off (and dangerous) to outsiders—that is, members of a caste— those who have lost their livelihoods for various reasons, the homeless, and those residing in the country illegally.

After the Fukushima nuclear accident, it was self-evident to the ministries that the network of day labor brokers—which consists of hundreds of “agencies” recruiting workers nationwide, including various groups of the Japanese mafia—would mobilize day laborers recruited on behalf of one of the ministries to the severely damaged nuclear power plants. From there, the system moved quickly into action. According to reliable sources, a few agencies had recruiters whose owners used the slogan: “Take this job if you don’t care how long you live.”

In the first five years following the disaster, tens of thousands of people participated in cleanup efforts (removing rubble and radioactive waste). The daily wage was much higher than in any other sector, yet workers had no way of knowing in advance whether their actual daily pay would be that amount. In most cases, it was less than that because employment agencies deducted a commission. As a result, the promised wage and the actual wage diverged sharply.

The higher wage also included a hazard pay allowance due to the radioactive environment. If a worker exceeded the predetermined radiation dose, they were immediately dismissed. This was the reason for the frequent forgery of medical certificates issued after radiation dose measurements.

Working conditions for industrial day laborers were extremely poor during the first year (minimal food, meager accommodations in barracks), and this was exacerbated by the fact that the government had raised the maximum annual radiation dose—which had been permitted before the nuclear accident—many times over. In addition, the harsher conditions intensified the risks they already faced.

The vast majority of recruitment agencies did not register most day laborers because the daily nature of the work (based, of course, on verbal agreements) exempted both the recruitment agencies and the ministries from any liability.

In 2018 (for the first time), after lengthy legal proceedings, one person who had worked in one of the power plant’s reactor units was officially recognized as having been exposed to radiation. Even after that recognition, there are still no accessible, reliable statistics on how many of the day laborers fell ill.

According to official Japanese statistics (2025), 3,810 people lost their lives due to the indirect effects of the nuclear accident. However, this data does not distinguish between illnesses among the general public and those among workers. More than two thousand Fukushima residents took their own lives because they were convinced that, after losing their livelihoods and homes, they would be unable to start their lives over again.

On March 12, 2011, at the request of Prime Minister Naoto Kan, then-U.S. President Barack Obama ordered the U.S. Navy to send the aircraft carrier Ronald Reagan near the coast of Fukushima. The aircraft carrier was en route to South Korea for a military exercise.

It had a crew of 5,680. The aircraft carrier carried food, drinking water, and medicine to Japan for the survivors of the earthquake and tsunami.

However, neither the Japanese nor the U.S. government was aware that, due to the explosion of one of the power plant’s reactor units, the ship was passing through a radioactive cloud at sea. Between March 14 and April 5, the ship’s crew and support personnel remained near the coast of Fukushima.

The ship’s captain detected high levels of radioactivity using the ship’s measuring instruments, and although he instructed the crew to wash their skin thoroughly, 250 people filed a class-action lawsuit against TEPCO (the owner of the nuclear power plant) in California months later. The amount of damages sought was $1 billion. Their legal representatives argued that although TEPCO was aware of the meltdown and explosion at the power plant, it failed to inform the government, and as a result, several members of the ship’s crew fell ill. (Eight of them have since passed away.)

The lawsuit was dismissed at every level by U.S. courts, which ruled that the radioactivity did not reach the “critical threshold” that would justify a causal link between the Fukushima nuclear accident and the illnesses.

Due to the earthquake and tsunami, significantly more people fled their former homes than the 160,000 whom the authorities evacuated to temporary shelters. Most of the natural village and town communities were destroyed. These people—who were both refugees and victims of radiation—remain unwilling to return to their former homes even 15 years after the nuclear accident, since not only have their former jobs and the conditions for their agricultural activities ceased to exist, but what matters most to them has also been lost: their trust in local and central authorities. They are, therefore, internal refugees who have become victims of the nuclear accident; the term “hibakusha” (a Japanese term for victims of radiation) applies to them as well. By 2025, of the two million residents of Fukushima Prefecture, only 200,000 had returned to their former homes.

Of course, a triple disaster requires an extremely rapid, effective, and reliable series of measures. However, even ten days after the disaster, the company’s management—that is, the decision-makers at TEPCO (the English abbreviation for Tokyo Electric Power Company)—had still not informed the prime minister that a complete meltdown had occurred in three of the power plant’s reactors. Representatives of the International Atomic Energy Agency (IAEA) were first granted permission in mid-May to inspect the site, that is, the Fukushima power plants.

The media had become just as untrustworthy to the majority of the public as the information provided in the government’s regular briefings. Misinformation following the triple disaster (such as regarding wind direction) had serious consequences not only for local residents but also for mayors.

In the year following the nuclear accident, the government enacted numerous punitive and restrictive measures. Journalists (or TV and radio reporters) were subject to 5–10 years in prison for “spreading alarmist news.” (A few days after the triple disaster, several journalists lost their jobs for not asking the right questions of the Cabinet Office’s press secretary.)

Those who have fallen ill due to radiation exposure must keep their true condition a secret. (A new rule ensures this as well: even today, doctors are not allowed to disclose the actual number of people who have fallen ill, only what the Cabinet Office authorizes.)

The most serious problem, however, is not this. All those who fled Fukushima to other parts of the country—in a society where stigma and exclusion strengthen group cohesion—cannot reveal (nor can their children) that they lived near nuclear power plants.

The above are merely selected details intended to illustrate that it will take another decade for society as a whole to receive accurate information about what actually happened in Fukushima.

Soil “decontamination” has been underway since the spring of 2011, and over time, the process must be repeated several times. There are 9 million bags of radioactive soil in Fukushima. The deadline for their final disposal is 2045.

Nuclear power is our friend, but if we make a mistake—and that mistake has terrible consequences—our friend will turn against us. At the moment, humanity is powerless in the face of this.

There are moments in history that become inextricably intertwined with individual destinies without us even realizing it. In the spring of 1986, during the Chornobyl disaster, I faced the threat of an invisible danger while visiting the Hungarian city of Győr. Twenty-five years later, history tragically repeated itself in my life. The Fukushima disaster reached me in Berlin, but it led to my second emigration: I had gone to work in Japan 17 years earlier, and then, due to the indirect effects of the Fukushima disaster, I decided never to return to Japan. Since then, I have been living in Berlin with my husband.

These two turning points in my personal life—both geographical and temporal—show that nuclear disasters are not abstract news stories but events that can radically reshape the fates of families and individuals.

Introduction

In 1902, British scientist Sir William Crookes discovered the peculiar glow of radium, and following American businessman William J. Hammer’s trip to Paris—where he met Marie Curie—he further developed this discovery in the form of a “business” venture. Although it took some time for the healing properties of radium to be discovered in America as well, commercial ventures spread much more rapidly. By the second decade of the last century, factories were already using radium on the dials of wall clocks and wristwatches, and this is how a new trend among young women—known at the time as “radium girls”—took hold: radium mixed with zinc sulfide, which glistened, was used as a nail polish and as an ingredient in lipstick. A significant number of female factory workers died within a few years as a result of their exposure to radium. Documentaries and even a feature film have chronicled their fate.

Decades later, following the horrific devastation caused by the atomic and hydrogen bombs dropped on Japan (Hiroshima, Nagasaki), this energy’s “capabilities” made it humanity’s savior in two senses.

Due to its healing and energy-generating effects, it was presented as a clean, environmentally friendly substance that posed absolutely no danger to human life. The destructive power of the atomic bomb was replaced by the demands of modernization—nuclear energy, one of the most important tools for humanity’s future. America exported this new ideology and practice to other countries—first to Japan—using both peaceful and less peaceful means, barely seven years after the end of World War II.

The goal was clear, at least from the American perspective: if the world’s developing nations wanted to create opportunities for successful participation in global economic competition, nuclear energy was indispensable.

This is the subject of my two earlier studies, Our Friend the Atom and The Elegant Apocalypsis.

The rapid proliferation (and spread) of nuclear power plants simultaneously provided a cheap energy source and, for decades, cemented the United States’ hegemonic role in the adoption of nuclear power plants by individual countries.

For nearly four decades, however, there was no mention of the risks associated with operating nuclear power plants, as the most modern technology, combined with scientific advances, was supposedly eliminating them. The technological “belief” eliminated human error. risks. During the Cold War, this situation unfolded in much the same way in the countries of the “free world” as it did in the Soviet Union.

Although numerous accidents occurred at nuclear power plants in various countries, as well as at storage facilities for the radioactive materials used by these plants, every nuclear power plant operated under strict secrecy, and this situation remained essentially unchanged until the two most serious plant accidents to date occurred. A significant portion of Western sources still condemns the former Soviet government’s “delayed” reporting on the Chornobyl disaster, but it is extremely noteworthy that the true situation—namely, the meltdown of three reactor units—announced two months (!) after the Fukushima disaster—has escaped media attention to this day. (Our report on this subject does not mention this fact either.)

The majority of nuclear power plants worldwide are owned and operated by private companies, with the exception of five countries: China, France, India, Russia, and the United Arab Emirates. These countries operate all of their nuclear power plants as a strategic sector under state ownership.

However, it is important to note that despite the strictest regulations, a private company primarily prioritizes a quick return on its investment over safety. Fukushima is an example of this. Of course, accidents can also occur at state-owned nuclear power plants; Chornobyl is an example. There are numerous examples of this pattern. From privatizing the British Railways to the Japanese Postal Service, in each case, the privately owned entities have drastically neglected maintenance and new investments, since it would have decreased the short-term returns.

1986 and 2011: Chornobyl and Fukushima

Many people confidently believe they know everything about the two most serious incidents involving nuclear power plant disasters. The International Atomic Energy Agency classified both as level 7, the most severe category. Although the root causes of the two “accidents” differed in part, their social, economic, political, and profound sociopsychological consequences were nearly identical.

In Chernobyl, design flaws in the relatively new nuclear power plant, the plant’s supervision by the KGB, and a series of human errors caused the explosion at Reactor No. 4. The KGB’s role in the operation of nuclear power plants was one of the, if not the, most important reasons for the delay in disclosing the facts, as well as for the failure to implement several extremely important measures, which claimed the lives of thousands of people.

The effects of the nuclear (toxic) materials released as a result of the Chornobyl disaster were (and still are) international in scope; it is a sad fact that even four decades after the disaster, the extremely negative effects on both the residents of Belarus and the Sami people of Norway remain largely unknown.

The 50,000 residents of the nuclear city of Pripyat were evacuated, and Gorbachev’s government mobilized nearly 600,000 people to clear the wreckage of the completely destroyed Reactor No. 4. As a result, the spread of radioactivity at levels that posed a serious health threat affected every country in Europe and Scandinavia.

(In Germany, for example, laboratory testing of all wild animals killed during hunting season was mandatory until as late as 2010.)

The Chornobyl disaster claimed the lives of its direct victims—that is, the thirty people who were present at the nuclear power plant and carried out heroic work there. The long-term consequences of the explosion are incalculable, as it seriously harmed the health of not only the residents of Pripyat but also those living in settlements hundreds of kilometers from the nuclear power plant, including residents near the border in neighboring Belarus. (This is the subject of, among other works, a Japanese documentary titled The Apples of Kalina).

The evacuation zone extends 30 kilometers and remains completely off-limits to this day.

Three specialists from the power plant were convicted.

Despite Gorbachev’s glasnost movement, the Chornobyl disaster contributed significantly to Ukraine’s subsequent demand for independence.

Between May and November 1986, the first temporary sarcophagus was completed, and in November 2016, a new sarcophagus—built through international cooperation and designed to last 100 years—was placed over it.

Following the outbreak of the Russian-Ukrainian war, among the nuclear power plants in Ukraine (there are four in total, with 15 reactor units), the Zaporizhzhia Nuclear Power Plant—Europe’s largest—is on the front lines, making it almost constantly in danger. The Chornobyl plant is also at risk because the protective shell of the new sarcophagus was struck by a drone attack, and the constant cooling of the radioactive material beneath the protective shell is taking place amid an intermittent power supply, while Russian military attacks are putting both the Zaporizhzhia and Chornobyl nuclear power plants in an extremely dangerous situation.

The disaster that occurred on March 11, 2011, in Fukushima Prefecture, Japan (a magnitude 9.0 earthquake followed by a 10–15-meter-high tsunami) caused severe damage to four nuclear power plant units. Three reactors suffered a complete meltdown; however, fortunately, only a small amount of radioactive material was released compared to the Chornobyl disaster.

In Fukushima, however, contrary to the majority of Western analyses and assessments, a report by the Japanese government’s independent committee of experts concluded that human error also played a role in the disaster.

The earthquake itself (the third-largest in the world since measurements began) claimed the lives of 16,000 to 20,000 people from the quake and the 10- to 15-meter-high tsunami. Numerous towns were destroyed along with their residents.

Since the six reactors at the Fukushima nuclear power plant—of which, fortunately, only four were operational at the time of the earthquake—were surrounded by a protective wall only 5 meters high, the tsunami cut off the power supply to the plant’s basements. This caused the cooling system to fail, leading to the complete meltdown of three reactors.

TEPCO (short for Tokyo Electric Power Company), the owner of the nuclear power plants, had rejected a recommendation from a committee of experts and top government officials three years earlier to build a higher protective wall, arguing that it would be too costly and completely unnecessary. The company’s management did this even though it knew that the risk of an earthquake was extremely real in the coming years.

Thanks to the measures taken by then-Prime Minister Naoto Kan, an explosion similar to the one at Chornobyl did not occur; thanks to the efforts of the engineers and workers who remained at the plant, Japan avoided another nuclear disaster—both for the country and the international community.

Nevertheless, government experts, acting on Kan’s instructions, drew up an evacuation plan for Tokyo. (Fukushima is only 220 kilometers from Tokyo.)

160,000 people were evacuated from Fukushima Prefecture, and the exclusion zone was initially set at ten kilometers, then extended to thirty kilometers.

The Fukushima disaster did not result in any direct fatalities caused by radiation exposure.

Much of the prefecture was home to the country’s largest organic agricultural production, which came to a halt for many years, possibly even decades.

Almost immediately after the disaster, the Japanese government ordered the shutdown of all 53 nuclear power plants. Safety regulations were tightened, and as a result, only 34 plants currently meet the new standards.

As documented, the (private) owners of the nuclear power plants had neglected maintenance and a series of technical upgrades for years; thus, according to one expert, it was a “miracle” that such a serious accident occurred only at the Fukushima plants. (In 1999, there was a Level 4 accident in the town of Tokaimura, but that is the subject of a separate article. The town is located just 140 kilometers from Tokyo, and locals believed that the plant was manufacturing auto parts.)

The lack of accurate information provided to the public, the direct ties between nuclear power plant owners and regulatory agencies, the regulatory agencies’ “lenient” attitude toward any malfunction, and shortcomings unimaginable to the layperson—all of this in the world’s third-largest economy.

All of this has been the case for decades due to the institutional and personal intertwining of the so-called “nuclear village” (genshirjoku mura in Japanese, “nuclear village” in English). This is an imaginary village whose inhabitants include nuclear power plant owners, politicians, ministry bureaucrats, and members of scientific institutions.

More than one CEO of a nuclear power plant—a retired ministry bureaucrat (a “messenger from heaven”)—had never even visited a nuclear power plant (Tokaimura is one such example), and thus was unable to assess the severity of a nuclear accident should one occur.

Only the Fukushima disaster changed this.

Nearly half of the 160,000 evacuated residents of Fukushima found refuge in various prefectures.

However, reconstruction is still ongoing, and tens of thousands of evacuees have been left with nothing. Many members of the older generation took their own lives as a result, because there was no hope whatsoever of resuming their farming (or fishing) activities.

Since the Fukushima power plant reactors are located on the coast, despite all attempts, none of the melted-down reactors has yet been “neutralized.” The sarcophagus solution is not feasible in Fukushima.

The cost of restoration, as well as compensation for evacuees and businesses, currently amounts to 300 billion US dollars.

The court acquitted TEPCO’s top executives because the nuclear accident (jiken in Japanese) was caused by a natural disaster, and under the Japanese Civil Code, this does not fall within the scope of personal liability. As a result of the “accident,” TEPCO became insolvent, a situation the government averted with a one-time, large-scale bailout funded by taxpayers’ money.

Since none of the experts were able to find a solution for discharging the radioactive, contaminated water using new methods, nearly half a million metric tons have so far been released into the Pacific Ocean—after filtration—through a canal built on land.

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The account above is brief, but it places an extraordinary burden on present and future generations. Indeed, nuclear power generation is relatively inexpensive, offers a quick return on investment, and generates significant revenue for every private company.

However, there has been no mention so far of what happens to the nuclear waste, nor of who the victims are—people who have not been mentioned in forty years (not in a single news report, nor have they been interviewed in fifteen years).

The next section will address this.

For decades, Japan has had a deeply ambivalent relationship with nuclear energy, striking a balance between its identity—as the only nation to have suffered a nuclear attack—and its dependence on nuclear energy, which developed during the postwar period. In his critical essay titled “Nuclear Noh Drama,” historian Yuki Tanaka approaches this paradox not through the usual lens of political science, but from the perspective of Japan’s oldest performing art, dating back to the 14th century. Tanaka uses the rigid conventions of traditional Noh theater—particularly the masks, spirits, and the chorus—as powerful metaphors to reveal how the Japanese government uses highly stylized political rhetoric to conceal the dangers of nuclear energy and suppress the historical trauma of radiation victims. By portraying modern political decision-makers as characters in a tragic, pre-scripted play, Tanaka highlights that the state’s narrative of “safe, clean energy” is a carefully constructed illusion designed to reassure the public and maintain the dangerous status quo.

The Mask: Japan’s Nuclear Power Plants for Peaceful Purposes

In my previous article, Our Friend the Atom, I analyzed why it was extremely important for the U.S. government to convince members of Japanese society of the peaceful use of nuclear energy and, at the same time, of its safety—that is, its lack of danger.

Those who survived the devastation of the atomic bombs dropped on Hiroshima and Nagasaki in August 1945; those who suffered serious illnesses for the rest of their lives as a result; the relatives ostracized by their local communities because they were survivors of Hiroshima or Nagasaki; and those who, although only relatives of the victims, were never able to marry because, at that time, most members of Japanese society had no access to professional medical information and did not know whether the injuries and illnesses caused by the atomic bomb were hereditary.

Under these sociopsychological circumstances, a media propaganda campaign, carried out jointly by the U.S. (CIA) and the Japanese government, was launched. It convinced an ever-growing portion of the population of the absolute safety of nuclear power plants, their indispensable role in economic and social development, and that Article 9 of the Japanese Constitution—written by the Americans and stating that Japan may not wage war or arm itself—would remain intact.

In 1960, amendments to the U.S.-Japan Security Treaty sparked massive public protests. As a result, the three prohibitions regarding nuclear weapons were not adopted in Japan until 1967: the country may not possess, manufacture, or use nuclear weapons. However, Prime Minister Eisaku Sato concluded a strictly confidential agreement with the U.S. government that became known to the island nation’s residents only three decades later. In the secret agreement—contrary to the “Three Non-Proliferation Principles”—the Japanese prime minister consented to the U.S. storing nuclear weapons at any of its military bases in Japan and to allow U.S. submarines carrying nuclear warheads and nuclear weapons to pass near the bases, and to station them there if necessary.

In other words, the struggle of the majority of Japanese society against nuclear weapons was, in part, in vain. The Japanese government of the day, following the concept of former cabinet member Shigeru Yoshida, entrusted the U.S. military-industrial complex with the production of nuclear weapons and Japan’s defense against China and the former Soviet Union. Historians refer to this as the U.S. nuclear umbrella.

The logic, again according to one of Yoshida’s guiding principles, was simple: if Japan entrusted its nuclear defense to the United States, the resources thus freed could be used to promote economic development. In other words, Japan lost World War II, but in this way, it would win the “war” for the global economy.

According to official propaganda from the Japanese and U.S. governments, this is why the construction and operation of nuclear power plants are indispensable, since Japan lacks natural resources, making this solution a cost-effective, efficient, clean—that is, non-polluting—source of energy.

Nuclear Power Plants in Japan and Asia

In 1957, the country’s largest electric utilities established a private company called Japan Atomic Power Company. In 1963, the “Experimental Nuclear Power Plant” (abbreviated as JPDR) generated electricity in the country for the first time. In 1966, the Tokai Nuclear Power Plant, designed in the UK, was completed and later faced numerous serious problems. It should be noted that the Tokai plant was also operated as a private company.

In 1970, water-cooled reactors began operating in the Tsuruga and Mihama regions. Both power plants were built using technology from the American companies General Electric and Westinghouse, with participation from Japanese firms—Hitachi, Mitsubishi, and Toshiba.

The 1973 oil crisis accelerated the construction of additional nuclear power plants in Japan: 14 began operating in the 1970s, followed by another 16 in the 1980s.

The most costly of these, a new type of nuclear power plant called Monju, has been inoperable for decades, and its complete decommissioning will not be completed until 2047. The government estimates the associated costs at $3.2 billion.

Before March 11, 2011, 54 nuclear power plants were operating in Japan, providing 30 percent of the country’s electricity supply. Fukushima and its impact on nuclear power plants in Japan and around the world, as well as the government’s changed energy policy, will be discussed in the next section.

The table below summarizes the first year of operation for nuclear power plants in Asian countries, excluding Japan.

In Japan, 54 reactors were in operation prior to March 11, 2011. At that time, the government’s plan was for nuclear power plants to provide 40 percent of Japan’s electricity supply within a decade. Many reactors had been operating for years with severe neglect of maintenance. However, it is essential to understand that Japan lies at the junction of four moving tectonic plates. Consequently, not only are earthquakes extremely frequent, but so are the tsunamis and volcanic eruptions that often follow them.

Consequently, ensuring the safety of nuclear power plants requires extraordinary technological, maintenance, and general engineering upgrades.

The brief summary above has so far failed to mention one extremely important factor: the probability of human error.

Returning to the title of this article and the duality of Noh drama: the country that, starting in the 1970s, became the world’s second-largest economic power after the United States—with the world’s second-largest GDP and cutting-edge technology in numerous fields—saw its politicians and highly trained government bureaucrats alike firmly believe that technological advancement precludes human error and mistakes.

On the afternoon of March 11, 2011, it became clear that this was not true. The triple disaster in Fukushima—a 9.2-magnitude earthquake, a 12–15-meter-high tsunami, and the meltdown and burning of four reactor units at the Fukushima nuclear power plant—was, apart from the first two natural factors, the tragic consequence of many years of technological overconfidence.

Japan cannot even be compared to the former Soviet Union in terms of economic and technological development. 1986: Chernobyl; 2011: Fukushima. The following study examines these two tragedies.

I borrowed this title from an American educational series produced by Walt Disney on behalf of the White House about the peaceful use of nuclear energy. The series, which was partially funded by the U.S. government and made famous by Heinz Haber (1913–1990)—a renowned aviation expert who emigrated to America from Nazi Germany—was the most popular science-education TV series in America.

It was later published as a book. It was entertaining, and everyone could understand it. Its popularity was largely due to Haber, who explained the generation of nuclear energy and the benefits of its use in an accessible style.

The 1950s marked not only the onset of the Cold War but also the beginning of the widespread use of nuclear energy. The former could be readily linked to the latter (though not obviously to everyone), since from the start of the Cold War, American technology also had to demonstrate its superiority over Soviet technology.

Production of the film series began following U.S. President Dwight D. Eisenhower’s speech at the United Nations on December 8, 1953. The president’s moving speech, “Atoms for Peace,” served as the introduction to a psychological propaganda campaign designed to appeal to people’s emotions, which emphasized the benefits of nuclear energy while downplaying its drawbacks. Eisenhower explained to his audience how nuclear power could be harnessed for the benefit of humanity. The speech was so successful that the members of the UN General Assembly present stood and applauded for several minutes, and the American president was moved to tears.

It was very important to convince the world’s public opinion that the U.S. and its future allies would use atomic energy exclusively for peaceful purposes. In the speech, the atomic bomb became one of the relics of the past that had to be forgotten. The use of nuclear energy for peaceful purposes ensured a happier future for humanity. It was cheap, clean, and even usable for medical purposes. All of this, of course, was made possible by U.S. technology.

The following article discusses how the Japanese government and all of its institutions involved in the use of nuclear energy adapted to American demands, and how the harnessing of nuclear energy became one of the key factors in Japan’s unprecedented economic growth.

1.

1. This atom is different from the atomic bomb

During the American occupation, nuclear physics research was prohibited in Japan. (1945–1952). In 1946, the particle accelerator at Japan’s National Institute for Basic Biology (RIKEN)

was smashed by occupying American soldiers, and the wreckage was thrown into the sea, sparking international outrage.

Thus, despite their previous achievements, Japanese nuclear physicists were condemned to inactivity, even though they had achieved significant results by the end of the war, and, according to some contemporary records, it would have taken very little time for Japan to manufacture an atomic bomb. One indirect piece of evidence for this is that Hideki Yukawa, the country’s first Nobel laureate (1949), received the Nobel Prize in Physics for his research on elementary particles. Years later, he became chairman of the Japanese Atomic Energy Commission.

In a 1953 speech, Eisenhower equated the use of nuclear energy with progress.

The reality, however, was alarming compared to the president’s speech.

After the dropping of the two atomic bombs (Hiroshima and Nagasaki), the U.S. did not stop expanding its arsenal of nuclear weapons, as evidenced by increasingly frequent nuclear test explosions. With the outbreak of the Cold War, the renewed use of the atomic bomb in the fight against communism became a grim reality, because during Eisenhower’s presidency, there was no distinction (unlike President Truman’s strategy) between conventional weapons and nuclear weapons. However, every country in the world feared nuclear weapons, so the president’s advisors recommended that this fear be dispelled, and the best way to do so was to convince allied nations that the U.S. intended to use nuclear energy exclusively for peaceful purposes. Resistance was massive worldwide, so the White House even brought in a psychiatric expert to help the U.S. government overcome the understandable fear of nuclear energy both at home and abroad.

The appointed group of experts unanimously recommended that the U.S. president must convince the world’s public that the atomic bomb is a thing of the past, and that humanity can harness its destructive power for its own benefit.

This is how Eisenhower’s speech at the United Nations came to be. It had a profound impact on international public opinion, and the speech was published in newspapers worldwide. The euphoria, however, did not last long, because three months later, another U.S. nuclear test on one of the Marshall Islands (the “Bravo” test on Bikini Atoll) severely contaminated the 22-member crew of a Japanese fishing boat seriously contaminated the 22-member crew of a Japanese fishing boat with radioactive ash. (In addition to them, 236 islanders suffered radiation exposure, at least according to American statistical reports.) The fishing vessel named “Lucky Dragon No. 5” was fishing for tuna, and as was their custom, they took that day’s catch to the largest fish market, Tsukiji in Tokyo. That is when the protests began, as no one could have known whether the tuna were radioactive. The demonstration turned into a nationwide protest when it emerged that the fishing boat’s captain and crew had fallen seriously ill. The sight of the radiation victims in Hiroshima and Nagasaki and their terrible suffering remained vivid in everyone’s memory (despite the fact that news and images of this had been censored by U.S. military authorities for years).

The ship’s captain died of his injuries in September.

In Japan, the nationwide protest was followed by a petition, which was signed by 32 million people in less than a year.

We don’t need nuclear weapons, nor do we need nuclear power plants, because both endanger human lives, which is not surprising in Japan’s case. The signed petition was presented to the then-prime minister on August 6, the anniversary of the atomic bombing of Hiroshima. It was presented to the then-prime minister at the August 6 commemoration in Hiroshima. Thanks to this protest, the first World Congress Against Atomic and Hydrogen Bombs was also convened in Japan, held in Hiroshima.

Japan was America’s most important Asian ally, so convincing the Japanese government was of extraordinary importance. This was the easier task, because when the atomic and hydrogen bombs were dropped, many right-wing Japanese politicians spoke appreciatively of American technological superiority, which they believed was the main reason Japan lost World War II, along with its colonial empire.

American institutions had to do something—and as quickly as possible—to dispel Japanese public doubts regarding the peaceful use of nuclear energy. An American senator (Murray) suggested that Japan should be gifted a nuclear power plant, as this would be a truly “Christian” gesture and would convince Japanese society of America’s peaceful intentions.

Another proposal suggested that the first nuclear power plant should have been built in Hiroshima, since the people living there already had sufficient experience with the destructive effects of atomic energy, and thus would have more easily recognized the positive effects of nuclear energy. (Yasuhiro Nakasone, albeit in a somewhat blunt style, held a similar view regarding the possibilities of winning over Japanese society.)

The nuclear “Marshall Plan” proposed by the then-chairman of General Electric was adopted by the White House with unparalleled speed. A delegation of American businessmen traveled to Tokyo, but the U.S. government also invited Yasuhiro Nakasone, who was a minister at the time (and would become prime minister in the 1980s). Recalling his own memories, Nakasone noted that as early as August 6, 1945, upon seeing the mushroom cloud after the atomic bomb was dropped on Hiroshima, he thought that this energy was the future. He added that if Japan did not adopt nuclear energy, it would sink to the status of a fourth-rate nation. Nakasone, along with many other far-right, ultra-conservative Japanese politicians, readily accepted the construction and operation of nuclear power plants.

In June 1955, the United States and Japan signed an agreement formalizing cooperation in the research and development of nuclear energy. Although Japan initially purchased a nuclear power plant from the UK, subsequent plants were supplied to the island nation by the US, all of which were manufactured and shipped by the corporate giant General Electric. This was the first significant step in the U.S. for nuclear power plant manufacturers (and their suppliers) to significantly expand their exports.

2. The Role of the CIA

However, Nakasone’s enthusiasm for nuclear energy was far from sufficient to implement the American plan. The majority of Japanese society, whether actively or passively, opposed any form of nuclear energy, as many rightly feared that peaceful use was merely a cover, and that it would actually provide an opportunity to produce atomic bombs if the country had access to uranium.

For this reason, persuasive propaganda was needed, and this could only be achieved through the press and radio, and later through television.

Thus, the Americans had to find the person in Japan who could change the public opinion’s anti-nuclear sentiment and the resistance of civil organizations.

It was not a difficult task, since during the occupation period between 1945 and 1952, the American occupying authorities had collected and documented information on all those who had played a key role in implementing wartime propaganda, which they forwarded to the CIA.

Numerous Japanese experts who had achieved outstanding results in propaganda during the war years were thus entered in the records of the American intelligence service.

Among them, the American government chose Macutaro Sóriki. (He appears in CIA files under the code names PODAM and PODAM 1.)

Soriki was born in April 1885 in Toyama Prefecture and graduated from the law faculty of the renowned Imperial University of Tokyo, from which the vast majority of the state’s professionally trained bureaucrats emerged during this period. He worked for two years at the National Bureau of Statistics, then spent a decade in a senior position with the Tokyo Metropolitan Police Department, ensuring public order.

Among other things, he is associated with directing the witch hunt against suspected communists and local Koreans following the Great Kanto (Tokyo) Earthquake of 1923, which resulted in numerous fatalities. His career would clearly not have stopped at the rank of criminal police officer, but in 1924, due to an unfortunate incident, he and several others were dismissed from their posts on the orders of the Minister of the Interior. In 1924, an anarchist fired a shot at the emperor, and since it was the Tokyo police’s duty to have prevented this, senior police officers, including Sóriki, were immediately dismissed from the police force. (The incident is known by the assassin’s name, the so-called Namba Assassination.)

He did not remain unemployed for long, however. During his years as a police officer, he had built excellent relationships with leading politicians, ministers, and businessmen. At the time, the Yomiuri Shimbun daily newspaper was on the verge of bankruptcy, and as a result, the stock price of the company that owned the paper had plummeted. Thanks to Shoriki, Gotō Shimpei—a baron with political and financial power who was an “expert” in colonization—acquired a significant sum of money, bought up all the shares of the daily newspaper, and thus became its owner. Known for his energy, Sóriki turned the newspaper into the country’s third-largest daily within a few years. He then founded Japan’s first baseball team, naming it the Giants, following the American model. To this day, this baseball team remains one of the most famous in the country.

He did not sit idle during the war years either. He became a leader of the country’s largest fascist mobilization organization, and as a result, he became a member of the Cabinet Information Council. This council developed the basic principles of media censorship. From October 1944, he served as a media advisor to the government. After the unconditional surrender, he was arrested by the U.S. military police and, along with many other (former) colleagues, awaited trial as a war criminal in Sugamo Prison (a district of Tokyo). He, too, was a Category “A” war criminal (according to the Nuremberg classification). His influential Japanese acquaintances and friends (including one of Gotō’s relatives) wrote numerous letters to MacArthur, the general of the American occupation forces, stating that Sōriki had never done anything wrong, that he was a businessman with very positive initiatives. However, this was not enough to secure his release. Fortunately for him, however, the outbreak of the Cold War—the year of the turning point—changed the Americans’ previous views of Japan, so that establishing democracy was no longer the occupiers’ most important task. In the new international situation, Japan became the most important base for defense against communism, so all of the hundreds of detainees and those suspected of committing war crimes, including Shoriki, were released from prison.

With the support of American businessmen and the CIA, Sóriki was able to begin winning over the Japanese public.

Sóriki had a highly influential daily newspaper with a large circulation, but through the intervention of one of the American senators, he received a significant sum of money (10 million US dollars) to establish a TV channel, which was named Nippon TV (Nippon Terebi in Japanese). Of course, the money came along with American technology, and as a result, domestic television manufacturers found themselves at a disadvantage, even though they already possessed all the technical capabilities for production.

With the launch of the TV channel, the two media outlets owned by Sóriki thus began a major campaign to convince Japanese society of the benefits and safety of nuclear energy, as well as its indispensability for development; to marginalize those opposed to it; and to win over the skeptics. However, this was not enough: active supporters also had to be recruited. The first step in this was the media campaign. The rest was already in motion locally. Soriki had calculated well; a few months after the campaign began, more and more people joined the government’s initiative.

All of this took place with the cooperation of major American companies, Japanese nuclear physicists, and the CIA. Sóriki likely repaid the occupiers in this way for releasing him from prison in 1947 without a trial or sentence.

According to CIA records, Macutaro Soriki regularly passed information to the powerful agency; he even had a code name, meaning he was employed by the CIA. (Anyone can verify this online, as these CIA documents are now public.)

Sóriki had a clear, well-defined political goal in his campaign activities. He wanted to become the country’s prime minister, and he believed that by introducing nuclear energy, he would achieve this. Few things illustrate his self-confidence better than the fact that he entrusted an American journalist with writing his memoirs—for a suitable fee, of course. This has been published in English, and it reveals, among other things, that Sóriki Macutaró was one of the island nation’s great, forward-thinking personalities.

However sad it may be, Sóriki Macutaró was nothing more and nothing less than an adaptable, aggressively anti-communist, far-right, naturally nationalist businessman who always heeded the spirit of the times—and, according to the Japanese left, a fascist wielding significant influence. All of this, however, made him perfectly suited to carry out the American goal through his campaigns.

In March 1954, the Japanese parliament approved the first budget dedicated exclusively to nuclear research, totaling 230 million yen. (The amount “harmonized” with the atomic number of uranium-235.)

In June 1955, the U.S. and Japanese governments signed an agreement on nuclear cooperation.

Thus, everything Eisenhower had spoken of in his address to the UN General Assembly was given the green light. In 1955, with American assistance, Sōriki organized a traveling exhibition in Hiroshima titled “The Peaceful Use of Nuclear Energy,” which was opened in Tokyo as part of a religious (i.e., Shinto-style purification) ceremony.

By May 1956, the exhibition had attracted more than 110,000 visitors in Hiroshima. Although the exhibition was organized by Sóriki, staff members of his daily newspaper (Yomiuri), and the CIA, the Hiroshima authorities, Hiroshima University, and other local organizations also participated in its preparation, organization, and execution.

In the following years, the exhibition was held repeatedly, making the propaganda effective. More than a million visitors and cognitive dissonance—perhaps this is how the result can be succinctly summarized.

Even some of those who had previously fought against the peaceful use of nuclear energy changed their earlier anti-nuclear stance and realized that the future of humanity is hard to imagine without nuclear power plants, since nuclear energy is everyone’s friend.

Sóriki thus “rightfully” became a member of the lower house of the Japanese parliament, and later the Minister of Nuclear Energy in the Hatoyama administration. In 1956, he became chairman of the newly formed Science and Technology Agency, working in collaboration with Yasuhiro Nakasone, who was then chairman of the Lower House’s Special Committee on Nuclear Energy. In December 1955, at the recommendation of these two committees, the government approved the plan to build the first nuclear power plant and its budget proposal. Due to the country’s geological conditions—namely, the risk of frequent earthquakes and tsunamis—experts, at Nakasone’s instruction, also prepared a rough cost estimate for the future nuclear power plant’s safety equipment. However, this amount was so enormous that Nakasone and the other committee members rejected the idea of implementing it.

Although the government purchased Japan’s first power plant from England, by the end of the 1950s more than 20 contracts had been signed under the Japan-U.S. nuclear agreement. The first British nuclear power plant supplied energy only as a byproduct; its primary function was the production of plutonium. After that, the Japanese government purchased exclusively American nuclear power plants manufactured by GE.

President Eisenhower must have been satisfied. When he took office, the U.S. possessed only 1,000 nuclear weapons. By the time he left office eight years later, that number had risen to 22,000. However, he did even more than that, because by the early 1960s, the Kennedy administration could boast 30,000 nuclear weapons. Some of these had been prepared by institutions led by Eisenhower. In 1961, this was equivalent to 1,360,000 Hiroshima-sized atomic bombs.

The next part of the series examines the worldwide spread of nuclear power plants and their consequences

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In my previous two-part article (“War Business, Business War”), I outlined America’s true plan, which motivated the attack on Iran on February 28.

I must note upfront that there are four ongoing wars—Ukraine, Gaza, Southern Lebanon, and Iran. These are now the fundamental modes of operation in a multipolar world. This global order is constantly changing. Therefore, no peace agreements are expected in the near future.

The goal is to weaken China.

A military attack on China is out of the question. Weakening the Chinese economy has been a key part of America’s foreign policy strategy for more than two decades.

China’s development and economic growth over the past decade have surpassed Japan’s development in the 1970s, which was hailed as an economic miracle.

China offers an alternative model. American strategic experts see this as the real danger of China’s development. Thirty-six years after the collapse of Eastern European and Soviet “communist” power, China’s dynamic growth and technological advancement—based on a one-party system—challenge every traditional capitalist system.

If anyone feels like reading the international press from the 1970s, they will find news similar to today’s about the Western dumping of Japanese and South Korean goods, the success of their cheap, high-quality products, and the open fear that “the yellow peril is coming.”

Authors at the time wrote that East Asian products had low wages, copied technologies, and lacked originality. They described these products as shoddy copies. Yet, consumers still preferred these products, such as cars and electrical appliances.

In the first decade of the 21st century, similar remarks were made about Chinese products. “Made in China” became a commonly derisive phrase.

Like Japan, South Korea, and Taiwan, China is currently one of the world’s leading economies, and its technological standards in many sectors exceed those of the United States.

China copied, as did Japan and South Korea, but this alternative learning process is not necessarily inferior to the Western approach.

Now, the competitiveness of the Chinese economy elicits worldwide admiration. The Western perspective accepts development only on its own terms. Yet China is developing differently and surpassing capitalist characteristics seen in the last two centuries. In a single decade, “Made in China” became “Made by China.” Earlier, like Japan and South Korea, China went from a low-cost manufacturer of large quantities of consumer goods to a producer of new, proprietary technology. It built the world’s largest high-speed rail network. China became the largest manufacturer of solar panels and created many other products based on new innovations. All of these are Chinese achievements.

Financial “war” instead of competitiveness

Three decades ago, in 1996–97, the U.S. government, led by Bill Clinton, mobilized numerous institutions to liberalize (i.e., open up) the capital and commodity markets of East and Southeast Asia.

This is not mere hearsay; there are still living witnesses to the fact that an informal meeting took place in New York, in one of the FED’s (i.e., the Federal Reserve System) buildings, among the owners of the largest American hedge funds (absolute return funds).

Then-U.S. President Bill Clinton and his experts considered the “liberalization” of the rapidly developing countries of East and Southeast Asia to be of utmost importance for the export of U.S. financial capital and U.S. services.

Many East and Southeast Asian countries did not liberalize their money or capital markets. Domestic economic and social development—and its stability—were most important. Some might call this economic and financial nationalism, though this strategy was closer to mercantilism. A group of Asian countries later agreed to liberalization. In these places, capital and money-market liberalization made them more vulnerable due to the Clinton-era reforms.

Faster, more drastic liberalization than before was achieved with short-term speculation in Asian currencies. Most authors in the Anglo-Saxon literature still deny this, except for Nobel Prize-winning economist Joseph Stiglitz. If a country’s export revenues don’t consistently generate foreign-exchange earnings, its domestic currency can be attacked through small-scale speculative investments. Its exchange rate will collapse within weeks.

Five countries—Thailand, Malaysia, the Philippines, South Korea, and Indonesia—liberalized their markets under U.S. pressure. Hedge funds succeeded with currency speculation. Southeast Asian economies collapsed. In Indonesia, there were pogroms against the local Chinese community. Malaysia lost three decades of economic gains. South Korea’s then-imprisoned former president signed IMF proposals from his cell, making many Korean companies easy targets and guaranteeing the inflow of international capital.

By late 1997, the situation grew so dire that the IMF held an emergency meeting in Hong Kong. Mahathir, then president of Malaysia, pointed at George Soros, one of the largest hedge fund owners, and called him a criminal. He blamed Soros and others for ruining Southeast Asia’s developing countries. Singapore banned investment funds from its stock market. Japan faced another crisis after its bubble economy burst.

The only country that did not suffer serious damage was China. China had not liberalized its capital and currency markets; its currency was not freely convertible, and it escaped unscathed. Nevertheless, Chinese financial policy experts developed an alternative proposal to restrict the operations of the International Monetary Fund and the World Bank in Asia. Chinese economist Ma Jun’s proposal for implementing Asian financial cooperation was the Asian Monetary Fund (AMF). At the same time, reforms to China’s domestic credit policy also took effect, aimed at ensuring domestic financial stability.

However, the economic efforts of Southeast Asian countries spanning several decades were reduced to mere past achievements within three months.

The simplest financial weapon

One of the employees of Quantum (owned by George Soros) in the 1990s was Scott Bessent, who, thanks to currency speculation operations, brought about the “crash” of the pound sterling in 1992 and the resignation of the British prime minister at the time; In 1997, while still an employee of Quantum, he did not achieve results with currency speculation in Hong Kong, but in November 2012, recognizing the weaknesses of Shinzo Abe’s new economic policy, his operations in the Japanese currency led to a 20 percent decline in the Japanese currency by February 2013. (Abe, however, did not resign.)

In November 2025, a series of speculative operations against the Iranian currency led to the mass uprising in Iran this past January, followed by its bloody suppression. The idea of collapsing the Iranian currency is also attributed to Scott Bessent.

Scott Bessent founded his investment firm, Key Square Group, in 2015. By then, his fortune (about $500 million) enabled him to start his own company. Known as the “tsar of hedge funds” in financial circles, he became U.S. Secretary of the Treasury after Donald Trump’s second presidential inauguration and remains in that role today.

The U.S. Secretary of the Treasury continues to think in terms of short-term speculative investments (as he has for decades) and acts accordingly. The “new adversary” is China, so speculation in the Chinese currency promises almost certain returns.

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For at least a decade and a half, U.S. foreign policy has focused on sidelining China. One must agree with those experts who view the Russian aggression against Ukraine (in which U.S. strategic and tactical moves played a decisive role) as essentially a response to China’s economic and financial rise, which the U.S. government sought to use to weaken China. A direct attack on China would not be “advisable” from either a military or geopolitical perspective; thus, according to American strategists, Russia’s military actions would suffice to weaken the Russian economy and thereby neutralize one of China’s key allies.

Contrary to all expectations, however, Russia has not collapsed so far, thanks to the industrial capacity it inherited from the Soviet era.

After the Russian-Ukrainian war broke out, a series of sanctions followed. Still, the Russian economy did not weaken. One of the most significant sanctions was freezing Russia’s central bank reserves held abroad. Russia was excluded from the SWIFT international financial transfer system. A large share of Russia’s oil and gas exports goes to China—50 percent of oil exports alone. China gets one-fifth of its oil needs and one-fifth of its liquefied natural gas imports from Russia. The prices of Russian oil and gas remain far below those seen since the Strait of Hormuz was closed.

Payment is made partly in yuan, partly in rubles, and partly in cryptocurrency, as well as via an electronic money transfer system established through Sino-Russian cooperation, including the People’s Bank of China’s system. (Similar to the electronic transfer systems of Revolut or Wise.)

However, payments in yuan are risky for China because the People’s Bank of China has less and less control over an ever-increasing amount of domestic currency. With the attack on Iran, this risk increased further because, following the closure of the Strait of Hormuz, the Iranian Islamic Revolutionary Guard Corps allowed only ships paying in yuan to pass through the strait starting in early March. (Iran itself receives payment for its oil exports in yuan.)

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On February 28, the United States, together with Israel, attacked Iran. A few days later, Iran closed the Strait of Hormuz, through which one-fifth of the world’s crude oil and liquefied natural gas supplies had previously been transported.

The shortage of crude oil and natural gas affects China, East Asia’s largest economy, the least directly. On the one hand, the Chinese economy has reserves sufficient for 100 days, and on the other hand, its imports of crude oil and natural gas have not stopped. It secures its supply of raw materials by bypassing the Strait of Hormuz, partly via pipelines and partly through other Asian countries. (Central Asia). In a far more serious, near-crisis situation are America’s two “client states,” South Korea and Japan, because they have not built up even minimal reserves, and this may soon force the introduction of various restrictions. (Research by Roger Boyd.) Moreover, China not only uses solar energy but also coal mining, which once again supplements the economy’s energy needs, albeit to a decreasing extent.

The developmental state

In my earlier writings, I have analyzed the economic and financial policies of the Chinese developmental state from many different perspectives, established over nearly four decades since the late 1970s.

Over the course of half a century, China has built a new type of economic and financial system that, with the exception of Japan, fundamentally calls into question the viability of capitalist “free market” systems over the past century. More importantly, an advanced version of this developmental economic and financial policy has proven viable not only in China but also in numerous countries of “Group B” (as the author of the Chinarb Substack page calls it). This, therefore, represents a real threat not only to the leader of the “A” group of countries, the United States, but also to nearly every EU member state.

What are the most important characteristics of developmental economic and fiscal policy, many elements of which originate from none other than Japan? (It may be worth revisiting the works of Chalmers Johnson, who developed the concept of the developmental state in the early 1980s based on an analysis of Japanese economic strategy.)

The skilled, central, and local bureaucracy

The primary goal of economic and financial policy is the development of the national economy, the creation of balanced income conditions, and the gradual implementation of these objectives.

Those who operate the economic and financial institutional system do not view the functions of the state and the market as conflicting. The most important practical consequence of developmental economic and financial policy is that the activities of state institutions and competing private institutions complement one another. An extremely important element of this approach and practice is that every member of the central and local professional bureaucracy is capable of thinking in terms of market competition and of implementing the duality of “coordination and control” in this spirit. There are numerous examples of this in Japan, South Korea, and Taiwan, and Chinese economic and financial policy decision-making institutions are making the most of the key advantage of being latecomers by drawing on every aspect of these seven decades of history.

Several generations of Chinese policymakers have learned a great deal from every aspect of Japan’s seven-decade history of developmental economic and financial policy—but also from its mistakes. Its entire financial system (similar to Japan’s quasi-public—i.e., semi-public, semi-private—state banks) operates under state control and partial state direction, with strategic banks (such as the EXIM Bank and the Development Bank) that operate profitably.

Put simply, the Chinese financial sector as a whole combines the Japanese model, which redistributes the massive amounts of household and corporate savings, based on the decisions of quasi-state banks and skilled financial bureaucrats, to infrastructure investments with low returns, which private banks would not undertake precisely because of the high risk involved. At the same time, the Chinese financial system also draws on elements of German bond-based financing, enabling the financing of long-term infrastructure investments with extraordinary costs to be safely managed through quasi-state financial institutions and domestic bond issuance. (One example of this is China’s construction of a railway network of a quality and scale unprecedented in the history of the global economy.) Muyang Chen has written numerous studies on China’s infrastructure financing system in recent years.

Similar to Japan, China has not applied either “shock therapy” (as in Central and Eastern Europe) or rapid currency liberalization, thereby protecting its domestic financial market.

Two types of currency policy—so-called offshore and onshore—are implemented in the Chinese economy. The central bank closely monitors the onshore exchange rate. The offshore yuan, however, is traded in the financial markets of Hong Kong, Singapore, and London, so its exchange rate fluctuates with market conditions. Thanks to Ryan Perkins’ research, the following logic likely holds true: (which Scott Bessent, as Treasury Secretary, applies in practice) that maintaining the offshore yuan’s exchange rate requires the Chinese central bank to draw upon ever-larger dollar reserves, and that as a result, the autonomy of China’s currency policy has been seriously jeopardized precisely because of the ongoing dual blockade of the Strait of Hormuz.

Ryan Perkins’ excellent analysis reveals the purpose of the U.S. counter-blockade against the Iranian blockade of the Strait of Hormuz, as well as the goal of starving the global economy and accelerating the global economic crisis by any means necessary.

The goal is to undermine China’s financial stability, force China to use the US dollar, and thus eliminate China’s monetary independence.

It is, however, a legitimate question whether this will succeed.

Second Movement: Allegro

China is still not a developed country; neither its income level nor its economic growth rate indicates this. It is worth recalling, however, that in Japan in the early 1960s, a university professor’s salary was 10,000 yen—this rose to 150,000 yen ten years later. So, the current, relatively low average income level in China should not mislead anyone. Latecomers take longer strides, but they reach their goals more slowly, since their competitors are not only time but all of the developed Eastern and Western economies.

Japan, South Korea, and, to a lesser extent, Taiwan owe their industrial modernization and development primarily to the practical implementation of economic nationalism. Since Japan served as a model for the other two countries mentioned above—both of which were part of Japan’s colonial empire until 1945—the Japanese developmental state model is particularly significant for Chinese modernization, albeit with significant differences. Turning to the Japanese case: economic development after 1952 was due, on the one hand, to American, British, and German technologies and know-how transferred to it on favorable terms, often for free, and, on the other hand, to the complete exclusion of foreign working capital. From the 1950s onward, Japan’s two “economic” ministries (Finance and Industry, and Commerce) pitted domestic companies against one another. The corporate bid that won banking and budgetary support was the one capable of manufacturing world-class products at significantly lower costs and price levels than those of the world’s most advanced manufacturers. Thus, Toyota won, but Suzuki did not; thus, Hitachi won, but Sony lost.

The 1970s, when IBM entered the island nation, marked a milestone because Japan was already capable of manufacturing world-class products in its strategic (i.e., export-oriented) sectors.

Until the late 1980s, Japan’s financial sector remained almost off-limits to foreign investors.

Other key infrastructure sectors and the Japan Pension Fund also excluded foreign companies.

Japan’s economic rise was distinctive: its foreign capital exports and aid programs, led by the Overseas Development Agency, quietly expanded markets for Japanese products worldwide up to the early 1990s.

For nearly fifteen years, Japan opened its domestic market to foreign companies with extreme caution. In contrast, China, beginning in the early 1990s, adopted a significantly different approach by opening more rapidly to foreign investors.

However, before we proceed to describe the three stages of development and growth of the Chinese economy, we need to understand the difference between China’s economic and financial policy institutional framework and that of developing economies.

The authority and power of China’s one-party system are unquestionable within the country. To Western democracies, it is unknown (and therefore incomprehensible) why an authoritarian party, which calls itself communist, can accept a market economy and profit-oriented corporate operations. They also wonder how it can gain acceptance for these among ever-wider segments of the population.

The answer (somewhat simplified) is that the economic development now known as the “Chinese model” is, in every instance, aligned with and supports the economic and financial policies aimed at development—precisely to preserve (and legitimize) the Communist Party’s power—a process aided, on the one hand, by Deng Xiaoping’s 1978 opening-up, and, on the other hand, by drawing on China’s extremely long historical traditions. As long as democracy is purely economic, the party encourages it.

In other words, like neighboring East Asian countries, China demonstrates that economic democracy—that is, broad-based economic participation—can occur without political liberalization or the adoption of Western-style political democracy.

The Chinese Communist Party refers to this economic system as a “socialist market economy.”

(Just as a point of interest: Germany’s economic system was long referred to as a social market economy.)

The first step in Deng’s reforms was the reform of Chinese agriculture, followed by the creation of special economic zones. In the former, advice from Eastern European, Hungarian, and Polish reform economists was utilized just as much as the example of the Singaporean trading city-state was in the latter case. A few years later, China was already capable of producing enough rice to meet the population’s needs.

The second phase of the reforms involved the creation of special economic zones and, simultaneously (albeit on a limited basis for the time being), the admission of Western companies into the economy. Thanks to this second phase, China exported a “flood” of cheap goods to every corner of the world. It is also worth noting, however, that this second, extensive phase ensured the labor supply for the initial phase of capital accumulation by organizing the relocation of millions of people from remote villages.

The third phase began in 2004, when the Chinese Party leadership designated railway construction as one of the most important economic goals. Of course, by that time, a significant number of major foreign companies (such as Apple) had already relocated most of their manufacturing to China, just as major Japanese and South Korean companies had expanded production there. For China, the presence of foreign companies meant not only copying Western technologies but also further developing and applying them.

Four decades earlier, a similar process had taken place in neighboring East Asian economies.

In Japan and South Korea, the process of adopting foreign technology relied primarily on structured study tours and technology aid programs rooted in economic nationalism, whereas China’s assimilation involved broader domestic participation.

China exhibits regional extremes in economic development; in a country of this size (especially in parts of inland China), hundreds of millions of people still live in extremely underdeveloped conditions. However, to enable the development of these extremely underdeveloped areas, infrastructure must be built first. Perhaps the best example of this is the expansion of the railway network, announced in 2004 and still ongoing today.

In 2004, the State Council of China published its railway construction plan, which called for the construction of 100,000 kilometers of high-speed rail lines by 2020 (12,000 kilometers of which would be passenger lines). Four years later, seeing the unparalleled speed of the rail lines’ construction, the target was increased to 120,000 kilometers (16,000 kilometers for passenger transport).

Between 2004 and 2015, 29,000 kilometers of the planned network were built, giving China slightly more than 60 percent of the world’s high-speed rail network. Four of these rail lines connect the population north–south, while four others do so east–west, facilitating the transport of both people and goods. (The “One Belt, One Road” initiative, announced nearly a decade later, also relies on these already hyper-modern rail freight systems beyond China’s borders.)

Similar to the practice of Japanese industrial policy—dating back to the 1950s—the Ministry of Railways in China issued a tender for numerous domestic railway construction companies, with the following conditions: keeping imports (imported components) to a minimum, negotiating only with foreign companies employing the most advanced technology, and producing products that are the most advanced internationally and meet domestic requirements.

In other words, local railway construction companies combined their own technology with the foreign technology they incorporated to achieve a higher standard of quality. As a result, over the past decade and a half, China has built the world’s most advanced super-express network. This is no longer simply the low-cost production of foreign products, as in the 1990s (Made in China), but rather an industry built on railway companies’ own innovations (Created in China).

In other words, a state-of-the-art railway network based on independent Chinese know-how and registered as a patent.

What accounts for the unparalleled development and application of Chinese innovation in less than a decade?

The first two elements of the answer are familiar from Japanese industrial policy: coordinated cooperation between state institutions (ministries and banks) and companies. The third element of innovation, however, was missing in Japan. This is the cooperation between these two institutional systems and universities.

While in Japan, the designers of the first bullet train (Shinkansen) during World War II were the same people who designed the kamikaze single-seat aircraft, or as a saying from that time—now legendary—put it: “the common element was that both had to be fast and silent,” Chinese high-speed trains (and their tracks) are now domestic inventions backed by a flood of Chinese international patents.

Moreover, the construction of this network did not proceed by “dismantling” the plan announced in 2004, but rather through state coordination and simultaneous competition between domestic and foreign companies. In this regard, China has surpassed even the traditional (Japanese, South Korean, and Taiwanese) development model.

The Chinese model is thus nothing more than a new version of this, a new development model (neo-developmentalism).

For those somewhat familiar with East Asian economic development, it is therefore not surprising that the rapid construction of rail lines not only connects the most developed regions, but from there it is only a small step (and logically self-evident) to extend domestic lines. And this brings us to China’s “One Belt, One Road” initiative, announced in 2013.

This Chinese program—a long-term, primarily infrastructure-focused initiative connecting every continent—has faced a barrage of criticism. For years, a host of researchers has used data to demonstrate that this concept is nothing short of the culmination of China’s ambitions for world domination—or, to put it less delicately, the Chinese version of colonization.

At this point, it is worth recalling the systematic “developmental-colonial” economic and financial policies of the Japanese colonial empire (Taiwan, Korea, Manchuria), through which the Japanese colonial government modernized and developed these three territories.

After they regained their independence (1945), this provided the technological and infrastructural foundation for the economic growth that began in the 1950s (including Manchuria and Inner Mongolia, which were returned to China).

China’s “One Belt, One Road” initiative (and the Asian Infrastructure Investment Bank, or AIIB, the largest financial institution funding these investments) aims to modernize low-income regions through infrastructure investments. Both land and sea routes facilitate the smooth handling of Chinese goods exports. At this point, it is worth referring again to the development of the super-express network, as it is no coincidence that domestic freight lines primarily connect the most developed Chinese cities with the networks outlined in the “One Belt, One Road” initiative.

It is important to list these here: China–Mongolia–Russia, Bangladesh–China–Myanmar, China–Indochina, China–Pakistan, China–West Asia, China–Kazakhstan–Russia. The maritime routes: South China Sea–Pacific Ocean, Indian Ocean–Mediterranean Sea.

With this strategy of connecting multiple continents via land and sea routes, the Chinese economy, on the one hand, creates enormous investment opportunities and exports its current excess capacity. On the other hand, it reduces the production costs of its goods, as rising incomes expand the domestic market’s absorption capacity through exports.

Furthermore, the domestic currency (the renminbi) will thus enjoy much greater demand than before. China currently holds 30 percent of the world’s total official foreign exchange and precious metal reserves. As a result of “One Belt, One Road” investments and goods shipments, it will generate significantly greater (central bank) revenue than, for example, by holding reserves of bonds issued to finance the U.S. budget deficit. (If nothing else, this alone signals the weakening of the United States’ dollar-based international payment and reserve system.)

It is an increasingly common claim that China links its infrastructure investments to the provision of loans, that its lending practices are opaque, that it ignores the borrowing country’s payment constraints, and that in the event of default, it seizes or confiscates that country’s port—or even some of its more valuable land.

However, much of the above is nothing more than a meme originating in India, which was immediately picked up by leading Western media outlets. According to this narrative, Sri Lanka fell into a debt trap due to taking out a Chinese loan. This is not true; Sri Lanka was unable to repay its debts due to the civil war, and the Chinese investment—which a Chinese company secured after numerous Western firms had rejected it—primarily puts India at a competitive disadvantage. This is why this meme was created and then spread uncritically throughout the global press.

Part of China’s “One Belt, One Road” initiative includes the modernization of the Belgrade–Budapest railway line and the establishment of the (planned) Budapest campus of Fudan University.

In both cases, Chinese quasi-state-owned, quasi-privately owned financial institutions are providing loans to the Hungarian side for these projects. However, the risks involved are not due to the terms of the loans, but rather to the currently unpredictable fluctuations in the Chinese currency’s exchange rate.

The problem with these investments and the loans financing them is therefore not what the Western media constantly repeats. The problem, on the one hand, is the risk of exchange rate fluctuations (see also the similar burdens of Japanese loans taken out in the 1970s and 1980s in Hungary). On the other hand, Chinese railway investment primarily connects the Southeast and Eastern European regions by transporting Chinese goods.

As for the planned first European campus of Fudan University, it will facilitate the training of experts in Chinese technological development and innovation in the medium term.

There is no doubt that both Chinese investment plans received the green light due to a decision by the current Hungarian political leadership, thereby reinforcing Chinese support for the domestic authoritarian regime.

What this will mean for the economy in a few years’ time cannot be predicted at this time.

With its investment initiative connecting these continents via land and sea (the first phase of which is taking place in Africa and Central Asia), China does not seek to colonize, but rather to expand its economic achievements—already established in its domestic market—to the international level. And this is hardly achievable without the development of regions that have lagged behind until now.

The less positive news, according to researchers, is that it is also doubtful whether this can be achieved even if Chinese development projects succeed. The symphony, therefore, remains unfinished for the time being.

References

Arase, David (1995): Buying Power: The Political Economy of Japan’s Foreign Aid. Lynne Rienner.

Brautigam, Deborah – Rithmire, Meg (2021): The Chinese Debt Trap Is a Myth. The Atlantic, February 6, 2021.

Gao, Bai (2020): Three Theoretical Issues Concerning China’s HSR Innovation System.

(Chapter One.) In Gao, Bai: High Speed Rail: An Analysis of the Chinese Innovation System. Singapore: World Scientific.

Gowan, Peter (1999): The Global Gamble. Washington’s Faustian Bid for World Dominance. London: Verso.

Kohli, Atul (2004): State-Directed Development: Political Power and Industrialization in the Global Periphery. Cambridge: Cambridge University Press.

Johnson, Chalmers (1982): MITI and The Japanese Miracle. Stanford: Stanford University Press.

Lui, Weidong – Zhang, Yajing – Xiong, Wie (2020): Financing the Belt and Road Initiative. Eurasian Geography and Economics, 61 (2): 137–145.

The growing evidence of neoliberal system failure underscores a global transition. The rapid, sustained growth of the Chinese economy points to an impending shift toward East Asian economic and financial leadership. China is poised to lead this transition. Our two-part article examines the underlying factors driving this shift.

I am not an expert on China. Although the following study may appear to focus exclusively on Japan and to apply lessons from Japanese economic history to China, this is not exactly the case. The Japanese economic “miracle” served as a model not only for South Korea, Taiwan, and Singapore (adapted to local conditions), but also for China, which drew on Japanese economic and financial experience alongside those of many others, including the state-socialist economies of Eastern Europe.

Introduction

The increasing failure of globalization and neoliberal systems is now evident in both the East and the West, highlighting the need to understand the model that has enabled East Asia—especially China—to sustain success. Recent failures by the wealthiest countries to maintain social peace and competitiveness emphasize this contrast. East Asia stands as the exception, achieving what others could not.

All signs point to China—having learned much from the economic successes and failures of its neighboring countries—joining its neighbors in achieving economic and financial success.

We are all witnesses to—and at the same time victims of—a transitional era, because the unprecedented speed of China’s economic modernization only exacerbates the failure of globalization and neoliberal systems, as well as the resulting economic and financial uncertainty. Of course, it is not yet possible to know whether China and its neighboring, developed East Asian countries will take over the leadership of the global economy, which previously rested on American and European hegemony, but many signs suggest this is likely.

The demonization of China is becoming increasingly common in the global media. China is a dictatorship based on a “communist” one-party system, so most Western countries are far more familiar with the oppressive functions of this authoritarian system than with the country’s more than three thousand years of history, literature, philosophers, and, not least, the name of the country written in Chinese (and Japanese) characters: the center of the world.

Much of the Western world knew little about Japan until the 1970s. Thanks to the island nation’s economic successes, however, the world outside Asia quickly came to realize that Japanese goods were not only cheaper but also better; indeed, by the 1980s, Japan had become a recognized economic miracle in America just as much as in Western Europe. It is thanks to this miracle that more and more Asian and non-Asian countries came to know about Japan. And perhaps it is no coincidence that Japanese electronic devices (video games, the PlayStation), manga (i.e., comic books), and Japanese animated films (anime) fill entire evenings .

China is going through similar stages of development and recognition, with the significant difference that, so far, the economic and financial rise of no other East Asian country has sparked international concern—except for China. Its size and the modernization it has achieved over the past four decades threaten to trigger a trade war and raise international security concerns. None of this happened in the case of Japan, Singapore, Taiwan, and South Korea because these countries have been under U.S. military influence and supervision since 1945.

China, however, is something else—a “socialist market economy”—which is a thorn in the side of decision-makers in neoliberal systems.

In their view, China must be sidelined due to its authoritarian system, its economic power must be curtailed, and its arms buildup must be prevented by any means necessary—China’s aggressive and colonialist intentions are clear.

Below, I will take a closer look at some of the factors behind China’s economic and financial successes and, based on this, attempt to demonstrate that the demonization of China is nothing more than a reaction to concerns about the loss of former Western hegemony.

China’s “threatening” expansion is a consequence, not a cause: it has been exaggerated due to the uncertainties of the transitional period mentioned in the introduction, which are felt by ordinary people (especially since the outbreak of the Covid pandemic) just as much as by social scientists and leading politicians.

First Movement: Andante

The economic and social modernization of East Asia is due to the implementation of developmental economic and fiscal policies, which Japan first introduced in the 1930s in response to the Great Depression (1929–1933). It was then that Japan definitively abandoned free-market liberal economic and financial policies, which it had previously applied very cautiously and selectively in the interest of modernization.

The originator of the concept of developmental economic policy, Chalmers Johnson, was a historian who analyzed the island nation’s developmental economic policy and its changes over the history of a single Japanese ministry—the Ministry of Industry and Commerce—in his 1982 book.

Unlike the ideological orientation of free-market liberal systems, developmental economic and fiscal policy prioritizes nationalism.

Its institutional system as a whole and its decision-making mechanisms are flexible, employing a variety of tools always adapted to the given situation. Its essence lies in a global market orientation, meaning that the state’s professional ministerial apparatus—including the central bank’s leadership—supports or dismantles industries based on a market-oriented approach, with the primary goal of economic development being to reach the forefront of global market competition.

Its tools include the system of state subsidies, domestic competition, the application of customs and other import restrictions, and the systematic support of family businesses, which help protect some employees of companies slated for downsizing from unemployment.

From a fiscal policy perspective, the interdependence of commercial banks and large corporations, considered strategic (through cross-shareholding), along with a complete ban on the inflow of foreign working capital, complements economic policy. The development concept supports competition among companies but prevents monopolies.

From a financial policy perspective, centralized foreign exchange management must be maintained (as was also the case during the Great Depression of the last century) as long as the country’s “hard currency” and precious metal reserves remain low. The task of giant financial institutions, operated under semi-public, semi-private ownership, is to provide credit to companies capable of competing internationally, with the source of these loans largely being the reallocation of household savings. The domestic market serves as a “test” for industrial companies, so it is common for the quality and prices of products sold domestically to differ from those intended for export.

The state institutional system simultaneously coordinates and, when necessary, controls economic actors—that is, companies.

In other words, the balance between coordination and control always depends on the competitiveness of companies and international, i.e., global economic conditions; decision-makers adjust their approach accordingly.

As a result of all this, by the end of the 1960s, the products of numerous East Asian companies had achieved success in the global market in South Korea, Taiwan, and Singapore. In the aforementioned countries of the economic “miracle,” there was no Western-style political democracy (at most, only certain elements of it) for four decades, because the indispensable condition for catching up was economic, not political, democracy. (This is of particular significance in the case of China.)

The developing state’s measures to equalize income and expand the social safety net led to social relations that were far more balanced than in Western market economies. It is no coincidence that the “East Asian miracle” elicited undisguised amazement among American economists.

Of course, a relatively stable international environment—both economically and financially—was also indispensable to all of this. However, the fall of the Berlin Wall and the collapse of the Soviet Union created a new situation for East Asia as well.

History had come to an end, as Francis Fukuyama claimed, meaning the confrontation between the two world systems had ceased, and it was expected that liberal free-market systems would become dominant in Eastern Europe and the independent states of the former Soviet Union, with East Asia (excluding China) joining them. That is not what happened. The developed economies of East Asia essentially remained unchanged, or changed only to the extent necessary to maintain their competitiveness. To bring this region into line with the neoliberal world order, then-U.S. President Bill Clinton announced a strategy to target Asian markets for American capital and exports.

Of course, all of this was ostensibly a non-governmental initiative. The four largest American hedge funds (including Quantum, owned by George Soros) began speculating against the currencies of East and Southeast Asia with relatively small investments. In the region, decades of economic and social achievements were wiped out in barely three months.

The consequences were tragic: by speculating on national currencies with relatively small financial investments, the financial, economic, and social stability of numerous Asian countries collapsed. The 1997–1998 Asian financial crisis also served to transform the East Asian economic miracle into corrupt, wasteful systems; in other words, following the work of hedge funds, an ideology emerged explaining why the previous development policy must be dismantled and why liberalization is necessary.

In 1998, following the currency collapse, it became clear that the World Bank, the International Monetary Fund, and the Asian Development Bank did not represent the interests of the countries suffering severe losses in the crisis. It is therefore no coincidence that, at that time, a proposal was put forward to establish an East Asian financial institution without U.S. participation, as well as the idea of creating a regional currency.

Despite all this, the global triumph of liberal systems proved to be an illusion. Neither the former socialist economies nor the Western free-market economies succeeded in preserving (or creating) global competitiveness while simultaneously maintaining domestic social stability.

Every country—whether “latecomers” or “early industrializers”—has been a loser in the practical application of neoliberal ideology. Deregulation, the privatization of strategic sectors, the abolition of trade restrictions, and the disregard for social stability (see British Prime Minister and reformer Margaret Thatcher’s statement: “There is no such thing as society, there are only individuals.”)

As consistent implementers of free-market principles, two countries—the United Kingdom and the United States—leaned toward financialization by the early years of the twenty-first century: the decline in economic efficiency and export capacity was offset by financial markets and stock markets. The culmination of this was the 2008 U.S. and subsequent international financial crisis.

It is therefore no coincidence that authoritarian political systems have since become indispensable for the maintenance of neoliberal systems; Donald Trump is just as much an example of this as the governing tools of Poland, Hungary, or Brazil, and the realization of Brexit.

Although the four most developed countries in East Asia liberalized their economies, they simultaneously imposed stricter controls on Western capital than before. China was the only country in the region where, thanks to its dual currency system (yuan and renminbi), massive exchange rate gains boosted the Chinese central bank’s reserves.

The economic weakening of the neoliberal West and East Asia’s successes in global markets are fraught with serious contradictions, as no East Asian country has yet assumed a leading role in international political organizations. The United States’ hegemonic position appears unassailable, yet China’s economic, technological, and military-industrial development calls this into question. It is no coincidence that while Japan is the International Monetary Fund’s largest contributor, the organization has never had a Japanese president. Members of China’s financial diplomacy have engaged in persistent negotiations to have the IMF accept the renminbi as one of the key currencies, which it can utilize within the framework of Special Drawing Rights.

In 2015, an official government document titled Made in China 2025 was made public in China. Members of an expert committee operating alongside the U.S. Senate recommended immediate action, listing countermeasures to China’s “advance” (i.e., increased competitiveness) in their analysis, which included a list of strategic sectors. According to experts, strategic sectors include all areas where China is not only competitive but also produces products that are significantly better (and cheaper) than those produced in the United States. Joe Biden’s administration has already approved a proposal for $2 billion in government support for “strategic products” and sectoral activities. But the American expert community has responded to China’s long-term strategy with further self-defense measures.

Free-market liberal ideology has unfortunately proven ineffective, they wrote, so Chinese technologies must be urgently banned from the U.S. market, and Confucius Institutes must also be expelled from the country to counter Chinese “ideological” influence.

This is developmental economic policy at its best, even if it does not use the same tools and institutions that East Asia has employed so far.

All of this was triggered by the Chinese threat. The second part of the study will discuss the background and toolkit of Chinese development and progress.

References

Calder, Kent E. (1988): Crisis and Compensation. Princeton: Princeton University Press.

Gao, Bai (1997): Economic Ideology and Japanese Industrial Policy: Developmentalism from 1931 to 1965. Cambridge: Cambridge University Press.

Johnson, Chalmers (1982): MITI and The Japanese Miracle: The Growth of Industrial Policy. Stanford: Stanford University Press.

National Science and Technology Council (2018): Strategy for American Leadership in Advanced Manufacturing. Washington.

Károly Polányi (2004): The Great Transformation: The Economic and Political Roots of Our Time. Budapest: Napvilág Publishing House.

Stiglitz, Joseph (2018): Globalization and Its Discontent (Revisited). London: Penguin Books.

A brilliant economist, who insists on remaining anonymous in his publications, makes a crucial distinction when describing the wars currently underway. In his view, two systems are at war: A, which is the Western world, and B, which lies outside it. A has established financial and military hegemony, while B strives for industrial hegemony. A established its dominance of the seas nearly three centuries ago, and later its financial hegemony based on the dollar (along with the so-called SWIFT transfer system), and A boasted the “petrodollar” system, which was already in operation by 1973. The logic of its system was continuous warfare.

It still is today.

In contrast, B represents the entirety of industrial-technological systems, China’s industrial capacities, Russia and Iran’s oil and gas production, and the Belt and Road Initiative (BRICS) with its international rail and maritime transport network, bypassing the SWIFT system and establishing its own electronic payment system. The system that supplies these countries with industrial products is capable of maintaining and expanding its own civilizational traditions without resorting to war. It is incapable of this because a speculative capital allocation system cannot introduce innovative, continuously expanding technologies and meet the growing needs of societies.

The logic of this Chinese expert may be simplistic, but it contains the most important element: namely, the complete exhaustion of one system (A) and the rise of another system (B).

U.S. President Donald Trump is attempting to change this with the help of federal institutions, and so far, there are many signs that he is succeeding. However, the following article does not focus on these “successes,” but rather on a two-pronged approach. There is, therefore, Group A (the U.S., European NATO member states, and Australia), and there is Group B: China, Russia, and their Asian allies. This section of the article, drawing on journalist Richard Medhurst’s summary and my own research, outlines the largely unknown elements of the American strategy that act “in the interest” of Group A (the Western Hemisphere).

The following section describes China’s responses to this, specifically, the most important elements of China’s strategy, including the reactions of other countries in Group “B” to the U.S. strategy’s steps.

Although this introduction has become somewhat lengthy, it is essential to understand that two “systems” are actually clashing (for now, in the form of wars), and the outcome of the conflicts between them remains uncertain. It is worth noting, however, that one of the best analysts of System A is Tanvi Ratna, an American engineer and economist, while the best experts on System B as a whole are the aforementioned anonymous Chinarb (Substack.com), Ryan Perkins, and two other authors. It is no coincidence that the analysts of the B group of countries, without exception, possess direct experience and knowledge of the countries in the East Asian region.

When the US dollar is backed by domestically produced oil and liquefied natural gas.

Richard Medhurst rightly emphasizes in his latest documentary that today’s America is no longer the America of the 1970s. Back then, in accordance with a long-secret agreement, the strengthening of the dollar’s international position was due to a pact with Saudi Arabia: the “petrodollar” agreement. Today, America has abundant oil and natural gas reserves thanks to hydraulic fracturing (fracking).

In other words, the U.S. strategy is nothing short of weakening or eliminating the position of its former competitors. These include the Middle East (primarily Qatar), Venezuela, and Russia (crude oil and natural gas, whose prices were one-tenth of those in the U.S. before the outbreak of the Iran war). The goal, therefore, is simple: every country or group of countries dependent on crude oil and natural gas imports will be forced to purchase American crude oil and natural gas due to the elimination of competitors.

Russia was sidelined first by the bombing of the North Atlantic pipeline, then by export bans. Over the past year, this has been achieved through U.S. attacks on Russian tankers near the Arctic Circle and the seizure of oil reserves—that is, through organized U.S. pirate operations. (Hence the title of Medhurst’s documentary: Pirate State,

Venezuela, the country with the world’s largest oil reserves, had its leader (and his wife) kidnapped and forced to the U.S., becoming the playground of the American giant Chevron: oil extraction is their business.

Iran possesses the world’s third-largest oil reserves, which are state-owned. (This has been the case since the 1979 Iranian Revolution.) Following the “dress rehearsal” last June, on February 28 of this year, America, together with Israel, began bombing Iran.

Russia, Venezuela, and Iran exported oil to China. As for liquefied natural gas (LNG) supplies, Qatar and Australia, the most important LNG exporters, were cut off from the supply chain. The former as a result of the U.S.-Israeli war against Iran, and the latter due to a massive cyclone.

This, then, is the U.S. strategy, but this picture would not be complete without the LNG agreement signed with Israel last year. Last December, Israel signed a 15-year agreement with Egypt to export gas from its offshore (Leviathan) reserves.

The contract was signed under U.S. pressure, as this secured an excellent business opportunity for Chevron for 15 years. (Chevron also operates in Venezuela.)

The contract, the largest in Israel’s history, not only meets Egypt’s gas needs but also significantly increases Egyptian exports to Europe, while providing a stable income for the Israeli government to fund its military operations in Gaza, the West Bank, southern Lebanon, and Iran.

A fairly clear picture emerges from the above regarding the U.S.’s radically changed energy strategy.

The first and most important element is that U.S. oil and gas needs no longer depend on imports from Middle Eastern countries. The second is that America has successfully eliminated all competitors in these two product categories from the competition (or at least the most significant exporters). The attack on Iran on February 28 led to the closure of the Strait of Hormuz a few days later, which radically reshaped the world’s sources of raw materials and their transport routes. The EU signed an agreement on U.S. crude oil and gas imports last year, the catastrophic consequence of which is the imminent disruption of energy supplies—a situation that even the temporary authorization of Russian oil imports cannot alleviate. One consequence of this is the relocation of Europe’s largest industrial companies to the U.S. market, similar to Japanese firms.

Currently, both natural gas and oil prices on the global market are many times higher than they were before the war.

At the same time, foreign direct investment in the U.S. market is growing in value. (Siemens, Toyota.)

The combined result of all this is a dollar backed by crude oil and liquefied natural gas, which no longer depends on Arab oil exporters but is based on domestically produced raw materials.

And if all this isn’t convincing enough, let’s now take a look at the other side, namely China. Not that China is the only country in Group B, but from the Chinese perspective, knowing the facts on the ground there, the interested observer gains a somewhat more complete picture of the state of the current geopolitical war at the end of April 2026.

The following text is a continuation of the essay titled “The Enlightenment of Darkness,” published last June. In that essay, I summarized the intellectual and ideological background—and its practical implementation in policy programs—of Donald Trump’s second presidential administration. In my essay, I argued that Trump’s daily statements reveal nothing about the government’s actions and are rather diversionary tactics that have so far achieved their goal. The American and international public opinion know nothing about the true objectives of the war on Iran.

To clarify, the true objectives differ from common assumptions: they are not the destruction of the nuclear arsenal, the elimination of Hezbollah and Hamas, the pacification of the Middle East, or even the overthrow of the Iranian theocratic regime for a democratic transition.

The goal of the attack against Iran launched by Israel and the U.S. on February 28 is the complete restructuring of the Middle East, a plan that was finalized well before Donald Trump’s first presidency. Since 1979—that is, since the Islamic Revolution—Iran has been a target of U.S. foreign policy strategy, but it was necessary to wait for “favorable” circumstances to arise. The plan to attack Iran and its detailed strategy were finalized a decade earlier, so the U.S. government was also aware that Iran’s most effective response would be to close the Strait of Hormuz. The current situation, therefore, did not come as a surprise to the U.S. government. U.S. oil and gas companies, however, are reaping huge profits thanks to the Iranian blockade. Israel, meanwhile, is generating massive revenue from other sources, as will be discussed later.

The transformation of the Middle East region began with the establishment of the Board of Peace, and the essence of the plan is the reconstruction of the territories in Gaza, the West Bank, southern Lebanon, and Iran—that is, the profit-driven “repair” of the war-torn destruction in the region. The financial resources for this are available, and as will become clear later, this is the U.S. government’s primary objective. In fact, to secure revenue, the U.S. is restructuring its alliances in the Middle East, thereby ensuring the infusion of additional working capital and other resources.

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America’s national debt currently stands at $38 trillion. Interest alone amounts to $1 trillion annually, and this figure has risen significantly in the first months of 2026. One of the most important reasons for this is that the holders of government bonds that previously financed U.S. debt—the central banks of China, Japan, and South Korea—have sold them over the last six months at an unprecedented scale and speed. The consequence is an increase in interest rates on U.S. government bonds (loans) and a weakening of the U.S. dollar’s position. It is therefore no coincidence that the U.S. has sold a massive amount of gold on the international financial market since last November.

Government debt chart:

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The attack launched jointly with Israel against Iran on February 28 was the “dress rehearsal,” initiated using the lessons learned from the brief 12-day war last June.

The Middle East strategy is part of years of economic, financial, and military preparatory work preceding Trump’s second presidency. The most important document in this planning is Project 2025, which was prepared by hundreds of experts under the auspices of the Heritage Foundation, including two associates of former Prime Minister Viktor Orbán. Every recommendation in the nearly thousand-page document has been implemented to date. This is supplemented by the new National Security Strategy released last December, much of which remains classified to this day.

Both documents reflect the complete centralization of executive power (which is why the plan to attack Iran was not debated in Congress) as well as a profit-driven approach to war.

Among the domestic measures outlined in Project 2025, a nearly thousand-page publication by the Heritage Foundation, are tariffs imposed on nearly every country in the world, the deportation of illegal immigrants, (ICE has deported approximately 650,000 people with the help of AI so far) and, as a result, the “voluntary” departure of nearly 1.2 million immigrants, as well as a reduction in the number of federal government employees. The latter was the result of Elon Musk’s DOGE program, implemented in 180 days. Among the measures of the DOGE initiative are the termination of numerous healthcare services and the suspension of aid programs.

Internationally, the new national security strategy prioritizes redrawing the map of the world, meaning the goal is to define the Western Hemisphere as an exclusive American sphere of influence. One element of this is a radical shift in previous U.S. security policy practices in the Middle East.

At the same time, there is a definitive break with most international organizations (WHO, UNCTAD, UNICEF) and a confrontation with the European member states of the North Atlantic Treaty Organization (NATO). These, then, are the domestic and international goals of the presidential term marked by Donald Trump’s presidency. It is worth repeating: every point of the vision outlined in Project 2025 has been realized so far.

What, then, is the reason for the joint U.S.-Israeli attack on Iran?

It is impossible to answer this question without a brief digression. On the one hand, it is essential to know that at least fifty of the experts commissioned by the Heritage Foundation—that is, the architects of the current U.S. government’s programs—are members of the administration. On the other hand, it is also of extraordinary significance that not only Christian nationalists but also major financial backers of Trump’s first and second presidencies are members of the current administration. As we shall see, the companies they own generate enormous revenue thanks to their founders’ government membership. This is nothing other than the implementation of the “revolving door” system, which anthropologist Janine R. Wedel analyzed in detail in her excellent monograph Shadow Elite, published in 2009 by Basic Books. Employees moving from the private sector to the public sector simultaneously leverage the information capital provided by public institutions, which they then utilize in private-sector companies.

This, as is well known, first occurred during the Iraq War (2003), when the Pentagon commissioned the giant corporation Halliburton and the private military company Blackwater to send troops to Iraq. (The Pentagon’s investigations into the two companies’ overbilling are still ongoing.) The privatization of wars is perfectly in line with Curtis Yarvin’s vision, according to which a single centralized power makes all its decisions relying exclusively on the activities of profit-oriented “market-driven” companies.

Two specific examples illustrate this point well.

While Peter Hegseth is the Secretary of Defense, his deputy, Stephen Feinberg, is responsible for the Pentagon’s entire annual budget of nearly $900 billion. Feinberg’s Cerberus Investment firm (with $70 billion in assets) itself participates in the most profitable investments in U.S. military activities. This is tantamount to the privatization of the government (Pentagon) military equipment manufacturing. It is important to note that none of the companies listed are part of the military-industrial complex.

Howard Lutnick, the current Secretary of Commerce and a business executive, also heads the department responsible for customs tariffs. This year, however, the Supreme Court ruled that all of these tariffs were unlawful and unconstitutional, so damages resulting from higher import prices must be reimbursed to those affected. Following excellent financial logic, Lutnick does nothing more than pay 30 cents on every dollar lost to the victims, and later receives the full amount. An excellent deal. These two examples are just a few among many where government officials use and abuse their public positions to profit through their companies.

The program, known as MAGA, thus aims to achieve only a few goals. The first and most important is the rapid removal of “foreigners,” carried out by the armed ICE (Immigration and Customs Enforcement), which in many cases has resulted in the deaths of both U.S. and non-U.S. citizens. It is a very important fact that ICE’s search system, developed by the software company Palantir, provides a great deal of false information.

The second task is to bring American companies back home and support them by every means possible; originally, the imposition of tariffs was intended to serve this purpose.

The third is to purge American society of rebellious elements, specifically with the help of the technocratic giant corporations of Silicon Valley, the most well-known of which is Palantir.

This company is not only a contracted “client” of the Pentagon, but also a firm that stores data on members of American society and can access it at any time; and Palantir, along with Elon Musk’s two companies, is an active participant in every single war currently underway: Ukraine, Gaza, the West Bank, and Iran.

In other words, every one of the wars listed is being waged with the help of cutting-edge technology; people are “targets” on the pilot’s screen, but also in the actions of soldiers deployed in the field, which are directed by AI and software. While 2,000 soldiers were needed in Iraq to carry out a single destructive operation, today in Iran it takes 20. In the case of Iran, a single operation amounts to an order every 2 seconds, enabling it to reach 1,000 targets per day. On the other hand, however, artificial intelligence, when used in conjunction with software programs—similar to ICE’s operations against immigrants—is carried out with a massive error rate. In the latter case, numerous U.S. citizens were temporarily imprisoned, while the horrific consequence of the former was the killing of more than 180 elementary school students and several teachers due to the outdated database of the software program called the Maven Smart System. Marven’s hit rate is 35 percent; despite this, the Pentagon continues to use it in operations.

Palantir—which owns the Marven program, facial recognition systems, and personal data stored under Elon Musk’s DOGE savings program—has undoubtedly become one of the world’s largest and most profitable companies.

It would be difficult to deny that all of this is happening in the name of competition with China. That is the subject of the second part of this article.

The following brief piece is merely an introduction to a longer analysis of the American objectives in the war in Iran currently underway (April 6, Easter Monday).
I should note in advance that the analysis, which will be completed shortly, has nothing to do with a daily chronicle. On the one hand, I will describe the historical situation of the Middle Eastern states (including the colonial periods); on the other hand, I will outline the series of steps taken by the U.S.—a long-term strategy that appears to consist of improvisations and impulsive threats but is in fact a deliberate plan—based on expert analyses. To set the stage, let me note that all of this began with the tariffs introduced last February and is consistent with the coherent implementation of a coherent economic, fiscal, trade, and geopolitical strategy.
On February 28, Israel and the U.S. jointly attacked Iran. Every news report condemned this aggression, which openly defied international conventions; Iran posed absolutely no direct or indirect threat—this was the view of the Iranian leadership as well as the media as a whole.

Perhaps symbolic is the Iranian school bombed to the ground on the first day of the war, which housed more than 180 young students =according to some other estimation, more than 100 students) and numerous teachers.
Let us pause (as it is worth doing so to understand the content of this article) to consider the circumstances of this bombing.
The agreement between the Pentagon and Palantir was established nearly a decade ago., in 2017.The purpose of this agreement was to develop software capable of using artificial intelligence (instead of previous satellite imagery) to identify people and objects with the utmost precision, so that the U.S. military would not merely have tanks and missiles, but also programs that combine target detection with immediate destruction.
This was still technically impossible during the U.S. invasion of Iraq in 2003, although at that time the training of American mercenaries recruited at exceptionally high pay “removed,” that is, objectified, the enemy targets (people), so that soldiers in tanks could mark the target to be destroyed on a screen (similar to bomber aircraft).
The Pentagon’s agreement with Palantir (Peter Thiel) identified two key priorities for developing the software and associated artificial intelligence: efficiency and productivity. During the Iraq War, a series of operations required 2,000 soldiers; today, it takes 20.
Although the Pentagon had been in talks with several Silicon Valley companies prior to 2017, Google withdrew from the contract after 3,000 of its employees signed a protest petition, citing ethical reasons. To put it less delicately, Google did not want to participate in the development of software designed to kill people.
The English phrase “Save lives instead of taking lives” became the motto of the Maven Smart System. Palantir (and one of Elon Musk’s companies) first tested it in Ukraine in 2022, with convincing success.
The majority of the victims of the school in southern Iran that was destroyed by bombs three times (an act immediately condemned by international organizations) were school-age children, with the death toll exceeding 180.
This bombing was carried out using the Marven program, which, however, had not been updated by Pentagon experts. This is because 10 years earlier, the school had been a military base of the Islamic Revolutionary Guard Corps, so the program identified the school as a target to be destroyed based on that information.
There was no human verification prior to the operation. An investigation is underway at the Pentagon and the Department of Defense.
Food for thought.

A book on the history and current application of the Maven Program was published on March 26 (in English).

Historical Mosaics
“Whoever saves a single soul saves the whole world.”
Chiune Sugihara (1900–1986)
Take a close look at this photo. Though posed, one instantly notices Sugihara’s intelligence, wisdom, and affirmation of life.
This is Chiune Sugihara, gone for forty years. Fifteen years after his death, his country’s prime minister posthumously rehabilitated him in 2000, highlighting his lasting impact.
Sugihara was a young man with exceptional language skills and ambition. Though his father wanted him to pursue another career, he chose to become a diplomat.
Colleagues and officials said Sugihara spoke Russian so fluently that native speakers couldn’t tell he was Japanese. He won an award for outstanding language skills on tough civil service exams.
He began at the East Manchurian Railway Company, then became Deputy Minister of Foreign Affairs in colonized Manchuria in 1931. Four years later, he resigned over the occupiers’ treatment of the Chinese. That year, he returned to Tokyo and was appointed Deputy Consul in Kaunas, Lithuania.
After the Soviet-German invasion of Poland in September 1939, a flood of refugees fled to the Baltic states. Most Jewish refugees feared for their lives under German occupation.
Sugihara moved to Kaunas with his family. By spring 1940, refugees arrived in Lithuania. That summer, Sugihara and his wife saw long lines outside their window—Jewish refugees seeking transit visas, their only chance at survival. Most did not want Soviet citizenship, despite government offers. This was after the major purge and just before the execution of the Red Army’s top leadership.
Sugihara notified the Ministry of Foreign Affairs in Tokyo of his request for permission to issue visas, and repeated it. Each time, superiors insisted on statutory conditions: personal documents and a substantial fee. Without both, Sugihara could not issue visas. Former officials noted ministry disagreement on rescuing Jews, but in 1940, as Germany’s ally, Japan’s official stance was to avoid antagonizing Germany through charitable acts. Meanwhile, some experts had devised plans to resettle Jews in Manchuria, though there is no evidence Sugihara learned of them from the railway company.
Seeing the lines of children, the elderly, and rabbis, Sugihara defied orders and gave transit visas to all who requested them. This was the start of his quiet defiance and compassion.
Sugihara later said he couldn’t bear the thought of their deaths. He issued visas to everyone, regardless of their ability to pay or their documentation.
He issued an estimated 4,000 to 6,000 transit visas, allowing travel to Japan via the Trans-Siberian Railway and ship from Khabarovsk to Kobe. Japan cited formalities, but its alliance with Germany was the real reason for its resistance to such actions.
Sugihara was transferred after two months. Survivors recalled him signing visas at the train station as his train departed. The Ministry of Foreign Affairs sent him to Prague, then Romania. After the Red Army advanced, he and his family were imprisoned for eighteen months. Released, they returned to Japan. Sugihara was dismissed amid postwar ministry cuts and lost his pension. Supporting a wife and four children, he worked as a door-to-door salesman, hotel porter, and later as an interpreter and translator. From 1960, he worked in Moscow for an import-export company while his family remained in Tokyo, working for 15 years until his retirement.
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During this period, Sugihara’s actions remained unknown in Japan as he quietly rebuilt his life.
In 1968, an Israeli embassy employee visited him, fulfilling his father’s dying wish to find the vice consul who had issued him a visa. Yad Vashem collected the documents and recognized Sugihara as one of the Righteous Among the Nations.
A tree was planted at Yad Vashem in his honor for his heroism. His Kaunas home became a museum. He is commemorated yearly in Lithuania, and a street bears his name.
In 1991, the Ministry of Foreign Affairs formally apologized to Sugihara, but only his widow heard it. In 2000, the prime minister presented an honorary award to his family. Recognition came 45 years after his death.
Thanks to the 4,000–6,000 visas, about 20,000 survived the Holocaust, reaching Kobe before moving to other countries, including China, America, and Australia. None returned to Europe.
“Whoever saves a single soul saves the whole world.” The phrase originates from the Talmud, and it is also spoken in the film *Schindler’s List*.
He was a vice consul. He disobeyed orders.
He was a human being.
A documentary about his life is available online. Wikipedia also covers Sugihara’s life, usually accurately, though with minor errors.

How many realize that the so-called “era of terror”—the twelve harrowing years after the Nazi rise to power—overshadows a largely forgotten history: over twenty thousand people were saved from almost certain death? These survivors, and their descendants—some still alive today—witnessed firsthand the daring flight from Europe that gave them a future.

For individuals, history often feels intangible and mystical. Each day of our lives becomes history, though few know whether they will be remembered as victims, victors, or not at all — having simply lived and, if fortunate, survived.

This short essay will discuss why, at the end of the 1930s, the Chinese (Nationalist) government led by Chiang Kai-shek and the majority of its diplomats representing them in Europe, as well as tacitly many Japanese military leaders and a few diplomats, helped save thousands of German, Polish, Lithuanian, and Austrian Jews.

Each of them received entry permits to Shanghai or the Japanese city of Kobe, where they settled; most survived the war years and, after 1945, continued their daily lives in various countries around the world. (Most of the refugees in Kobe traveled on to Shanghai.)

Historians have shown that, in China, several Europeans—such as a French Jesuit priest and a German Nazi Party member—risked their lives to save hundreds of thousands of Chinese civilians from violence and death.

However, information remains scarce on the efforts, after 1939, by Jews from Lithuania, Poland, Germany, and Austria to escape Nazi expansion and reach safety.

The Western world turned its back on them.

However, the governments of these two East Asian countries treated Jews trying to flee Europe differently.

Although Japan was an ally of Germany, everything that the Germans used as justification for their racial laws—which initially mandated the extermination of Jews—was accepted in the official Japanese (political) perspective, albeit with the opposite intent.

Since Jews were skilled at “making money” and most of them were educated and trained, according to some experts in the Japanese government, this made Jewish refugees perfectly suitable for resettlement in the already colonized Manchuria (in the hundreds of thousands), because the architects of the Fugu Plan hoped this would ensure the economic revival of Manchuria.

(The name “Fugu” refers to a fish—the pufferfish—whose proper preparation requires a specialized degree; without it, consuming the fish causes instant death.)

Although the Fugu Plan did not materialize, some Japanese leaders hoped Jewish refugees would boost Manchuria’s economy, recalling financier Jacob Schiff’s key role in Japan’s earlier war effort through his bank’s loan in protest against tsarist pogroms.

China, however, had a different yet similar reason to Japan for taking in Jews fleeing Hitler’s Final Solution.

In China, the (in my view, racist) myth about Jews had long been prevalent, to the extent that “Jewish” was a constant epithet used by prominent Chinese thinkers.

Chinese leaders, believing Jews were educated and influential in the West, proposed resettling up to 100,000 European Jews in southwestern China. One such plan, supported by Einstein and an American Jewish banker, sought U.S. funding, but none was provided.

None of the plans succeeded because China received no funding from Western countries for this.

Thus, what remained was diplomacy and actions driven by individual courage, resulting in nearly 20,000 European Jews settling in Shanghai, as well as Jewish refugees who stayed for a time in Harbin (Manchuria) and Kobe and were provided with travel documents.

However, that is another story.

Katalin Ferber

Despite U.S. government assurances, the war launched by Israel and the United States against Iran on February 28 is escalating throughout the Middle East. The anticipated quick resolution has not materialized, as Iran is countering every attack, challenging prior American and Israeli expectations, and highlighting the central issue: Iran’s refusal to submit is prolonging and widening the conflict.

A consistent theme in current online articles and analyses is the war’s senselessness, its unpredictable and extensive regional damage, and the disconnect between actual events and U.S. government communications. The U.S. administration—excepting the Chairman of the Joint Chiefs of Staff—describes victory and strategic bombardments, but these claims contrast with Iran’s ongoing resistance, underlining the core argument about the war’s costs and futility.

According to publicly released data, the war has cost the Americans $16 billion in the past two weeks. In Iran, more than 1,500 people have lost their lives due to the bombings, and more than 700 in Lebanon. The number of Israeli casualties is “a few,” as no data is available due to total censorship.

Iran lost its religious leader, Khamenei; his son became the new ayatollah, but every member of his family also lost their lives.

In the first week of the war, Donald Trump and Netanyahu spoke of regime change as the war’s objective, but this has so far been unsuccessful. Although military experts warned the U.S. president repeatedly about the risks, Donald Trump did not heed their advice. He continues to speak of total surrender and successful attacks, even though two weeks have shown that Iran will not agree to a ceasefire and is attaching conditions to any potential peace agreement.

However, Iran cannot attack the United States directly, though it can strike U.S. military bases in Middle Eastern countries. The U.S. has been supplying missiles and other equipment to Ukraine for nearly three years. As a result, American military resources are running low—though this may seem unbelievable to the layperson. The war has escalated because Iran is continuously attacking oil refineries and U.S. bases in neighboring countries in response to bombings.

Why did Israel and America attack Iran?

Israel has regarded Iran’s regime as an existential threat for decades. According to Zionist government officials, Iran must be changed in some way. In the event of a military victory, its territory must be carved up. For the U.S. as well, Iran is synonymous with a terrorist state. The Iranian masses must replace the current religious leaders and be supported in establishing a democratic system. However, there is no known plan as of yet. Peter Hegseth, the U.S. Secretary of Defense, has not addressed how to “get rid of” the current oppressive regime in Iran.

Experts say that about 25 years ago, the U.S. told Israel to deal with Iran. More recently, U.S. plans have included replacing Iran’s leaders and trying to make Iran a democracy. This has been a central part of U.S. foreign policy.

As early as 2009, a detailed collection of studies was published by researchers at one of America’s most prestigious think tanks, whose fifth chapter is titled: “Trust Bibi: Should We Allow or Encourage an Attack on Iran?” Link to the study: file:///Users/katalinferber/Desktop/Substack%20related/06_iran_strategy.pdf

Title of the study: WHICH PATH TO PERSIA? Options for a New American Strategy toward Iran. (In Hungarian: Which Path Should Persia Take? Options for a New American Strategy toward Iran. June 2009) In other words, regime change in Iran was a key element of U.S. foreign policy in 2009.

Even the average reader is well acquainted with the export of democracy, a common refrain during the U.S. Cold War era. This led to decades of resistance in many countries, which later exploded in the so-called boomerang effect. While the author does not find any form of terrorism acceptable, it is easy to see this boomerang effect—called “blowback” by the CIA—not only fueled anti-American sentiment but also the terrorist attacks against America on September 11, 2001. (Chalmers Johnson first wrote about this in his book *Blowback*.)

Terrorism, however, is the ultimate, extreme—because desperate—response to systems that have been forcibly changed in individual countries. The export of the American democracy has, in fact, failed miserably.

The countries of the Middle East, which almost without exception supply the oil and gas needs, are in a somewhat different situation. Since the oil crisis of the 1970s, oil-exporting countries have been among the most important pillars in maintaining the U.S. dollar. (This has been shaken by the current war, as well as by the alternative payment system established among the BRICS countries.)

Iran is the only oil-producing country that has left the U.S. oil alliance in the Middle East. Some disagree, but when the CIA and British intelligence helped remove Iran’s elected president in 1953 and put Reza Pahlavi in power, this was not a good example of spreading democracy.

In 1979, a religious group within Iranian society overthrew the Shah’s rule. They summoned Ayatollah Khomeini—who had been living in exile in Paris—back to the country. Under his leadership, an Islamic (Shia) state structure and its institutions were established. Iran possesses the world’s third-largest oil reserves. Last December, it was revealed that Iran holds the world’s largest gold reserves (53.1 million tons). With the Islamic Revolution, Iran broke away from its neighbors and aligned with the United States. The 2003 invasion of Iraq and its “regime change” remain one of the greatest failures of American foreign policy to this day.

Iran, or Persian civilization, is more than four thousand years old. Its territory includes the Strait of Hormuz. One-fifth of the world’s oil supply passes through this waterway in tankers—or did, until the Iranian leadership closed it on the fourth day of the war. The Western response has been to mobilize emergency reserves and to trigger an explosive rise in oil prices, with resulting economic and social consequences.

Iran has disrupted the world economy’s core functions. While this article was being written, it was reported that Chinese and Indian tankers would be allowed through the Strait of Hormuz.

For Israel, the dismantling of Iran’s current political system is indispensable. Many analysts believe Israel needs this to neutralize the Palestinian population in Gaza and the West Bank. Other authors attribute it to Israel’s territorial expansion plans—the so-called “Greater Israel.”

Iran has suffered severe losses for at least four decades due to financial, economic, and military sanctions. Ninety percent of its oil exports go to China, but this makes up only 13.5 percent of China’s total oil imports. China, incidentally, has oil reserves sufficient for 100 days.

From the preceding analysis, it is clear that neither Iran’s nuclear program nor its support for Hezbollah or the Houthis was the main reason for the recent attack. The evidence points to a broader strategy: Israel and the United States are targeting Iran because its policies and alliances obstruct their regional and global objectives.

Iran’s obstruction is significant for both regional and strategic reasons. It stands in direct opposition to the goals outlined by American experts in the Pax Silica document, endorsed by several Middle Eastern governments, emphasizing the central argument that Iran blocks U.S. and Israeli visions for the Middle East.

On the other hand, Iran, seeking a way out of the sanctions imposed on the country for decades, has begun implementing multifaceted investment, financial, and arms programs with China.

Pax Silica

Its author is Jacob Helberg (American-French), a state secretary for economic affairs and advisor to Alex Karp, one of the leaders of Palantir, a giant artificial intelligence company.

The proposal was created to secure the supply chains for artificial intelligence, rare earth metals, and computer chips. Its founding members are Australia, Israel, Japan, South Korea, Singapore, the United Kingdom, Qatar, the United Arab Emirates, and India.

From the brief overview above, it is clear that all of this was created to reduce dependence on China and to halt the spread of Chinese artificial intelligence. The Pax Silica envisioned by Donald Trump, depicted on a map:

China and Iran

In two previous articles, I described in detail Iran’s investment agreement with China, one of the outcomes of which has already been realized: the railway line connecting Iran to China.

However, this is only a fraction of all the military and IT assistance that the Iranian leadership receives from China.

Here is one of the key components Iran receives from China for its missiles:

Iran manufactures missiles at a fraction of the cost compared to American or Israeli missiles.

To illustrate one of the sanctions that have been in place against Iran for decades, the following graph is worth noting. In fact, ninety (!) percent of Iranian oil exports are destined for China

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The most important chart, given the ongoing war against Iran, is the Chinese missile manufacturing program, thanks to which Iran is currently capable of responding to any attack against its country.

Source: Zineb Riboua: Beyond Ideology, as well as this author: Iran Under China’s Protective Wing.

As this text was being finalized, news arrived from multiple reliable sources that the Iranian leadership will allow oil tankers to pass through if the buyer pays in yuan.

This decision underscores the core argument: Iran’s actions, particularly in the context of the war and the shifting economic landscape, reflect its resistance to foreign pressure and its determination to carve an independent path, challenging U.S. and Israeli ambitions in the region.

evidence than this that the Israeli-American war against Iran is, in all likelihood, America’s last attempt to save the American economic, financial, and military hegemony, of which not even a fraction remains functional today.

The consequences of the war’s escalation are incalculable.

And Iran remains unwilling to submit. As one Iranian university professor put it, the world can now see that there is no need to submit to an imperialist country—that is, America.

Katalin Ferber

Berlin

Do you remember where we met? It was in Tokyo’s largest bookstore—a vibrant maze of endless shelves—where we found refuge together on weekends, long before Amazon changed the world. Those moments felt like our own secret ritual, a comforting constant in a city that never stood still.
I couldn’t reach a book on the highest shelf, and you reached up to help me. Our hands brushed, and we shared a smile that felt charged with possibility. You introduced yourself, but for the sake of both our memories, I will keep your name safe in my heart.
Of course, we had seen each other many times before our “meeting” in the bookstore, and I knew that we didn’t live far from each other, which is a miracle, or rather, a stroke of luck in the capital.
We walked home together that Saturday, and we were both happy that we lived only a ten-minute walk apart.
We often met in the mornings, waiting for the same Japanese city train, and I still remember when one of the railway employees stared at you for a long time at the station, then carefully searched through all the trash cans on the platform, wearing white gloves.
You didn’t hide a bomb in any of them.
Slowly, it became clear who you really were. A philosopher, an internationally renowned aesthetician, and the founder of a progressive magazine, you were invited by a Japanese university,and you accepted the invitation. By the time we met, you had already been living in the capital for many years.
You established a doctoral school, and diplomats and former foreign ministers gave exciting lectures at one of your seminar series. I believe your activities were known not only in Tokyo but also elsewhere.
I once attended one of your lectures. The largest lecture hall was filled to capacity, and the first sentence of your lecture was from Martin Luther King: I have a dream.
You couldn’t help but be a tolerant, equality-seeking classic intellectual. I knew you spoke many languages (you even learned Japanese), and when you stopped by our place one evening on your way home, I jokingly asked if you were homesick. With a charming smile, you asked me back: which home should I miss? Then you told me that your parents emigrated to Canada with your eight siblings in the early 1970s. You grew up there, then, with your parents’ consent, you went to Europe to continue your studies at university. You graduated from the Sorbonne in Paris and were the last student of the internationally renowned philosopher Foucault. You didn’t think your knowledge was sufficient. You left Paris for Heidelberg, Germany, where you earned a doctorate in philosophy.
I was proud of our friendship—it was a rare and precious gift in my life. When you got divorced, I felt your pain as if it were my own. Even though you saw your little girl every week, the ache of separation lingered, and I watched you search bravely for happiness, hoping you would find it again.
She was your student at work, but you waited until she graduated to start planning your future together. Your rings were made by one of my jewelry designer friends in Budapest.
I could see how happy you were, and a year later, your little boy was born, the doctoral school gained national recognition, and it all seemed like an unrealistically perfect life.
It was time for you to take a sabbatical, you could travel with your little boy, and you spent a whole year at a university in London.
Six months later, you called me from Tokyo.
You came to see us that evening. You told us that while you were on creative leave (during which, according to university rules, you receive your salary from your place of work, i.e., Tokyo), your salary had not arrived. You were there with your wife and a small child, and then the next time, you were left without an income.
It turned out that during your absence, the university’s top management had initiated disciplinary proceedings against you, which were conducted and concluded in your absence. Your crime, allegedly, is that after a dinner with your students, you tried to kiss one of them.
The evidence for this was the student’s testimony.
You showed us both the cover of Japan’s most popular magazine, which featured a long article about your terrible deed under the headline “Iranian tries to molest Japanese schoolgirl.”
Other weekly and daily newspapers quickly picked up the story, and within a week, the press campaign turned it into a nationally known “scandal.”
I came back to Tokyo to talk to my lawyer. The university will lose the lawsuit filed against it, and of course, I am doing everything in my power to defend my honor.
We met once more: that was when we said goodbye to you for good. You asked me not to ask for your contact details. You asked me not to email you. You indirectly indicated that you were going to Iran with your wife and young son because “important things are happening there now,” and I must do everything I can to bring about positive change in my former homeland.
I don’t know where you live now. I hold onto hope that you are alive, even though the silence between us has stretched for a quarter of a century. Sometimes, I close my eyes and picture your little boy—now a grown man—wondering what dreams he carries, and if he remembers the laughter we once shared.
I’m sure your wife speaks Persian very well.
Perhaps you even have grandchildren now. I miss you deeply—more than words can ever express. But I know, wherever you are, you still carry a dream close to your heart. Your spirit shining brightly, unchanged by time or distance.
Katalin Ferber

Seventh: Iran

After September 11, 2001, as retired General Wesley Clark publicly stated years later, the Pentagon recommended in a secret document that the then US president “take out” the regimes of seven countries. These were Iraq, Syria, Lebanon, Libya, Somalia, Sudan, and Iran. In other words, this has been more or less successful in the other countries over the past two decades, but not yet in Iran.
The following summary describes the background to the coordinated attack by the US and Israel against Iran on February 28. A few hours after the attack, an American journalist bitterly remarked that US President Donald Trump had probably grown tired of the negotiations with the Iranian delegation and therefore decided to launch the attack. However, this is contradicted by the fact that US naval and ground forces had already appeared near Iran weeks earlier.
Before the article, the author makes an important note that it is not his job to evaluate the Iranian system as a whole. However, presenting the facts is essential to assess not only the events in Iran but also the possible consequences of the spread of war in the Middle East.
Iran currently has a population more than 93 million and an area of 1,648 million square kilometers. The average age of its population is 34.5 years, and the country’s urbanization rate is 73.5 percent. Sixty percent of Iranians are 39 years old.
Between 90 and 95 percent of Iran’s population is followers of Shi’ism, a branch of Islam. Outside Iran, Shi’ites make up more than 50 percent of the population in Azerbaijan, Bahrain, and Iraq. (Iran shares a border with Azerbaijan.) Nearly 85 percent of the world’s Muslim population is Sunni. The Shiite and Sunni branches of Islam differ in a few important ways. While Sunnis are relatively flexible in their approach to political organization, the Shiite religious movement insists on a political system based on the Koran, which has a hierarchical structure headed by the highest authority, the ayatollah. In 1979, Iran based its new constitution on the principles and text of the Koran. (This was slightly amended in 1989.)
June 13, 2025
“Knowledge cannot be bombed.” (Mehdi Mohammadi, advisor to the speaker of the Iranian parliament.)
Midnight Hammer Operation was the name given to the attack carried out on the night of Saturday, June 13, last year, against three Iranian nuclear centers. B-2 bunker bombers were tasked with destroying the underground facilities, with 12 bombers carrying out the mission.
The head of the US government, President Donald Trump, did not listen to the reports of his own national security agencies, which were based on serious assessments, but to the opinion of Israeli Prime Minister Netanyahu. Iran did not and does not have a nuclear bomb, but according to Donald Trump (and Netanyahu), 60 percent enriched uranium makes Iran capable of manufacturing nuclear weapons.
According to Trump and Netanyahu, the series of actions was great, i.e., successful. The reality is the opposite. In the week preceding the American bombing, all three nuclear facilities were evacuated, and according to the head of the IAEA (International Atomic Energy Agency), 400 kilograms of uranium “disappeared” in Iran. (It did not disappear; it was simply transferred to another location or locations.)

February 28, 2026
The operation is called Roaring Lion.
The bombing of Iran has begun with American-Israeli cooperation. Weeks earlier, the US sent one of its largest warships to the region. However, numerous military assets are “in place,” as shown on the map below.
Th Thanks to Ben Norton, author of the Geopolitical Economy Report, for sharing the map.

Donald Trump promised Iran “regime change.”

However, the United States has not succeeded in doing so in the past seven decades.
Korea: the fate of the divided country has not been settled to this day. Vietnam (a 20-year war) won against the US. The attack on Iraq was based on similar “logic” to that used against Iran, because the US government, led by President Bush Jr., claimed at a UN meeting that Iraq possessed weapons of mass destruction, and therefore the attack on Iraq was a “preventive” action. Tony Blair, the British Prime Minister at the time, repeated the American claim, even though it was not true. Terrible destruction took place in Iraq, and Saddam Hussein’s regime was replaced by almost constant civil war, inflation, and, incidentally, the complete looting of most of Iraq’s museums. Despite hundreds of thousands of victims and the emigration of millions, Iraq does not have an American-style democracy today.
Afghanistan: the American military occupation and the overthrow of the Taliban government have had only temporary results. The imagined “regime change” collapsed within days, and today the Taliban-led government and its institutions have more influence than they did before the American occupation. It is unnecessary to list the enormous financial losses and hundreds of thousands of lives that have proven that American imperial ambitions have so far been a complete failure.

In 1953, with the help of the CIA and British intelligence, the democratically elected government (led by Prime Minister Mohammad Mossadegh) was overthrown because it wanted to nationalize oil production. The joint action of the US and Great Britain led to a coup d’état, and the new leader became Shah Mohammed Reza Pahlavi. The SAVAK, the Shah’s secret service (which the CIA actively helped to establish), arrested, tortured, and imprisoned thousands of people.
This system was replaced by Khomeini and the masses of rebels in 1979, who occupied the American embassy in Tehran and changed the system.
The entire political and institutional system is based on the Shiite Islamic religion, based on the Koran in the text of the constitution (this was slightly modified in 1989).)The theocratic system, i.e., the merging of the state and Islamic religious institutions, is considered by most Western analysts to be backward, archaic, semi-feudal, and incompatible with the requirements of modernization, i.e., development.
What the “developed” part of the world knows about Iran is the oppression of women, the strict dress code that everyone (i.e., women) is required to follow, and the imprisonment of women for violating these rules. Donald Trump, and other Western leaders call Iran a terrorist state.
None of the news reports or longer analyses consider it important to mention that one part of the Koran’s rules places great value on education, so it is perhaps no coincidence that 60 percent of Iranian women have a university degree while wearing the hijab.
Iran loses 30-40 percent of its national income annually due to American and Western economic and financial sanctions. Various forms of sanctions have been in place for nearly two decades, including a severe speculative attack on the Iranian currency. (This is partly the reason for the rapid devaluation of the Iranian currency and inflation.)
The fact that the Iranian economy has continued to function despite all this is partly due to a conscious policy of autarky, or, as a Tehran university professor calls it, a policy of resistance (Setareh Sadeqi, professor at the University of Tehran, 2026, February 13), as well as the economic strategy agreement signed with China in 2021.
As a result, the closure of the Strait of Hormuz (which occurred shortly after the second attack on Iran) does not affect Iranian oil exports, because Iran has established a railway line to China that reaches its destination in 15 days, instead of the 40 days it takes by sea.
On June 1 last year, the first freight train left China’s Xinjiang province (from the city of Urumqi) for Tehran. The journey takes only 15 days (compared to 40 days via the Strait of Hormuz) and runs along the Strait of Malacca. This can be summarized by the conclusion that if the Strait of Hormuz, through which tankers carrying one-fifth of the world’s oil needs pass, would, in the event of its closure, provide Iran (and China) with unimpeded access to the new rail transport needs of all countries directly or indirectly involved in trade with the BRICS Plus member states.
The new China-Iran land-based rail transport, which China is implementing as part of its Belt and Road Initiative (BRI), effectively neutralizes US control over transport routes and a significant portion of the trade (transport) sanctions imposed by the US.
The railway line is 4,000 kilometers long, connecting the city of Yiwu (Zhejiang province) with Qoom in Iran, then passing through Kazakhstan and Turkmenistan. There are still a number of technical problems to be solved with the railway line, but it is literally vital for Iran because it avoids both straits. Since 90 percent of Iranian oil exports go to China, rail transport allows the country to bypass all the traditional sea routes controlled by the US. In addition, Iran will thus connect Europe with Asia.
Iran and China signed a 25-year strategic partnership agreement in 2021. Under the agreement, China will invest $400 billion in infrastructure, energy, and technology in Iran. Construction of the Iranian section of the freight train network, launched on June 1, was carried out in accordance with this agreement and partly financed by the China Development Bank, the Export-Import Bank, and the China Railway Construction Corporation. (Geopolitiq, June 2025.)

The violent regime change in Iran, which the US president calls the only and greatest opportunity for Iranian society to take back its country, began with a wave of protests in Iran last November. (According to authors of news sources that consider themselves independent, including Iranian doctors, the protests are also due to the activities of serious CIA agents.) The mass protests in the second week of January, which spread to 400 towns across the country, were bloodily suppressed by the Iranian armed state forces. According to the Iranian International Editorial Office, the death toll exceeded 36,500. (Western estimates put the figure at one-tenth of that.)
However, despite all this, regime change is doubtful, as Iran, the heir to 5,000 years of Persian culture, does not consider martyrdom a “loss” due to its religious values. The killing of (former) Ayatollah Khomeini (and his bodyguards) was a martyr’s death, which was followed by the appointment of an interim ayatollah barely 24 hours after the bombing of Iran.
Iran is not merely a backward, semi-feudal country living according to the principles of the Koran. Its independence is based on millennia-old traditions, so the anti-Americanism (and success) of the 1979 Islamic Revolution is a direct consequence of Iran’s history. Martyrdom is not merely a loss according to Shiite traditions and values, but an event that strengthens social cohesion. (Kautilya, the Contemplator. Substack.)
Finally, instead of estimates and predictions, here is a single observation confirmed by several observers. A second attack on Iran would primarily fulfill Netanyahu’s long-standing demand.
Donald Trump can easily be blackmailed with materials in the possession of the Israeli secret service, which have not yet been made public in America. (The materials relate to the activities of the late Jeffrey Epstein, a billionaire adventurer.)
Katalin Ferber
Berlin

Sleepwalkers II

He who has the gold rules

The previous section provided a brief overview of the changed strategic relationship between the US and the EU and its consequences for EU member states.

The second part, precisely as a consequence of US domestic and international indebtedness, analyzes the financial situation of the United States in recent months, whether the tariffs imposed on other countries will change this, and whether we are indeed close to a “capital war,” a concept coined by Ray Dalio, the owner of the world’s largest hedge fund, and which I discovered thanks to Tanvi Ratna’s series of articles.

The essence of this concept is that if geopolitical realignment begins, and it has already begun (EU-US, the exclusive hegemony of the US in the Western hemisphere, as formulated in the new national security strategy). Domestic social realignment begins in the countries concerned; a capital war will break out, the winners and losers of which are not yet known. This does not necessarily require a war, although two are already underway; it is enough that the restoration of the former, but now shaken, American hegemonic position will trigger the use of many unprecedented methods.

In short, the war for capital means a fiscal, trade, and investment war in which the most economically (technologically) advanced countries are participating, and it is not a “zero-sum game,” meaning that some will lose and some will win. If readers are interested, please read Tanvi Ratna’s five-part essay on capital war.

___________-

AN ERA HAS COME TO AN END

Although only two months have passed, the year began with American action in Venezuela, the future acquisition of Greenland, a “solution” that has been floating around to this day, and to the layman, all this seems like a brainstorming session, a flood of improvisations, but behind it all, serious economic, financial, and geopolitical realignments are taking place.

The first news of the year was that China had crossed a threshold: in 2025, its export surplus exceeded $1 trillion. More than a third of this came from products exported to the EU market. The total value of Chinese exports was 3.77 trillion US dollars.

All this was accompanied by the introduction of continuous, often changing US tariffs, so the Chinese economy suffered minimal losses. The Chinese economy grew by 4.5 percent in the same year. (See Ratna.)

However, exports do not come for free, meaning that huge amounts of money flow back into the Chinese economy. In 2026, the Chinese Foreign Exchange Authority, under the direct control of the Chinese central bank, revised its foreign exchange policy by introducing a currency basket. This new currency basket reduced the weight of Western currencies and replaced them with the currencies of China’s most important trading partners. (See the BRICS countries and their contracted partners.)

Thanks to the Belt and Road Initiative (BRICS), the US dollar and the euro have a lower weight in the currency basket, as countries in Asia and Africa are becoming increasingly important trading partners for the Chinese economy. This payment system frees individual countries from the exchange-rate fluctuations of both Western currencies by enabling regional payments. The currency of East Asia’s leading economy is the Japanese yen, which has become a “competitor” to the Chinese yuan in the region, because the yuan offers predictability and stability across Asia and Africa. In contrast, the Japanese yen is closely aligned with the US dollar and represents the strategic alliance of the United States.

Based on this, most economists argue that it is precisely because of China’s dynamic trade surplus growth that the US dollar’s former role as a key currency has been shaken, and that the Chinese currency, the yuan, will soon take over this role.

However, this is not the case, because China is not directly seeking to weaken the dollar’s dominant role; rather, it is a different kind of monetary policy that characterizes the strategy of the Chinese central bank and the quasi-state giant banks.

In addition to the currency and foreign exchange basket, China is rapidly divesting itself of US government bonds. In the past six months, the Chinese central bank has sold almost a third of the government securities in its portfolio. Similar to Japan’s financial strategy almost half a century ago, this tool is quick and effective, and it is no coincidence that a few months ago, Donald Trump withdrew his previously announced, completely unrealistic tariff measures threatening China. (About this

The US is forced to use all previously unimaginable economic and financial policy tools against China.

The first part of this article discussed how America only supported (or allowed) the economic development and growth of Germany and Japan, the two most technologically advanced countries that lost World War II, as long as it did not threaten its own position in the global economy.

Japan had been threatening this position since the late 1960s, and within a decade, South Korea, Singapore, and Taiwan had joined the fray. Then, in the first decade of the 21st century, as China’s economic and financial rise accelerated, the US government realized the threat was coming from the Chinese economy. Due to its fundamentally different political and economic institutions, China cannot be won over as an ally of the “West.” The US cannot even use a partial amount of China’s capital accumulation to finance its budget deficit. Nevertheless, the growing Chinese exports to the US itself cause a growing American budget deficit. For half a century, Japan, the US’s most important military ally in East Asia, willingly financed American consumption on extremely favorable terms.

Almost a century and a half ago (in the 1880s), Japan established an institution to encourage savings among the low-income population, the Postal Savings Bank, which paid (very low) interest even if the depositor used some of the money in their account. Savings were tax-free, and by the middle of the 20th century (the 1970s), there were more postal savings accounts than there were people in Japan.

These savings were placed in a separate (secret) fund managed by the Minister of Finance, and it was thanks to this “second budget” that Japan’s industrial development and infrastructure investment program was realized. Thanks to its export surplus and extremely low interest rates (0.7-1 percent), foreign investors, including the US government, were able to obtain Japanese loans at extremely low cost, which they then “converted” into more profitable investments. In the 1970s, Japan’s savings still amounted to 40 percent of its annual national product. Today, this figure is only 30 percent, and neighboring Singapore and South Korea (both former Japanese colonies) boast higher household savings thanks to institutions similar to those in Japan. However, unsurprisingly, the region’s biggest saver is China, where household savings account for almost half of the annual GDP.

Thanks to its new prime minister (as briefly mentioned in the first part of this article), Japan has broken with its half-century-long policy of “cheap money for foreign investors.”

Japan is currently struggling with the world’s largest public deficit (230 percent of annual national product), it needs to arm itself (because the US dictates this to the Japanese government), and it needs to reduce food inflation to maintain social peace, as it is untenable that the price of rice has risen by 100 percent.

The US has therefore lost its former stable financier, Japan, for a long time, or perhaps permanently. Despite all this, the Japanese central bank is the largest holder of US government bonds in East Asia. (South Korea is second in the region.)

So we are faced with a new “financial map.”

Within Asia, there is competition between the Chinese and Japanese currencies, the declining role of the US dollar in the region, and the growing dependence of the euro on both the yuan and the US dollar.

The “hidden” financial hegemony of the US

In December and January, a “gold and silver rush” began on the international financial markets, which subsided by the end of January. The market prices of gold and silver rose significantly, and many stock market experts described this as capital flight, i.e., a loss of confidence in currencies. However, as so often before, America posted huge profits thanks to the rise in gold prices. The US currently has the world’s largest gold reserves, with 76 percent of the Fed’s (central bank) reserves held in gold. (By comparison, the Chinese central bank holds only 5 percent, and Japan 4 percent.)

All this seems like accounting sophistry, but the US dollar currently plays a dominant role thanks to these gold reserves.

Therefore, financial experts can interpret (as Dalio, Ratna, and others do) that the dollar-based international payment system as a whole is institutional, i.e., it is not identical with the American means of payment, but rather reflects confidence in the financial system as a whole.

This, then, is the background to the looming capital war. The US government is trying to use all available financial and economic means to push the Chinese economy’s international activities into the background. China has created a regional currency and foreign-exchange system that bypasses the Western (American) SWIFT payment system. After half a century, Japan has quickly stopped feeding the American market with cheap capital. Currently, the euro and the US dollar play a significantly smaller role in investment and foreign trade within Asia than they did five years ago. Financial competition between China and Japan is therefore inevitable, as Japan cannot end its dependence on US foreign policy, and its status as a client state remains unchanged.

Any threats and blackmail involving customs tariffs only intensify the capital war being waged for the redivision of the continents.

Katalin Ferber

Berlin

Sleepwalkers I.
Relations between the EU and the US.
Unusual introduction
This brief, two-part summary, although available in Hungarian, does not address the foreign policy approach of the Orbán-led regime, as this is not its purpose. Nor does it, even indirectly, with the now- comprehensive FIDESZ propaganda in Hungary, nor does it even indirectly touch on current political and economic events in Hungary. The sole reason for this is that it is not the author’s task to describe and evaluate these issues.
While the American media, the Senate, and its committees are spending significant time on various parts of the Jeffrey Epstein materials that the American government made public a few days ago, as this writing is nearing completion, all the files are now available to the public. Even though only half of the materials available to anyone have been released by the authorities, in Europe, without much fanfare, EU member states have begun to adapt to a new division of labor. The statements made so far at the Munich Security Conference make it clear that the European NATO member states ( except Hungary and Slovakia) are committed to defending Ukraine to the bitter end. (When this war will end remains to be seen.) It is extremely important to note that US Vice President J.D. Vance canceled his participation in the conference. Still, Marco Rubio (Secretary of State) is present, and anyone can view his speech on YouTube.
The first part of this article examines the current situation and “strategy” of the EU. The second part examines the financial background that led the US to change its foreign policy strategy. I agree with some experts that the new tasks and America ‘s fiscal and monetary situation are directly related.

The EU’s new tasks
Over the next few years, the European Union will be forced to adapt to the US’s new foreign policy strategy. This is not a question of breaking ties, as that would result in serious economic and financial losses for both regions. The EU will be forced to accept a subordinate role in the Western camp, firstly because, with the except France, none of the member states has significant defense capabilities, meaning that all of NATO’s European member states are dependent on America, and on the other hand because, since the outbreak of the Russian-Ukrainian war, the European Union’s most important task has been to defend itself against Russia, which is synonymous with providing massive financial, economic, and military support to Ukraine.
A foreign policy expert calls this the Ukrainization of Europe.
The question, however, is how the EU as a whole can fulfill all the tasks imposed on it by the US, given that the expansion and modernization of its own military industry depends not only on America but also on China. The purpose of this article is to highlight that the US has made the EU as a whole a subordinate player to successfully combat China’s competitive economy and military potential, which it sees as a threat. However, this may not take the form of military warfare against China. Still, it is unavoidable that the US tries to regain economic and financial hegemony in the world economy.
The figure below, taken from Ryan Perkins’ website, clearly shows that the US and the EU are inseparable thanks to working capital investments. Although the figure does not show this, the US dollar is therefore the most important element in the functioning of the euro currency. As shown below, we are witnessing a further strengthening of the dollar’s role, i.e., a deeper dependence on the EU than before.
Despite all the rhetoric and propaganda about “diverse democracy,” the EU has been forced to arm itself independently (although in terms of technology, this depends on imports from the US and China) and has been forced into significant debt. Just think of the recent €800 million “loan” to Ukraine or the lifting of the previous ban on budget deficits in Germany. In other words, it is now solely the EU’s responsibility to defend the continent from Russian aggression and support Ukraine (which partly means purchasing and paying for American military equipment). And all of this is an important part of American strategy. The EU as a whole has lost its sovereignty, and what remains is limited autonomy. The two are not the same.

Over the past six months, there have been numerous signs that a completely new division of labor is emerging among EU member states, because this is the only way to meet the requirements of the US’s changed foreign economic and foreign policy strategy. One of the most important elements of this is that the “agreement” on customs tariffs signed last summer is a defeat for the EU, as it forces all leading EU companies to relocate a large part of their activities to America. (One example of this is Mercedes’ battery production.) If leading companies do not do so, they will face significant cost increases and thus declining revenues. The primary goal of US customs tariffs is therefore not to increase budget revenues, but to reduce the competitiveness of former European and East Asian competitors, enabling US companies to regain their former leading positions in the global market.
In this respect, shifting the entire cost of the Russian-Ukrainian war to the EU—since the EU pays for all US military products and then sends them to the Ukrainian front—is one of the US government’s tools for profiting financially from this war without participating in it. From a strategic point of view, however, since these are NATO member states, the US exercises constant control over the escalation of the war and temporary ceasefires. (There have been many in the past year.) All of the previous “peace talks” have failed. The war continues, claiming thousands of lives.
There are two reasons for this. One is that the Russian government believed for too long in a negotiated settlement, even though all of them served merely to buy time. (Minsk I, Minsk II). There were negotiations in Istanbul, which were thwarted by the former Prime Minister of the United Kingdom (Boris Johnson). Two NATO member states, the founding member USA and the United Kingdom, agreed that bleeding Russia dry was the most important thing.
Ukraine is a tool for this, which the EU leadership has accepted, and by throwing away the EU’s former principles enshrined in law, it has perpetuated the state of financial and economic emergency.
It is a sad fact that the current EU leadership is incapable of doing more than this. Russia will attack the Baltic states and regain control of most of Eastern Europe – these are just two quotes from the EU’s four years of propaganda. It is irrelevant that Russia is incapable of doing this unless it resorts to nuclear weapons. The latter has also lost its former weight in Europe: it is as if Hiroshima and Nagasaki had never happened, as if there had been no Cuban crisis.
Four years after the outbreak of war, the EU has no choice but to lift its previous restrictions on public debt, engage in open armament, grant Ukraine permanent and increasing loans (which will never be repaid), and face the social, financial, and economic consequences of this. There are no longer any conditions attached to EU membership, as Ukraine’s membership is almost certain. The serious economic and financial damage this will cause to other EU member states is no longer an issue.

It is worth noting the most important of the sanctions initiated by the US against Russia over the past four years: the complete cessation of Russian oil and gas imports. This has resulted in a sharp increase in US liquefied gas exports and financial bleeding for EU member states, primarily Germany, as US gas imports are significantly more expensive than Russian ones. Still, the construction of receiving stations also involves considerable costs.
It is quite clear that the essence of the new division of labor within the EU is to reduce industrial production in the three (previously strongest) economies and to relocate part of it to the US market and part to Central and Eastern European countries. The latter is due to lower production costs and significant financial support from the receiving countries.
It is therefore easy to understand that Germany, like Japan (albeit at different times), has lost its leading role in the global economy and within the European Union. After World War II, the US-led stabilization of both countries was an essential condition not only for the stabilization of their own regions but also for the creation of American export markets. The competitiveness of Japan and other East Asian countries was undermined in the 1980s (in Japan`s case, by the Plaza Accord) and in 1997 by coordinated financial attacks by American hedge funds on East and Southeast Asian countries. Both were successful, if you will. Japan has been stagnating for the past three decades and is finding it increasingly difficult to compete with products from competitive Chinese sectors. It is no coincidence that Southeast Asian countries can defend themselves against the US’s drastically changed foreign economic strategy by joining the Belt and Road Initiative. In the case of East Asia, however (as in the EU), there is no question of a “break” with America, as Japan, South Korea, and Taiwan are host to US military bases. For America, except China, this region is no longer important because it needs to restore its monopoly position in the Western hemisphere.
Germany was the first to bear the brunt of the 2008 financial crisis, which originated in the US economy, along with the other EU member states. Over the past half-decade, the German economy shifted from industrial production to the financial sector. It was this process that ended the “golden age” of the German economy. Perhaps one of the obvious consequences of this was the election (by a majority vote) of Friedrich Merz as chancellor, who was one of the leaders of the Blackrock multinational corporation for many years and treats the entire German economy with a “corporate” approach. Longer working hours, fewer social benefits, privatization of some services, and, of course, profit-based operation.
After 1945, the US foreign economic strategy was similar in both regions: to support the recovery, economic rebirth, and competitiveness of individual countries (Germany, Japan), but to quickly end this if it threatened the competitiveness of the US economy as a whole.
Tariffs affect Japan and its neighbors just as much as they affect the EU. Although it is a paradoxical phenomenon, Japan’s response (thanks to its new ultra-conservative female prime minister) soon arrived. After almost seven decades, the island nation ended its “cheap money,” “cheap investments-significant profits” monetary policy. Not only did it start selling bonds issued to cover the US budget deficit, but it also significantly reduced the previously extremely favorable conditions for US financial investors.
This is a significant loss for US public finances (and investors), and it is partially offset by EU member states, as the overview above shows.
This summary continues with an analysis of the US financial strategy, i.e., the position of the US dollar and its invisible but successful competitor, the Chinese currency, the yuan (renminbi).
Katalin Ferber
Berlin

A colleague introduced me to him. We immediately hit it off, so much so that he invited me to his home. He had only been working at the university for a few months, and everyone spoke of him with admiration.

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I sat in the kitchen while she made dinner for us—one of her favorite dishes. I had never eaten Mongolian food before, and I really enjoyed it because it reminded me of our Hungarian stuffed cabbage, only tastier and lighter.

Let’s listen to some music, she said with a smile, I’d play you some from home, but I can’t listen to it without crying.

It was at her place that I heard throat singing for the first time in my life. It is thanks to her that, almost two decades later, I never miss it when Mongolian throat singers come to Berlin to perform every year. I listen to them and think of her, my (former) Mongolian girlfriend. -

I looked at her and thought how beautiful she was. She was slender, natural, every movement was perfect, she had a great sense of humor, but there was sadness lurking in her eyes.

I thought she was maybe three years younger than me, but during our conversation, it turned out she was ten years younger.

My father had 501 sheep, and when a relative asked him why he had so many, he replied that one (it is not known which one) was a gift for the wolves.

There are five of us siblings, and my father was determined that we should all go to college. To this day, I don’t know why he was so determined, even though my mother was worrying about us, but my father always said that if our children studied, they would have not only a different life, but a much better life than ours.

I was born third, and my two older siblings were already in high school when my parents sent me to one of the elementary schools. There was only one stove in the dormitory, and ten of us slept there. I think our body heat was stronger than that of the stove. In the morning, we woke up to find that we couldn’t even wash our hands in the basin because the water had frozen in it.

Minus 35 in winter, plus 40 in summer. That’s where I come from. It was hard for me not to be at home, but I knew I had no other choice but to study.

I graduated two years earlier than my classmates. I moved even further away from my family and attended one of the best universities, but I graduated after three years instead of five. Beijing was a truly “cosmopolitan” place, and there I experienced almost everything I had never experienced before. I lived in a dormitory there too, but there was heating and and hot water, and I didn’t really need anything else, because there were libraries, which were more than enough for me.

Perhaps few people in Europe know this, but Inner Mongolia is a beautiful place. That’s where I got used to walking and later cycling. The endless landscape there is unlike anything else. And the wind.... and its sound...

I had two native languages as a child, Mongolian and Chinese, and I quickly learned English at university. After graduating from Chinese university, I applied to the university in Bonn because I already knew Japanese quite well at that point, and that’s where I got my doctorate. I was awarded my doctorate younger than all my classmates.

Before I left for Bonn, I needed a passport, but I only had one name because where I grew up, everyone only had a family name. Two names had to be entered in the passport, so I chose a name, and the official entered it in my passport. It’s a beautiful name, isn’t it? And I eagerly agreed, because the name Narangoa is indeed very beautiful.

That’s how I became Nara (everyone calls me that), I love my first name, and how nice it is that my nickname is the same as the small town near Kyoto, which many people think is even more beautiful than Kyoto itself. I noted that I like Nara much better than Kyoto.

I had my doctorate, applied for jobs, and was hired almost immediately in Copenhagen, where there is a famous Asian research institute.

I felt very comfortable there for a while, although I remember waking up one morning and feeling an urgent need to eat the soil that our mother had given us at home. It contains iron and calcium, and I wanted to eat it right away. My friends searched all over Europe for it, until finally one of them found a small jar in a Chinese-Mongolian shop in Paris and sent it to me. It tasted like home, and I felt calm.

However, this didn’t last long because I had constant headaches, so I went to a doctor in Copenhagen, who smiled and said: lack of sunlight. He advised me to find a place where the sun shines a lot because my body cannot adapt to the almost Scandinavian twilight and darkness.

Where I come from, the sky is blue in winter and summer, and the sun shines a lot.

With a heavy heart, I applied for jobs, and my first application was successful: in Australia, which is where we are now. “It’s very sunny here,” Nara said with a laugh, and I nodded again, because I knew that Nara would stay in Australia for good, as she was the head of one of the best university departments after barely a year.

“Do you see your siblings?” I asked, a little awkwardly.

“Yes, my sister is currently attending university in Tokyo, and my other three siblings are in America and Japan. I am the only one of us who became a historian of religion. I haven’t seen my parents in decades, but they will be visiting me here in Australia soon. Bureaucracy is unavoidable here too: I had to deposit a huge amount of money, as they are Chinese citizens, which serves as a guarantee to the Australian government that they will not do anything illegal.

My beautiful friend and colleague, Nara, has since gotten married and had twins (two girls), and I suspect she is still at the same university. I am sure she is happy. After all, she not only radiates sunshine, but is surrounded by it.

Katalin Ferber

Berlin

He was the most talented student, together with his friend, who never left his side, not even for a minute.

When I first saw them, they were amusing opposites, at least in terms of their appearance.

I was ashamed of myself for envisioning of Stan and Pan when I saw them.

But one was smarter than the other, as it turned out later, and they had been inseparable friends since elementary school.

Li walked strangely, and when I first saw this, I understood why Tian, his friend, never left his side. Li’s speech was also a little stuttery, he had difficulty forming words, but I always understood what he was asking and what he was saying. Later, Li told me that when he was born, “the doctor’s forceps damaged something in my head,” but he said this with a laugh.

Tian attended my classes for many years, earning a double degree and a master’s degree (in Japan), but his friend Li only attended my classes for a year, and then, as Tian said, he spent two years in Tibet. He needs this, Tian told me, because he has to understand himself, otherwise he won’t be able to decide which path would be the best for him..

Many years passed, and I was already living in Berlin when I received an email from Tian. He was going to London for further training as an assignment from the giant size Chinese bank, to its branch in London. He called me in Berlin, and asked me to meet him in London. . Li was already living in England, attending doctoral training (in philosophy) in Oxford. Two days later, Tian called me to arrange when and where we would meet in central London.

I was delighted to go, because I was very curious to find out how these two talented, extremely creative young men imagined their next few years (and where).

There was an Indian restaurant next to my accommodation, and I sat down at a table by myself. A few minutes later, a Chinese man in his fifties appeared, sat down, and asked if he could join me at my table. Of course, I said with a laugh, my dinner would be far better if I eat with him.

We talked for almost two hours. From the very first moment, I sensed that this soft-spoken, extremely intelligent gentleman, who spoke fluent English without an accent, had not come to the restaurant and sat down at my table by chance.

The (pleasant) conversation was actually a gathering of information, since Tian and Li were in the West, it was better to know in advance who they were meeting and why.

How could he have known that I had decades of experience (thanks to my rebellious behavior) in recognizing “informants”? As we enjoyed our delicious dinner (he ordered the same meal I did), I remembered the first group of Chinese students who wanted to meet me at the university before the start of the school year. Within a few minutes, I knew who was the member of the group responsible for writing reports to the Chinese authorities. (It wasn’t Tian or Li.) I had decades of experience...

The intelligent agent (spy) wanted to know everything, and I willingly answered all his questions, of course without mentioning Tian and Li’s names even once. I’m meeting with two former students, I told him, and at that moment I remembered that when I accompanied my husband to Beijing years earlier, where he was attending an international conference, the local “assistant” to the Western guests and their relatives was also an intelligent, knowledgeable young man who spoke fluent English.

On one occasion, when I had grown tired of climbing the Great Wall, after learning that I was not American, he took courage and asked me why I was “working for the Japanese” and not for them. Because I don’t like it, I replied with a smile, when other people read my letters before I do, when they listen to my phone conversations, and when they follow me. But you’re safe with this, aren’t you, he asked with a laugh.

Instead of answering, I sympathetically told him that he could ask me anything, as it must be difficult to write his reports every day after a full day of guiding tourists.

He thanked me.

I was the first to return to my accommodation from the Indian restaurant.

The next day, when I met Tian and Li, I knew that several people had been following us all day, but we didn’t care. Tian explained how they use a different SIM card for their phones every day, and Li proudly told me that he is an advisor to a member of the British Parliament.

I haven’t seen Tian and Li since. However, I am sure that thanks to the conversation we had in the Indian restaurant more than ten years ago, neither of them can keep in touch with me anymore.

That’s okay, because they are still great people.

Berlin

The picture is AI generated

“Will dinner be ready soon?” asks my mother in law with a smile. “It needs to bake a little longer,” I say, thinking about how to distract her.

She has difficulty moving, but she won’t let anyone help her. I have to let her take her time getting up from her armchair, because no one is allowed to help her. never, despite her age. She is 92.

It takes five minutes to get to the sacred room, even though it opens from the living room where we started. There is a home altar there, where every family member prays for their departed loved ones. And this room is full of photographs. I know that Mother loves looking at them, but I don’t yet know how much she would like to tell me about the people in these pictures. It’s a big family. Her parents, her siblings, then her husband, his parents and siblings, like a single series of pictures from Japanese history in the nineteenth and twentieth centuries. Smiling or somber faces, and if I didn’t know the past century of the country’s history, I might not listen with inexplicable excitement to everything she says about each picture. But this way, history is completely different. It becomes real. Close to every family member, including me. Reading history is my profession, but listening a human who has been living in that history is completely different. As we slowly walk past the pictures, I catch sight of a photo of a young man who is (probably) sitting in a spa pool, his smile unusually open, the inevitable terrycloth towel on his head, his arms stretched out on the edge of the pool indicating that he is a tall, well-built man.

He wasn’t even thirty years old, says Mother, and the smile disappears from her face. This picture was taken during the war, she adds in a whisper, not long before his death.

I don’t dare ask if he died as a soldier.

Mother, as if sensing what I am not saying, hastily adds: he had encephalitis, and there was no medicine.

He was a chemist, he had a great job with a high salary. Fortunately, he did not have a family yet.

I pluck up my courage and ask where my smiling relative worked. He worked in one of the army’s laboratories, but we didn’t know what he did because it was a state secret. After his death, Hideki Tojo (who was sentenced to death as a war criminal in 1948 and executed) this brave young man was awarded a medal by Tojo..

Then, you know, Mama continued, her voice becoming tearful again, Japan surrendered, and I immediately burned the medal. It could have been dangerous to keep it.

That evening, after Mother had eaten her dinner heartily, I had to be a historian again, at least for a few hours. Yes, Mother’s young relative researched and developed lethal chemical substances for Unit 731 (in English), which was established in the early 1930s and was under the supervision of the military police (Kempeitai). The unit’s existence was strictly secret, and later the military high command expanded the Manchuria-based unit with several (also numbered) subunits. Without exception, all of them conducted chemical and biological experiments on living humans. By 1942, the network employed ten thousand people. Several of its laboratories were located in the mother country, including the capital, Tokyo. The smiling young man worked as a chemist in one of these laboratories, probably experimenting with chemicals.

The next time I visited Mother, I asked her only about her younger years. I still remember that she never spoke to me again about any of her relatives, who looked down at us all from their pictures on the wall of the clean room. It wasn’t that Mother was ashamed of anyone. She simply felt that I understood what, according to Mother, foreigners rarely manage to understand: that pain is universal because it is humane.

Katalin Ferber