[1Old Pro]

Japan put all it's marbles on technology. Now they are losing market share big time in large part because of cheap labor as you mentioned. Their automobile market share is dropping because their cars used to be reliable and cheap, a.k.a. Toyota, Datsun. Now they are expensive and Domestic autos are actually competing again.

[AmericanInTokyo]

Traditional American analyses of Japan (for the last 80 years at least) has been one of a humorous saga occupying two extremes of the pendulum movement.

It alternates (usually in 15-year increments) between the polar opposites of the galvanized paranoia "Japan Will Rule The World!" (Russo-Japanese War, Pearl Harbor, Rising Sun) and the abject triumphalist "Japan Is Dead!" (Hiroshima, Nixon Oil Shocks, Bad Bank Debt). Nasakenai!

The analysis I see on FR keeps true to this American tradition, and has swung fully into the defeatest mode.

It shall swing back in not too short a time.

While the truth of the matter is, (equipped with a knowledge of the the highly resilient, intelligent yet limited Japanese), as always, somewhere in the middle.