Essay

The Foreigner Pendulum

Randy McGraw · 2026

Tokyo · the New York Bar, Park Hyatt.

When I arrived in Tokyo in 1999, the foreigners were bankers and commercial leaders. There were too many of them. They filled the same restaurants in Ginza, Ebisu and Roppongi (then at the tail-end of its heyday), the same seats at the same conferences, and they were all, one way or another, working the same trade, e.g. helping Japan’s money leave, or helping foreign money in to buy what had suddenly become cheap. Japan, at that moment, believed it needed them.

That ilk of foreigner is nearly all gone now, and the reasons are a matter of record. In March 1999, the month I arrived, fifteen large banks took ¥7.46 trillion of public money and signed restructuring plans that committed them to shedding some twenty thousand staff and closing a tenth of their branches. What followed was consolidation on a scale that removed the client base: eleven city banks became three megabank groups — Mizuho in 2002, Sumitomo Mitsui in 2001, Mitsubishi UFJ in 2005 — and three houses do not need outside advice on every transaction the way eleven did. Then the trading revenue went. The Volcker Rule, section 619 of Dodd-Frank, was finalised in December 2013 and took effect in July 2015, and Japan’s own regulators wrote to Washington warning that as drafted it could drive the Japanese subsidiaries of US banks out of Tokyo altogether. The appetite that had paid for all those seats went with it.

The point to extract for this essay is that the invitation to go to Japan was never withdrawn. It simply stopped being extended — and as Japan is a place with an unabashed otherness, most of them weeded themselves out once the earnings no longer justified the friction. In their place however are now technologists: engineers, product people, founders, the occasional data scientist with no Japanese at all, holding a residence status that did not exist when I arrived — 高度専門職, Highly Skilled Professional, created in 2015, and since April 2023 its fast track, 特別高度人材, marketed by the government as J-Skip.

Japan built these doors deliberately. The points system came first, in May 2012; the residence status itself, 高度専門職, followed in 2015; and in April 2023 J-Skip arrived, a fast track that skips the points table altogether for anyone who clears an income bar. Read that last one closely and the whole argument of this essay is sitting in the fine print: a researcher or engineer qualifies at twenty million yen a year, a business manager at forty. Japan has written the preference into law and priced the executive at double. Japan did not stop wanting foreigners. It changed its mind about which foreigners it wanted, and the old cohort discovered that the invitation had been for a skill, not for them.

Not that Japan closed. It did the opposite. There were about 1.7 million foreign residents in the country when I landed; there are now more than four million, a record for the fourth year running. But look at where that growth sits — skilled workers in the trades, technical trainees, care workers, engineers — and the Western executive is nowhere in it. The country did not want fewer foreigners. It wanted different ones.

That is the pendulum. It swings between we need the foreigners and we don’t need the foreigners, between we need the help and we can do this ourselves; and at every point along the arc it is also deciding what it needs, and so which kind of foreigner.

I have now watched it swing twice.

What I did not expect was to watch it swing again, in a different direction, across Southeast Asia.

The generation now taking over the ASEAN conglomerates and the family groups is in its forties, and it was educated abroad. Wharton, INSEAD, LSE, Melbourne, Stanford. They came home fluent, credentialed, and entirely unimpressed. They have seen the Western head office from the inside and concluded, not unreasonably, that there is no magic in it. The sentiment is not hostile. It is something more final than hostility: we don’t need it, we can do it ourselves. They are frequently right.

I met it directly in Jakarta. A large Indonesian media group was interested in what I had done at Amazon and before that in social commerce: how Prime had been built, what the bundling deals had actually required, what had gone wrong and why, how to take the next hill in the evolution of their business. The conversations with the founder (60s gen) went well, better than well. Then his son, who ran the e-commerce and video divisions, joined the process. Nothing was said. Nothing was ever said. He was cordial throughout and we got along fine. Thus I cannot point to a single moment or sentence that turned it. The opportunity simply died, and it died the week he entered the room.

I do not hold it against him. From where he sat, I was a man offering to teach him something he had every reason to believe he already knew or could know without me, in a market he understood better than I did, at a price he did not need to pay, with a cultural entrant to the shoppe from a Western poll that increasingly brings question marks. The lesson was not that he was wrong. It was that the father’s generation and the son’s were doing different arithmetic, and the son’s arithmetic is the one that will govern the next twenty years.

The pendulum is swinging once again, and there is an unmistakable geopolitical momentum in the speed and direction of the swing in Southeast Asia. More on this in another essay.

Artificial intelligence is accelerating the swing. The foreign executive used to arrive carrying things that could not easily be obtained locally: a method, a network, a playbook, a way of structuring a deal that nobody in the building had seen before.

I was one of them. I washed up in Tokyo as an expert in satellite pay television, and the reason that counted for anything was that the rule book belonged to the Americans. Hughes had built Japan’s commercial satellite industry in the first place; the hardware above the country and the operating knowledge on the ground had come from the same place I had. That was the whole of my advantage. I did not speak the language, I knew nobody, and I had no standing of my own. What I had was an excellent, rock-solid playbook that existed in only one country, and I had come from it. It was the same background and deep capability I brought to Singtel when they hired me to run business development for video. A great deal of that is now available to anyone with a subscription.

The language barrier that once made a bilingual foreigner indispensable is dissolving in real time. What remains scarce is judgment and relationships, and neither can be subscribed to. Relationships in particular take real time, staying power and commitment to build. That was never the arriving foreigner’s advantage; it is only ever earned by the one who stays and stays committed.

There is an exception, and it is narrower than the people relying on it believe. Technical talent still travels. A foreign engineer with a scarce specialty is still wanted, still sponsored, still paid. Business and industry talent is another matter. The commercial executive, the country manager, the head of strategy, the man brought in to run a division or build a market: those seats are being filled locally, and increasingly by the forty-year-old who was educated where the foreigner was educated and has the additional advantage of being from here. That is the part of the pendulum nobody announces. Tech in, business out.

Then there is a reason I did not anticipate at all as it has crept up. A very prominent headhunter in Thailand told me recently that his clients are hiring fewer foreigners, and in particular fewer Americans, Europeans and Australians. Part of it was the obvious arithmetic: cost, and the fact that the local bench is deeper than it was. But part of it, he said, was that his clients no longer know what they are getting. They cannot tell from a résumé whether a candidate is, in his words, a woke-ster, and they want nothing of that garbage brought inside the company culture. His phrasing, not mine.

I pass this on with my endorsement. I have been here thirty years, I hire people, and I see it in the candidates who come across my desk. It is now Forrest Gump’s box of chocolates whereas before it was all the same bite. That risk is not something Asian businesses like to take.

The Western executive abroad has always been sold partly on what he represents, and for thirty years what the American represented was competence, access to capital, subject matter expertise, and something that mattered more than either: flexibility. He was open by nature, tolerant of difference, respectful of the authority in the room, intellectually capable, and focused on the commerce rather than other motivations, or on trying to stand pat to change the manner in which local business is done and society runs. He accepted the rules of the house he had entered. That was the reputation, it was largely earned, and it was the whole basis of his welcome.

What he represents now, in the mind of many a foreign company, is a question mark. Wokeism is not synonymous with flexibility. It is ideological rigidity, and it arrives with three habits that are the precise inverse of what made Americans commercially strong abroad: a disposition to import one’s own convictions into another culture rather than adapt to it, a reflexive hostility to authority and to rules, and the belief that it is acceptable to impose one’s own rules in place of the ones already operating in the room. “We know better, this is what’s right” - Asian leaders do not want their organizations exposed to this poison, and I do not blame them.

So the man doing the hiring no longer knows what he is getting. He may get the American of the old kind: competent, flexible, commercially focused, a genuine subject matter expert. Or he may get the other one, arriving with an inflated transcript from an inflated university — an A is now the most common grade awarded in America, some forty-three percent of the total, against fifteen percent in 1960, and the median grade at Harvard is an A-minus — with standards that do not survive contact with the work, and a set of convictions he intends to bring inside the firm. From a résumé the two are indistinguishable. Faced with that uncertainty, the rational move is to hire locally, and that is exactly what is happening.

A man who cannot leave his convictions at the door is the one guest a host has never wanted under his roof. If that is what the hiring manager sees when a Westerner walks in, the invitation has changed again, and the American is the last to know.

What would I tell someone building a career out here now? That what you have to offer has changed, and that the offer is the whole of it.

Your relationships back to your own country are an asset again, perhaps the main one. The thing a local firm still cannot manufacture is a door into your market, opened by someone who will pick up the phone because it is you. Subject matter expertise on business questions is strong but no longer the calling card it once was; in many cases it is more cheaply available elsewhere with lower risk, and the local room may now have enough of it – or at least believe that they do until proven otherwise. On the technical side it is still black and white, and true expertise there still travels. Elsewhere, be sure the expertise is genuinely true, because the market now checks.

Do something beyond the job. The job is a contract; the standing is built outside it. Write, speak, build something of your own, keep a network that does not belong to your employer.

And understand the arithmetic you are on. You are worth exactly the next touchdown they think you can score. Score it and you might play another season; miss it and you will not finish this one. That is not a Thai or a Japanese or an Indonesian truth. It is the truth for anyone who is there on his usefulness rather than his name, and the foreigner is always there on his usefulness.

Last, learn to partner. Not in the brochure sense. The mechanics: who brings what, who earns what, who decides what, what happens when it goes wrong. It is the one skill that improves as the pendulum swings, because the further it swings toward the local side, the more valuable it is to be the man who can make two sides work together.

I have been on the useful side of this pendulum for most of thirty years. The bankers and commercial men of 1999 did not see their swing coming either, and most of them were still explaining their value to Tokyo as the door closed behind them. The only defense I know is the one that has never depended on the arc: be the person they cannot easily replace, be attached to people rather than to a function, and keep your eyes on which way the thing is moving.

It is moving.

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