The video you watched was probably before the collapse of the Japanese economy. Before that, Japan was the power of Asia and many people were legitimately worried that they were going to take over the world (economically and industrially speaking, that is). Things have changed.
If you think about it in terms of recent developments and technology, Asia doesn’t seem to be outperforming the West. All of the major technologies we use today (cars, iPods, cell phones, computers and Internet, etc) were developed in the West – mostly in the USA.
I can’t say much for China since I’m not very knowledgable about that country, but what Japan in particular excels in is taking pre-existing ideas and improving on them. They have been doing this since the beginning of their civilization. They took from China their writing system, currency, and political system, and over time developed that to be something quite efficient and uniquely Japanese. They did the same thing in the late 1800’s and early 1900’s, when they sent scholars to the West to learn about Western technology, industry, economics, politics, education systems, etc. and incorporated them into their culture with an alarming degree of success. The same thing happened during Japan’s “economic miracle” days, when they would purchase patents and other technological information from the United States and utilize them with extreme efficiency and quality.
However, another thing I have heard (but I’m not sure quite how true it is) is that the extremely demanding educational system in Japan wears out their students to such a degree that by their college years they spend most of their time in bars, bullshitting their way through college. In the 1990’s a family friend of mine went to some big convention of university doctorate projects from around the world, and most of the ones from Japan were just ridiculous (in a bad way).
Things have definitely changed since that video was made. With the increased modernization of China and India, Asia may well begin to lead the way in producing new ideas and technology. If you say that 1% of humans are complete geniuses (I’m making that statistic up, but it’s probably around there), that means there are 11,399,649 geniuses in India, 13,246,550 in China, and only 3,070,065 in the USA. Whether those geniuses have the education and opportunity to create major new ideas, however, is a matter all in its own.