This film can be seen as an expression of the cultural anxieties about Japan at large in American culture in the 1980s. The film starts with images of modern America as powerful but decaying. Nick Conklin - played by Michael Douglas - is an aggressively individualistic cop whose individualism has gone too far (a metaphor, perhaps, for the current plight of US culture itself). Nick - like the US? - is not what he once was and he finds himself having to bend the rules in order to survive in an increasingly competitive world. His world is changed, however, when he encounters the Japanese mob - the yakuza.
The film is deeply racist in many respects, but in the end strives to reach some kind of mutual understanding/recognition between Japanese and US culture (although very much on the American hero’s terms). Japan is represented in strikingly ‘orientalist’ way in the film; the film’s ‘noir style’ is used to create a sense of the Japanese as ‘mysterious’ and ‘inscrutable’. However, more than this it depicts the ‘future as Asian’; Asian capitalism is represented as the next stage of capitalistic evolution because it is a pre-eminent centre of technological innovation, a culture based upon self-discipline and a culture that is the true heir to ascetic Protestantism with its now rapidly fading work ethic. A remarkably prescient observation in many respects.