Don't get me wrong, it's a major pain to memorize thousands of characters. But in the language the system is native to (Chinese), it's not as bad as all that. Chinese characters do encode a lot of phonetic information -- it's just suggestive rather than definitive. On the other hand, they encode a *lot* more information about meaning/sense (and even etymology in some cases) than words written in a purely phonetic system.
In Japanese, well, it was probably a misguided decision to import that particular foreign writing system, but you go to literacy with the tools you have, not the tools you wish you had. Unless you're Korea, and then you independently invent the world's most brilliantly designed alphabet... and *still* use some Chinese characters anyway.