AMPONTAN

Japan from the inside out

Archive for June, 2010

Whose side are you on anyway?

Posted by ampontan on Wednesday, June 30, 2010

SHORTLY AFTER taking office, Prime Minister Kan Naoto turned everyone’s head by suggesting that former DPJ Secretary-General (and former party head) Ozawa Ichiro keep his lips zipped for a while. Mr. Ozawa’s problems with the law and his unpopularity with the public were two of the reasons the DPJ’s popular support had collapsed, so former Prime Minister Hatoyama made sure to take the old puppet master with him when he left.

He was also unpopular with many in the party for his iron-fisted leadership style. (He’s long believed that the people who understand will shut up and do as they’re told, while those who don’t understand and ask questions are hopeless.) It was therefore natural that the new prime minister wanted to create some breathing room for his Cabinet by having Mr. Ozawa go someplace where people couldn’t see or hear him. On the other hand, Mr. Kan took the risk that alienating Mr. Ozawa could cause the serious rupture in the party they’ve been trying to avoid since he joined.

Mr. Ozawa took the hint and behaved himself for most of the subsequent month—in public, anyway—but during a campaign speech yesterday in Imabari, Ehime, he seems to have finally looked at his watch and said, “Time’s up!”

That’s not all he said. Indeed, it would be understandable if one read the text of his criticisms of the Kan administration and thought the remarks were delivered by an opposition politician. Here’s how he started out:

It’s not my position to be talking about policy decisions…

Translation: I’m going to talk about policy decisions.

…but the DPJ has become the ruling party, so if we don’t keep our promises to the people, society will not be realized.

Yes, he said that last part.

Therefore, as a result, we will have lied to the people.

The man who once joked with a double-entendre in Japanese that the advantage of campaign promises was that they could be replastered then spoke about keeping specific campaign promises:

In last year’s lower house election, we campaigned by saying we would not raise the consumption tax during the four-year Diet term….we promised the people during the general election last year that we would remove tolls on expressways and provide a child allowance and income supplements (to farming households)—and we won a majority.

He elaborated:

Is there anything so stupid…

Yes, he said that too.

…as to form a government and then say, ‘There’s no money, so we can’t do it’? Politics is keeping your campaign promises.

He wasn’t finished. On Mr. Kan’s ideas about raising the consumption tax to 10%:

I don’t know what (Prime Minister Kan) was thinking (when he talked about an increase in the consumption tax), but we said during the election that we would not raise it for four years. We’ll work as hard as we can to eliminate waste in government, and after four years, if the funds for social welfare expenditures are still insufficient, we must consider it.

Then he made a pledge of his own:

I will definitely use all of my meager abilities to achieve our campaign promises.

Now that sounds like a man running for office, doesn’t it? Mr. Ozawa has already hinted he might challenge Mr. Kan in September; the prime minister’s term as party chief ends that month because he’s filling up the unused portion of Hatoyama Yukio’s term. Everyone in Japan is well aware that many in the DPJ, including those in party and government leadership positions, wish he would go far, far away, and just as aware that others in the DPJ are afraid he might make their wish come true. Not only does this speech raise the possibility of a party split, it also sows doubts among the electorate about whom in the party they should believe (assuming that it’s possible to believe any of them). That could dampen the DPJ vote, which Mr. Ozawa might have had in mind.

Finance Minister Noda Yoshihiko couldn’t leave well enough alone, and snapped at the bait:

Our upper house campaign platform was put together by the planning committee under Prime Minister Hatoyama and Secretary-General Ozawa. I don’t understand what all this blah, blah, blah about the platform is supposed to mean.

Memo to Mr. Noda: You know the media is going to jump all over this (more than 60 separate articles on Google News before the day was out), so why fan the flames this close to an election? Now that you’re in the Cabinet instead of coffeehousing, isn’t it time you started to learn when and how to deflect that which you want people to ignore?

Besides, why would a finance minister want to defend himself against the charge of not spending money that the government doesn’t have?

The article in the Nishinippon Shimbun covering Mr. Ozawa’s speech, by the way, drily noted that he played the leading role in formulating this year’s current budget. The newspaper also reminded their readers that he insisted on keeping the “temporary” gasoline surtax despite the party’s pledge in the election platform to eliminate it. That seems to have slipped his mind during the speech yesterday.

Whoops Mr. Kan #1

Now that their party’s taken a hit in the polls, the DPJ leadership is trying desperately to backtrack from Mr. Kan’s ruminations about a boost in the consumption tax. The prime minister will have more than egg on his face if the party falls a few seats short of an absolute majority in the upper house election.

Government Reform Minister Ren Ho even tried this line: “That’s not what this election is supposed to be about.”

I repeat myself, but now that you’re in the Cabinet instead of coffeehousing, isn’t it time you started to learn that once the prime minister says something about a matter of policy—especially tax increases—that statement becomes what every subsequent election is about? It’s not as if elections have name tags for placement in tidy little categories.

Whoops Mr. Kan #2

The prime minister seems not to have had a very good summit, though the major media outlets are covering for him. The stories still filter out anyway.

For example, when referring to a meeting with the leaders of India and Indonesia, Mr. Kan wanted to say “emerging countries” (in English), but out popped “emergency companies” instead.

He also botched the names of the presidents of South Korea and Russia, and called it the G7 instead of the G8.

Finally, during a casual conversation at lunch with the other national leaders, he suggested inviting the Chinese in the future. An awkward silence followed.

And yes, if it had been Aso Taro, you would have already heard these stories by now.

Afterwords:

Speaking of free expressway tolls, the first stage in that program finally got underway this week—just three weeks before the upper house election. Golly, isn’t it amazing how that timing worked out?

And speaking of politicians going someplace where people can’t see or hear them, that was too much to hope for from Fukushima Mizuho, head of the junior coalition partner Social Democrats and the former Cabinet Minister who got her 15 minutes of fame by getting herself fired by Mr. Hatoyama over the Futenma base issue.

In a speech on Tuesday in Matsudo, Chiba, she said:

The Hatoyama Cabinet was yuai politics. With the Kan Cabinet, I’m worried that yuai might have disappeared. They immediately said they would build a base at Henoko (in Nago, Okinawa), and that they’re thinking of raising the consumption tax to 10%. To tell you the truth, I’m the parent who gave birth to the Kan Cabinet. Since I am its parent, I will keep placing my orders with that Cabinet (i.e., as in a restaurant) and strive to ensure that they don’t change.

Who knew that Fukushima Mizuho was the queenpin of Japanese politics? Other than herself, of course.

But as often happens with parental nagging, her orders will surely go in one ear and out the other—or, as the Japanese say, the Cabinet will have chikuwa mimi (chikuwa ears). You can see why from the photo of chikuwa below.

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Typical

Posted by ampontan on Tuesday, June 29, 2010

EVERYONE ENJOYS a change of pace, and that’s why most of the popular website/blogs that focus on serious political or social topics also include lighter posts.

I visited an American website this morning that features articles about American politics and society, but also contains many posts about international affairs. This site too effectively uses lighter stories for a change of pace. The identity of the site in question is not important.

Here’s a partial list of the stories on their top page right now:

* How a ship’s crew was saved from Somali pirates, who had planned to kill them and sell their organs because the owners refused to pay the ransom

* The state-run Norwegian forestry research institute reports that acid rain eliminates pollution and has resulted in 25% forest growth in 15 years.

* Russians are interesting in buying French infantry gear.

* A refutation of the theory that the stock market crash of 1929 caused the Great Depression

* Angry Afghan civilians demand that NATO act more decisively against the Taliban even if it puts them at risk.

* North Korea demands that the US pay them $65 trillion in compensation for six decades of hostility. (Heads or tails on whether that can be classified as a serious or a lighter piece)

* A link to a New York Times article that claims agencies recruit too many Caucasians when hiring models from Brazil

* A poll showing that a plurality of voters opposes President Obama’s Supreme Court nominee

* A discussion of the decision by the West Virginia governor to delay a special election to fill a vacant Senate seat after Robert Byrd died. It would normally be held this November, but 2010 will probably be a very bad year for Democrats, Byrd was a Democrat, and the governor is a Democrat. There is a longish discussion of the West Virginia state constitution

* Posts on the U.S. Supreme Court decision striking down a Chicago law on guns, and a video interview discussing the effectiveness of gun bans

* A post complaining about how Obama advisors constantly complain about how difficult it is to be President

* Iranian and Israeli sources claim that Israel is positioning equipment in Saudia Arabia for a possible attack on Iranian nuclear facilities, and the G8 thinks an attack might be coming.

* A video of U.S. Vice-President Joseph Biden acting like a jerk. Again.

* Venezuela nationalizes oil rigs owned by a U.S. company that the Americans shut down because Venezuela was a year behind on payments.

* A link to a blog post by someone who claims: We (the U.S.) are in a Depression now and have been since 2008. A Depression is defined as a 10% contraction in GDP. But for the government borrowing 11% of GDP and spending it, GDP would have contracted by at least the same amount borrowed and spent.

* A brief article on the 60th anniversary of the start of the Korean War

* A post about the revelation of a sexual harassment complaint by a masseuse against former Vice President Al Gore. It has the amusing headline: If You Reach Under My Towel There’s a Throbbing Carbon Offset With Your Name On It

There are also several pop culture posts.

They also have one post about Japan, derived from a link to another site.

The website’s political perspective is from the right. Japan still has the world’s second-largest economy, and economic conditions here can affect the rest of the world. Is this post about how a government of the left is trying to deal with massive public debt and deflation by raising taxes and redistributing income?

Is it about how that government is trying to roll back the privatization schemes of the Koizumi/Abe administrations?

Is it about the ongoing debate over the role of the bureaucracy in political governance—the most intense debate of its kind among the advanced industrial democracies?

Is it about how a Japanese government that seeks closer ties to China is also taking a hard line against Chinese behavior in the Western Pacific? Is there anything about how these diplomatic moves are taking place against a backdrop of soaring Chinese tourism in Japan?

Is it about the opening next spring of the Kyushu leg of the Shinkansen—which means that a high-speed rail network unlike anything in the United States will now link the entire archipelago?

Is it about the recent announcement that a Kumamoto University team has created the world’s strongest metal–a magnesium alloy with a tensile strength of 512 megapascals? This is stronger than the duralumin used in aircraft, an aluminum alloy of 505 megapascals.

No. This is what it’s about. Note also the subject matter of the website that is the source of the video.

I am not saying that stories such as these do not have their place. Heck, I’d volunteer to be the man on the sled myself.

I am saying that when the subject is Japan, stories such as these—in addition to the putatively serious stories that are willfully distorted or inaccurate—are the only stories that have any place at all in the media or the Internet.

It’s time again to quote the Jenny Holt article from The Guardian:

I have lived in Japan for nine years, I have a Japanese husband and son, and I can honestly say that the most striking thing about people here is how downright normal they are….This is modern normality, and if foreigners who came here actually bothered to learn the language and find out what ordinary Japanese people think they would appreciate that….The stereotyping also speaks volumes about the western psyche. It suggests that westerners resent and fear successful non-white cultures and that they cope by denigrating and dehumanising them. What Britain chooses to see in Japan says more about its own insecurities than about the Japanese…

Let’s take that last sentence a step further.

What the world’s news media and Internet websites choose to see in Japan says more about their own insecurities, incompetence, ignorance, immaturity, and general laziness than it does about the Japanese.

They choose to focus on the serious side of the rest of the world, but choose to view Japan only as goofy Asian vaudeville.

But then, if what you know about Japan is derived from the English-language news media and Internet websites, then everything you know about Japan is wrong.

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Bad ideas that never die

Posted by ampontan on Monday, June 28, 2010

As usual, Prime Minister Kan keeps repeating that the (income) gap is growing because of “excessive market fundamentalism”. As long as he views the problems facing Japan precisely the opposite way (of how he should), the Japanese economy will not recover.
- Ikeda Nobuo

We have so many people who can’t see a fat man standing beside a thin one without coming to the conclusion the fat man got that way by taking advantage of the thin one. So, they’re going to solve all the problems of human misery through government and government planning.
- Ronald Reagan (1964)

ONE CAN almost be sympathetic with the desire of the Japanese left to implement their pet theories now that they’re in control of a government for the first time since the LDP merger of 1955. (Socialist Prime Minister Murayama Tomi’ichi from 1994-1996 doesn’t count; he had to promise not to behave like a socialist before the LDP let him serve as a figurehead.) The American Democrats enjoy playing the song Happy Days Are Here Again at their party conventions; the theme song for the Japanese Democrats inebriate from their first draught of power, however, might well be Happy Days Are Here at Last.

But note that I said almost sympathetic. The average Japanese pol doesn’t pay close attention to what happens overseas, so most of them aren’t tuned in to what’s worked or what hasn’t for economies in other countries. In addition, the average leftist, Japanese or otherwise, doesn’t pay close attention to what works anywhere. Their primary concern is the dogma, even if the citizens wind up living in equally sized dog houses with equally sized, half-empty feed bowls. That was their attitude in 1964, just as it was in 1864 and just as it will remain in 2064. Far better to be politically correct than to be economically correct. Besides, it’s not as if they’ll be the ones to suffer.

That’s why the new DPJ government of Kan Naoto, which represents the older, more leftist DPJ before then-party head Kan Naoto let Ozawa Ichiro join, is pleased as punch to offer as a solution to Japan’s problems the idea of steering the car in the direction of the ditch.

From The Wall Street Journal:

Japan’s new finance minister will push to raise taxes on high earners in an effort to boost revenue and narrow the country’s income inequality, he said in an interview published today.

‘I believe we are at a stage where a little bit of egalitarian thinking should guide our tax policy,’ Yoshihiko Noda told The Wall Street Journal.

“Egalitarian thinking”? A flat tax, perhaps?

‘In that sense, our tax reform will be designed with an eye toward restoring its income-redistribution function,’ he added.

Translation of egalitarian thinking: Pursuing equality of outcome by taking money from the people who carry the water and giving it to those who drink it.

Does Mr. Noda realize that increasing taxes on the wealthy never brings in the revenue people claim it will? (Unlike Barack Obama, who admits that he knows but doesn’t care.) The highest rate in Japan is 40%, down from 75% 30 years ago. Does Mr. Noda understand that beyond 40% is the level at which people start to limit and hide their income?

Do you have to ask?

Prime Minister Naoto Kan’s new administration hopes to revive confidence in Japan by introducing a new era of fiscal discipline and beginning work on reducing the industrialised world’s biggest public debt mountain.

Confidence might already have been revived had he come to those conclusions when he was Deputy Prime Minister/Finance Minister earlier this year, before adding to the fiscal indiscipline and the industrialized world’s biggest public debt mountain. Perhaps he didn’t want to let a crisis go to waste.

*****
Ono Yoshiyasu, Mr. Kan’s home tutor for the study of public finance and economics, appeared on an interview program last week and demonstrated that he doesn’t pay close attention to events overseas, either. He justified greater government intervention in the economy by starting a sentence with the phrase, Minkan ni hottoittara…(Leaving it to the private sector). It’s not possible to convey in a snappy translation the deliberate nuance that he thought leaving affairs to the private sector would be tantamount to criminal negligence.

Instead of the private sector, which provides the greatest prosperity for those willing to work for it through a rational, reality-based system, he would rather entrust matters to the public sector and the tenured academics that never have to pay for their mistakes.

*****
Had they been paying attention, they could have read this from Britain:

It simply demonstrates something that free market economists have always known, namely that, because of the law of dispersed costs and concentrated gains, governments will always find it easier to raise taxes than to cut spending. Not that this concession has appeased Left-wing pundits, who are insisting that the budget is unfair to the poor. It is true, of course, that any spending cuts will necessarily affect net beneficiaries of state expenditure more than net contributors. But is it right to measure the compassion of a society by the size of its welfare budget? Surely the whole purpose of social security should be to draw people out of dependency so that budgets, over time, can fall. By lifting personal allowances, the government is doing its best to facilitate this process. As Art Laffer says, if you pay people to be poor, you’ll never run out of poor people.

Or this from the United States, titled The Keynesian Dead End:

Today’s G-20 meeting has been advertised as a showdown between the U.S. and Europe over more spending “stimulus,” and so it is. But the larger story is the end of the neo-Keynesian economic moment, and perhaps the start of a healthier policy turn.

For going on three years, the developed world’s economic policy has been dominated by the revival of the old idea that vast amounts of public spending could prevent deflation, cure a recession, and ignite a new era of government-led prosperity. It hasn’t turned out that way.

…Now the political and fiscal bills are coming due even as the U.S. and European economies are merely muddling along. The Europeans have had enough and want to swear off the sauce, while the Obama Administration wants to keep running a bar tab. So this would seem to be a good time to examine recent policy history and assess the results.

Like many bad ideas, the current Keynesian revival began under George W. Bush. Larry Summers, then a private economist, told Congress that a “timely, targeted and temporary” spending program of $150 billion was urgently needed to boost consumer “demand.” Democrats who had retaken Congress adopted the idea—they love an excuse to spend—and the politically tapped-out Mr. Bush went along with $168 billion in spending and one-time tax rebates.

The cash did produce a statistical blip in GDP growth in mid-2008, but it didn’t stop the financial panic and second phase of recession. So enter Stimulus II, with Mr. Summers again leading the intellectual charge, this time as President Obama’s adviser and this time suggesting upwards of $500 billion. When Congress was done two months later, in February 2009, the amount was $862 billion. A pair of White House economists famously promised that this spending would keep the unemployment rate below 8%.

Seventeen months later, and despite historically easy monetary policy for that entire period, the jobless rate is still 9.7%.

Or, if income gaps really troubled them, they could have read this from a tax professor:

The gaps in after-tax income between the richest 1% of Americans and the middle and poorest fifths of the country more than tripled between 1979 and 2007 (the period for which these data are available), according to data the Congressional Budget Office (CBO) issued last week. Taken together with prior research, the new data suggest greater income concentration at the top of the income scale than at any time since 1928.

But:

What (the survey) does not show, and what is not to be automatically inferred from it, is that the poor and the middle-class have gotten poorer. Of course, I fully expect the tax-the-rich types to suggest that very thing. But by doing so they only betray one of their many faulty premises: Namely, that wealth, like energy, is finite and an increase in one individual’s wealth is always be matched by a commensurate decrease in another individual’s wealth.

Or, this question from the comments:

Would it make people happy if they found that the gap had closed but everyone is worse off?

I think we already know how some people would answer that.

*****
One of the few beneficial effects of policies such as those endorsed by the DPJ is that it increases the urgency and sharpens the arguments of those in the opposition. (Barack Obama is demonstrably the best thing to have happened to the small government movement in the U.S. in more than a generation.)

Here’s university professor, author, and blogger Ikeda Nobuo (writing in Japanese):

Another economist influencing Prime Minister Kan is Jinno Naohiko, the head of the panel of experts in the National Tax Commission. He’s the person who came up with the slogan, “Strong economy, robust finances, and strong social welfare”. He (recently) issued an interim summary of the panel’s debate, but it is composed of his personal impressions rather than the response of the commission. He has a unique fiscal theory, and the commission seems to be in turmoil as a result.

Rather, it would be more accurate to say that Mr. Jinno has no fiscal theory at all. That’s because he is a rump Marxist economist…He hasn’t written a thing about economics in this book (no link), but it’s filled with so much abuse of “neo-liberalism” that reading just short excerpts is enough to make one ill.

The idea that that neo-liberalism convincingly preaches spontaneous cooperation such the family or the community is laughable. Neo-liberalism envisions homo economicus, who rationally behaves through the instantaneous calculation of pleasure or hardships. In other words, it is a view of people in which cooperation with others, or sharing, is not possible.

If there is deregulation of the labor market in accordance with the tenets of neo-liberalism, the income distribution in the market will be unequal. If this inequality becomes pronounced, it will cause fissures in society, and social unity will become impossible. Neo-liberalism aims for small government, but it insists on a strong government that oppresses democracy.

Everyone should easily understand that neo-liberalism is a reaction against history. In fact, neo-liberalism does not present a vision for a new age, but sincerely intends to uphold the dominating benefits of destruction.

When the conditions for small government are absent, the tragedy of forcibly maintaining small government is the performance of the poverty and income gap tragedy presented by neo-liberalism. Neo-liberal policies have been forced on Japan since the inauguration of the Nakasone Administration in 1982.

That’s how he repeats the lie that the Koizumi reforms caused the income gap to grow. Jinno also argues for the creation of a robust economy with a strong social welfare component, but the relationship of cause and effect is reversed. Normal economics assumes that social welfare cannot increase unless the economic growth rate rises. The Marxist economists think a planned economy that increases the distribution to the working class will increase the growth rate. Their ideal seems to be a citizen burden of 70% on the order of Sweden. Therefore, they think Japan, where the burden is only 40%, should have a larger government and share the wealth through welfare giveaways.

*****
They also could have read this by Yamaguchi Natsuo, the head of New Komeito, from a speech on the 26th in Chiba:

Prime Minister Kan says the economy will improve even if taxes are raised, as long as the funds are spent properly. But both American and Japanese scholars say that when consumption is frozen, the economy will worsen. We’ve had that experience in the past, with the coalition government of 1997. They raised the consumption tax from 3% to 5%, and the economy got worse. One of the members of that Cabinet was Prime Minister Kan.

See what I mean about ignoring the lessons of the past?

*****
If they were willing to put their policies where their mouth is, they could take up the proposal of Dr. Z at Gendai Business:

There are still some concerns that Prime Minister Kan, Chief Cabinet Secretary Sengoku Yoshito, and party Secretary-General Edano Yukio are all economically tone deaf.

All three have boldly stated outrageous theories in public that would ordinarily be inconceivable. Prime Minister Kan says the economy will improve even with tax increases. Mr. Yoshito says that alleviating the supply and demand imbalance will be bad for the economy. Mr. Edano says the economy will improve if we raise interest rates. The rest of the world will not take seriously public officials who make statements such as these.

Here’s an idea for Mr. Kan: Raise taxes and interest rates, see if the economy improves, leave the supply and demand gap as is, announce that the unemployment rate is fine as it stands now, and then ask the people if they believe you.

*****
Mr. Edano is suggesting again that having Your Party in a coalition after an election would be just dandy, now that it appears the DPJ won’t win an outright majority in the upper house. That would be a good idea, assuming he would listen to party head Watanabe Yoshimi:

Mr. Kan often talks about Greece. We hear him call for raising the consumption tax because the Greeks went bankrupt. But the Greek consumption tax rate when it went bankrupt was 21%. To say that we won’t go bankrupt if we raise the consumption tax is a pack of lies. We must not be fooled by ridiculous economics based on magic charms.

*****
We already know they don’t listen to Nakagawa Hidenao, the unofficial spokesman for the LDP Koizumians:

Mr. Kan said, “The first (areas) to suffer in Greece were pensions and salaries.” The average public sector salary in Greece is 1.5 times that of the average private sector salary. This gap is the largest of the OECD countries. Pensions in Greece are roughly the same as the salaries of the people actually working. In Japan, pensions are only 30%-40% of those salaries. That demonstrates the high level of pensions and public sector salaries in Greece to begin with.

*****
Perhaps they were reading only selected material. One example might have been this recent headline in the International Herald Tribune:

U.K. Tightens Belt Despite Hard Times

“Despite”? Yes, everyone knows that hard times surely require profligate economic measures.

Well, everyone at The New York Times or The Washington Post. That’s where the IHT obtains most of its content.

They might also have been reading the editorials of the major Japanese dailies. On his Japanese language blog, Kishi Hiroyuki, a former aide to Takenaka Heizo when the latter served as Minister of Internal Affairs and Communications under Prime Minister Koizumi, reviews those editorials published after the DPJ released its platform for the upper house election on the 17th.

The Nikkei Shimbun:

Drastic reform of the taxation system, including the consumption tax, is a difficult subject because the LDP administrations kept putting it off. We welcome the prime minister’s decision to reveal his basic thinking about increasing the consumption tax before the upper house election.

The Asahi Shimbun:

The consumption tax rate is not a simple method for rebuilding finances…it is an issue related to the basic design of the country. A multiparty forum should be established immediately after the election to examine the issue and to rapidly determine a course of action.

The Sankei Shimbun:

Prime Minister Kan has broached the subject of dealing with the tax rate and reform proposals, including some reactionary measures. The idea of moving to a course to rebuild the nation’s finances is itself a desirable change.

The Yomiuri Shimbun:

It is a political responsibility to clearly declare the necessity (for a tax increase), even if it is accompanied by some pain for the citizens. We hope to hear some lively debate during the campaign.

The only discouraging word was from The Tokyo Shimbun:

Rather than (raise) the consumption tax, the first step that should be taken is to work together in a multiparty arrangement to eliminate waste from government.

Wrote Mr. Kishi:

What is behind this low level of editorial from Japan’s major newspapers? A plurality of citizens favors raising the consumption tax in polls, but aren’t they bound to make an error in judgment after reading these distorted editorials?

After the cabinet presented its fiscal strategy on the 22nd, the tone of the editorials the following day was that an increase in the consumption tax was required because fiscal reconstruction was difficult. This is nothing but “war correspondent” journalism.

I was well aware of the level of the newspaper media in Japan before this, but I was surprised once again to read the editorials about the increase in the consumption tax. This is no different than (their) rubber-stamping (of) the mistaken policy decisions of the military during the war…If this type of editorial is all they’re capable of, the Japanese newspaper media does not support journalism at all…If they’re going to survive in the Internet age, they’ll have to start by raising the quality of their editorials and articles before they think about reworking their business model.

*****

The DPJ’s thinking is based on the premise that the Koizumi reforms were bad. Some people have decided they can no longer sit still for that one, however. This interview with Shinbo Masaki appeared last week in J-Cast.

Were the Koizumi structural reforms bad? With the privatization of Japan Post and the issue of dispatching workers, policies and the tone of debate that reject the structural reforms have become the mainstream in politics. We interviewed Shinbo Masaki, the managing director of JAIS. He sounds the alarm that Japan is headed for serious decline if it does not again serious consider reform and its concomitant pains, rather than superficially attractive arguments about saving the weak.
—–
In your recent book, Nihon Keizai no Shinjitsu (The Truth about the Japanese Economy, written with younger brother Jiro Shimbo, an executive with Yomiuri TV), you dealt with evaluations of the reforms of former Prime Minister Koizumi Jun’ichiro, such as the privatization of Japan Post. You sharply criticized the oft-heard argument that the Koizumi reforms deprived young people of employment.

That argument is a big lie. Let me say at first that I do not approve of all the reforms of Koizumi and Takenaka. But let’s look at the numbers during the Koizumi administration. While improving the fiscal balance of accounts, stock prices rose, the rate of GDP growth increased, there was a dramatic climb in the rate of hires for new high school graduates, and the unemployment rate fell.

As for the alleged growth in income gaps, the growth rate of the Gini Coefficient, the most frequently used indicator of that gap, slackened compared to the four or five years before he took office, while it expanded in Western countries.

What specifically do you think he did right?

As a starting point, he understood very well the position we were in, that with the globalization of the international economy, companies had to survive international competition. Good or bad, like it or not, those are the cold, hard facts. Japan had become inefficient and had lost competitiveness. To recover that vitality, he identified where the reforms should be implemented, what hardships would have to be endured as a result, and what effects they would have.

It is important to clearly specify the negative aspect of hardships. Politicians before then, and even today, continue to spread the pork to maintain the illusion that they are making everyone happy. They’ve also continued to increase the government’s debt. In this case, the “everyone” they are talking about is today’s “everyone”, while they’re passing the bill on to the “everyone” of the future.

When people think of the Koizumi reforms, they usually think of the privatization of Japan Post. Now, however, we’re on the verge of passing Japan Post reform legislation that would mark a retreat from privatization.

The Japan Post privatization in particular was an issue regarding the postal savings accounts. That symbolized reform because its intention was to create vitality by transferring the funds from the inefficient investments of government to the efficient investments of the private sector. A retreat from this path will accelerate the impoverishment of Japan.

In addition, the Koizumi administration dealt with the problem of the mobility of labor by removing restrictions on the seconding of employees in the manufacturing industry. Mobility should be considered in a form that includes full-time employees, but there are severe restrictions in Japan on laying people off, so companies won’t hire. They made a start by dealing with that tendency.

Just before you said that you didn’t agree with all the Koizumi reforms. What negative aspects did they have?

When they provided mobility to the workforce, they put off paying attention to those people who were laid off. Those people who were laid off needed study and training to improve their skills for moving to the next dynamic company. This required the creation of facilities, subsidies, and the enhancement of the safety net for a specified period until they found new jobs.

After Koizumi left office, a debate should have been held on the best way to provide a safety net, but the trend gradually shifted to tightening regulations to protect employment. Now these regulations have in fact been tightened. Companies are concerned this will have the opposite of the intended effect for Japanese workers. It will create a reality in which people will not be hired in Japan, and they will not be able to hire people overseas. This has already started to happen.

In regard to this problem of government debt and guaranteeing social welfare payments, Prime Minister Kan Naoto indicated that he is resolved to bring up the unpleasant-sounding question of increasing the consumption tax.

A discussion of tax increases is something different than the necessity of a growth strategy that includes structural reform. Until Japan conducts structural reform to become a country that can maintain its competitiveness, it will start a new and gradual decline even with a tax increase to improve the fiscal side. It is important to show a clear growth strategy.

What should voters pay attention to when they compare the growth strategies of all the parties before the upper house election?

Distrust the rose-colored glasses approach and the pie-in-the-sky with no specific numbers. The money is limited. If you devote your attention to one area, you will have to do without in another. Nothing will change with the gradual decline of Japan if we keep dithering and doing the same things we’ve always done. We have to examine how much a specific action will cost, what we will have to give up to implement that action, whether it will require a tax increase, and whether the specific advantages and possible pain have been clearly shown. It is also important to make efforts to alleviate concerns about the future, such as with pensions.

*****
One can almost be sympathetic with the Japanese voters for being swayed by the DPJ claims. They’ve never lived under a serious government of the left before, so they’ve never seen how these programs constitute a willing leap from the frying pan into the fire to ensure that everyone is equally singed. That’s a lesson that every generation in the United States has to relearn.

Let’s hope this generation of Japanese voters learns that lesson before the car winds up in the ditch.

Afterwords:

Once people start using a political catchphrase, it’s not long before they start misusing the term by arbitrarily giving it whatever meaning appeals to them. A recent example is the term neo-liberal. The following are excerpts from an article titled Neoliberalism: The Genesis of a Political Swearword.

(T)he relatively little known Alexander Rüstow delivered the most noticed speech at the (1932) conference, which was later published and republished many times. Until the present day, it is widely regarded as the founding document of neo-liberalism.

The speech was titled ‘Freie Wirtschaft, starker Staat’ (Free Economy, Strong State), and in these four words we can already see Rüstow’s basic economic creed…Rüstow blamed excessive interventionism for the economic crisis. He also warned of burdening the state with the task of correcting all sorts of economic problems. His speech was the clear rejection of a state that gets involved with economic processes. In its place, Rüstow wanted to see a state that set the rules for economic behaviour and enforced compliance with them. It was a limited role for the state, but it required a strong state nonetheless. Apart from this task, however, the state should refrain from getting too engaged in markets. This meant a clear ‘No’ to protectionism, subsidies, cartels—or what today we would call ‘crony capitalism,’ ‘regulatory capture,’ or ‘corporate welfare.’ However, Rüstow also saw a role for a limited interventionism as long as it went ‘in the direction of the market’s laws.’…

Although contemporary supporters of a ‘Third Way’ claim to be fighting neo-liberalism, to Rüstow this very same ‘Third Way’ was neo-liberalism. He called it neo-liberalism to differentiate it from earlier liberalism, for which Rüstow frequently used derogatory terms such as ‘vulgar liberalism,’ ‘Manchester liberalism,’ or ‘paleo-liberalism.’ Rüstow wanted to break with this old liberal tradition to put a new liberalism in its place—hence the prefix ‘neo’….

Rüstow’s differentiation between the state as the guarantor of economic order, as the rule-giver that stands above economic processes, and the failed interventionist state that meddles with economic processes and gets easily captured by special interests, are still valid. It would be worth to rediscover them, especially today….

The discussions about the proper political reactions to the global financial crisis are, sadly, not as nuanced as they could be. For example, when we read Kevin Rudd’s ‘anti-neoliberal’ essay we find some strong language right from the first paragraph where he blames ‘free-market fundamentalism,’ ‘extreme capitalism,’ and ‘excessive greed’ for our economic problems….

Neo-liberalism is a far richer, more thoughtful concept than it is mostly perceived today. First and foremost, it emphasised the importance of sound institutions such as property rights, freedom of contract, open markets, rules of liability, and monetary stability as prerequisites for markets to prosper and thrive. It seems that the global financial crisis has once again demonstrated how important these core insights of neo-liberalism are.

To those criticising neo-liberalism today, the answer may well be just that: We need more of this kind of neo-liberalism, not less. What we would need less of is only the rhetorical abuse of neo-liberalism for political purposes.

Kevin Rudd isn’t the only one who likes to throw around the term “free-market fundamentalism”. Take a look at that quote from Prof. Ikeda at the top of the page again.

Former Financial Services Minister Kamei Shizuka liked it too.

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Posted in Business, finance and the economy, Government, Politics | Tagged: , , , , , , | 1 Comment »

Matsuri da! (113): It’s about that time!

Posted by ampontan on Friday, June 25, 2010

EVERY COUNTRY seems to fill its calendar with commemorative days, weeks, and months that most people never know exist, or would never care about if they did know. In the United States, for example, June is both National Polka Month and Bath Safety Month. The second week of June was Law Enforcement Training Week and School Guard Crossing Week. The 16th was National Fudge Day, the 14th was Blood Type Awareness Day (that’s every day in Japan), and the 10th was American Log Cabin Day.

In Japan, meanwhile, the 10th was set aside as the day to commemorate time. Unlike American Log Cabin Day, it did not pass by unnoticed, particularly by the folks in Otsu, Shiga. They did what comes naturally to the Japanese—they had a festival!

That event was the Rokokusai, or Water Clock Festival, held at the Omi-jingu, a local Shinto shrine. As the jingu name suggests, this shrine is associated with the Imperial household, and the enshrined deity is the spirit of the Tenchi Tenno (emperor). He was number 38 and lived in the seventh century. In contrast, the shrine itself is relatively new—it was built in 1940 to celebrate the 2,600th year of the Imperial reign, dating back to the legendary first Tenno, Jimmu.

The reason they got all excited about water clocks is that the Tenchi Tenno introduced the use of those timekeepers to Japan 1,340 years ago. Several of those clocks and other historical timepieces are on display in a museum on the shrine grounds. Naturally, the local timepiece manufacturers take a special interest in the shrine and this event. They each donated a sample of their new products to the shrine for presentation to the divinity with a prayer for the prosperous growth of their industry.

The festival included a performance of kagura, or Shinto song and dance, and there was a procession with 400 people. The photo shows some of those participating in the procession presenting the donated timepieces to the divinity. They’re dressed in the manner of uneme, which means “selected women”. During the Heian period (794-1185), they were chosen from a nationwide talent pool—probably for their timeless good looks—to be court attendants and serve the Tenno at table. This was a formal role, though they likely did not serve the Tenno in other ways that some of you lecherous types are probably thinking about. He had official concubines to handle that aspect of his life.

Because the Japanese Tenno has primarily been a religious figure, the uneme were considered to have a religious role, and they were also his personal property. Therefore, violating an uneme was a serious breach of the law that was severely punished as one of the “eight abominable crimes”.

Watching attractive women in period costume carry around clocks might not ring most people’s chimes, but one participant saw it differently:

When I sat inside the quiet shrine precincts with the guardian deity for time, I reflected on how much time I’ve wasted. I hope to live my life hereafter with a real sense of the importance of time.

Tenchi’s water clocks sounded the passage of time with a bell, but some later timepieces used a boom. On Time Day this year, Kadoya Shoji of Nagaoka, Niigata, displayed a taiko drum clock that he recreated based on an original model dating from 1793 now in the collection of the National Museum of Nature and Science in Ueno, Tokyo (link on right sidebar). The interior of that clock is hollow, however, and how it worked is a mystery. There are no surviving designs, so Mr. Kadoya, who repairs timepieces for a living, had to come up with some ideas on his own.

His task was complicated because Japan used what is known as the temporal time system during the Edo period. Instead of dividing a day into 24 equal periods of 60 minutes each, the period from dawn to dusk was split into six equal intervals, as was the period from dusk to dawn. Therefore, the operation of the clocks varied from month to month. The period of daylight is longer than the night in summer, but that’s reversed in winter. Thus the “hours” progressively grew longer until this time of year (this week in fact), when they began growing shorter.

This manner of timekeeping was used until 1873, when the Japanese government adopted the Western method of using equal hours with no seasonal variation, as well as the Gregorian calendar.

Mr. Kadoya contrived a system with two scales – one for day and one for night—and used lead weights to operate it. He said it was difficult to create the mechanism for the automatic switch from the daytime scale to the one used at night. The weights are raised and readjusted once a day. The clock itself is 108 centimeters high (3.54 feet), 45 centimeters in diameter, and 20 centimeters thick. In addition to the drum beat signaling the hours, a bell sounds at the equivalent of noon. A mechanical bird attached to the upper part of the drum also moves at midday, in accordance with contemporary accounts of the original drum.

He’s been at this quite a while; Mr. Kadoya first repaired a Japanese clock 35 years ago at the request of a customer. That piqued his interest, and he has repaired more than 200 since then.

Asking someone for the time of day is usually a simple matter, but Mr. Kadoya might have a more complicated answer. You should specify the century first!

Afterwords:

For a photo of the face of an older Japanese clock, plus more details on their operation, try this post on the website of novelist Gina Collia-Suzuki.

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Posted in Festivals, History, Imperial family | Tagged: , , | 2 Comments »

Letter bombs (7): More on Isesaki

Posted by ampontan on Thursday, June 24, 2010

READER ACEFACE, employed by a media outlet in Japan, sent in a comment to our previous post that deserves greater attention. The piece in the Guardian about the facial hair ban in Isesaki was more poorly conceived than I thought. Here’s what Aceface has to say:

*****
I stayed for six days in Isesaki, Gunma, in the spring of 2001 for an assignment on one of those “take a short walk in the neighborhood” type of stories.

At the time, nearly 10% of Isesaki’s population were foreign residents, which is not that unusual for Southern Gunma, where many Brazilians and Peruvians live and work. But Isesaki also had residents coming from more than 70 countries. I was surprised to find a man from Equatorial Guinea registered as a resident foreigner there. The percentage and the variety of the residents match only one place in Japan–Minato Ward in Tokyo, ground zero for foreign diplomatic missions.

After I checked the Internet, (Japanese-language link) it seems the number has been reduced a bit to 12,296 people from 63 countries, and the ratio to the entire population is around 5.90%.

The City of Isesaki does hire many foreigners as temporary workers, such as substitute teachers at school and translators in city hall. And while I’ve never run into Sikhs, I’ve met lots of foreigners with facial hair.

Cities along the Tobu Isesaki line are known to have a significant Muslim population. The first shop you see after you get off from Isesaki station is a halal food shop. There were at least three mosques when I was there back in 2001. I was told by one of the Muslim residents I met in the city that one was “a bit fundamentalist”.

I can’t exactly tell how true it was, but one thing for sure is this guy was working in Isesaki and recruiting comrades for his cause from 2002 to 2003. (English-language link)

With that information in mind, the ban on facial hair for public servants in Isesaki has a whole different meaning.

******
Indeed it does, Aceface. So much for the “lovingly tended full beard” angle of McCurry’s article. A contemporary journalist stumbles across a real story and has neither the wit to understand what he was looking at nor the iniative to do more research. This will come as no surprise to the consumers of the contemporary journalism product.

They don’t want potentially dangerous people with Japanese language ability working as substitute teachers? I don’t blame them a bit.

*****
Here are excerpts translated into English from the Japanese-language link provided by Aceface. They are taken from Isesaki’s website and describe and explain the activities of the International Department.

(begin translation)

If you walk the streets of Isesaki today, you’ll see many foreigners. They often participate in local events, including the Isesaki Festival. Many children of non-native parents attend local primary and junior high schools. Restaurants serving cuisine from overseas, shops selling overseas food and clothing, and rental video shops with overseas titles are a common sight in town. There is even a supermarket-type retail outlet consisting of separate shops operated by people from overseas. Entering the facility is like taking a trip outside Japan.

Therefore, the Isesaki International Exchange Association offers services and conducts events for the non-native residents who live among us. These include consultation services, Japanese language classes, and exhibits of the artwork done by foreign students at public schools. There are an increasing number of situations, however, in which we cannot interact as we have in the past with the growing foreign-born population.

We established the International Department in 2004…That department set up a council for foreign-born residents of the city, the first of its kind in Gunma. It has 20 members from 13 countries. The objective is to create a multi-cultural city by incorporating the views of foreign-born residents and to create a consensus of opinion as Isezaki residents, despite their foreign nationality, based on considerations of cultural differences with Japan. As a result, many non-native residents have participated in such projects as the Tone River basin Clean Campaign and the planting of flowerbeds and trees at the public housing projects where many of these residents live. In one year, they offered the following suggestions:

1. Provide Japanese-language documents that are easier to understand by including reading aids for the kanji
2. Create a community center for the interaction of non-native and native residents of the city
3. Have council members actively participate as Isezaki citizens in city government activities with positive results

Within the city government, we have also created the Research Project Team to Promote Internationalization consisting of members of related municipal departments. They have since installed signs at public housing sites in five languages providing easy-to-understand instructions for separating and putting out household refuse. They’ve also created pamphlets in four languages providing explanations of the foreign resident registration system, national health insurance, and tax payments.

In addition to the foreign residents’ association and the project team, associations have also been formed for natives of Brazil and Peru, who have the first- and second-most residents of the city registered as foreigners when classified by country of birth. In the future, we will encourage the creation of organizations that promote internationalization, and plan to make every effort to have those organizations work with the foreign residents’ association and project team.
(end translation)

*****
My last post linked to a Guardian article that tried to depict the Isesakians as throwbacks to an imagined age of absolute conformity in postwar Japan. Soon after the post went up, a curious flurry of similar English-language articles on the same topic popped up on my RSS feed—even though the Guardian published the original article more than a month ago.

Just a coincidence, I’m sure.

Well, now they’ll be able to write a follow-up article with plenty of nuance that provides an accurate picture of life in Isesaki, including the sincere effort of the native residents to interact with their foreign-born population, without having to resort to the tired and inaccurate narrative of the Japanese as xenophobes.

We all know how busy they are wearing out shoe leather on their reportage, so Aceface’s description and my translation should be more than enough to give them a head start and save them some legwork. It shouldn’t take long at all for those follow-up pieces to appear.

Right, guys?

Afterwords:
Thanks also to reader RMilner for thinking to ask a question that brought an answer few expected.

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Posted in Foreigners in Japan, Government, Letter bombs, Mass media, Social trends | Tagged: , , | 6 Comments »

Letter bombs (6): Ignorance goes viral

Posted by ampontan on Monday, June 21, 2010

For people whose job it is to describe the world, journalists often seem to have remarkable difficulty imagining life in other people’s shoes.
- Michael Kinsley

The buzzing of the flies does not turn them into bees.
- Georgian proverb

JOURNALISTS and their employers have always been dependable for providing an undependable view of events that is more agenda-driven entertainment than information. Former American President Harry Truman once sighed that he felt sorry for his fellow citizens who woke up in the morning and read the newspaper, thereby thinking they knew something of what was happening in the world.

Isesaki flag

The revolution in information technology that has occurred since Truman’s time has given us much more tech than info. Though more pixels are hurled onto more screens, and more talk is belched into the ether, its accuracy and value are in indirect proportion to its quantity. The new technology also allows anyone to participate, but as the Georgians had it, the buzzing of those flies does not turn them into bees. The cacophony they create resembles nothing so much as a conductorless orchestra of vuvuzelas on a radio with a missing volume knob. Ignorance has gone viral.

They’re even more dependably undependable regarding Japan, a subject they almost never get right. A Japanese friend still keeps a clipping from an American newspaper he saw while on a trip to that country with a map of Japan showing Yokohama where Osaka is. (Osaka is 241 miles almost due west.) But as this post will show, they really don’t want to get it right.

This edition of Letter Bombs contains three items sent in by readers, one of which has an embedded fourth item. To these I’ve added a discovery of my own. All of them demonstrate that neither the bees nor the flies care a whit about the facts. They’d rather feed on the offal of a narrative of Weird Japan, the Goofball Kingdom of East Asia, populated by losers and perverts.

The Bogus #1

Mac sent in the first article by The Guardian’s man in Japan, Justin McCurry, whose body of work suggests his ambition is to become the thinking man’s WaiWai. McCurry slid forward on his stool at the FCCJ bar and pulled out another one. There are too many fascinating stories in this country of 127 million to cover them all, but the one McCurry selected for his Guardian readers was about the municipal government of Isesaki, Gunma, a city of 209,000 people, ordering its employees to shave their facial hair.

His manner of presenting information about Japan has become so predictable it deserves to be recognized as the McCurry Method ™. This consists of blending dollops of mythomania into meaningless generalizations applied to the entire population and to entire eras with the journalistic equivalent of an industrial paint sprayer, propelled by a condescending sense of superiority.

He starts with a line straight out of the Ryan Connell WaiWai stylebook:

(B)ureaucrats in one town could find themselves sent to the bathroom, razor in hand, for sporting even the suggestion of a five o’clock shadow.

There’s a reason they don’t issue artistic licenses to the people writing for a daily paper. None of this works even as hyperbole, least of all the idea that the average Japanese man is capable of producing a five o’clock shadow. Well, some are—by five o’clock the next day.

Authorities in Isesaki, Gunma prefecture, have ordered all male employees to shave off their facial hair, and banish all thoughts of growing any, following complaints from members of the public who said they found dealing with bearded bureaucrats “unpleasant”.

Might as well use that counterfeit artistic license until it expires from overheating. Imagine an Isesaki municipal bureaucracy capable of mind control, banishing thoughts of banned beards from all those who dare enter its precincts. You can’t even look out the window and daydream of a tidy Van Dyke.

Here’s a textbook application of the McCurry Method ™:

The Isesaki ban is reminiscent of the strict rules on physical appearance enforced by conservative companies in the postwar period in the belief that Japan’s rise to economic superpower required absolute conformity.

That’s in contrast to the wild and crazy guys with beards to their sternums, ponytails to their shoulder blades, and rings in their ears, lips, and noses to the grindstones at the hip, tolerant, a-go-go American and British industrial corporations of the 50s and 60s.

Shall we hold a pool to speculate where McCurry got the idea that the Japanese corporate establishment “believed” that “absolute” conformity was the key to becoming an economic superpower? Here’s where I put my money: He pulled it out of his backside.

What’s he going to write next? The robotic Japanese are automatons and economic animals who live in rabbit hutches, dream of conquering the world economically because they couldn’t militarily, and are so xenophobic they think Wogs begin at Calais?

Whoops, sorry about that last one. That comes from McCurry’s neck of the woods.

For an illustration of the strict ban on facial hair in Japan during the postwar period, here’s a photo of the man at the top of the social ziggurat in those days:

But this was the first time that an absence of whiskers had been enforced among civil servants, the internal affairs and communications ministry said.

But this was probably not the first time McCurry rewrote something to enhance the narrative. What the ministry really said was that they had “never heard of” any municipality in the country introducing such a rule, not that it had never happened.

The ban, the first of its kind among Japanese public officials, applies to any manifestation of facial hair, from lovingly cultivated full beards to trendy goatees and designer stubble.

And we all know that the range of facial hair from lovingly cultivated full beards to trendy goatees and designer stubble constitutes the A to Z of masculine hirsuteness.

A more realistic view was offered by Nakata Hiroshi, now running for an upper house Diet seat. When he was the mayor of Yokohama, he would have been in a position to institute such a ban.

Some beards are stylish, and some are unsightly, and it’s not possible to clearly define what would or would not make other people uncomfortable. This is a service industry whose employees should be aware that they interact with the public, and that everyone is checking out everyone else’s appearance.

Here are some more things McCurry didn’t see when he wasn’t looking: Facial hair for male employees is also banned at 7-Eleven Japan (full-time employees and student part-timers alike), Oriental Land, the operators of Tokyo Disney Resort, and the Tokyo Yomiuri Giants, the country’s premier sports franchise.

He also missed this site for a business consulting firm in the U.S.:

(E)mployers in the USA have a legal right to ask you to adhere to dress codes:
“A person can be fired because the company doesn’t like your shoes,” explains Robert D. Lipman, who manages the New York employment firm Lipman & Plesur, LLP …“People say ‘This is America. We should be able to do what we want.’ But I tell them that once you walk into a private employer’s workplace, your rights are limited.”

Less than a minute of research turned up this site from solicitors in Britain:

Standards of dress and personal presentation are relevant to most employers and having a policy on dress code can be important.
Where the employees meet customers and are effectively the shop window for the company, the benefits of presentable appearance are obvious. But even where the employee’s work is internal, there are less tangible benefits such as:
•creating a team atmosphere,
•engendering standards of professionalism, and
•creating a corporate image.

McCurry seems to fancy himself a successor to the tradition of British essayists, so it’s fitting to close this chapter with a quote from one of the best, William Hazlitt:

“The true barbarian is he who thinks everything barbarous but his own tastes and prejudices.”

The Bogus #2

Aceface found an article by people who didn’t look very hard either: a group of Internet hucksters calling themselves Business Ideas International, who claim to be based in Japan. A look at their website turns up business ideas resembling the sort of suggestions that used to be advertised on matchbook covers in the United States. (Start a DJ business and rock your way to financial freedom! How to get paid to play video games!) The combination of lackwits producing junior high school prose and preening with the conceit that they know what they’re talking about makes one wonder how they succeed in business even when they really are trying, much less offer advice to others.

The title is: 5 Twisted Business Ideas (That Could Only Have Come From Japan)

Sushi, Geisha, Schoolgirls and Anime are usually among the first things that come to mind when people mention Japan. Business Ideas International is based here in Japan though – and we’ve got the inside scoop. We can tell you from first-hand experience that the quirkiness of the land of the rising sun is not just limited to these usual pop-culture icons.

Give the business mavens credit for thinking outside the box. Who else would consider sushi and geisha “pop-culture icons”?

As someone who has regularly interacted with both Japanese and American schoolgirls, by the way, I’d say the Japanese variety are considerably less quirky.

(H)ere’s just a sampling of five twisted business ideas that could only have come from Japan.
#1 Love Doll Rental
It’s weird enough that some guys settle for a “real life” doll instead of a real girlfriend. But leave it to the Japanese – the place where these dolls-as-partners were invented – to take things a step further.

The earliest recorded instances of love dolls are the “dama de viaje” or “dame de voyage”. Those are Spanish and French terms for female dolls sewn out of old clothes for use as substitutes on sailing ships during long voyages. The Japanese and German navies performed similar experiments in the 1930s, and the Germans called theirs seemannsbraut. The Japanese like the term Dutch wives.

There was a big to-do in Britain in 1982 when a company called Conegate tried to import inflatable sex dolls from West Germany, but customs seized them. They were so anatomically accurate the authorities considered them indecent. The High Court overturned the verdict of an initial hearing on appeal and allowed the sale of seemannsbraut in the UK.

You see, here in Japan, if you’re not a “one-fake-woman” kind of guy, and prefer to “work the scene” you can opt to rent a love doll by the hour.

Thus demonstrating the aptness of Henri Amiel’s epigram that cleverness is serviceable for everything and sufficient for nothing.

But there’s a reason for the rentals.

With $2 million in sales last year, (Matt) McMullen now employs 14 people at his San Marcos, Calif., company (Real Doll) and makes about six or seven dolls a week, each requiring 80 hours of labor.

The linked article says that some dolls sell for as much as $US 6,500. To get an idea of what’s available, here’s a website with immaculate English offering “realistic latex & silicon love”.

Could it be that BII is chagrined they didn’t come up with the rental idea themselves?

Business Ideas International prides itself on being a publication that is SFW, so we won’t go into too many more details. Needless to say, let your imagination wander – what ever pops into your head, yup, that’s what they do.

How would the people of Business Ideas International know what Japanese men do with sex dolls? Unless…

#2 Roadside Alcohol Vending Machines
Nothing takes the edge of (sic) the morning drive to work like an early A.M. beer-buzz right? If you agree, you’ll love Japan. Here there are literally thousands of street-side alcohol vending machines. You can just pull up to one, stick in your ID and a couple hundred yen, and out pops a can of premium beer or potent Japanese sake. Open her up and keep on driving. Gives a new meaning to “one for the road”.

Anyone who thinks the Japanese show up for work with a morning buzz because they bought some beer at a vending machine instead of pulling into a 24/7 convenience store offering a greater selection of the same product is not old enough to work for a living. Incidentally, drunk driving laws in Japan are more stringent than in the US. Any alcohol in your system at all lands you in jail. No malarkey about blood alcohol percentages.

Remember, these people claim to be based in Japan.

The vending machines selling alcohol are for walk up (or pedal up) business, not drivers, but let’s not judge Business Ideas International too harshly. Anything to do with business, ideas, or Japan seems not to be their forté.

#3 Every Invention By Dr. Nakamatsu – Ever
If you don’t live in Japan, chances are you haven’t heard of Dr. Yoshiro Nakamatsu.

Even if you do live in Japan, chances are you haven’t heard of Dr. Nakamatsu.

Dr. Nakamatsu’s most notable invention is one that helped change the world at the time – the floppy disk. IBM made a deal with him in the late 70’s for his floppy-disk related patents that are bound by a non-disclosure agreement, so they may take most of the credit. Although the sum paid to him has never been revealed, he has lived the life of an extremely eccentric multi-millionaire ever since. Besides the floppy disk, Dr. Nakamatsu also holds patents for the core technology behind the CD, the DVD, the digital watch and even the taxi-cab meter.

They missed the patent for the automated pachinko machine, but what the heck. BII thinks that every invention by Dr. Nakamatsu ever is twisted. However, they do note that he also sells:

Pyong-Pyong Flying Shoes, Love Jet 200 Anti-Impotence Perfume, Yummy Nutri Brain Food…

Put “eccentric inventor” into Google and you’ll get almost two million hits. Dr. Nakamatsu actually appears in a few of them, but most of them refer to the tradition of eccentric English inventors.

Either Business Ideas International is jealous that Dr. Nakamatsu has more money than they ever will, or this is some undergrad’s idea of a put-on.

#4 Maid Cafes
Cute Japanese girls dressed in French maid costumes take your order and serve you food. They also occassionally (sic) get up on stage and sing and dance for you. ‘Nuff said.

Nah, not nearly “‘nuff said”.

Let’s talk about the American-based restaurant chain Hooters. The waitresses wear orange shorts cut at crotch level, tanks tops designed to show off their superstructure—hence the name “Hooters”–pantyhose, and bras. This is taken from the company’s website:

Hooters of America, Inc. is the Atlanta-based operator and franchiser of over 455 Hooters locations in 44 states in the US, Argentina, Aruba, Austria, Australia, Brazil, Canada, Chile, China, Columbia, Costa Rica, Dominican Republic, England, Germany, Greece, Guatemala, Korea, Mexico, Paraguay, Panama, Peru, Philippines, Singapore, South Africa, Spain, Switzerland, Taiwan, Venezuela and the Virgin Islands. The privately held corporation owns 120 units.

Now there’s a Business Idea International! Hooters has yet to hit Japan, however. Maybe all that latex & silicon love is squeezing them out of the market.

The element of female sex appeal is prevalent in the restaurants, and the company believes the Hooters Girl is as socially acceptable as a Dallas Cowboy cheerleader, Sports Illustrated swimsuit model, or a Radio City Rockette…Claims that Hooters exploits attractive women are as ridiculous as saying the NFL exploits men who are big and fast. Hooters Girls have the same right to use their natural female sex appeal to earn a living as do super models Cindy Crawford and Naomi Campbell. To Hooters, the women’s rights movement is important because it guarantees women have the right to choose their own careers, be it a Supreme Court Justice or Hooters Girl…Sex appeal is legal and it sells.

They’re feminists!

Hooters does not market itself to families, but they do patronize the restaurants. Ten percent of the parties we serve have children in them. Hooters is in the hospitality business and provides the best possible service to anyone coming through the door. For this reason, the chain offers a children’s menu.

So to sum up: A children’s menu in a restaurant called Hooters wink wink nudge nudge is normal, but some Japanese men patronizing restaurants with waitresses wearing French maid outfits is twisted.

#5 Live Seafood Restaurants
While many English-speaking countries have caught the Sushi Restaurant buzz, food connoisseurs abroad are still missing out on the REAL seafood dining experience here in Japan.
Apparently for the Japanese, just serving your food raw was not good enough for them. “If we’re not going to cook it”, an enterprising restaurant owner apparently thought, “why should we even bother killing it?”…

Apparently.

…and so the live seafood restaurant was born. That’s right, in Japan, you can go to a restaurant and be served a plateful of food that’s still alive and kicking.

Putting aside the image of kicking seafood, the folks at Business Ideas International apparently have not been to China or South Korea. Not very international of them, is it? Neither do they read Britain’s Telegraph, nor visit YouTube:

Chinese diners eat live fish in YouTube video
Animal rights campaigners have criticised the Chinese over their extreme eating habits after a video of diners eating a live fish became a hit on the internet.

The article is dated November 2009. The BII piece was posted in May 2010.

The Telegraph article contains this passage:

Reports have claimed some restaurants offer monkey’s brains. Other dishes include rats, dogs, snakes, lizards and baby mice.

I’ve also heard the monkey brains story from a Japanese man who operates a small restaurant and likes Chinese food. He visited China on a special tour for people in the industry.

Yesterday, I did a search at Google Videos and YouTube: “China live food” got 2,400 and 1,780 hits respectively. “Japan live food” got 1,800 hits and 1,410 hits, and “Korea live food” got 1,140 and 911. Not all of them were about the actual consumption of live food, however.

Incidentally, unless you’re interested in getting ill, all shellfish must either be eaten live or be cooked while live. The Health Department of the State of New York has issued an official warning. Raw oyster bars have long been popular on the American East Coast and in France. They’re so common in the U.S. the dish is called shooters.

Hey, who’s up for some shooters at Hooters!

At the very least, we hope this post has made you realize that no business idea is too strange or outlandish.

It also made me realize the extent to which ignorance has gone viral.

The Bogus #3

As we saw from the previous example, there exists a type of low intelligence that’s become convinced of its cleverness without seeing through the transparency of its oafdom. An even clearer demonstration is the Adam Frucci post at Gizmodo sent in by Dokushoka. It’s the journalistic equivalent of picking one’s nose in public.

The title is: Elderly Japanese Would Rather be Tended to by Robots than Foreigners

Frucci provides no specific information on what elderly Japanese think. How can he? That’s because he pulled it out of the primary source for people who write about Japan: His own backside.

What he does is provide in this “article” is a hot link at the bottom to the BBC, which is presumably his source. The link covers the space of only three letters inside parentheses, meaning most people will miss it or not bother with it. That’s the point.

Those few who do click on the link will be directed to a BBC report by Roland Buerk. It has no text—only about 2:40 worth of video, which means even fewer will bother. That’s also the point.

I watched.

That title is: Japan MAY accept robots over immigrants. (Emphasis mine) It’s about the nursing shortage in Japan. In his own variation on the McCurry Method ™, Buerk provides no specific numbers about a national nurse shortfall, but just expects everyone to take his word for it. He does talk to one woman employed at a hospital who says it’s difficult to find staff.

Back to Frucci:

Many of the potential nurses to tend to said old people happen to be from neighboring Asian countries. Not so fast! What about robots?!

Not so fast indeed! What about reality?! Frucci eliminates a critical part of Buerk’s story, which is that nurses must pass a medical terminology test in Japanese to stay more than three years. The failure rate is 98%. Buerk calls this “an example of Japan’s barriers to immigration”.

I’d call that another example of faux journalism and cultural arrogance. How loathsome of those Japanese to spend 1,500 years developing a difficult written language just to prevent other people from moving there.

The BBC briefly interviews a Filipino nurse complaining that even Japanese people have trouble reading the test vocabulary because they’re specialized kanji.

But of course they’re specialized kanji—they’re medical terms. Most laypeople in English-speaking countries couldn’t pass a medical terminology test in their own language either. How many people do you know who could define nosocomial infection, iatrogenic illness, or lethologica without looking them up? The English-language Internet is filled with advice to students for dealing with medical terminology tests.

Had anyone involved with the story known what they were talking about or cared to discover the truth, they’d know that learning kanji is sometimes a beneficial shortcut. Before I came to Japan, I had no idea what nephritis was. When I came across it in kanji, I understood immediately: inflammation of the kidney.

Back to Frucci:

Japan is a very racially homogenous society, where immigration is frowned upon and genetic purity is seen as a good thing.

Putting aside what Frucci thinks he knows about Japanese attitudes toward “genetic purity”, here’s a link to an article published in the monthly magazine Voice—available at newsstands everywhere—almost seven years ago by six members of the now ruling Democratic Party in Japan calling for the immigration of 10 million people. Two of them are now in the Cabinet.

And with the birthrate slowed, they’re moving towards an era where (sic) a full half of the population will be over 65.

His source, Buerk at the BBC, says only that a quarter of the population is over 65 now. He says nothing about an era “where” a “full half” of the population is over 65.

See what I mean about pulling stuff out of their backsides?

Buerk’s turn:

Compared to the melting pots of London and New York, foreigners really stand out here.

On the contrary, the many Chinese and Korean foreigners here don’t stand out at all, but then some people think they all look alike. As Britain’s Prince Philip had it, they’re all “slitty-eyed”.

In passing, I’ll note this belief that the term “foreigner” belongs exclusively to them is endemic among Caucasians in Northeast Asia.

The possibility of allowing mass immigration is barely even discussed.

Buerk doesn’t seem to be big on reading Japanese either. He’s also not the first European to look the other way when the subject is the impact of mass immigration in Europe. After all, Mohammed has been the most popular name for baby boys in London and Yorkshire since 2008. Here’s a headline from a Swedish newspaper a few months ago: “Gothenburg Man Arrested over Somali Terror Plot”.

Eventually they COULD be put to work in restaurants and shops…Accepting a robotic future in Japan COULD be more popular than accepting mass immigration. (Emphasis mine)

Eventually somebody COULD do some real research about this country—it’s easy if you try—but that’s not bloody likely, is it?

The Beeb and Buerk knew enough to use the weasel word to give them plausible deniability against the charge of overt statements without a basis in fact, but that flew over Frucci’s head. He writes:

That means they’ll need one of two things to take care of that aging population: foreign nurses or robot nurses. Guess which option seems more reasonable to them?

Frucci is also a masterful prose stylist…

Yes, robotic fucking nurses.

…whose primary source after Buerk is his buttocks:

(H)ospitals are going to be shut down because of a lack of staff and people are going to be left without vital medical care.

Not even Buerk claimed people were going to be left without vital medical care.

Here’s some more glittering prose:

Sooner or later, they’re going to need to allow immigrants from neighboring Asian countries to enter the country and work in much greater numbers in order to make up from (sic) the soon-to-be greatly diminished Japanese workforce.

Soon according to Buerk was 40 years, if current demographic trends hold.

And not just to build goddamned robots.

But perhaps I misunderstand. Frucci may be deliberately adjusting the level of his writing and intellectual content for his audience. From the comments:

I just wrote a research paper on this same subject. The Japanese are very xenophobic and homogeneity is important to them. So to except about a million (yes I said a millions about 15 million to be exact) immigrants is a tough thing for them.

Here’s another:

Japan is such an odd place that I am willing to believe that they think robots are better than humans of a different ethnicity. Stay classy Japan.

Recall what President Truman said about the effects of newspaper journalism? Here’s one more:

Foreigners also prefer that robots take care of old Japanese people.

How much do you want to bet that guy fancies himself a master of wit and repartee?

The Bogus Bonus!

I ran across this article in Britain’s Telegraph by Danielle Demetriou. That it was the only article about Japan on an American site with political and social commentary demonstrates the poisonous effect journalists have on the views of their product’s consumers in the Anglosphere.

It’s a perfect fit for this post. It now contains links to an aggressively ignorant business promotion site and an aggressively ignorant tech blog sandwiched by poorly researched articles from British broadsheets of the left and the right.

Here’s the headline:

Tokyo sees rise in ‘divorce ceremonies’
As Japan’s divorce rate soars, couples in Tokyo are ending their marriages with as much care as they began them. (Emphasis mine)

It includes this sentence:

Their introduction is timely: more than 251,000 divorces took place in Japan in 2008, a figure blamed partly on the poor economic climate and the end of the salaryman-led family units which used to be the bedrock of much of Japanese life.

Comparing that with this section of the English-language website of the Ministry of Internal Affairs and Communications brings up some intriguing questions.

In Japan, divorces were on a generally upward trend from the 1960s until 2002 when they hit a peak of 290,000. Since then, both the number of divorces and the divorce rate have declined for six years straight. In 2008, the number of divorces totaled 251,000, and the divorce rate was 1.99 (per 1,000 population).

Did Demetriou access this herself, get the accurate divorce statistic, and pull the rest out of her backside to juice up the story? Or did someone access it for her first and fail to provide the full context, forcing her to pull the rest out of her backside to juice up the story?

And just what is “soaring divorces blamed on the poor economic climate and the end of salaryman-led family units” supposed to mean?

Japan’s divorce rate per 1,000 population is one of the lowest in the world and is declining. The unexplained and inexplicable reference to the “end of salaryman-led family units” is a borrowing of the McCurry Method ™. Now I’ll borrow the pretentious phrase of those thin-skinned scribes caught with their pants down pulling stuff out of their backsides: I stand by my claim that the journos are making stuff up to ridicule the Japanese and thereby sell product.

Saori Teshima had long dreamt of the moment.

How would Demetriou know?

So goes another divorce ceremony – a bizarre, but increasingly popular ritual among Japanese couples, who choose to end their marriages with the same pomp and ceremony with which they began them.

Who is Demetriou to use “bizarre”, the contemporary teenager’s default term of derision, to describe a preference for ceremonies to mark the milestones of one’s life? I was graduated from school twice in my life—once from high school and once from university. Japanese also have graduation ceremonies for those finishing kindergarten, primary school, and junior high school. They also have entrance ceremonies and ceremonies to mark the start of the school year.

Saturday night, I attended a party for a man’s kanreki—his 60th birthday. The Japanese have observed customs associated with kanreki for several hundred years.

But it’s understandable why some British would consider a divorce ceremony bizarre. Their divorce rate is roughly six times that of Japan. From the Office of National Statistics, UK:

The rate of divorce in the United Kingdom has been dropping in recent years. In 2007 the divorce rate in England and Wales was recorded at 11.9 people per every 1000 of the married population. This is the lowest divorce rate recorded since 1981.

If they started conducting divorce ceremonies, when would they ever sober up enough to go to a pub for the binge drinking required to properly enjoy a soccer match?

Britain also has the highest number of unmarried mothers in Europe. Ceremonies and commitments? Screw that for a lark.

Pioneering the trend for divorce ceremonies is Hiroki Terai, 29, an entrepreneurial former sales man from Japan’s Chiba district…

Chiba is a city and a prefecture (i.e., province or state) right next to Tokyo. Odd that The Telegraph’s Japan correspondent wouldn’t know that it isn’t a “district”.

…who dreamt up the idea after friends of his decided to separate last year. Since setting up a company devoted to divorce ceremonies in March, he has been contacted by more than 700 people and conducted 21 divorce ceremonies – costing from £44 to £700 – with a further nine booked.

In other words, this “increasingly popular ritual” is performed for 0.01% of all divorces.

Roland Kelts, a Japan culture expert and lecturer at the University of Tokyo, described how divorce ceremonies were a welcome tool for Japanese to deal with shifting family structures.
“Today’s Japanese women are well-educated and worldly,” he says. “They watch Sex and the City and wonder why their husbands are not more dynamic. And their husbands, having lost the security of lifetime employment and its perks, are wondering why their wives are so impatient. No wonder divorce has risen to a third of Japanese marriages.”

Only an academic could achieve the hat trick of pulling something from his backside, applying the McCurry Method ™, and beclowning himself in a few meaningless sentences. My favorite was the non sequitur of men losing their lifetime employment perks and then wondering why their wives were impatient.

Kelts’s “discipline” is pop culture in general and manga in particular, which might explain why he’s hit an intellectual glass ceiling here. Yes, an entire nation of Japanese women, just recently backwards and uneducated, knew nothing about sex before they married and even less afterwards, but turned on the cable to Sex and the City and found it so believable they got impatient with their limp, uninterested husbands.

And so the divorce rate has fallen for six years straight.

The Bona Fide!

It’s time for a palate cleanser after swallowing all that inedible fare. Fortunately, Mac also sent in a Youtube video of a live performance by the Shibusashirazu Orchestra, whom he says played at his local rice festival. The music is a heady blend of modern jazz and pop played with straight-ahead gusto on both Western and traditional Japanese instruments. To this they add free-form stage performers and modern and traditional Japanese dance. Their name literally translates to “not knowing tasteful sobriety”, and that’s no joke.

If they were from America or Europe, you’d know about them already. But after you watch the clip to the end, you’ll know something McCurry, BII, Frucci, Buerke, Demetriou, and their readers don’t.

Afterwords:

* Any municipality with a flag such as the one used by Isesaki has to be a cool place no matter what happens there.

* Haruyama Fumio, the chair of the human rights committee of the Gunma Bar Association, says the Isesaki facial hair ban restricts the freedom of individuals.

Count on a human rights lawyer to know nothing about human rights.

Part of the transaction between the employer and the employed is that the employed voluntarily gives up certain rights at the employer’s request. That’s why none of the staff at the elegant hotels in London’s Mayfair district wear Hawaiian shirts and beach sandals to work, for example.

If Justin McCurry wants to work out of his rabbit hutch, he has every right to wear a French maid costume, paint his face to look like Hello Kitty, and identify himself as Justine on the telephone if he chose to do so. No one would care. But his employer would surely object if he were to dress and behave that way on the rare occasions he sallies forth to interact with the Japanese public as part of his job.

Of course, if people found dress and facial hair codes to be an infringement of their rights, they’re free to refuse a job offer.

All of this should be elementary.

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Posted in Food, Foreigners in Japan, Government, Letter bombs, Mass media, Music, Popular culture, Sex, Social trends | Tagged: , , , | 27 Comments »

Shaved ice goes upscale and global

Posted by ampontan on Sunday, June 20, 2010

ONE DELIGHTFUL SURPRISE when I arrived in Japan was the discovery that kakigori, or shaved ice, is a favorite summertime treat. I grew up eating what we called snowballs in the hot humid summers of Baltimore. The name is different, but the basics are the same: shaved or granulated ice covered with a sweet syrup. The Japanese have variations that include condensed milk, the sweet adzuki bean, and ice cream toppings, but there are seldom more than four or five flavors. Baltimore snowball stands offered a much greater variety, however. My parents often took my sister and me to a stand on the premises of a plant nursery near my mother’s family home that featured more than 40 flavors, including peppermint and spearmint. Liquid marshmallow on top was also available for a few cents extra. My mother was a chocolate aficionado and my father fancied the egg custard, which was similar to vanilla. I liked both of those, as well as grape, which I did find once in Japan. My sister was partial to the sarsaparilla flavor, based on the soft drink common in those days that could be described as hard-core root beer. I don’t know if the stand still exists, but it was in business every summer for at least 30 years.

The Japanese have been treating themselves to kakigori for a very long time. The first recorded mention appears in the Makura no Soshi, or Pillow Book, a collection of the personal observations and writings of Sei Shōnagon, a court lady to the Empress Consort Teishi. The book was finished in 1002.

One of the “Elegant Things” she describes in a section of her book with the same title is a delicacy in which a block of ice was scraped with a blade, with the scrapings placed in a metal container. The ice was then covered with the sap from a local ivy called amazura, which has been used as a sweetener in Japan for about 3,000 years.

The first kakigori shop was opened in Yokohama in 1869. The proprietor must have been one sharp businessman–his shop was also the first in Japan to sell ice cream. The government instituted purity standards for ice in 1878, and the first kakigori machine was patented in this country in 1887 by Murakami Hansaburo. Edward S. Morse wrote of eating kakigori in Japan circa 1880 in his book Japan Day by Day, published in 1917. Morse was an American zoologist who came to Japan in search of coastal brachiopods.

Tracy Schneider at the Al Dente website goes in search of even more shaved ice treats, and in addition to kakigori, she’s found Thai Nam Kang Sai, Korean Bingsoo, Chinese Baobing, Vietnamese Che Bau Mau, Indonesian Es Cendol, Hawaiian Shave Ice, Filipino Halo-halo. and Malaysian ABC Ice Kachang. She’s got a link at her post to another post describing the characteristics of each one. Ms. Schneider is a true devotee–she had nine posts on shaved ice last summer alone.

She also links to this informative article on shaved ice by Julia Moskin in the New York Times’ Dining and Wine section. It’s now haute cuisine! Ms. Moskin’s article presents examples from even more countries, but–this is the Times after all–occasionally spills over into Manhattan gourmet pretentiousness.

There’s also an Amazon link to buy a Hamilton Beach Snowman Ice Shaver for those who want to make it at home. I’ll stick with the manually operated crank-type machine that my wife bought about 20 years ago, which still works fine. Come to think of it, it’s about time to take it down from the cabinet for this summer’s mid-afternoon delights.

The critical factor for the creation of shaved ice in any country seems to be humid summers. I found only one shop that offered shaved ice in the Bay Area of California when I lived there. It was a sideline to their fast food offerings, and they had no idea what they were doing. I never went back a second time.

I saw a TV program in Japan a few years ago in which they flew a kakigori machine and some flavorings to the Sahara and served it to a small tribe of nomads. (Who says Japanese TV isn’t interesting?) None of them cared for it–the sweetness might have been a problem, and it’s not a practical thirst quencher in a place where water is at a premium. They all laughed and puckered their lips as if they had eaten something too tart.

One person commenting on the Al Dente post had this to say:

We called them snow balls, and they were literally shaved from a big block of ice with a shaver that worked a bit like a carpenter’s plane, except that the shavings were caught in the front under a lid. Kids (maybe 12 to 15) operated snowball stands all over the town every summer. The syrups were normally purchased. Back in the 50s, prices started at a nickel.

I could have written the same thing word for word myself!

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Posted in Food, History | Tagged: | 2 Comments »

Some people

Posted by ampontan on Friday, June 18, 2010

SOME PEOPLE were pleased with Prime Minister Kan Naoto’s recent announcement that he wouldn’t visit the Yasukuni Shrine as prime minister, though no one was surprised.

Some people, however, were angry. Some people in the latter group were upset for reasons that others might find distasteful, but others were angry for a reason that should be understandable to everyone, regardless of their position on the issue.

Earlier this year, when relations between Japan and the United States grew tense with Prime Minister Hatoyama’s blundering over the Futenma issue, then-Finance Minister/Deputy Prime Minister Kan visited Washington D.C. as part of his official duties. Realizing that he might well wind up as prime minister himself before long, and looking for a way to mollify the Americans, he visited the national military cemetery at Arlington, Va.

That’s why it’s natural for some people in Japan to be dumbfounded that he would visit a site to commemorate American war dead, but not a similar site for Japanese war dead.

Some people might object to a Yasukuni visit because they would claim some of the Japanese memorialized there fought in an immoral war. But there are a lot of people around the world who think some of those buried at Arlington fought in immoral wars too. Including some Americans.

The Chinese will be gratified that Mr. Kan won’t visit Yasukuni, but some of the men buried at Arlington killed plenty of Chinese when the army of that country came to the assistance of Pyeongyang on the Korean Peninsula 60 years ago.

Some people would object because Yasukuni enshrines Class A war criminals. Then again, nearly 500 soldiers of the Confederacy are buried at Arlington in concentric circles around the Confederate Monument. One of the reasons they fought in the American Civil War was to maintain the institution of human slavery.

On the base of the monument are the following words: (I)n simple / Obedience to duty / As they understood it / These men suffered all / Sacrificed all / Dared all-and died.

Those words wouldn’t be out of place at Yasukuni, either.

*****
Some people were nonplussed when Ren Ho, the Wide Show Daijin, grilled a bureaucrat during last year’s policy review and asked why it was necessary for Japan to aim at being number one in the world in the development of a supercomputer. What was wrong with being number two, she demanded?

For the same reason your party wasn’t satisfied with being the second-largest in the Diet, would be the obvious answer for some people familiar with evolutionary biology.

Now she’s interested in walking that one back, particularly after the successful return to earth of Japan’s asteroid probe has generated some positive publicity. In a recent interview with the Sankei Shimbun, she said:

(Japan) aims to be number one in the field of science and technology. It’s natural that we should aim to be number one in other fields, too.

She was asked the same question by the opposition in the Diet. Her first instinct was to use an excuse that some people no longer accept from politicians:

My words were taken out of context.

But she also got a bit huffy:

My word alone was not the determining factor for everything in the policy review.

No one thought that it was. Some people just assumed you meant what you said.

*****
Some people were mildly surprised that Kamei Shizuka of the People’s New Party didn’t withdraw from the ruling coalition instead of merely resigning his Cabinet post after the DPJ brain trust double-crossed him like they two-timed Fukushima Mizuho and the SDPJ over Futenma by postponing passage of the Japan Post renationalization bill. Then again, some people wondered why a man of his age and political experience should have expected the DPJ to keep its word, especially after their behavior of the past few years.

Mr. Kamei explained his reasoning during a speech at the JR Shinjuku Station in Tokyo:

(The DPJ) are neglecting an important political issue and holding an election while their support rate is high. There have been repeated crashes-and-burns in Japanese politics. The PNP is gritting its teeth and staying in the coalition to prevent the DPJ from running out of control.

Even some people who don’t care for the PNP and Mr. Kamei will have to admit that makes a lot of sense…

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Posted in Politics | Tagged: , , , | 3 Comments »

Car accident culture

Posted by ampontan on Thursday, June 17, 2010

KREMLINOLOGISTS during the days of the Soviet Union would go so far as to examine the relative positions of leaders on the review stand during the annual May Day parades to assess the strength and weakness of the individuals involved.

Though they don’t receive as much public attention, those who study the personnel shifts in Pyeongyang under the Kim Family Regime employ even more arcane methods. One of them, an American named Michael Madden, has a website named North Korean Leadership Watch devoted to the ins and outs of the North Korean Who’s Who.

Mr. Madden is wondering if something might be afoot, as he reports that “11 members of North Korea’s leadership have either passed away, been replaced or disappeared from public life in the first half of 2010.”

This passage is both instructive and entertaining:

A book-length historic study could be done on car accident culture in the DPRK. On one hand, a car accident, heart attack or “incurable illness” may be as reported. The side effects of the elite’s party and social culture–drunk driving fatalities (some elites seem to refuse chauffeur service), alcohol-related disease–have thinned the ranks of KJI’s trusted lieutenants in his Personal Secretariat. On the other hand, the car accident has also been a euphemism in the regime’s official obituaries, and can indicate either the beginning, or end, of a purge.

Elsewhere, he quotes a Korean analyst who says that Kim Jong-il practices “inclusive politics”, which involves a delicate balancing act.

Change the name and the nationality and he’d be the National Sparkler on the editorial pages of the New York Times and Washington Post.

Also on the main page of the site now are photographs of four of Kim’s children, a classic photo of Kim’s December 2009 tour of the Pyeongyang Cornstarch Factory, and an account of the brief JoongAn Ilbo interview of Kim Jong-nam, the Dear Leader’s eldest son, in Macau–the first given to a South Korean source. Hoofing it in blue loafers, the younger Kim offered a top-notch Sgt. Schultz imitation (“Cheonan? I do not know. Please stop.”)

And if you want more speculation on the state of the current North Korean leadership, this Asia Times article by Aidan Foster-Carter is also worth reading.

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Letter bombs (5): Bombs away on Your Party!

Posted by ampontan on Thursday, June 17, 2010

FREQUENT COMMENTER M-BONE sent in a comment about Your Party that’s so good it deserves to be on the main page. I asked him for permission to post it here, and he kindly agreed. Here it is, with translations for the Japanese parts and some minor editing for readability

******

(It’s) not like Your Party is immune to contradictions, however.

Just off the top of my head, I can remember Asao Keiichiro last year proposing (in the media) “to float a retired US aircraft carrier out in the ocean and use that” as a solution to the Futenma deal. I mean, they only have what, a half dozen members in the Diet, and this one is clearly out to lunch on this issue anyway. That’s the kind of solution that progressives jokingly come up with. In private. When drunk.

Also, it is my understanding that American neo-liberals (and libertarians) have been arguing for some time now that more flexibility, less conservativism, and less regulation is needed in the Japanese labor market, and that this is a necessary condition for growth. I also recall this being a key issue during Koizumi’s tenure.

Your Party, however, is putting forward a bunch of policy suggestions that don’t seem a whole lot different from those of the Communist Party including: equal pay for equal work for permanent and temporary employees, improved public housing and reduced medical insurance payments for the long-term unemployed (in terms that pussyfoot around, but seem an awful lot like, a mandate for increasing welfare spending), increasing the minimum wage, cracking down on unpaid overtime (i.e. direct intervention in corporate culture) with the aim of having companies hire more employees, and eliminating day labor. This is a big step back from some of the reforms implemented in the Koizumi days and, on the whole, doesn’t seem radically different from the slate of DPJ proposals. I really don’t see how they can expect to do this while reducing taxes and eliminating deficits.

They’re also promising to more than double the amount of the current children’s allowance to JPY 30,000 (about $US 328) per child per month until age 15, free medical care until primary school, increase (and apparently heavily subsidize) daycare. They also promise straight up to:

社会的弱者に配慮した所得再分配を強化する.(その財源として、人定控除の見直しや高額所得者への課税強化(所得税、相続税等)を検討。)
Strengthen the redistribution of income in consideration of the weaker members of society (As funding sources, we will consider reexamining [i.e., removing] personal deductions, and increasing taxation on those with higher incomes [income tax, inheritance tax, etc.]).

This kind of language should make libertarians gag, no? It also seems unrealistic to talk about doing things like this while reducing deficits and taxes.

They’re also apparently going to do all kinds of expensive stuff to education like introduce dramatically smaller class sizes in order to increase the role of direct experience in education. And once again a focus on egalitarianism that has to be paid for:

親の貧富で教育格差が広がらない環境整備。高校、専門学校、大学等の高等教育への奨学金制度の拡充
Creating an environment that does not exacerbate the disparity (kakusa) in education based on the financial resources of the parents. We will expand and enhance the system of scholarships for higher education, including high schools, vocational schools, and universities.

There’s that kakusa word so loved by the left.

Some more:

日本は、「唯一の被爆国」という原点に立ち返って、また、「アジアの中の日本」という認識に立脚し、「核廃絶」「世界平和」に向けて、持てる力をフルに活用し、国際社会において主導的役割を果たしていくべきである。
Japan should return to its fundamental standpoint as “the only country to have suffered an atomic attack”, ground itself in the awareness that it is part of Asia, fully utilize its strengths for abolishing nuclear weapons and achieving world peace, and assume a leading role in the international community.

That could have been straight from the JCP webpage, but it comes from Your Party’s. I also don’t see how this is so different from yuai:

成長しつつある「30億人のアジア市場」を「国内市場」「内需」とする消費拡大を実現。車・電機・機械だけに頼る単純なモノづくり信仰から脱却。これまで内需型産業とされていた流通(コンビニ、専門店)、物流(宅配便)、教育(学習塾)、福祉(高齢者介護、老人ホーム)、農業、食品等の海外進出・輸出を強力に支援。同時に、医療(高度医療・高級健康診断)、大学、観光などでアジアからの顧客を誘致し、少子化のハンディキャップを克服
We will expand consumption so that the growing Asian market of three billion people becomes a domestic market with domestic demand. We will transcend the creed of simple manufacturing (monozukuri) that relies only on automobiles, electric equipment, and machinery. We will provide strong support for companies that want to establish an overseas presence or engage in exporting, in what have been considered domestic demand-driven industries, such as retailing (convenience stores, specialty shops), distribution (home delivery services), education (private preparatory schools), social welfare (long-term care for the aged, homes for the aged), agriculture, and food products. We will also overcome the handicap of a declining population by soliciting customers/patrons from Asia for medical care (sophisticated medical treatment and medical examinations), universities, and tourism.

And:

中国、韓国、アセアン、米国、豪州、インド等を含むアジア太平洋地域内で、経済、エネルギー、環境、安全保障各分野での協力を促進。
Promoting cooperation in the economic, energy, environmental, and security sectors in the Asia-Pacific region, including China, South Korea, the ASEAN countries, the U.S., Australia, and India

アジアを一つの市場とみなし、国内市場と一体化して域内経済を活性化。「サムライボンド」(「円建て債」)の活用による域内インフラ、物流等の整備。
We regard Asia as one market; we will work to unify that market with the domestic market, providing dynamism to the regional economy. We will create a regional infrastructure and logistic networks through the use of samurai bonds (yen-denominated bonds).

アジアの通貨防衛、為替安定を図るため、アジア版通貨基金構想を推進。
We will move forward with the concept of an Asian Monetary Fund to protect Asian currencies and stabilize foreign exchange transactions.

This mantra of increasing economic integration and security cooperation doesn’t seem to differ a whole lot from the DPJ. They sure aren’t any more interested in pushing China on human rights, at least not according to the manifesto or anything easily available in the media.

On foreign affairs, they seem to accept that the Iraq War was dishonest/a failure, which parallels the mainstream progressive position:

イラク戦争等の反省に基づき、自衛隊の海外派遣については、しっかりとした原理原則を定める法律を策定。
We will formulate laws that provide clear principles for the overseas dispatch of the Self-Defense Forces, based on a reexamination of the (mistakes of) the Iraq War.

It certainly doesn’t look like this is going to lead to the type of backup in the Middle East and elsewhere that the US has hoped for from Japanese conservatives.

In effect, there are many Your Party policy parallels with the center-left. Since Kan came in, they already seem to have lost about a quarter of their support (latest Sankei poll) and I can see why – they parallel DPJ on issues important to the Japanese public (lifestyle, employment, education improvement) and now that the hated Ozawa/Hatoyama manzai team is out, the wind is going out of the Your Party sails.

I’m not really feeling this “lumberjacks at a hoedown” thing – it seems like they want loads of regulation and hand over fist government spending in some of the same places that the left of the spectrum parties do. So do they want to have their cake and eat it too?

*******
Evidently, M-Bone, that seems to be exactly what they want to do.

I translated an interview with Your Party head Watanabe Yoshimi and posted it on 1 April. Here’s one quote from that interview:

The LDP has abandoned the small government path. Both they and the DPJ are on the big government path. In other words, they incline toward the socialist path of expanding state intervention. In contrast, we prefer the small government path, and we insist that the payment of the bill not be deferred to the future. We have also presented a clear growth strategy for expanding the economic pie.

Now compare that with what M-Bone found in their platform.

M-Bone also said:

I really don’t see how they can expect to do this while reducing taxes and eliminating deficits.

You’re not the only one, dude. They’re making a big deal about how they and only they are opposed to increasing the consumption tax, which, in retrospect, should have made me take a closer look at their taxation proposals. In a recent interview that I was going to use in an upcoming post, Mr. Watanabe also has favorable things to say about personal accounts for health care, although he was vague on the details. After all the time I’ve spent mucking around in the back alleys of the DPJ and SDPJ platforms, I should have known better.

In a personal note, M-Bone wrote:

I agree that Kasumigaseki should be burned to the ground, but Eda’s attempt to frame Your Party as some sort of anti-DPJ strikes me more as an attempt at branding than a real ground up difference.

Yeah, that too.

I’ve been swayed by the enormous amount of time Mr. Watanabe and Mr. Eda have spent campaigning against the bureaucracy’s stranglehold on government, their support for devolution, their complaints about labor union involvement and hypocrisy in the Democratic Party of Japan, and their insistence on expanding the economic pie. But when they start talking about increasing the child welfare allowance, income differentials, taxing the rich, and a half a dozen other things in there, it falls apart like a cheap suitcase.

Considering the sheer volume of public statements and interviews containing comments such as the one I quoted above, I thought they had to be serious.

As a university friend of mine often used to say, “Well, f**k me dead!”

To be sure, there was another warning sign. The June issue of Seiron had an article charging that they were no different from the DPJ, and that their platforms were urifutatsu (two melons, or like two peas in a pod). Sometimes, however, that publication can be too over the top and has too much Tamogami for my taste. I thought their problem might be that Your Party wasn’t wrapped in the flag, so to speak, and I passed on buying the issue. Boy, was that a mistake.

I apologize for not doing my homework, and vow not to let that happen again. Thank you, M-Bone, for teaching me a lesson. Making assumptions about anything at all in the world of Japanese politics is impossible!

******
That said, some of the excerpts about integrating with the regional Asian economy don’t bother me that much. The idea of an East Asian entity modeled on yuai and the EU is even less desirable than the EU itself, but I’m a free trader by nature.

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Japan’s political kaleidoscope (5): One degree of separation

Posted by ampontan on Wednesday, June 16, 2010

HUNGARIAN AUTHOR Frigyes Karinthy is credited with developing the concept of “six degrees of separation”, which holds that everyone on earth is at most only six links in a human web away from everyone else.

But with Japanese politics you can stretch the definition just a bit and the separation between everyone shrinks to only one degree!

*****
When the Hatoyama administration was burning up on reentry into the atmosphere last month, Democratic Party of Japan elder statesman Watanabe Kozo (who as a former Liberal Democratic Party member and former friend of Ozawa Ichiro in both parties is a key player in the degree of separation game) suggested that the DPJ might form a coalition government with the hard-line reformers of Your Party. A few columnists in the weekly magazines picked up the idea and gummed it over.

Your Party Secretary-General Eda Kenji was having none of it:

I firmly declare that we will not join with the DPJ after the upper house election….If we were to form a coalition with the DPJ, it would be suicide for the party. It’s not going to happen.

It’s a wise man who never says never about anything in Japanese politics, but Mr. Watanabe and the journalists really are out of touch. Your Party does not just stand for bureaucratic reform, small government, devolution of power, and lower taxes, they stomp their feet on that platform like lumberjacks at a hoedown. They are as much an agenda party in their own way as the Communists are in theirs. It should go without saying that it would be political hara-kiri for them to sell out to the DPJ by joining a coalition, but some people are still looking through the eyeglasses of the last century.

Someone else who should have known better is the Internet pundit who suggested that we’d find out what Your Party is really like after they join a larger party. Not only are they unlikely to join either the DPJ or the LDP as presently constituted, it is more likely that people will wind up joining them, particularly if they do well in the upper house election. Every day the RSS feeds coughs up another article about a new Your Party candidate announcing his candidacy in either the national or a local election.

*****
Speaking of Watanabe Kozo, he had this to say in a TV interview on the 11th about Ren Ho, the new Minister for Government Reform:

Having a minister like that in the television age is good for our popularity with the people. She’s a made-for-TV minister.

Out of the mouths of babes and the elderly. Ren Ho is now ending her first term in the upper house after a career as a model and TV announcer.

When Mr. Watanabe tried to recover, he shoved his foot in deeper:

She’s a flower, the Cabinet’s flower, both in name and in fact.

*****
Speaking of Ren Ho, her mother recalled this in a recent interview:

Just before he died, her father told her, ‘Whatever you do, don’t go into politics,’ and now she’s a Cabinet minister.

Ren Ho’s father was Taiwanese and her mother is Japanese. She became a naturalized citizen in 1985.

The leaders of her party, including Messrs. Kan, Hatoyama, Ozawa, and particularly Foreign Minister Okada Katsuya, are supporters of legislation allowing people with permanent resident status the right to vote in local elections (though the Japanese expression refers to political participation, which also implies candidacy).

They wanted to include this pledge in the party’s political platform for last summer’s lower house election campaign, but someone launched a petition drive to prevent that. The petition was circulated among the party’s Diet members and got roughly 50 signatures. Though her office denies it, she is thought to have been the person most involved in collecting those signatures. She is also on record as saying:

If you want the right to vote, you should become a citizen.

*****
Here’s what else Ren Ho said on the record, this time at a news conference on the 15th about the recovery of the Hayabusa capsule in Australia after seven years and four billion miles in deep space. It was the first spacecraft to land on an asteroid and return to Earth. Scientists are anxious to see if it brought back a sample from the asteroid Itokawa, on which it landed twice in 2005.

Said the minister:

All Japanese should be proud of this magnificent achievement. We made a major statement to the world.

One of the reporters present pointed out that the DPJ policy review conducted last November—the platform that launched her into the Cabinet—cut the budget for space exploration. One of the items whose budget was slashed–from JPY 1.7 billion to JPY 30 million–was the program to create a successor for the Hayabusa.

First she bought some time:

I was not directly responsible for space exploration (in the policy review). I’m in the process of confirming what happened.

And then she answered:

We shouldn’t defend all the results of the policy review, no matter what. Of course we should incorporate the different opinions and judgments of the people when compiling the next budget.

This is the person the Japan Times called a “firebrand reformer”.

She may be a relative newcomer to politics, but she’s already grown a second face.

*****
Speaking of two-faced politicians, Tanaka Shusei reminded people in the current issue of the weekly Shukan Gendai that when Prime Minister Hashimoto Ryutaro concluded the agreement with the Americans in 1996 to move the Futenma marine base to another location in Okinawa, current Prime Minister Kan Naoto was a member of the New Party Sakigake, which was part of the coalition government. Mr. Kan was in the Cabinet as the Health Minister, and former Prime Minister Hatoyama Yukio was then the acting secretary general of the party.

Neither man objected to the agreement at the time.

*****
Speaking of Tanaka Shusei and the lack of a dime’s worth of difference between the two major parties, Mr. Tanaka had this to say about the DPJ’s comeback in the polls in the Weekly Diamond online:

This closely resembles the events of last year, in which disillusionment with the LDP government resulted in a DPJ government. We cannot ignore that the disillusionment with and unpopularity of the Hatoyama Yukio government (the Ozawa – Hatoyama structure) is linked to the public’s expectations for the new Cabinet. At any rate, it is likely that most people wanted to end the Hatoyama administration in the same way they wanted to end the LDP administration.

*****
Speaking of Ozawa Ichiro, he was in the Kumano area of Wakayama on the 12th. It was his first trip outside of Tokyo since Hatoyama Yukio maneuvered him out of the post of DPJ secretary general. Mr. Ozawa has a habit of saying things that raise people’s eyebrows. He did it again:

People with an illness have come to this area since ancient times for rebirth or resuscitation. This land has long held a belief in revival.

Just like the Terminator, eh? “I’ll be back!”

*****
Speaking of reminding people of the old LDP, the new Cabinet’s national strategy minister, Arai Satoshi (of the Kan faction) was found to have purchased some curious items that he charged to office expenses. And speaking of Mr. Arai’s office, it was found to have been located smack dab in the residence of what the media called “an acquaintance”. The DPJ released receipts for the years 2007 to 2009, and a total of JPY 42.44 million (about $US 462,000) of his expenses turned out to be of dubious value for political activity.

Count on the Akahata, the house organ of Japan’s Communist Party, to have the most detailed list. Here’s what they said he charged:

Under the category of equipment and consumables:

JPY 4,485 for five volumes of Yazawa Ai’s Paradise Kiss comics (37 comic magazines were charged in all)
JPY 2,210 for a hamburger set at the McDonald’s at Nagata-cho

Also:

JPY 2,500 for a CD of background music for pachinko parlors
JPY 26,500 for books on improving pachinko technique
JPY 22,670 for 18 articles of clothing, including underwear, briefs, and camisoles
JPY 7,350 for toys purchased at a department stores

Under office expenses:

JPY 2,300 for a massage at a Sapporo massage parlor
JPY 150,000 for a man’s suit
JPY 2,547 for onions, milk, and cooking oil bought at a supermarket

Mr. Arai said the comic book receipt got mixed in with the real expenses, but he had no explanation for the others.

The response of the DPJ was also reminiscent of the LDP. Acting Secretary General Hosono Goshi said on TBS:

It’s not against the law to buy comics, but it is inappropriate. I hope he adjusts his accounts quickly.

Looking after his own, Prime Minister Kan said he doesn’t think Mr. Arai should resign, but everyone knows what he would have said had the man been in a different party. They know because they remember what he usually said about politicians in other parties when the DPJ was in the opposition.

*****
Speaking of Mr. Kan, and “that was then, this is now”-type answers, the prime minister was asked in the Diet about his reasons for submitting an amendment to the 1999 bill that would have removed the clause making Kimi ga Yo the official national anthem. At the time, then-DPJ party head Hatoyama Yukio argued in favor of his colleague’s measure because of what he termed the song’s unpleasant wartime associations.

Eleven years later, however, Mr. Kan told a different story. He explained there was a difference in opinion in the DPJ at the time, and added:

Some (in the party) thought a livelier national anthem would be better.

*****
Speaking of Mr. Kan making stuff up, he did it again on the 14th in the Diet. Mr. Kan has often cited political scientist Nagai Yonosuke as a political and personal influence. Prof. Nagai taught at the Tokyo Institute of Technology when Mr. Kan was a student there, and the two stayed in contact after he graduated. The prime minister has said:

We had a close relationship for a long time.

It turns out that another admirer of Prof. Nagai was Watanabe Yoshimi, now the head of Your Party. Mr. Watanabe said that when he was a student at Waseda, he snuck over to the other campus to sit in on his classes. He said he was struck with the depth of his thought and the beauty of his prose.

Mr. Watanabe asked the prime minister:

Prof. Nagai said that Article 9 of the Constitution (the Peace Clause) should be amended. What do you think?

Replied Mr. Kan, on the most-frequently debated subject in Japanese politics over the past 65 years:

The topic of Article 9 itself never came up in discussion between us.

See, it’s not necessary to think fast to be a politician. You just have to say something fast.

*****
Speaking of Mr. Kan, let’s take a closer look at Kan the Man. We’ve already quoted Tanaka Shusei once today, so let’s take a second dip from the weekly Shukan Gendai:

I’ve seen both Miyazawa Kiichi and Hosokawa Morihiro serve as prime minister at close range. From that experience, I can say that a person’s abilities and character are completely exposed once they become prime minister. Deception and disguise are absolutely impossible. That is the decisive difference between being a party leader and being a prime minister. Mr. Hatoyama became prime minister without understanding that. Eventually, after eight months, every aspect of his personality was laid bare before the people.

Since the Kan breech has long been exposed in Japan, let’s transfer some of it to English.

*****
It’s nearly impossible to read a feature article about Mr. Kan that doesn’t include a mention of his hair-trigger temper. He’s been trying to keep a lid on it for past month or two, after it became apparent that the Hatoyama administration was evaporating and he was the likely choice to succeed him.

But most Japanese journalists expect it to erupt eventually, and it won’t be attractive when it does.

For example, one report from earlier this year had him throwing an ashtray at a bureaucrat who told him it was not possible to do what Mr. Kan asked him to do.

The steam might already be rising. Mr. Kan revealed at a news conference that he was unlikely to ask for an extension of the Diet session just to pass the Japan Post legislation. Reporters told him that the opposition had charged him with “running away from” the issue.

Cue the unpleasant face and the sharp voice: “What criticism was this? Why are they criticizing?” He asked four times in all.

The Asahi ran an editorial titled Realism without the Specifics about his first speech as prime minister in the Diet. Snapped the prime minister:

Did they listen to all of it? I wanted to say things that were even more serious.

*****
Mr. Kan is a fan of go. One of the reporters assigned to the Kantei said the prime minister had became hooked on the online Pandanet go game, and was frequently seen playing it on the PC in his Deputy Prime Minister’s office. The reporter added: “But when he went to the Diet he just sat there with his eyes closed.”

*****
The Japanese tend to be indulgent of men who are serious drinkers, and most Japanese men who consume prodigious amounts of alcohol are blasé about it. During his university days, Mr. Kan’s favorite pastime was drinking and arguing politics, and he seems to have turned his avocation into his life’s work. One report this week described him with the expression, sakekuse ga warui, or a problem drinker.

Maybe there’s a reason he nods off so frequently in the Diet.

In the current edition of the weekly Shukan Bunshun, freelance journalist and open DPJ sympathizer Uesugi Takashi describes the background of the founding of the modern DPJ. He was an aide to Hatoyama Kunio at the time (who was also present at the creation). Mr. Uesugi reports that Mr. Kan, Hatoyama Yukio, and their wives met secretly at the latter’s villa in Karuizawa. He thought there was nothing amiss about reporting that Mr. and Mrs. Kan knocked back more than a few jars during the meeting, as the Irish say.

Speaking of Mrs. Kan, by the way, she and her husband are first cousins. Her mother and his father were siblings. Those marriages aren’t encouraged in Japan, but they do happen.

The current edition of the weekly Shukan Shincho ran some informal photos taken at the couple’s home one morning in 1998, shortly after that meeting in Karuizawa. There were open beer cans (tall boys of Kirin Ichiban Shibori) on the kitchen counter and kitchen table, probably left there from the night before.

They also recounted several of his escapades, one of which occurred at his favorite drinking establishment, identified as S.

In 2006 he was a candidate in the race to replace Maehara Seiji as DPJ party president, to whom he had lost by two votes in the same election the previous year. Friends tried to talk him out of it, but he ran anyway and was trounced by Ozawa Ichiro. That night, he got ripped on white wine at S, shouted to no one in particular, “I’m the one who built this party! Why shouldn’t I run (for party head)?” and passed out on the floor. (I’m assuming tatami mats in an alcove, but then I’ve never been to S.) He woke up when another customer’s dog mounted him. He started petting the dog and exclaimed, “Wan-chan, thank you!” (Wan-chan is a generic term for addressing a dog. I don’t know how else to translate noru for what the dog did, which is the word the magazine used.)

*****
Mr. Kan also has a vision, and it isn’t one of pink elephants. According to the Shukan Shincho:

The reason I left the Socialist Democratic Federation was that in my 30s, I thought a small party was the best way to stay on as a Diet member, but in my 40s, I wanted to go to a larger party and take leadership positions within the party. From the latter part of my 40s to my 50s, I wanted to be the leader of a large organization. Then, in my 60s, I would be prime minister. That is my vision.

He did not use the word for dream or ambition. It was bijon, taken from English.

Mr. Kan also thinks highly of himself. In 1998 he met Lawrence Summers when the latter was in Japan and a deputy treasury secretary in the Clinton administration. After the meeting, he told an aide:

He’s not such a big deal.

The lightweight Mr. Summers later became the last treasury secretary in the Clinton administration, served as Harvard president for five years, and is now the director of the National Economic Council in the Obama administration.

When the economist Milton Friedman died, Summers wrote an Op-Ed in The New York Times called The Great Liberator. He said that “any honest Democrat will admit that we are now all Friedmanites.” He added that even more important than Friedman’s contribution to monetary policy was his work “in convincing people of the importance of allowing free markets to operate.”

It would surely be enlightening to hear the heavyweight Mr. Kan—a former finance minister himself for a few months—discuss anything to do with Milton Friedman’s theories, either pro or con.

*****
Speaking of Mr. Kan and economic policy, Takahashi Yoichi wrote a column in the Gendai Business on 14 June about Mr. Kan’s maiden Diet speech. It’s long and in Japanese, so here’s a summary.

Mr. Takahashi said the speech consisted of a rehash of his political experience and a summarization of the policies for each ministry, which consisted of several lines each. The journalist was startled to see that Prime Minister Kan had gone back to the old LDP custom of reading aloud from what the bureaucracy calls tanzaku, or strips of paper. Each ministry presents a sheet of paper with a few sentences for the prime minister to say, and they’re stapled together to use as a text. Recent prime ministers had abandoned the practice, but Mr. Kan brought that back. The bureaucrats, said Mr. Takahashi, must have been delighted to see him reading from their script again.

He also addressed Mr. Kan’s claim that his policies would be a “third way”, with the public works pork of the LDP being the first way and the extreme market fundamentalism of the ten-year period centered on the Koizumi administration (2001-2006) being the second way. The prime minister blasted the excessive deregulation of the second way.

Mr. Takahashi—a former Finance Ministry bureaucrat/turncoat—pointed out that in the 1998 OECD ranking of G7 nations by stringency of regulatory systems, with the top position being the least regulated, Japan was #5. Ten years later, in 2008, they were fourth, overtaking Germany.

The prime minister charged that the Koizumi restructuring had caused widespread unemployment. Mr. Takahashi noted that the total number of employed persons rose by one million during the five years of the Koizumi administration, and has fallen by 30,000 since the DPJ formed a government last September.

Further, Mr. Takahashi referred to DPJ claims that income gaps widened during the Koizumi era. The OECD uses the Gini Coefficient to monitor that gap. In their rankings of the G7 countries, Japan was 4th in the Gini Coefficient in 1998, and stayed there through the mid-2000s. In fact, with this used as a metric, the income gap actually shrank in Japan under Mr. Koizumi (and in Great Britian) while it expanded in some other G7 countries during that period.

Mr. Takahashi warns the DPJ will use these fables as the justification to fashion policies that will limit deregulation and redistribute income to reduce the so-called income gap. He used the Japanese expression, e ni kaita mochi, or a rice cake drawn into a picture, to describe the DPJ approach.

In English, we’d say “pie in the sky”.

****
Speaking of Mr. Kan, drinking, and supercalifragilisticexpialidocious economic policies, the Shukan Gendai quotes a Finance Ministry official describing an impromptu news conference with the reporters assigned to cover the prime minister at the Kan residence last week. Mr. Kan was sailing along righteously–whether from white wine or Kirin tall boys, he didn’t say.

The new prime minister claimed the people would swallow a rise in the consumption tax to 15% if the funds were diverted to long term care, social welfare, and pensions. He then said that when the economy improved, they could cut the rate back to 8%.

Speaking of rice cakes drawn into pictures…

The Finance Ministry official said he heard the story second hand, but liked what he heard. They could work with a prime minister like that.

*****
And speaking of people in the government whose economic ideas have about as much substance as an empty Kirin tall boy can, Ikeda Motohisa is one of the new deputy finance ministers. He was also one of roughly 130 DPJ MPs that proposed in April the passage of a law requiring the Bank of Japan to set an annual inflation rate of more than 2% as a target.

*****
I have a feeling this is not going to end very well either, whenever it ends.

And that means there won’t be any degrees of separation at all from this administration and its recent predecessors.

Mr. Hatoyama had all the political substance of a piece of wet flannel. That might not turn out to be so bad, in retrospect. Mr. Kan, on the other hand, could cause some real damage.

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Interview: Ono Yoshiyasu

Posted by ampontan on Monday, June 14, 2010

PROF. ONO YOSHIYASU has been outed as the man behind the curtain whispering the lines to new Prime Minister Kan Naoto when the latter expounds on matters related to the economy. Some have dubbed these ideas Kannomics, and they don’t mean it as a compliment. The Sankei Shimbun published an interview with Prof. Ono on Friday. Here it is in English.

*****
You’re said to be the person who proposed the “economic growth through tax increases” idea now championed by Prime Minister Kan Naoto.

Tax increases do not generate economic growth. They expand the economy when the money collected is diverted to create employment. We must fully utilize Japan’s workforce and create goods and services.

The fiscal mobilization during the period of Liberal Democratic Party rule, including the public works projects, had little effect.

If those public works projects create no value at all, they are tantamount to unemployment benefits for the laborers. They’re meaningless unless the money is invested in sectors that create new value and make the most of human resources.

What sectors will create new value?

Some sectors that have not received enough attention include the environment, the tourism infrastructure, medical care, and health. When you supply necessities such as food, or distribute money such as the child allowance, it replaces the outlays that were made until then. New employment or demand is not created.

Ono Yoshiyasu

Isn’t one aim of the tax increases “fiscal reconstruction”?

Even if we increased taxes and limited the issue of government debt, that alone wouldn’t result in increased income and employment. But if we use that money to create employment, income will rise, it will stimulate consumption, and the gap between supply and demand will shrink. That will lead to the elimination of deflation, resulting in added tax revenue. The budget deficits will also decline.

Japan has a higher debt-to-GDP ratio than Greece, which is now embroiled in a fiscal crisis. The national finances are in a critical state.

Bonds are government debt, but the bills issued by the government are also financial assets. It is most important to maintain that asset value. It will relieve the anxiety of financial institutions holding that debt, and they will increase their lending. If we can do that, the money will be circulated to employment and consumption. The debate over the targets for fiscal reconstruction must be conducted from that perspective.

How should we respond to the increase in social welfare expenditures?

Pensions and other cash payments are nothing more than diverting money from the young to the elderly. If we reduce pension payments and apply it to enhancing long-term care facilities and improved employment conditions for long-term care workers, the elderly will receive services instead of money. The employment and income of young people will rise.

Calls are mounting within the government to increase the consumption tax.

Rather than the consumption tax, I think it would be better (to increase) income taxes, which are progressive (which lightens the burden for lower income levels). But the tax system is a secondary problem. It is during an economic turndown that the objective of the government must be to create employment.

What happens when the economy recovers?

We could reduce government programs and taxes. We should define this by law in advance, such as cuts in government programs when the unemployment rate falls below 3%.

(end translation)

Afterwords:

Prof. Shimojo Masao, an occasional contributor to this site, is scornful of Japanese politicians because he says most of them have absolutely no interest in what happens outside the country. Judging from this interview, it would seem that Prof. Ono is oblivious to everything that’s happened with governmental manipulation of the economy overseas and the implementation of dirigisme over the past 80 years.

There is no indication that he understands the Japanese budget deficit is not a problem but a symptom. Rather, he thinks that doing more of the same—relying on the political decisions of government—will cure the disease instead of making it worse.

There is no understanding of the inherent contradiction in claiming that governments are wise enough to make investment decisions when governmental investment decisions got us into this fine mess.

There is no understanding that of the public-private sector partnerships in Japan, a favorite policy tool of sub-national governments for the past two decades, more than 70% lose money. There is also no understanding why that would inevitably be the case.

There is no understanding that tax revenues are the assets of the people who made the money, not the social engineering tools of a bureaucratic priesthood. A Japanese man who retires at 60 can expect to live a healthful life for the better part of the next 20 years, but the professor wants to reduce their pensions—and as a result, their economic activity—for “services” rendered during the last few months of their lives. He was dismissive of transferring assets from the young to the old, but he thinks transferring assets from the old to the young is a great idea.

There is no understanding that if one is concerned about the burden of the “regressive” consumption tax on low-income earners, that burden can be lessened by making tax-exempt the purchases of food, children’s clothing, or books (to cite just three examples), rather than penalizing the people who earn more as a result of their contributions to economic society.

He actually believes that the government can be made by law to reduce taxes and government programs based on a benchmark that is easily manipulated. Is he working in an Ivory Tower, or living in an Ivory Cave?

But others have said it better than I. Here’s an American economics professor, Don Boudreaux:

Some of these economists emphasize that every dollar that government spends is a dollar taken from someone who had plans for that dollar, and so it’s unlikely that government spending raises overall demand. Others of these economists emphasize that, if private-sector spending is too low, the problem is not “animal spirits” so much as it is taxes and regulations (both actual and threatened) and excessive government spending itself that make consumers and investors leery of the future. Yet others of these economists focus on the market’s ability to restore itself to health once it rids itself of inappropriate investments.

And:

…(H)ow is it that wide swathes of our lives work so well without such spending? Grocery retailing, for example, receives no handouts from government and yet serves customers with extraordinary efficiency and creativity. Ditto for restaurants, hardware stores, the press, language-learning software suppliers, and myriad other industries not suckling at the state’s tit.

Or Mario Rizzo:

So when [Brad] DeLong, among others, says that government spending is as good as private in restoring employment, he is speaking against the whole thrust of the principle of efficient resource allocation….When government adds to investment as a result of fiscal stimulus or directed monetary expansion (like buying mortgage-backed securities, student loans, etc) it does not act as a super-entrepreneur who is trying to determine the efficient and sustainable direction of resources, including the allocation of capital goods. It spends according to economically irrelevant criteria of job creation, propping up over-expanded sectors, and preventing politically painful adjustments….Such spending is counterproductive in the medium to long term. It is also unsustainable (once the stimulus stops) since it is not consistent with the preferences of consumers.

To which Paul Walker added:

(T)he government bureaucrats carrying out the fiscal or monetary policy have no way of knowing what the efficient, productive investments are likely to be. They are not entrepreneurs. It is the market that can, over time, work this out, via the interactions of millions of investors….This is short-termism at its worst. Doing something, anything, now is better than waiting for the market to work things out, that takes too long. Or so bureaucrats and politicians think.

And here’s William Shughart:

(T)he intellectual poverty of Lord Keynes’s ideas was evident at the end of the Second World War, when massive cuts in federal government spending, which on the basis of Keynesian orthodoxy should have caused a return to pre-war recession or depression, actually launched a period of robust economic growth as scarce resources were reallocated from the production of military goods to that of civilian goods.

Reader Toadold asks:

Given that the Bureaucracy has been entrenched far deeper and longer than the US one what are the chances of the Japanese populace starting a “Tea Party” movement?

I think there are two conditions at work in the United States that aren’t yet present in Japan. First, the Japanese have never seen a serious left-of-center government make the usual promises and take the usual economic pratfall, after which they get booted out of office. Even the Americans have to do this once every generation so the kids can understand how life works.

Second, while there are plenty of good ideas and discussion flying around in the print media, there is very little in the broadcast media, either on TV or radio. That makes it difficult to offer an alternative to presentations such as one I briefly saw last night on a weekly news roundup. Coverage of the DPJ: Mr. Kan pumping his fist and talking about his “irregulars”. Coverage of the LDP: Mr. Tanigaki saying he will step down from his leadership post if they blow the election. Coverage of the newer small-government parties: Zero.

Information providers on the Internet also seem to be more dispersed. I’ve never found a clearinghouse such as a Japanese version of Instapundit, for example. The lack of on-line information outside of newspapers (such as magazine articles) and the shorter time that information stays on line tend to mitigate against that. One such site started a few months ago, but I don’t think it’s as well done as it could be.

But if I had the time, and/or the fund-raising ability…

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Letter bombs (4)

Posted by ampontan on Monday, June 14, 2010

THANKS TO RMILNER for sending another thoughtful note. He writes in his latest:

Too much Japanese government spending has been on useless assets such as concreting riverbeds, and bridges to no-where, which were done to justify the diversion of tax revenues to organisations which supported the LDP system — the amakudari bureaucracy, large building corporations and local government.

I don’t disagree with anything you’ve said, but allow me to make two points to provide another perspective.

One: I’m not a civil engineer and know nothing about riparian works, but perhaps some of those concreted riverbeds really needed concreting, particularly in places like the city where I live. The people here call them rivers, but where I grew up, we’d call them creeks, and this town might as well be the Venice of creeks. We’ve just entered the rainy season, and there’s bound to be one, and maybe more, heavy rains that cause those rivers to overflow. I wonder–doesn’t that concrete prevent a lot of collapsed riverbanks?

Two: The spending may create useless assets now, but they might not have been so useless when the paradigm was developed by Tanaka Kakuei.

In 1972 he dictated a book called Nippon Retto Kaizo Ron (Building a New Japan), incorporating ideas from young bureaucrats and aides. The concept was to create a unified national infrastructure that would raise the living standards of the regional areas to the level of those in the big cities. As he explained it to one of those bureaucrats, “If you get drunk and pass out in Hibiya Park, an ambulance will come and take you to a hospital. If you did the same thing in Hokkaido, you’d freeze to death. The conditions of life are different depending on where you live. We have to eliminate that difference.”

A translator of my acquaintance has lived in Japan since the late 1960s, and he remembers unpaved streets in the Tokyo Metro District in those days.

Tanaka’s book was really a blueprint with an enormous number of new ideas for linking the country through highways, airports, and the Shinkansen. (In fact, he called for building more Shinkansen track than exists now, or will exist after the Kyushu leg opens next spring.) He proposed the creation of a telecommunications network that anticipated the Internet, as well as cable TV and videophones. He called it the unification of omote Japan with ura Japan (the front and the back). He also wanted to create rural/industrial cities of 250,000 people throughout the country. If they were attractive places to live and work, people wouldn’t concentrate in Tokyo, and it would help alleviate pollution and the other problems of unbalanced industrialization.

Some of the quasi-national corporations that became amakudari nests were created to implement those programs, and some had the ability to procure funds quickly on their own. He even encouraged what are called zokugiin (the legislator lobbyists), because he thought it would facilitate the national business if the legislators made themselves experts in the affairs of one of the ministries. In other words, there was a good reason for a lot of that stuff in the beginning.

His book was released in June and it wound up 4th on the best-seller lists that year. It even outsold a mass market sex manual called How To Sex, which wound up in 5th place.

The downside of all that has become obvious over the years, and it was just a matter of human nature for that downside to emerge. Nevertheless, an ambulance will pick you up if you pass out drunk in a Hokkaido park today and take you over paved streets to a fully equipped hospital with an Internet connection.

That it would be difficult to leave that old vision behind and take the next step is understandable (especially for the LDP). I’m certainly not going to make excuses for any of it, or for his money politics, but from what I can tell, a lot of it did happen with the best of intentions.

But if anyone who was around in those days thinks I’m off base, feel free to write in and set me straight!

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The dear leader’s enablers

Posted by ampontan on Monday, June 14, 2010

GEORGE JONAS, columnist for the National Post of Canada, is a treasure of the Anglosphere–everything he writes, whether serious or light-hearted, is worth reading.

Readers with an interest in Northeast Asian affairs will find this recent column especially worthwhile. It’s called Dear Leader’s see-no-evil enablers, and it examines the international response to North Korea’s sinking of the Cheonan. Here’s the point:

Westerners who look to China for relief against North Korean aggression fail to see that China is the problem, not the solution.

To illustrate:

…(A)fter North Korea sank the Cheonan, the world’s advice to the injured party, South Korea, was: Forget it…Don’t go after the bully. Don’t even bother calling the cops of the United Nations. Complain to China.

North Korea’s “Dear Leader” Kim is China’s pet, said pundits…The trouble was that, as some predicted, far from muzzling Kim, Wen wasn’t even going to say “bad dog” to him. In fact, he would veto anyone who tried. Muzzling Kim wasn’t the pressing task. What was? The Chinese president spelled it out at the end of the Seogwipo summit:

“The pressing task now is to respond appropriately to the serious effects of the Cheonan incident,” he said, “to steadily reduce tensions, and especially to avoid a clash.”

In other words, following the loss of its patrol boat with 46 sailors, South Korea’s pressing task was to take active steps to avoid a clash.

Mr. Jonas offers no solutions. He simply forces the dogs to look at the mess they’ve made on the living room carpet instead of pretending it isn’t there.

Ignoring the mess will have unpleasant consequences. What form they take and when they occur is not yet apparent. But occur they will.

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Kannomics

Posted by ampontan on Sunday, June 13, 2010

If the DPJ takes control of the government, the basic policy of the Cabinet will be to change all bureaucracy-directed governance. We will create the strongest Cabinet and strongest Kantei to achieve that. Of course, there will be no room for the bureaucracy or the zokugiin to enter.
- Kan Naoto, Soridaijin no Utsuwa (The Caliber of the Prime Minister) 2003

The politicians should absolutely never decide things by themselves. The bureaucracy (consists of) professionals with many years of experience in dealing with policies and issues.
- Kan Naoto’s first news conference as prime minister last week

THE LATE American humorist Will Rogers was famous for a stage routine in which he would draw laughs from the audience by reading aloud from a newspaper and making comments on each article.

Imagine how much money he could make today.

Take all the reports about Japan’s new prime minister, Kan Naoto, for example.

He was the deputy prime minister when Hatoyama Yukio formed a Cabinet last September and took on the additional role of finance minister on 7 January. The day before, Bloomberg reported:

Kan told reporters yesterday he will tackle “various issues aggressively,” and pledged to make sure the proposed 92.3 trillion yen 2010 budget is passed by the Diet.

Meanwhile, Kyodo quoted Mr. Hatoyama:

“Kan is someone involved in compiling the budget, so there is no impediment—I believe we can adequately get through the Diet session,” the prime minister said.

On 10 January, NHK reported:

Deputy Prime Minister and Finance Minister Naoto Kan has said the key part of the pledges made by the governing coalition has been achieved in the fiscal 2010 budget plan.

The budget was passed on 24 March. Only four budgets in Japanese history were enacted more rapidly. It was the largest budget in Japanese history, with the highest amount of debt and the greatest reliance on deficit-financing bonds.

Two days ago, fewer than three months after the budget passed, the Associated Press reported on a speech by now-Prime Minister Kan:

Japanese Prime Minister Naoto Kan says his country could become the next Greece if it doesn’t reduce its current debt load….Kan says Japan needs to rein in spending before things spiral further out of control. “It is difficult to sustain a policy that relies too heavily on issuing debt,” he said. “As we have seen with the financial confusion in the European community stemming from Greece, our finances could collapse if trust in national bonds is lost and growing national debt is left alone.”

Here’s the Will Rogers punchline. AP characterized Mr. Kan as a “fiscal hawk”.

Did the AP mention his role in compiling the budget, getting it passed, and making Japan bend over for the insertion of all that Grecian style debt?

Don’t make me laugh.

*****
With their typical verbal ingenuity, the Japanese have started to refer to the prime minister’s theories as Kannomics. They seem to instinctively understand they can’t call it “economics”.

Takahashi Yoichi took a look at Kannomics in an article for the 7 June edition of Gendai Business. It was titled, How will the new Kan Naoto administration handle the economy? Here it is in English.

*****
One securities dealer wasted no time in using the new Cabinet as a business opportunity by quickly sending out a solicitation that said, “There will be growth under the Kan administration, and the yen will decline, so we recommend investment in either Japanese stocks or foreign bonds.”

To be sure, Mr. Kan was at first quite spirited after being appointed Finance Minister in early January. He ignored the wishes of ministry apparatchiks by calling for a cheaper yen. The Finance Ministry put a lid on that talk right away, however, and his course turned in a more dangerous direction.

He later stumbled, being unable to answer a question in the Diet in the latter part of January about the multiplier effect of the child allowance, i.e., what the macroeconomic effect of the allowance would be. In the beginning of February, a large contingent of ministry bureaucrats accompanied him to the G7 (finance ministers’) meeting.

His relationship with the bureaucrats changed markedly around that time, and the opinion began circulating around Kasumigaseki that “Finance Minister Kan is studying very hard.”

Then, as expected, Mr. Kan argued on television in mid-February for a sweeping overhaul of the tax system, including an increase in the consumption tax. Until then, he had insisted a debate on increasing the tax should start next year. His ideas underwent a significant change and he accelerated the start of the debate well in advance of his original intentions.

That signifies Mr. Kan has completely fallen under the control of the Finance Ministry bureaucracy.

What then will become of the Japanese economy in the Kan administration? Will the yen decline?

The keys to deciphering that are the split with Ozawa Ichiro and the rapprochement with the bureaucracy. That he has split with Mr. Ozawa is clear from the makeup of his Cabinet and his choices for party offices.

Further, the rapprochement with the bureaucracy is clear from his personnel choices for deputy chief cabinet secretary. He retained Matsui Koji and appointed Furukawa Motohisa, veterans of the Ministry of Economy, Trade, and Industry (MEIT), and the Finance Ministry respectively. Prime Minister Kan has fallen into the clutches of the Finance Ministry.

This will be a sharp difference from the Hatoyama Administration, which had initially proclaimed a disassociation from the bureaucracy. It is obvious that the new growth strategy and mid-term financial framework announced this month were created by METI and the Finance Ministry.

Viewed from the perspective of economic policy, the break with Mr. Ozawa and the rapprochement with the bureaucracy are consistent with a course of tax increases.

Mr. Ozawa had a negative view of tax increases because elections are always the priority for him. Politically, the break with Mr. Ozawa makes it easier to talk about tax increases. They will likely create a plausible reason for public consumption, such as the danger avoiding tax increases will present for “fiscal reconstruction”.

If they were really interested in fiscal reconstruction, a sequence should be followed before taxes are increased. They must try to increase revenue by boosting the nominal growth rate, reducing the vast amount of government assets, and cutting the salaries of public employees.

But boosting the nominal growth rate would lead to a discussion of inflation targets, which would result in conflict with the bureaucratic organization of the Bank of Japan. In addition, many of the government assets consist of loans and cash infusions in quasi-governmental corporations and quangos, which are nests for the amakudari (post-retirement jobs) of the Kasumigaseki bureaucrats.

A reduction of these assets would entail the elimination or privatization of these amakudari outposts, as well as a reduction of their duties, so this will meet with opposition from Kasumigaseki bureaucrats. Cuts in personnel expenditures for civil servants will be fought tooth and nail by all the bureaucrats. Thus, the rapprochement with the bureaucrats means they have eliminated the prior steps to be taken before a tax increase and gone straight to the tax increase.

Incidentally, Mr. Kan has not mentioned the phrase datsu-kanryo (disassociation from the bureaucracy) at all since his election as party head on the 4th. That phrase was part of the original DPJ party line before Mr. Ozawa joined.

On the other hand, Prime Minister Kan has frequently mentioned of late that the economy will improve with a tax increase. This seems to be the “Third Way” of increasing taxes, using the funds for employment, and creating new demand. It’s based on the claim that the first way was the public sector investments of the old LDP, the second way was the strengthening of the supply side during the Koizumi-Takenaka era, and that both were failures.

The Brains behind Kan are Keynesian

This Third Way is the slogan of the Kan administration. It was proclaimed by Osaka University Prof. Ono Yoshiyasu, who became part of the Cabinet Office on 26 February.

Prof. Ono’s economic theory is based on an elaborate mathematical model with rather debatable content, but it has some adherents among economists. Eliminating the technical details, however, there is little difference from orthodox Keynesian economics of relying on fiscal measures without using monetary policy.

At the backdrop to Mr. Kan’s assertion that the economy will improve if there are no mistakes in the use of the increased tax revenues is the Keynesian “balanced multiplier” (there will be economic effects even with increased taxes and public sector investment).

The premise of this theory, however, is that the government is smarter than the people. Prime Minister Kan makes that point by adding the condition, “if there are no mistakes in the way the money is used”. That is a classic case of easier said than done.

Additionally, the premise that the government is intelligent is consistent with Kasumigaseki governance. The bureaucracy will readily accept Prof. Ono’s idea as a theory.

Reality is not at all that simple, however.

Last December, Mr. Kan said at a Cabinet Office conference that it should be possible to create policies with a multiplier effect of 11 (JPY 11 trillion in benefits for JPY one trillion in government expenditures). Yet when Watanabe Yoshimi of Your Party asked him to provide a specific example during question time in the Diet in January, he couldn’t answer. If he could have given a real example, anyone would have recognized that the government was intelligent…

But the rationale behind the DPJ claim of disassociation from the bureaucracy was that they knew the government had wasted money. It’s not as if they can say that the government’s use of the money is intelligent.

Well then—what will happen if the unintelligent government raises taxes to collect money and use it?

If the private sector lacks money, they will be unable to make beneficial capital investments. Real interest rates will rise, which would threaten the growth of the Japanese economy, of which the private sector is the main element. The yen would be unlikely to depreciate.

Also part of Prof. Ono’s theory is that deflation is caused by the people’s “love of money”. It does not recognize the effect of an expansionary monetary policy.

Prime Minister Kan has shown the desire to overcome deflation, but judging from Prof. Ono’s “love of money” theory and the rapprochement with the bureaucracy, he would likely reject a monetary policy that would boost the nominal rate of growth. In that case, deflation will continue. From this perspective too, there will be no growth in the Japanese economy and the yen is unlikely to depreciate.

It is a fact, of course, that Mr. Kan has jawboned for a lower yen. Even if this resulted in a temporary depreciation of the yen, judging from the supporting economic theory (which the prime minister probably does not understand), Japanese economic growth will be harmed, and there is little hope for a cheaper yen.

Even if the yen were to depreciate, it would be because the tax increase and redistribution of income would not improve long-term productivity. Then the Japanese failure would really cause the yen to crash.

Afterwords: Two posts ago, there was a quote from a book by Hasegawa Yukihiro in which he charges (based on personal observation) that METI and the Ministry of Finance worked together to find ways to spend higher tax revenues as a way of ensuring later tax increases. See what he means?

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