Category Archives: Econ & Business

What would doubling the JET program look like?

Recent news reports suggest that the LDP is planning to propose doubling the JET Program in three years and placing JET language assistants in all elementary, middle, and high schools within a decade. There are around 38,000 such schools in Japan, so that’s a LOT of ALTs!

According to internal affairs ministry statistics, in fiscal 2012 there were around 4,300 JETs in the country, so the plan is apparently to increase that by a whopping factor of nine. According to the statistics that METI keeps on language schools, there are 10,000 or so full- and part-time language teachers working for regulated schools. I believe that does not count the large number of contractors like the teachers working for ALT placement agencies or the poor devils at Gaba, university instructors, and certainly not the many student teachers or anyone operating their own eikaiwa that does not fall under METI’s purview. But even generously allowing for a teacher population of say 30,000 total (around 3 for every train station), in ten years this number will be more than doubled.

The program is designed to place youthful foreigners, generally native English speakers, in Japanese schools (and to a smaller extent, local governments) for up to five years with two explicit goals: supplement English-language education and promote international interaction at the local level. Another key benefit is that the participants often go on to take influential Japan-related jobs, be it in foreign governments, Japanese companies, or companies that do business in or with Japan. Having a stable of Japan hands around seems pretty necessary at this point, given the relatively poor state of English language ability among the Japanese population. Unlike normal employment situations, JET offers a high level of support in the form of a reasonable salary, free housing, and a network of fellow JETs and regional coordinators to help with problems.

I get the feeling that a ninefold increase in the JET Program isn’t realistic—could they even recruit that many people to come and live in Japan, or would they maybe just cannibalize the entire existing eikaiwa-for-kids market? Still, some increase in the program along these line seems like a fairly simple way for the Abe administration to make a bold move in the direction of “internationalization” that won’t run into much political resistance.

Regardless of your views on the merits of the JET Program or the Japanese education system in general, you must admit that even just doubling the size of JET would have a pretty profound impact.

For one thing, that is double the amount of people coming in each year. That means more foreign faces on the street and more non-Asian foreign exposure for the Japanese public at large.

It also means more “Japan hands,” maybe even double, and this can cut in different ways. I feel like Japan is sorely in need of talented Japanese-to-English translators, so an influx of native English talent that could eventually progress to ace-translator status is a good thing. At the same time, the increased supply in the market could put pressure on prices, and who knows maybe some whipper snapper could come after my job some day.

I think it would also revive the option of teaching English in Japan for graduates of US universities that (from my admittedly limited perspective) seems to have died down a bit in the wake of troubles in the eikaiwa market and competition from China, a bigger and perhaps more intriguing destination. I can envision a near future in which young men see the Tokyo Vice movie and become inspired to chase thrills and excitement in Japan.

And it would necessarily boost the number of international marriages and the resulting children, bringing Japan that much closer to becoming the Grey Race.

On the negative side, the JET Program might have to loosen standards to attract talent. Even if they don’t, the sheer number of additional people will likely result in an increase in the problems that occasionally befall foreigners in Japan – crime, drugs, suspicious visa activity, ill-advised YouTube rants, you name it.

JET is a net good, but not for Japanese people’s English ability 

I say bring it on, mainly to bolster Japan-related talent. Unfortunately, my support of the program is not for its value as an English teaching tool (disclosure: my application for the JET Program was in fact rejected. I am not bitter about it because I handed in a terrible application, but nevertheless I feel like I should own up about it).

I have spoken with/read about perhaps dozens of JET teachers and students over the years. The teachers by and large do not have a particularly high opinion of the job’s value in terms of English teaching, but they almost unanimously credit the program for giving them a great experience. And while the students might not master English thanks to their JET, in many cases they remember them being a friendly adult who helped make school more enjoyable.

From what I gather, the job of an ALT is generally to supplement a Japanese teacher of English by helping with pronunciation and various other tasks. Maybe I just don’t get around enough, but I cannot recall ever hearing someone even try to argue that they are an essential part of the learning process or that what they do has an appreciable benefit to the level of English ability in Japan. I don’t think that is really a problem though because of the program’s other upsides.

On the other hand, what I have heard and experienced is that ALTs can help inspire students to discover the joys and rewards of learning English or encourage them to keep going. I think the value of that should not be underestimated because it is life-changing and the ALTs deserve huge credit for it.

This is kind of an aside, but basically I do not share the government’s fascination with trying to make the entire country proficient in English because for most people that is just not necessary. The way things stand, the biggest result of the current system seems to be the long list of Japanized English loan words that are often such a headache-inducing component of the Japanese language.

To have a more realistic and beneficial impact, I would rather them focus on establishing separate programs for the kids who excel at languages and giving them a place to shine on their own (and while they’re at it they should devote resources to helping returnees re-integrate when they come back while maintaining their language skills). That would hold out the hope of producing a larger population of Japanese adults with near-native English skills.

I feel like there is negative feedback loop whereby most Japanese people are in an environment where the norm is to not be good at English and therefore most people choose the path of least resistance. Separating out the kids that have a real talent and placing them in a more encouraging environment might keep them from missing out just because they have to go along with the crowd.

All in all, JET seems like a worthy program for giving kids a glimpse at a world outside of Japan and the teachers an interesting start to their post-college lives in a way that usually ends up benefiting Japan in some way.

PS: This independent video guide to the JET Program is very well done. If you are reading this and considering doing the program yourself, it is definitely worth a look:

Japanese people can’t speak English because they live among tainted, Japan-savvy foreigners

It seems to me that a major factor behind Japan’s vaunted problems with the English language could have to do with the learning environment.

Specifically, some Japanese people are not sufficiently aware that Japanese-accented English is often incomprehensible to listeners who are not familiar with it.

I call it the Heisenberg property of language – simply being among Japanese people causes native English speakers (eikaiwa teachers, friends, coworkers, etc) to get used to how Japanese people speak, and of course alter how they speak to ensure Japanese people understand them.

This concept came to my attention in a big way at an investment conference that I recently attended for work.

The keynote speaker was a well-known American investment manager, and when it came time for the Q&A session, there was a roughly even mix of question-askers who were native English speakers, Japanese who asked their questions through the interpreter, and Japanese who opted to ask in English.

The guest speaker had trouble understanding all of the Japanese people who asked questions in English. One person in particular asked something like, “What is your view on Abenomics?” and it took about three tries before the speaker got that it was something about the new prime minister.  I understood it the first time because I could hear him say the katakana “abenomikkusu” just really fast and with an attempt at English inflection. But to the American guest speaker, the questioner must have sounded like he was mumbling “obb-nom” instead of the properly enunciated “Abe-nomics” that sounds similar to Reaganomics.

This is just one small example, but I encounter cases of this phenomenon all the time:

  • Several English-speaking Japanese people in my life have heavy accents, but I can understand them because my years in the country have gotten me used to how Japanese people tend to speak. 

  • Japanese commercials are flooded with simplified English

  • Eikaiwa teachers tend to use simplified English to make themselves understood in class. I have even known some to incorporate common Japanese phrases like “hora” to get students’ attention.

  • Lip my stocking!

And so on.

If a Japanese person spends all their time in this “Japanese-familiar” bubble, then when it comes time to go face-to-face with a less Japan-savvy foreigner, they are likely to run into trouble.

I don’t necessarily see this as a bad thing. For the sake of communication, speaking to make yourself understood (and listening carefully to understand) is only the most natural thing in the world. I just feel like pointing it out because Japanese people who equate speaking English with native speakers in Japan with “immersion” might be in for a rude awakening if they ever step outside that environment.

Using a smartphone as a visitor to Japan

I just landed in Narita and came to my friend’s apartment in Koenji, Tokyo last night, coming to Japan for the first time since I finished graduate school last March, and for the very first time as a tourist and not a resident.

I had been looking at the options for having at least some basic mobile phone service, as I have been able to arrange cheaply in every other country I have previously visited, but the solutions in Japan are less straightforward, or at least less obvious. (On a tangent, this article about the state of Internet access in the remote island territory of American Samoa is pretty neat.) I DID find an option that works well, but it took a little bit of poking around and some minor hoops.

For example, in Taiwan I had no trouble getting a prepaid SIM card by showing my passport, here in the US (somewhat surprisingly, with all the Patriot Act and related security in recent years) you can still buy a prepaid phone or SIM, and on my first visit to the Philippines I actually got a SIM card out of a vending machine! While it has always1 been easy for a resident foreigner to sign up for a mobile phone contract, the providers will quite understandably not offer a one or two year contract to somebody who is only legally allowed to remain in the country for 90 days.

While Japan has long had perhaps the best wireless communications infrastructure in the world, it also has some of the least flexible ways to register for service. While prepaid SIM cards for voice and/or data are the norm, or at least commonly available, in most countries, such options are far more limited in Japan, and those that do exist tend to be unavailable to temporary visitors.((Prepaid service is very widely available in the US, for both voice and data, and although still not very popular overall is gaining fast in popularity.)) Options for international data plans do exist, but even the better deals fall between pretty expensive and ruinously expensive. (The NY Times just had a post discussing some other options.)

Prepaid phone service does exist, offered  companies such as au or Softbank, but for some bizarre reason these are still structured as one year contracts, and are therefore also not available to visitors. For example, if you look at Softbank’s page explaining how to register for pre-paid service, it clearly states that one needs either proof of Japanese citizenship or visa that has over 90 days remaining. It is certainly possible for a visitor to have a friend in Japan to arrange service for them, but that is not only kind of a hassle for both parties, but also may not be an option for visitors who do not (yet?) have friends in the country.

Perhaps the most popular option for foreign tourists is Softbank’s Global Rental service, which will rent either a Japanese phone or a SIM card for use with an unlocked 3G phone. The prices for this service are not too egregious for very light use, with a bare SIM costing for ¥105/day, ¥105 per minute for outgoing calls, and ¥15 per domestic SMS. Incoming calls and texts are free, like in basically every country outside of North America. Data, however, is another matter. Although Softbank thankfully caps the data charge for a single day to ¥1500, it takes only slightly more than 1 megabyte to reach that level, which means that any smartphone that sees even minimal use will incur ¥1605/day, plus whatever you spend on phone calls or texts. I don’t know about you, but ¥48,150+ seems like a lot to pay for one month of using my smartphone on a trip to Japan.

But there is a much, much better option.

Enter B-Mobile. B-Mobile is a MVNO, or Mobile Virtual Network Operator, which means that in contrast to wireless service providers such as NTT Docomo, KDDI AU or Softbank, they do not own any infrastructure of their own but instead purchase access to a wireless network at the wholesale level from the physical network providers, in this case from Docomo, and then re-sell it to retail customers in packages that the original network provider does not offer.

As soon as I stepped off the airport bus outside Shinjuku Station I walked across the street to Bic Camera and asked the first staff member I saw in the mobile phone area where the B-Mobile products were. She had no idea what I was talking about, and after running to check told me that they didn’t have any (申し訳ございませんが、当店では取り扱っておりません), but I suspected she was wrong and asked a man in a spiffier uniform. He immediately took me over to the counter and grabbed a box from the shelf behind it. For those looking to purchase these SIM cards in a store, note that they do not seem to be on display; you have to find someone who knows where they are kept in the back. I chose the 1GB/1 month 3G/4G option, for just under ¥3500, and purchased it along with an external battery pack for my phone.

Note that it is possible to order these SIMs online, using either a credit card or by COD means Cash On Delivery, which is something that used to be possible for mail order products, but now is pretty much restricted to delivery food. Japan is actually safe enough that when I ordered a ¥100,000 digital camera from Amazon some years back they let me pay COD.">COD) The downside of this, for many foreigners, is that the page is only in Japanese, as is the activation directions. If you do not read and speak Japanese, you may need someone else to help with ordering and configuring the setup.

Before I explain the annoying caveats, I will state upfront that it works great once configured, so you know this isn’t a waste of time.

I stepped out of the store and grabbed a coffee and a seat at the Starbucks just below. Popping the SIM card into my phone, an unlocked GSM/HSPA+ Galaxy Nexus and rebooting it did not give me any immediate results, only showing the notification screen message “EMERGENCY CALLS ONLY [NTT DOCOMO]”, which I had even with my American T-Mobile SIM installed.

After looking at the packaging I realized that it needed to be activated by phone, but this presented a minor obstacle. For some reason, the activation can be done one of two ways, either by calling from a Japanese mobile phone, or by calling a help-desk and paying a ¥2,500 handling fee. I nearly considered doing the latter just to get going… but the helpdesk closes at 6pm, an hour earlier.

I then switched tactics slightly and pulled out my laptop, a recently purchased 15” Retina Macbook Pro, to try the Starbucks WiFi. I was under the impression that it was a pay service as it had been years before, and was ready to begrudgingly spend a few hundred yen to get online for an hour, but was pleased to see that they have switched to a free service at some point. I was much less happy to see, however, that in order to use the free Starbucks WiFi, you have to register for a login account, which cannot be done from the login page. Yes, that’s right. To use the free WiFi you have to register in advance while already connected to the Internet. For your reference, the address for doing this is http://starbucks.wi2.co.jp. Do yourself a favor and register right now, even if you don’t expect to be using it anytime soon. Thankfully I was sitting next to a young Japanese fellow in a standard black suit, who was kind enough to lend me his smartphone for a minute to register myself an account and get online.

After I had both my laptop and phone connected to the free WiFi, I found a Japan-resident friend on Gchat and asked her to use her mobile phone to call and register my B-Mobile SIM, providing her with the unique registration code included on a slip of cardboard. Make sure not to lose that! (Incidentally, the SIM itself is a DOCOMO card, with B-Mobile branding used only on the packaging.) I suppose I could have done that call with the phone I borrowed from my Starbucks neighbor, but with the mention of a ¥2500 surcharge for using the helpdesk, I figured it would be rude to risk some unexpected charge on the phone bill going to a total stranger, rather than a friend I can repay in the event that it happens.

After spending another half-hour or so at the Starbucks before I was able to get in touch with the friend whose apartment in Kouenji I am staying at in Tokyo there was still no indication that my SIM card had been activated, even after rebooting again. It was on some pretty solid WiFi, so I was unsurprised to maintain Internet service for a little while after leaving the Starbucks, but when I glanced at my phone to check the time while waiting for the train and noticed that it appeared to still be signed into Gchat I was rather confused.

You see, although the phone appeared to have no mobile network service, it was in fact connected, and may very well have been connected the entire half-hour I spent waiting in the cafe. Very weirdly, it has a constant notification saying “NO SERVICE: Selected network (DOCOMO) unavailable”, while also constantly showing zero bars for my mobile network connection. And this is despite having a perfectly good Internet connection, even good enough for me to make and receive Skype calls.

Presumably this is because the OS, configured as it is for a phone rather than a tablet, is puzzled by an account that has data service, but is not allowed to place or receive calls, and therefore fails to display the proper indicator. This surprised me, as the same Android OS is also running on tablets, such as the Nexus 7, that also support SIM cards and HSPA+ data connections. Presumably on a Nexus 7 or similar device the mobile network indicator properly indicated when it is connected, and doesn’t harass you about not having voice service, so I wonder if there may be a way to tweak the phone version to fix this minor bug. After all, it is a little bit annoying not knowing whether or not you are connected until you try and access the Internet and either succeed or fail.

One final note for now is that this particular card provides 1GB of data or one month of service, which ever comes first. 1GB may not sound like all that much, but Android 4.x has extremely good tools for tracking and limiting your data usage, and if you are sensible enough to streaming media or file downloads while not connected to WiFi, I would not be at all surprised to see 1GB last for an entire month.

  1. At least since the first time I was in Japan, in 2002. []

Seven things I didn’t know about the consumption tax

In the last few months I have been reading up a lot on Japanese tax law, and have come across the following interesting facts about the consumption tax:

1. The national consumption tax rate is only 4%. There is also a uniform local consumption tax defined as 25% of the national tax; the two taxes are added together to form the 5% figure that everyone pays. The local consumption tax is split evenly between the prefecture and municipality where the applicable good or service was sold.

2. Not all of that 5% goes to the government. Businesses always take the full 5% from their customers (so long as those customers are located in Japan) but only pass on a fraction of this amount to the government. They can deduct any consumption-taxable expenses—inventory, materials, machinery, fees and the like—from their consumption-taxable revenues, and pay 5% on this net amount. The idea is to charge a total of 5% tax on the final value absorbed by consumers regardless of how many middlemen were involved in getting a product/service to the consumer. Businesses generally tally up their consumption tax bills on a quarterly basis.

3. Small businesses get pretty sweet tax breaks. Businesses with annual sales of less than 50 million yen can choose to keep anywhere from 10% to 50% of the consumption taxes they charge, regardless of their actual deductible expenses. The permitted amount depends on the type of business: wholesalers keep the least while service businesses keep the most. This is a really good deal for small service businesses, since their biggest expense is usually personnel, and most personnel costs (salary, social insurance, etc.) are not subject to consumption tax. Businesses with annual sales of less than 10 million yen get an even better deal: they are completely exempt from paying consumption tax. So in quite a few cases, part of the 5% paid by the consumer is effectively absorbed by smaller suppliers and subcontractors in the value chain.

4. Consumption tax applies to imports into Japan, whether for personal or business purposes, though the rules for this are very complicated. If you are bringing valuables into Japan as an individual, the 5% tax is calculated against a “taxable value” on the item, which is usually 60% of the retail price paid overseas. This is technically separate from customs duty, but is charged as part of the same inspection process and is superseded by customs duty where customs duty applies (i.e. to alcohol, tobacco and single items valued at more than 100,000 yen). You don’t have to pay consumption tax on anything within your duty-free exemption. Here is an example of how the calculation works.

5. Consumption tax arguably creates a government subsidy for large exporters. This is because exports are not subject to consumption tax in Japan (though they may be subject to consumption tax in the importing country). So when a company like Toyota or Sony totals up their consumption taxes, they usually end up having more taxable expenditures than taxable sales, resulting in a consumption tax refund. Quite a few companies get hundreds of millions of yen a year refunded this way.

6. It’s possible for Japan residents to get a consumption tax exemption for items in excess of 10,000 yen which are to be taken overseas. This is different from the exemption for foreign tourists and comes with a bunch of qualifications, among them that the item must be a gift for someone else or to be used or consumed by the resident outside Japan, and that it must be sold at some kind of “export store” (輸出物品販売場). I might look into this further if I ever get around to buying a washlet for my parents’ house.

7. Consumption tax was introduced in 1989. Most Western European countries adopted some form of consumption tax in the early seventies, and the idea had been floated by the Japanese government as early as 1978, but nobody acted on it until the height of the bubble. The initial tax rate was 3%, all of which went to the central government. The coalition government in the early nineties proposed hiking the tax to 7% but almost immediately back-pedaled due to negative public reaction. The current 5% rate, including the local consumption tax, became effective in 1997 after the LDP returned to power.

Why raising the consumption tax is a good idea AND good politics

The following is a lightly edited version of my e-mail reply to a friend who asked about the ongoing fight over passing a hike to the consumption tax. As of this writing the bill has passed the lower house but has still not become law. See Japan Real Time for a good breakdown of recent events:

The consumption tax was definitely too low for a country with such generous welfare benefits, so raising it only makes all the sense in the world. I almost wish they had put in a delay mechanism in case the economy is still in bad shape in 2 years, but hopefully that won’t be the case.

Fiscally, I think it is a drop in the bucket, and the short term economic impact is definitely not great. That is why there is such a strong knee-jerk negative reaction among the public. They either run or know people who run small businesses that will get hurt, but more importantly it’s one of the few policies that stares average people in the face every day and is easy to understand. Everything you pay for will get more expensive.

But at the same time it’s vital to get the house in order so to speak, or else Japan really is in for a hard landing. The social programs that Japan has are great and they need to be maintained. So they need to be funded in a way that’s not too onerous, and this seems like as good a way as any to me.

I have basically come to the conclusion that inflation is unlikely in Japan over the long term because there isn’t a fundamental basis for it. People are getting older fast and are just going to spend less. And productivity gains aren’t going to be fast enough to make up for that (economics isn’t my strong suit… but isn’t it the case that inflation is at least supposed to track economic cycles?) Japan isn’t going to necessarily have another growth boom, but what it can do is enjoy a comfortable and proud status as a rich nation. That is, they should be able to if people in their prime now can actually feel some security and expect a reasonable retirement not too different from what their parents had.

In terms of the political situation, there are a lot of people saying that Ozawa “won” but I don’t really see it that way. He didn’t stop Noda from doing what he wanted to do – there has effectively been a Grand Coalition in place since Noda came to power (note how close to unanimous the jail-for-download law was, or the postal reform bill, or take your pick) and for all the blustering among the parties they are pretty much united on a lot of policy measures because they are a) consensus among the Serious People muckimucks like the finance ministry and media opinion makers, and b) the subject of gaiatsu (I believe the IMF has been dogging Japan to raise the consumption tax).

And although Ozawa technically has the power to basically an early election through defecting, he is too afraid to do it because he knows that his clique is even more exposed to getting voted out than the others because it contains so many first-termers. It seems pretty shrewd for Noda to NOT punish the defectors in that case because it prevents the election from happening and lets the de facto grand coalition continue with him running the show.

If there is an election the DPJ will lose, the LDP will win (though maybe not get an outright lower house majority), Komeito will maintain, and Hashimoto’s party might make a serious splash, though Hashimoto himself has said he won’t run. So in that context I think all the established parties, especially the DPJ, have an incentive to delay an election as long as possible. Once Hashimoto has his foot in the door of national politics life won’t be the same. Every little thing will be a fight that can’t be worked out by getting drunk together at a ryotei.

Make no mistake, though, this is a big deal. This type of potential split in the DPJ was months in the making, maybe even years because Kan might have pushed for the tax hike had there been no earthquake (remember how he for whatever reason ran on that issue in the Upper House elections?).

And there is always the need to point out that this agenda of raising the tax was pushed by the finance ministry. Politicians in general are empty shells with voting power, and they need to get pushed in a certain direction by the people who they think will help them keep or increase that power. This time it was the ministry of finance because it is a permanent bureaucracy that has a political agenda that’s informed by its mission as the steward of the Japanese government’s finances.

That isn’t necessarily a bad thing because if there is one thing that the DPJ coming to power has taught me is that it’s dangerous to allow people with zero expertise being responsible for governing convince themselves that they know what’s best for the country. It feels like all they are good for is posturing and fundraising. The DPJ made the critical mistake of making enemies of the bureaucrats instead of cultivating them and influencing them in the subtle, glad-handing way the LDP mastered. Or at least they could have brought in people with talent and real ideas.

Kikuchi Naoko’s sarin, as described by another Aum member

By now everyone knows that Kikuchi Naoko, one of the last members of the Aum Shinrikyo cult wanted for the 1995 sarin gas Tokyo subway attacks, was arrested on Sunday. Although her face had been plastered on posters found in and around pretty much single police and train station in the country, she managed to remain at large for 17 years, until someone reported seeing her in the Tokyo suburb of Sagamihara.

Back in early 2006, Adam and I collaborated on a large job translating material about Aum Shinrikyo into English for some kind of security researcher down in DC doing a report about religious terrorism. The biggest single document in the project was the massive book Aum and I by Ikuo Hayashi, a medical doctor and member of the cult, who participated in the sarin release, which we translated a significant portion of.

I have previously posted a few excerpts from this book, including Hayashi’s description of the actual subway attack itself, the bizarre and stillborn plot to assassinate Ikeda Daisaku, leader of Sokka Gakkai, and a description of the gross practice of how cult members ate their own feces in a weird attempt to emulate the Buddha.

In honor of Kikuchi’s arrest, here is Hayashi’s memoir of his first encounter with sarin, found on pages 271-274 of the tankobon edition of the book.

  •     *     *     *     *

The first sarin dispersal experiment

At the end of April there was a phone call from Nakagawa to me at AHI. “Make the same preparations as when you treated Niimi and come to the Seventh Satyam, in Kamiku,” he said. The only treatment I had given Niimi was when he had been poisoned by sarin gas during the Daisaku Ikeda Poa incident, so I loaded up the station wagon with drugs, a respirator, an oxygen cylinder, and the other necessary supplies and went to Kamiku. Nakagawa went into the prefab that it was said Tomomi Tsuchiya had been assigned to, and came out carrying a box.

272


He told me that it had sarin inside it.

In the flask was a triangular flask, protected by a buffering agent. When I saw the liquid at that time, it was a faint fluorescent green. Since Nakagawa had said that it was sarin, I always thought of sarin as being that color a liquid afterwards. “So, Aum has sarin after all,” I thought. However, at this time I still had no confirmation that Tsuchiya was making sarin.

At that juncture, I still had no realization of what degree of chemist this Tsuchiya person was. Nakagawa said that because he and Tsuchiya were performing sarin experiments together, if by any chance one of them was poisoned, that I should come and treat them. I had a feeling that I had learned yet another secret. I myself was not receding, not progressing, being shown the true forms of Aum’s “secret work” one by one. I naturally felt the discomfort, the unsettlement of the treatment that came with it,

Those “sarin experiments” were to discover the volatilization volume of airborne sarin. I thought that this sarin was meant to be one means of defense against the American military and the [Japanese] Self Defense Force when the “war” broke out.

A truck was parked in front of the Seventh Satyam. It was loaded with several canisters, large storage batteries and a converter, plastic bottles and a sprayer that seemed to be the type used for the spraying of agricultural chemicals and pest removal. Driving the truck was a Samana in the Truth Science Research Department.

Nakagawa and Tsuchiya got in the car together saying to me and the young Samana that we should follow them and set off.

273


I had no idea whatsoever where we were going, but when we arrived it looking like a dry riverbed near the mouth of theFujiRiver. The time was night, just before dawn, and in the vicinity were no other people or vehicles. The riverbed was a broad area, and I got the feeling that they had chosen the location in advance, and we had gone to that place.

They used an ultrasonic nebulizer (sprayer) places on top of an electric balance to spray sarin into the air, measured the wind velocity and force at that instant, and checked the amount of sarin consumed based on the change in mass.

When the experiment was over, he sprayed some neutralizing agent from the nebulizer, but because he had been poisoned I gave him two intravenous injections each of two ampoules of PAM and atropine sulfate. When I examined Nakagawa it looked like there was some mild pupil dilation, but I couldn’t really tell. I treated Nakagawa based on his subjective symptoms.

Nakagawa and Tsuchiya didn’t say in what way they were going to use that data. I didn’t ask. The experiment was over, and we went back to Kamiku. Seeing this experiment, I thought that they really were going to use sarin for defense at the time of the “war.”

Thinking about it now, a much greater volume of sarin would be needed for defense and so the question of how they could get such a quantity comes up is raised, but at this time I was not thinking such thoughts very strictly, and only thought loosely about this.

Why was I called at this time? I think that it may be because I was supposed to perform treatment for sarin poisoning later on. At this time I was thinking that it would be fine if Asahara used me to treat sarin poisoning.

274


I supposes that Asahara must have had the intention of making me participate as a member of the medical team in his plans, particularly his plans to use sarin.

Now I think that Asahara had me join the on-site activities with a notion to “acclimate” or “condition” me, and made me participate in that experiment as a first step.

I think that after the Daisaku Ikeda Poa incident, Asahara stepped up the “fumie” [tests of faith] and “narashi”[habituation, conditioning] that he been giving me to the next level.

 

Why I don’t have an iPad: Son-san, are you out there somewhere?

I want one, and I’m willing to pay for a data plan. But Softbank will not give it to me.

I have used a Softbank iPhone for a while now—since July 2009, to be precise. Softbank has generally been pretty good to me. When the iPhone 4S came out, they essentially upgraded my iPhone 3GS for free in exchange for a two-year contract extension, and I was happy to take that offer. And their “packet-hodai” deals have been a very cost-effective way to stay in touch while traveling, often coming out cheaper than using hotel wi-fi.

When the new iPad was released last month, and Softbank offered a sweet deal for the 4G model (no money down, and less than 3,000 yen per month for up to 100 MB of data), it seemed like a good time to break down and buy one. I switched job functions a few months ago and now have to do quite a bit of traveling and client presentations, so having a nice big portable Retina display would be more useful than ever.

So I started my online application on the evening of March 18. The application is quite long. I had to input all my information (which Softbank already had) and agree to a few different lengthy form contracts.

Finally they asked for my credit card information, which I duly entered.

“ERROR: The name on your credit card must match the name on your application.”

I knew that my middle name was on my Softbank account, so I had entered my middle name on the first screen of the application. But my credit cards don’t have my middle name. Figuring that was the problem, I canceled the application and re-entered everything without my middle name. This time my credit card was accepted.

Two days later, I received a link to upload a scan of my identification. I started by trying my driver’s license. The upload had to be a JPG, and the scanner at work only produces PDFs, so I scanned a PDF, took a snapshot in Acrobat, and pasted it into Windows Paint.

A few minutes later I got another email. “Your ID has been rejected because it does not match the name on your application.”

Doh! Must be because it has my middle name on it.

Next try. My health insurance card does not have my middle name. Neither does my credit card. And health insurance card plus credit card is listed as an acceptable combination. So I scanned, copied, pasted, saved, and uploaded again.

A few minutes later I got another email. “Your ID has been rejected because it does not match the name on your application.”

I growled, picked up my phone and called customer service. After 15 minutes on hold I finally got to an agent and explained what had happened.

“OK,” she said. “I have your phone number. Can you confirm the name on your account?”

I gave her my name.

“Um,” she said, “that’s not the name on the account.”

I explained that my original account had a middle name on it but that I couldn’t use it while applying through the website. She put me on hold for a few minutes.

“Can you upload ID without your middle name on it?”

“Like I said, I already tried that.”

She put me on hold for a few more minutes.

“So… you tried using ID with your middle name, and then without your middle name?”

“YES,” I said.

She put me on hold for a few more minutes.

“OK, what you need to do is go to a Softbank store and request a change of name…”

I hung up on her and fumed on Facebook. One friend suggested that I complain to Masayoshi Son on Twitter. And I did, which sort of made me feel better. He never replied, though.

At that point I was willing to give up on my iPad dreams, but the deal still seemed too good to pass up. So on Friday, March 24, I walked up the street to the nearest Softbank store and told them I wanted an iPad. The guy at the counter checked my ID, asked for my mobile number, and produced a one-page printed application for me to sign.

“Is everything in this application correct?”

That’s when I noticed that my name was screwed up: the space between my first and middle names was in the wrong place.

“Well… that’s how it was entered in our system. I guess it was probably an error when they set up your account.”

I sighed. “I would have noticed it then. But OK. Can you still process the application?”

“Sure we can.”

“OK. And how long will it take to actually get an iPad?”

“Something like a week, probably. We will call you when it’s ready.”

The next week passed without a call. Yesterday (Monday), I tweeted Softbank customer service asking if there was any way to check the status of the request. They promptly responded that they had no way of checking and that I needed to take it up with the Softbank store.

So I went back to the Softbank store today, gave them my name and asked for a status update. The lady at the counter went into the back for a few minutes and then returned.

“We don’t know what the status is.”

“You have no idea how long it will take?”

“There is a huge backlog. It could easily take a month,” she said. “We request the iPad from Softbank, Softbank requests it from Apple, and there are probably some other steps involved as well.”

Seriously? Is it so hard to take my money and give me a product?

I am tempted to cancel the application and buy a Wi-Fi model at the store, but I know that I will want access to mobile data from time to time. Not enough to warrant a full-blown e-Mobile subscription, though. That’s the most frustrating part of this experience. Why can’t Softbank get its act together?

AIJ – mini-Madoff or yakuza slush fund? It’s too early to tell

(Update: Jake Adelstein has left a response in our comments section)

Friday morning the news broke that Japanese regulators shut down AIJ Investment Advisors, a small investment management firm, because its 183 billion yen in funds under management had mostly gone missing. The company specialized in managing pensions for smaller companies. It seems likely that a massive fraud has taken place.

Scandals like these are not obscure, victimless crimes – they directly affect people’s lives. For instance, semiconductor equipment maker Advantest apparently had 8% of its pension assets invested with the firm. These funds are very unlikely to be recovered at this point. That’s 8% less the firm has to pay its workers post-retirement, which it will have to make up for somewhere. The unwitting employees of AIJ will no doubt lose their jobs as well. A company the size of Advantest might be big enough to weather a loss like that but 100+ other clients that were wooed by the attractive returns might not be so fortunate. Layoffs, bankruptcies, ruined lives, misery all around.

The fund reported consistent returns regardless of market conditions, achieved with exotic financial instruments—classic signs of financial fraud that corporate pension managers should have seen coming a mile away. It’s too early to know exactly what happened, though. According to the WSJ, the ratings agency R&I called attention to the suspiciously favorable returns in 2009.

Too early to call “yakuza”

Even though the facts have yet to come out, that hasn’t stopped Jake Adelstein, among others, from promoting a possible yakuza connection. That’s understandable since he bases his media career around being the West’s yakuza expert. However, I take issue with him coming out so early in favor of an organized crime angle. He doesn’t know any better than the rest of us, at least judging from the justifications he has trotted out so far.

He argued in favor of a yakuza connection in the Olympus scandal not too long ago, and the New York Times ran a report that the police were looking into yakuza involvement. However, the independent investigative committee found no evidence of yakuza and I have not seen any major refutation on that point.

Despite seemingly getting it wrong on Olympus, Jake has again taken to Twitter to play up a connection in the AIJ scandal. As with Olympus, the New York Times has run an article that echoes and bolsters his claims. The feed and the article make lots of claims that I will paraphrase here:

  • AIJ is a Yamaguchi-gumi front (Jake)

  • This is true because one of the board members (not the head) was convicted of paying protection money to a corporate extortionist (sokaiya). And once someone has paid millions in protection money and gotten caught, that means they will turn around and steal billions (I am assuming because the yakuza tells them to). (Jake)

  • The head of the firm is also ex-Nomura (NYT)

  • The DPJ-led government turns a blind eye to financial fraud because the former FSA minister may have accepted yakuza donations at some point. (Jake)

  • The Nomura connection and the dates when AIJ and another firm received approval to offer financial services means the AIJ scandal “shares many characteristics with the Olympus scheme” (NYT)

  • Jake sent an email to a friend explaining his suspicions about AIJ in 2008. He says that his sources told him AIJ manages the Yamaguchi-gumi’s pensions.

I am ready to be wrong, but at this point I am not convinced. These unconfirmed claims, appeals to authority, and guilt-by-association tactics do not amount to actual evidence to justify labeling this a yakuza crime. Yet, anyway.

It may well be that the Yamaguchi-gumi raided AIJ and took all the money, or demanded favorable treatment as a customer. But a serious and contemptuous crime has apparently taken place even without a yakuza connection, so there’s no need to rush to apply a label, in my opinion. Jake and Hiroko Tabuchi of the New York Times, I beg you to please rein in your speculation until we have more facts.

Actual damage possibly smaller than 183 billion yen

It’s also worth noting that the 183 billion yen number includes potentially phony returns, so if the entire cumulative return of 245% is phony but the cash remained, that would leave AIJ with 53 billion in cash. That would leave “most of” the money missing even with most of the principal intact. That’s still a lot it’s indeed gone, but we don’t even know that much right now. And if the company has only been lying about returns that means they have likely been fraudulently collecting return-based fees.

It’s my understanding that investment managers are required to keep funds in segregated accounts at trust banks, to avoid the easy temptation of embezzlement. For example, if I buy a mutual fund, the fund manager doesn’t get to touch my money at all (unless I am totally naive). It goes into a trust, and the manager simply gives instructions on which securities to purchase based on the contract. AIJ was a “discretionary” manager, meaning that the managers had free rein over (but not direct access to) the funds as long as the action fit a pre-determined investment policy. Of course that assumes AIJ was following procedures when collecting funds. If AIJ was somehow just accepting cash and managing without a trust arrangement, that is a dreadful problem and could warrant prosecution even without any theft. The regulators’ statement (PDF) orders AIJ to “immediately confirm” the status of funds, including fund segregation. Ick.

Update: According to a story over this weekend, the firm apparently invested most of the cash in a single Cayman-registered investment trust of its own creation, which it then outsourced management of to a British-affiliated bank in Bermuda. This would suggest they may have used the funds as a way to get around fund segregation and gain access to the funds.

Japanese Kindle

Having now moved back and forth several times between my home in the US and Kyoto or Taipei, on the other side of the world in East Asia, it has become clear to me that dealing with books is the biggest pain in the ass. This is exacerbated by the fact that I am both a congenital book hoarder and (although not at this exact moment) a graduate student. After the most recent move home, after graduating from my Masters program in March of last year, I decided that purchasing a Kindle would be the best way to reduce the amount of weight that my future self will be sending across the sea when the need arises.

And I do love the Kindle, and Amazon’s service in general. (I should mention here that my father owns some Amazon stock, which has benefited me, but that the investment is based on enthusiasm for the company’s service, rather than shilling in order to promote the company.) I happen to have the 3G keyboard model, and the e-ink screen is a wonderful replacement for paper books, even if not quite as good. I do also use the Kindle app on my phone when the Kindle device is not with me, and it is surprisingly comfortable to read books the large screen of my Galaxy Nexus. And the service has been fantastic; when I accidentally broke my Kindle’s screen, Amazon customer support sent me a new one no questions asked. This clearly because Amazon’s priority is very different from that of a consumer electronic company whose profit comes from the hardware itself, who would be happier persuading you to pay for a new unit, or at least repair costs, for breaking a non-defective unit; rather than even asking if I had broken it, they seemed more concerned in getting me a new Kindle ASAP, so that I could resume paying them for content.

Unfortunately, however, the Kindle Store does not include Japanese books. However, it was reported a couple of weeks ago that Amazon would be launching the Kindle in Japan later this year, with Japanese language e-books from Japanese publishers. Apparently they will be launching with the current generation of e-ink devices, rather than the Kindle Fire Android tablet, but since I personally prefer both the readability and long battery life of the e-ink devices I don’t think this is a problem. Anyway, Amazon already sells the “International” Kindle in Japan, so the key here is that Japanese e-books will be available in the store, which will then be usable on existing hardware, including the Kindle app on iOS, Android, and OSX or Windows computers.

The big question for me, however, is how the different national stores will interact. Will it be possible to purchase Japanese books from my Amazon.com account, using my American credit card? If not, will it be possible to use, say, a Japanese debit card linked to my Shinsei bank account? Or will I have to resort to the more convoluted maneuvers required for some international online media stores, by purchasing Japanese Kindle books through my Amazon.co.jp account, and then switching the currently logged-in account on my Kindle to that when I want to read a Japanese title? I do know that Amazon has already localized the Kindle for Italian, Spanish, with Brazilian Portuguese also launching later this year, so I am wondering if anybody reading this knows how it currently handles juggling purchases from more than one country store?

Now, despite the fact that the rumored Kindle Japan store will (presumably) not be launched for a few months, there is still one major source of Japanese e-books usable for it today. Many readers are probably already familiar with Aozora Bunko, a repository for public domain Japanese literature, roughly similar to the primarily English language Project Gutenberg. Since the Kindle software—that is, the OS on the Kindle device, not just the app for other platforms—has included support for East Asian text for some time, it can display Aozora Bunko text files with no problem. Well, there is ONE problem. You see, while perfectly readable, the current text file viewer only displays text in the same left-to-right horizontal lines that you are reading this blog in. While it certainly no challenge to read Japanese in this format, it just doesn’t feel right for literature, which is still universally printed in horizontal lines, and read from right-to-left.

Luckily there is a solution: an online utility called Aozora Kindoru, which generates PDFs formatted in literature style vertical columns for the Kindle screen (they will also work great on any other device with PDF support and a similarly sized screen), and even properly formats any furigana present in the original file. I was first alerted to this utility via a Twitter user, and here are two English blogs with instructions, although I imagine that anybody who would be reading any of the old stuff on Aozora Bunko can figure out the Japanese directions with no problem. [Link 1] [Link 2]

As a final note, it appears that the Nook, from Barnes and Noble, is also planning to introduce international versions, including Japanese. While looking for jobs, I ran across a posting for an “International Content Manager” for Nook, the duties of which involve:

The Manager, International Content Acquisition will have previous experience working with publishers around the world and should be familiar with each territory’s publishing industry.  Candidates should be familiar with the latest developments in digital publishing.  Ideal candidates must have business level command, speaking and writing, of English and at least one other language.

and the job requirements for include:
Professional, spoken and written fluency in English as well as one of these languages is required:  German, Italian, French, Portuguese, Chinese, Korean, Japanese, Russian.

This actually surprises me a bit, as one of the reasons I decided to go with Kindle rather than Nook in the first place (aside from my history with the company) was that I expected from that beginning that Amazon, a country with a strong presence in Japan, would eventually introduce a Japanese language store, while I was doubtful that Barnes and Noble, a company with no history that I am aware of operating in foreign language markets, would do likewise. I am happy to be proven wrong. Incidentally, I have yet to see this move by B&N reported anywhere, but I think the job posting is pretty clear evidence, although if they are currently recruiting for these positions it would seem likely that they are not as close as Amazon to opening their Japanese store.

Corporate Japan’s Feudal Public Relations


The months of August began with a breaking story from the Nikkei: Hitachi Corporation and Mitsubishi Heavy Industries (MHI) were in discussions to merge. The stories were not clear if the merger would be of some of their business (not that uncommon—see, for example, TMEIC), or their entire business. If it was a true merger of both companies, it would create Japan’s largest company after Toyota.


The reasons for such a merger are obvious, as they are one of many types of Japanese companies facing two problems: a shrinking domestic market, and competition overseas from companies from places that they previously did not have to fight against (namely companies from Korea and China). A merger such as between Hitach and MHI would be a great way for Japan’s top-tier construction/technology/heavy industries companies to collaborate and compete not just again GE and Seimens (their historic rivals) but also Samsung and the growing horde of Chinese companies, when it comes to bidding and seeking overseas projects.


Yet the reaction by both companies to the release was a sharp denial. Hitach put out a one line press release: “The article is not based on a fact.” (When I read this, I was struck by the peculiar English—they surely did not mean to deny the singular fact but not deny the plural “facts,” but that was my first impressiony.) Then we had the MHI press release that reflected an ever worse command of the English language:


Even after a denial of the report this morning related to possible integration of business operations of Mitsubishi Heavy Industries, Ltd. (“MHI”) and Hitachi, Ltd., there have been a continuing flow of inaccurate information and reports pertaining to this matter. We feel uncomfortable that this inaccurate report continues. We hereby reiterate that the series of information is not based upon MHI’s own corporate decision or disclosure, and MHI has no plan to enter into any of the arrangement reported, while we resister strong objections to those inappropriate conducts.


My reaction reading that is to cringe. Why can’t these companies—which have hundreds of foreign employees—use native English speakers to check their English language public statements? You would think this is especially true for such statements that are picked up and read by the international press? This story is almost a month old, but I mention it because a person in Japan’s PR industry (which is basically dominated by two companies, Dentsu and Hakuhodo) just shared with me his insight that, while both these companies used Japan’s PR firms to handle their new product promotion and advertising, they take on this type of “crisis management” by themselves. For all the criticism that this blog has lobbed at Dentsu over the years, my feeling is—it shows! And hearing this, it reminded me of this section from a recent issue of “Terry’s Take”:


Traditional bedrock companies in Japan are proud and feudalistic. This used to be their strength—commonality of purpose, self-sacrificing employees, and no arguments about decisions from the top. However, with the advent of the information age, quality of response and reaction has become more important than unwavering commitment and persistence, and Hitachi in particular has suffered as a result. Perhaps ironic given that the company is so deeply involved in the IT industry.