Up and Down on the Abe reform agenda

Though it seems like everyone and his brother (including myself) are writing off Abe as a dishonest hack who might be replaced after the July upper house elections, not everyone sees it that way. I thought I’d take a quick look at some of my favorite opinionated pundits to see who’s up and down with Abe’s performance, particularly in the realm of the reform agenda (something we don’t hear too much about these days:

Up — Robert Feldman of Morgan Stanley:

Brilliant, Mr. Abe, Brilliant!
February 01, 2007

By Robert Alan Feldman | Tokyo

Political commentary on PM Abe has been unrelentingly negative. Indeed, there seems to be a bandwagon effect, as more and more pundits jump in to criticize. Unseen by these pundits, however, is a revolutionary change in the process of government. Policy competition within the government is emerging and seems to be a permanent feature of governance. Prior to PM Koizumi’s tenure, policy areas were typically monopolies. One ministry had control of the agenda for a given area. By gentlemen’s’ agreement, other ministries did not move beyond their jurisdictions.

Under PM Abe, competition between the PM’s Office and the bureaucracies has become the standard. Now, from the very start, PM Abe has formed special committees of non-government experts to deal with a broad range of issues. Examples areas include labor policy, agricultural policy, education policy, innovation policy, and — most interestingly — financial sector reform policy.[1] Action in the latter area has accelerated sharply over the last few days, and points to what we can expect in other areas.

[Feldman then describes the series of events that have led to the formation of competing committees — one in the Council on Economic and Fiscal Policy (a cabinet advisory body intended to take initiative of the budgeting and policymaking agenda away from the bureaucrats), and one in the Financial Services Agency (who currently has jurisdiction in this area)]

Now that both committees exist, they will have to compete in the public eye. Both will release materials and minutes, so that investors and the public can follow the debate closely. Moreover, since PM Abe’s committee has been formed under the CEFP, the matter will have to be discussed in that committee, under his own chairmanship. Naturally, both committees take the debate seriously.

The next phase of the debate is gathering opinions from the public. Both committees are eagerly seeking advice from around the world. Indeed, a friendly competition has emerged to see which committee can come up with the best plan. Expert witnesses will be called by both committees, and the press will notice.

Even more important could be the effect on confidence [in the market that sparked by the “intelligent policies” that Feldman is sure will result from this policy competition] in the Abe government itself. The government has already scored major wins in foreign policy, but a clear victory on reform has yet to emerge. The financial system debate is a major opportunity. The conclusion will not be far off. The PM’s own subcommittee on the issue is reportedly scheduled to submit its ideas by the end of March. The FSA committee cannot lag far behind, for fear of losing the battle.

Comment: This is very encouraging as this policymaking style is a similar of Koizumi’s smart management of reform campaigns: Take a sector that is in dire need of reform (in this case Japan’s financial markets), take up bold reform measures at the cabinet level, and then spark competition among agencies to try and work out the best policy. This is similar to Koizumi’s tactics that resulted in privatization of the highway public corporations and Japan Post — two interrelated sources of waste in the economy and a drag on public resources. Of course, “international competitiveness” for the financial sector is a relatively small issue compared to the quixotic goals of the Koizumi years.
Continue reading Up and Down on the Abe reform agenda

Foreign Crime File – is all the fuss really necessary?

Today I want to talk about the “Foreign Crime Files” manga. It’s an offensive, disgusting book that tries (albeit poorly) to exploit Japanese people’s fears and prejudices. By now many of my readers will have heard about this since the Japan bloggers have duly reported it with furious anger. But my preliminary and very unscientific research seems to indicate that this book has not made much of a splash in Japan as of yet. It’s enough to make me worry that this outrage might actually be building more of a market for the book (and a platform for its fear-mongering) than it would have had otherwise.

The sole Amazon review (1 star): “Uses lots of discriminatory phrases, low level content. It seems as if the author has a major inferiority complex as a Japanese person. This will engender a bias against foreigners among ignorant Japanese people.” Also from Amazon: People who bought this book also bought “Completely Master the Japanese Language Proficiency Test Level 1!” (a test of Japanese as a second language). Amazon rank: 1004 in books.

Japanese-language Technorati results: zero!

2ch presence: One very short thread on the “Books” board. Overview:

Thread starter: Did you know about GAIJIN HANZAI FILE, this horrible, discriminatory book?!
2channeler 1: It’s an ad!
TS: No, it’s not an ad, I just want to know why Japanese people allow this kind of thing?
2channeler 1: Well, I guess it’s more that we don’t really care about foreigners.
2channeler 2: My opinion is that people who overreact to this discrimination are pretty depressing. Just leave it alone. The fact that the foreign media has picked this up is just what I’m talking about. They understand that life and racial discrimination can’t be separated. A worldview that relates and compares issues to one’s own life is very Christian.

No mention in a news thread on the lower “foreign crime rate” reported by the National Police Agency.

Google results: The multitude of booksellers’ websites selling the book and foreign Japan bloggers’ reactions, plus one blogger/J-pop singer cocco (wiki), who explained: “It isn’t being talked about much by Japanese people yet, but one book (Foreigner Crime File) is enraging foreigners who live in Japan… I worry that this might turn into an international problem!”
According to cocco, there is a movement going on within mixi to boycott Family Mart over this book, one that debito has helped organize outside of mixi and that has in the end kept it off the shelves there as well as in other places.

It could be early to conclude that Japanese people just aren’t all that interested in this book, or perhaps they’ll just never have the chance to read it due to the success of Debito and others to get this book censored. But in this era of viral marketing and unscrupulous people, you have to wonder if all the coverage we foreign Japan bloggers are giving this awful book are giving it more attention than it ever really deserved. I feel like this book would have died a death in the sleazy porno section of the convenience stores if it weren’t for its almost made-for-the-Internet inflammatory illustrations.

“Child-bearing Machine” T-shirts

Fans of Japanese political kerfuffles can thank Kikko for letting us know how we can get T-shirts commemorating Health and Labor Minister Hakuo Yanagisawa’s clueless statement implying that women are “child-bearing machines.” No maternity sizes available yet, unfortunately.

ts.jpg

You can get some background on this and Abe cabinet’s other “gaffe” scandals here, but basically the opposition parties went nuts over this misstatement, sitting out on Diet deliberations (a move that goes against the supposed principles of a Japan’s proud new truly parliamentary system) on a supplementary budget to carry over Japan for the rest of the fiscal year. They came back after this tactic of shrilly lambasting the LDP produced only mixed results in local elections, and then Acting President of the DPJ Naoto Kan made a strikingly similar flub: “Tokyo’s birth productivity is low”. So, as with other recent scandals, the DPJ comes off looking no better than the LDP.

Continue reading “Child-bearing Machine” T-shirts

Gendai on Abe’s chances of survival: “Abe government destined to die like a dog”

Tell it, Gendai (in translation from their daily e-mail):

captksx10102010414japan_health_minister_ksx101.jpg
Prime minister Abe keeps on protecting Health Minister Hakuo Yanagizawa despite calls within the ruling coalition for him to quit over his “women are birth-giving machines” statement. If Abe fires him, his own responsibility for appointing him will be called into question, and his shoddy hiring practices will suck even more momentum from the administration. With the Abe government in such a state, the LDP-Komeito coalition won’t be able to campaign for the unified local elections in 2 months, let alone the upper house election this summer. Right now the future state of affairs has become murky as to whether he’ll be dragged out early or fall dead of disease. Looking back at previous LDP administrations, all governments that faced severe criticism have died young. This cabinet even even worse than the Uno cabinet, which came under fire for a sex scandal, or the worst-in-history Mori, who made the “nation of gods” statement. Most everyone is thinking Abe’s government will die an early death as well.

No more Dennis Hasterts for Japan, says Komori

Washington-based Sankei Shimbun veteran Yoshihisa Komori’s blog has gained some attention since its inception for two major incidents:

  1. A column of his lashing out at a government-funded research institute that was producing “anti-Japan” scholarship, which eventually led to its closure. The move was documented and condemned by Washington Japan policy wonk Steve Clemons in a Washington Post Op-ed calling Komori a member of Japan’s emerging right-wing “thought police.”
  2. Komori’s criticism of pro-China left-wing Japanologist Gregory Clark of Akita International University sparked a flame war between Clark and Komori’s readers. In response, Clark complained in the Japan Times of ideological harassment.

It may be true that Komori has used his position to put pressure on the left, but the claims made by Clemons that he is “not unaware that his words frequently animate [violent right-wing extremists],” however, seem to carry little water (at least based on the one example of Komori’s involvement in the aforementioned incident). At any rate, regardless of where you stand on Komori, it cannot be denied that the man is an experienced journalist with deep knowledge and insight, especially on issues of US-Japan relations.

It is with that in mind that I recommend his recent article (an excerpt from an article in December issue of monthly magazine SAPIO) from Jan 16 on the changes the new Congress will have in store in terms of individual members’/party stances toward Japan. Essentially, he rebukes the idea popular among some Japanese watchers of the US-Japan relationship that a Democratic Congress would suddenly turn hostile to Japan. No, he argues, the US Congress’ attitude toward Japan is far more complicated:

First of all, dividing American Congress members as “pro-Japan” or “anti-Japan” invites some misunderstanding. The word “anti-Japan” implies a perception that is somewhat removed from the reality of American politics. To put it bluntly, pro-Japan people do not exist in the US Congress and administration. To be pro-Japan means to have positive feelings for Japan or to like Japan.

The idea of a pro-Japan Congressperson would make one think of a politician who makes political statements and actions based on his affection or positive feelings toward Japan. Unfortunately, however, there are no such Congresspeople in the US Congress. It would disqualify them as US Congresspeople to change their legislative activities just because they like Japan.

[There are also people who are pro-Japan on the surface only because they think that the US-Japan alliance is in the US national interest. At the same time, there are “Japan experts” or those who have either lived, studied abroad in, or studied about Japan. These people have deep knowledge and understanding of Japan, but just because they know about Japan it doesn’t mean they are pro-Japan]

While emphasizing the above points, I have noticed that the biggest reason it seems like the “pro-Japan faction” in the new US Congress has declined is because Dennis Hastert (R, Ohio), former Speaker of the House since 1998, has stepped down. Hastert has experience living and teaching English in Osaka in the 1970s, and ever since he has often shown his closeness with Japan. For example, in 2003 when the “Families Association” including Sakie Yokota whose kin was kidnapped by North Korea visited Washington, it is well-known that Speaker Hastert greeted them in Japanese, saying “Yoku irasshaimashita” (Welcome!)

It is a fact that Hastert placed emphasis on Japan as Speaker in the process of holding deliberations on bills and hearings, and maintained a stance of firmly maintaining the alliance with Japan. For Hastert to go from Speaker to a regular representative perhaps means a loss in the power to place emphasis on Japan.

However, there are quite a few Congresspeople who value the relationship with Japan in both chambers. The reason there are so many in the Republican Party is probably because the Republican Bush Administration has taken the policy of emphasizing Japan. Rep. Senator Sam Brownback, too, has expressed sympathy and understanding of Japan for year, particularly with regard to the abduction issue. He has taken the utmost consideration of Japan’s humanitarian anguish with his efforts in holding hearings and press conferences. Brownback emphasizes all aspects of the US-Japan relationship and always speaks of Japan using positive expressions. He has shown interest in running in the 2008 presidential election.

Conservative Republican politicians such as Hastert and Brownback all place great importance on the US-Japan alliance. Similarly, another man who has made clear his stance to value Japan due to the importance of maintaining the US-Japan alliance is Rep. Sen. John McCain. He is the front-runner candidate for the Republican nomination in the 2008 presidential election.

The Democracts also have a near consensus in terms of maintaining the US-Japan alliance. One politician who knows Japan well and often talks about Japan is Dem. Sen Jay Rockefeller (WV, [who studied abroad at International Christian University in Tokyo for 3 years]). He often criticized Japan over the bilateral trade problems throughout the 1980s, but he has been consistent in espousing the alliance with Japan in terms of security.

Komori notes at the end that it’s not that simple to read the US Congress in simple pro or anti Japan terms. And anyway, it doesn’t matter that much anymore because the relationship has stabilized. There are no more major trade concerns, and anyway there is no way Japan can get a spot on the agenda with China getting everyone’s attention, not to mention the whole host of other foreign policy issues. While Congresspeople from either party might take an anti-Japan stance when jobs in their home districts are threatened, or the Democrats might go anti-Japan to please labor, these are not life or death concerns in the grand scheme of the relationship. Of course, worsened security situation in Asia or the unlikely prospect of a Nixon Shock-style financial crisis could make the US-Japan issue relevant and sexy again, I wouldn’t count on it.

Komori’s point seems to be one that I heard often when I was in Washington: Japan has little to worry about from losing “Japan hands” in high offices (such as when Mike Green stepped down as NSC adviser on Asian affairs in 2005). Perhaps in the rest of the article he makes this explicit. But I have to wonder about these reassurances: Japan has been relying more on the familiar Washington lobbyists recently as opposed to the traditional “Japan lobby,” but didn’t Hastert’s stance toward Japan come in handy when a Japan-backed lobbyist quelched a resolution condemning Japan’s supposed lack of reflection over WW2 atrocities? And isn’t it easier for people like the Washington-based Komori to do their own lobbying (say, brokering meetings between the Families Association and Hastert or helping hold hearings on an issue that has near-zilch to do with the US national interest) when the lobbied have warm feelings toward Japan already? Perhaps the lesson to be learned from the new Congress is that Japan shouldn’t count on seeing many “pro-Japan” Congresspeople from now on since people just aren’t paying that much attention to Japan issues right now. Whether that’s good or bad for Japan is somewhat besides the point.

Comedian shuns political parties to win gubernatorial race in Miyazaki

A comedian, Sonomanma Higashi (whom I’ve unfortunately never heard of), has won a governor’s race by shunning party politics completely (and the usual wheeling and dealing for institutional votes that such politics usually entail), relying only on his own fame and convictions to earn the job:

Sonomamma Higashi, a popular showbiz figure, was backed not only by the bulk of the floating vote but also by a sizable chunk of the prefecture’s massive conservative constituency.

Higashi’s victory is another sign of Japanese voters’ disillusionment with mainstream politics, which may have been deepened by a recent series of corruption scandals in local politics.

In Miyazaki, the bid-rigging scandal has led to the arrests of former Gov. Tadahiro Ando and some top prefectural government officials. The prefecture has traditionally been a bastion of rural conservatism, with the Liberal Democratic Party enjoying strong support.

But the conservative base was divided over two rival candidates, while the Democratic Party of Japan, the main opposition party, did not field its own candidate. Higashi, who apparently has no ties with local vested interests, was the choice among Miyazaki voters fed up with collusive politics.

Higashi, a native of Miyazaki, ran a low-key, low-budget campaign, supported only by his friends, and presented a well-prepared campaign platform. High name recognition was not the only factor behind his success.

The voter turnout was the highest for a Miyazaki gubernatorial poll in about 30 years. The voting rate was also high in the gubernatorial election in Fukushima Prefecture in November, which was also held to fill a post vacated by the resignation of the former governor over a bid-rigging scandal. (Nikkei Editorial)

A conservative base of independent voters turning away from the LDP has the party spooked, says the Yomiuri:

Former comedian Sonomanma Higashi’s victory in the Miyazaki gubernatorial election Sunday–without the support of any political party–sent shock waves through the Liberal Democratic Party.

A senior party figure expressed concern saying, “Floating voters who were fans of former Prime Minister Junichiro Koizumi’s style of theatrical politics may have started drifting away from the LDP after Prime Minister Shinzo Abe took office.”

In light of unified local elections in April and the House of Councillors election in summer, the LDP likely will have to review its strategy for winning the support of swing voters.

Opinion polls have indicated that independent voters are abandoning Abe and the LDP. Issues behind this trend are thought to include the return of the so-called postal rebels to the party; the resignation of Genichiro Sata, state minister for administrative reform and regional revitalization; and financially driven political scandals.

Many LDP members believe that swing voters who distance themselves from the party will not be quick to return, and in a worst-case scenario for the party, floating voters would cast their vote for the Democratic Party of Japan.

I have advice for the LDP: if it’s Koizumi-style politics you need, the only answer is to bring back Koizumi. The people of Japan will thank you for it.

Correction & the latest on white collar exemption

In my earlier post ““White Collar Exemption” and the danger to the LDP” I noted that Chief Cabinet Yasuhisa Shiozaki remarked that the government would try and submit bills that would make it possible to exempt workers making more than 9 million yen from overtime payment. I originally said that the move would affect 20,000 people, but that was a typo. It would actually affect 200,000 people. And as this new article from Asahi Shimbun notes, some politicians with sense don’t want to anger 200,000 voters 6 months before a major election:

Despite concerns about a backlash from voters, the government plans to submit legislation to the Diet that would introduce U.S.-style working rules exempting tens of thousands of white-collar workers from overtime pay.

Ruling coalition officials said pushing the so-called white-collar exemptions for labor standards would hurt them in this summer’s Upper House election.

However, Chief Cabinet Secretary Yasuhisa Shiozaki reiterated on Thursday that the government would submit the legislation to the Diet session scheduled to start later this month.

“We are making efforts now to move in that direction,” Shiozaki said at a news conference.

To alleviate concerns among ruling coalition officials, labor minister Hakuo Yanagisawa met with Liberal Democratic Party policy chief Shoichi Nakagawa and others Wednesday and explained the broad outlines of the proposed legislation.

Yanagisawa said the Ministry of Health, Labor and Welfare was contemplating applying the white-collar exemption to workers making more than 9 million yen a year and who have discretion over their work responsibilities.

Yanagisawa said that under those conditions the new exemption would affect only about 200,000 workers, or about 0.4 percent of the total working population of 54 million.

Those employees will not be paid overtime allowances even if they work more than the legal standard of eight hours a day or 40 hours a week.
Continue reading Correction & the latest on white collar exemption

Another Bush administration official who needs to pack his bags

Of all the asinine things that come out of Washington, this latest tirade by Charles “Cully” Stimson, the Defense Department’s point man on the Guantanamo detainees, is ridiculous. In an interview on Thursday, he went through a laundry list of large New York law firms which are representing the detainees… and then suggested that this was inherently wrong, and merited reprisals from big-money clients.

From the Wall Street Journal‘s Law Blog:

Said Stimson: “I think, quite honestly, when corporate CEOs see that those firms are representing the very terrorists who hit their bottom line back in 2001, those CEOs are going to make those law firms choose between representing terrorists or representing reputable firms, and I think that is going to have major play in the next few weeks. And we want to watch that play out.”

Trés daft. The right to counsel aside, and every American lawyer’s [aspirational] obligation to do some pro bono work aside, Stimson had just pointed out that almost every big firm is involved on the defense side in the detainee cases. So where are these corporate CEOs supposed to send their legal work? India?

As if this wasn’t enough, he then went on to suggest that foul play was afoot:

“Some will maintain that they are doing it out of the goodness of their heart, that they’re doing it pro bono, and I suspect they are; others are receiving monies from who knows where, and I’d be curious to have them explain that.”

Despite being a GMU law graduate and Navy JAG, Stimson must have missed the defamation section of his Torts class. I hope that someone actually drops a major law firm on these grounds, so the firm can sue the living daylights out of Stimson.

Anyway, there are some good reactions coming out already: Senator Leahy came out against Stimson and the Defense Department stated that Stimson’s comments were not representative of the Department.

“White Collar Exemption” and the danger to the LDP

Wages remain stagnant in Japan, and are even declining, even as the economy improves. TransPacificRadio’s Ken puts it well:

Certainly, Japan is in its longest period of post-war economic growth. That said, the current ‘boom,’ if it can be called that, has returned 2-3% annual gains in GDP. Further, the recovery has been fueled by capital expenditure. This means that corporations are the ones spending the money, not consumers. Consumer spending has remained flat in Japan, and it accounts for 50% of GDP.

abe looking serious t2007011229abe.jpgThere are those who have argued for interest rate increases by claiming that a rate hike would provide a better return on savings accounts. This, of course, is disingenuous. Current returns are next to nil; even doubling the prime rate from 0.25% to 0.50% would mean little in the way of returns on savings accounts. It would, however, mean substantial increases in terms of mortgages, business loans and automobile loans.

Plenty of experts have wondered why consumer spending has yet to increase in Japan. Yet, the reason seems obvious: wages declined by about $4,000 on average per worker from 1995-2005 and then increased by about $400 per worker over 2006. Given that two recent effective tax hikes have taken place, in January 2006 and January 2007, the average worker in Japan simply has less money.

The bigger questions would be: Why haven’t companies been able to increase wages during this period of supposed economy recovery?

PESEK has your answer, Ken:

Abe’s predecessor, Junichiro Koizumi, changed the tone in Tokyo, forcing the need to upgrade an antiquated economic model on change-resistant politicians. Yet Koizumi, who stepped down in September, was a transitional figure. It was always up to his successor to accelerate and broaden efforts to modernize the economy. So far, Abe is failing in this regard.

That can be seen partly in how households aren’t increasing consumption as you would expect by this stage in an expansion. If households had more confidence in the outlook, they might spend more. If consumers trusted politicians to increase GDP or shore up the national pension system, people might save less.

The thing is, foreigners are far more excited about Japan’s recovery than the average Japanese citizen. That’s a problem, considering that the only way for this revival to gain momentum is by increased household spending. Exports can only get Japan so far; domestic demand is a more important dynamic at the moment.

Without faster growth and fatter paychecks, Japan will be hard-pressed to restore fiscal sobriety. Abe is right to want to reduce Japan’s reliance on debt for growth, yet the government’s plans to increase consumption taxes may backfire. The same goes for central-bank policy makers anxious to raise rates. Doing so might damage Japan’s recovery.

Abe’s task is a tall one. A key reason Japan isn’t booming as hoped is that it, like other rich economies, is increasingly facing the dark side of globalization. High-cost nations are being pressured as rarely before by fast-growing developing ones. That competition is reducing the willingness of Japanese executives to boost wages.

Combating that dynamic is a long-term process. It includes increasing productivity among current workers and encouraging more start-up companies to create new jobs. The effort would have a greater chance of success — and its benefits would kick in sooner — if Abe were focused on it. What’s more, Abe needs to improve his public-support rating if he’s going to have clout to build on Japan’s successes of recent years.

PESEK’s somewhat grim recommendations to avoid “economic booms that the average citizen doesn’t benefit from” (my convoluted and liberal translation of “jikkan dekinai keiki”) — a long-term process of productivity boosting and job creation — will assuage the concerns of neither workers nor powerful, large corporations, who both want security, in the forms of stable career paths and guaranteed profits, respectively.

These competing interests are coming to blows in recent days, as the government’s plans to submit a bill that would create a “white collar exemption” — meaning office workers who earn 4 million yen or more (or 9 million depending on what the final bill looks like) annually could no longer be eligible for overtime — have come under intense criticism.
Continue reading “White Collar Exemption” and the danger to the LDP

Aso’s cultural diplomacy: so far so good

If Foreign Minister Taro Aso can keep wonderful photo opportunities like this up, I would support him for prime minister no matter who he might want to nuke:

Aso Bulgarian Sumo l2305389.jpg

Japanese Foreign Minister Taro Aso, front centre, poses with Bulgaria’s sumo wrestlers during the opening ceremony of a donation to Bulgarian Sumo Federaton, in the Bulgarian capital Sofia, Thursday, Jan.

Bulgaria was likely singled out as it’s the home country of star Sumo wrestler Kotooshu. Kotooshu is currently an ozeki, one rank under Yokozuna, though he is unlikely to achieve yokozuna status, the top rank in the sport, for some time (Japanese  Mongolian wrestler Hakuho might make it this year to the delight of people who want to see more Japanese Mongolian faces in the sport).

Aso has made promotion of Japanese cultural exports, chiefly anime and manga, a priority as he sees it integral to cultivating Japan’s “soft power.” You can read the details of his cultural diplomacy ideas (essentially, the main pillar in building a “Japan brand”) here.