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| Japanese Reforms In Progress We are undoubtedly experiencing radical changes worldwide. Allow me to express my views on the world and Japan. |
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[1] The World |
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It’s now been 15 years since the end of the Cold War, and capitalism has been spreading globally. Socialism had no precedent before 1917 when Lenin led the Bolshevik Revolution. In the last half of the 19th century, many capitalist countries had fallen to the brink of civil war. While the British Empire assumed hegemony over the seven seas, its European rivals - such as France, Germany, Italy and Russia - were engaged in a fierce scramble to colonize lesser nations in the Middle East, Africa and Asia. The later emergence of Japan and the U.S.A. marked the beginning of the Mergers & Acquisitions era, which somewhat paralleled the present-day situation in terms of the absence of a socialist superpower. Of course China is ostensibly a socialist country, but none of the world’s major powers believe that China aims to fully realize pure Marxism-Leninism.
Popular amongst the intelligentsia, Marxian communism was an inevitable response to the demands of the times, easily disseminated to the masses. At that time, it was believed that capitalist regimes would be dismantled and taken over by socialist ones, as a logical consequence. History has since demonstrated the triumph of freedom and democracy, and the dominance of the neoclassical market economy. These paradigms offer people of the world the promise of a bright future. Today, as we know, it is America and not England dominating the world stage with its leading military power and economic force. Looking to the past, we can see how Japan was able to foster stability and development under the Japan-England alliance (January 30, 1902 through August 17, 1923). Similarly, today’s Japan sees an obvious need to adhere to the Japan-U.S. Security Treaty. The world’s most influential spheres - the U.S. and Japan, the EU, Russia and China - all coexist in a state of competitive counterbalance. China is asserting its validity as a nation with an unprecedented ideology of socialistic market economy and promoting its economic structure, wherein its massive labor force - fueled by capital and technology from Japan and the EU - eyes the U.S. as its key export market. Meanwhile, the U.S. aims to export American-style freedom and democracy to Middle Eastern countries such as Iraq, Syria, and other autocratic nations in order to apply diplomatic pressure on them. Since 9-11 this policy has been accelerated by American neo-cons. The incidence of M&A will increase much as it did in the period between the late 19th and the early 20th centuries. The EU will surely expand its ranks beyond its current 25 members. Russia will cooperate with other countries toward the revival of the Soviet era. M&A’s among the Asian countries will occur, as demonstrated by APEC, ACU and ASEAN + 3 (Japan, China and Korea). In the near future, boundary disputes will grow more frequent, just as they did around the turn of the 20th century. In the last 60 years, the U.S. has carried out many proxy wars on Japan’s behalf, but this will not last forever. Japan must develop its military strength and fight to defend its own national interests. No country will establish alliances with Japan ‐ or stand by them ‐ unless Japan has self-defense capabilities. This also applies to private business. If we don’t stand by our promises, we won’t be able to foster relationships of mutual trust. This is especially true from an international relations standpoint. If the world were to descend into another so-called “warring states” era, it would not be possible for any country to survive on its own. Therefore the following three considerations would be crucial: [1] Which countries to form alliances with to ensure security (along with the maintenance of military forces and the right to collective self-defense) [2] How to secure the necessary resources (e.g. oil and other energy sources) for economic development [3] How to maintain livings conditions for the populace. The optimization of these three elements leads to hegemony ‐ currently manifested in the dominance of the United States. |
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1. The United States |
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More than ever before, forming strategies to maximize these three key elements will become America’s modus operandi. Building upon the successive efforts of the recent presidencies, the Bush administration is continuing to export the ideology of ‘freedom and democracy’ to the spheres of ostensibly non-democratic states *3. In Iraq, for instance, the formation of the new government and the initiation of general elections together represent the first stages of bringing order and stability to the Middle East as a whole. A national system based on democracy and freedom will have its Iraqi debut, although terrorism will undoubtedly continue in the region. The withdrawal of the US military from Iraq will only occur after stabilizing the oil infrastructure, as America’s primary aim is definitely to secure oil resources. No withdrawal is possible without such assurances. The dispatch of our Self Defense Forces to Iraq has served to establish Japan’s presence in these endeavors.
Moreover, the United States has reinforced its global economic structure by drawing upon capital and technology from Japan, and Chinese labor and locations for outsourced manufacturing, in order to fulfill America’s need for product consumption, thus establishing a currency monopoly with the dominance of the US dollar. It would be impossible for any country to continue its technological development, extend its military power, or strengthen and promote further arms development without adhering to the current world order outlined above. Therefore, the world economy depends on the US economy and on the ongoing trend of mass consumption and real estate development in the United States. There would be an undeniable effect on Japan’s economy and governance if the United States were unable to maintain its military power and hegemony, or sustain its current economic cycles, or fall into a domestic recession. Japan needs to speed up its reforms. One of our more pressing needs is the privatization of its government-led market economy. It is imperative for Japan to reduce its overseas dependencies, and promote and strengthen our independence by creating better domestic service industries. |
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2. China |
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China’s strategy is focused on oil and food reserves. Despite the nationwide development of nuclear plants, oil remain particularly indispensable. China has taken measures to develop its positive diplomatic ties, its readiness for a possible invasion of Taiwan, the East China Sea gas fields, the Central Asian pipeline, and its official stance toward Myanmar and Pakistan. The main issue here is securing the oil supply.
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3. Japan |
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Japan is protected under the Japan-U.S. Security Treaty. Japan also secures its food resources through international trade, and its vast fishing fleets. Its trade deficit in this area figures at 60%. Japan’s peaceful relations with oil-producing nations allows it to secure oil supplies and import them along American shipping routes. Japan’s petroleum trade deficit has now reached 99.8%. However the outbreak of civil factions would force Japan to find its own shipping routes through East Africa, across the Indian Ocean, and through the Straits of Malacca. The Japanese Coast Guard would have little regulatory power over these trade routes. This is a key part of the ongoing debate over the foreign dispatch of SDFs and the amendment of Article 9 of the Constitution. As far as amendments go, human rights issues and local government concerns are regarded as domestic and secondary matters, respectively. Matters of national sovereignty come before domestic ones.
In Japan, the ultimate goal in domestic politics is to raise the actual GDP growth rate to 4.3% as it stands in the U.S. The government has forecast a nominal GDP growth rate of 2.0% and an actual rate of 1.9% for the 2006 fiscal year, and has planned its 2006 budget accordingly. In fact, the Koizumi administration is now undertaking privatization or slashing of state-owned enterprises as the means toward - not the goal of - boosting GDP growth. Such measures include: privatizing the postal system and other government-affiliated financial institutions; slashing NPOs; abolishing special interests; creating regulatory reform special zones; and promoting rural industrial development. It is clear that Japanese companies will increasingly outsource manufacturing overseas. As a result, rising unemployment will shrink tax revenues. Denationalization makes it possible to revitalize the entire domestic industry, and to increase tax revenues through increased income and the expansion of job opportunities within private markets. Many government-owned businesses operate within labor-intensive industries promoting job creation. Fundamentally speaking, the service industry is a high value-added one, with high labor costs, and a majority of its revenues are poured into Japan’s GDP. Thus the privatization of state-owned enterprises will increase the number of such highly value-added companies, allowing the government to achieve its GDP goals reliably and safely. |
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4. The EU |
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Though modern civilization originated in Europe, its global influence has waned since the two great wars. The outcome is the establishment of the European Union. Therefore, the EU will not implode, despite the failure of the EU constitution due to the dissent of France and Holland. The enlargement of the EU and the integration of economics and politics will ensure future progress. The question is how to unite the various ethnic groups that span the Uralian to the Pyrenean plains. While the framework for peace has already been set, the two key issues of food and oil still remain. As the US withdraws it troops from Iraq, the EU will join the post-war framework to support the securing of oil resources ? this being the EU’s primary interest in the conflict.
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[2] Japan 1.Diplomacy |
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Now, sixty years after its defeat in the Pacific War (historically known in Japan as the Daitoa Senso, or Greater East Asia War) Japan is again in danger of conflict with its neighboring nations. This is to be expected, with the world now entering another ‘Warring States’ period, although Japan should attempt to maintain diplomatic, commercial and military relationships while giving due consideration to Japan’s national interests. This is an opportunity for the revision of the Constitution of Japan, especially Article 9. This year, constitutional revisions will in all likelihood progress, focusing on the Potsdam Declaration, the Tokyo War Crimes Tribunal, the peace treaty, the Yasukuni issue *8, the Japan-China territorial waters dispute over the East China Sea, and the Takeshima and Senkaku islands, and so on. Japan consumes mass quantities of fish, food, and raw materials, all of which require sea transport. Therefore, it is imperative that Japan have sufficient military power to secure the ocean transport routes between itself and east Africa. Up to now, it has been this nation’s diplomatic policy to solve its issues with various foreign countries by further strengthening the Japan-U.S. alliance. However, the world seems on the brink of another ‘Warring States’ period. Eventually, it will be essential for Japanese to be armed in order to maximize its existing alliances.
The Korean War (1950-1953) is still relevant to current relations between Japan and North Korea. This war now lies under the armistice pact between the U.N. forces, North Korea, and China. South Korea has refused to ratify it and thus the war between the United Nations and North Korea has yet to be resolved. The rear command of the U.N. forces still remains at the Zama camp in Kanagawa Prefecture. Moreover, there are seven camps (Zama, Yokota, Yokosuka, Sasebo, Okinawa white beach, Kadena, and Futenma), specified for the UN forces’ bases for American troops stationed in Japan, and 38 UN officials are working at the Zama camp *9. A North Korean missile launch on Japan would be considered an attack on UN forces, and the United States would have grounds to counterattack. It is reasonable to expect that North Korea does not desire self-immolation and therefore would not attack Japan. |
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2. Politics |
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Outside the realm of politicians and bureaucrats in Nagatacho, there are many in the private sector who can adequately assess Japan’s current situation and posit new ideas and political systems for the 21st century. This grassroots movement can be seen in the municipal elections, the monthly assembly elections, the previous election for the House of Representatives, and in public opinion polls *11. The national reform policies set forth by the Koizumi Cabinet have already progressed to the point of no return. Japanese people cannot move freely to any country that garners profits, much like enterprise capital. We have to regard the international economy as a system wherein ‘the people remain, but the capital flows out’. It is certain now that government-owned industries should be privatized ? otherwise, there is no way for Japan’s “sun” to rise again, except by creating completely new domestic industries that can absorb huge numbers of the unemployed. This fact will not change, no matter who is in power.
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3. Economy |
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Japanese industry is in the process of splitting into two poles: the one is global enterprises spreading their business around the world; the other is domestic service industries and government-owned corporations. Consolidated financial results indicate a surplus, but this is because overseas subsidiaries make profits. Overall, parent companies and domestic subsidiaries are stagnant, so Japan’s internal revenue will not increase *12. If the United States falls into a depression, Japanese global companies will similarly fall into deficit. Japan will thus fall into a recession, since domestic industries generally operate in deficit. To avoid this situation, it is urgent that we speed up the productivity of our domestic service industries and the privatization of government-owned corporations.
As employment-stimulation legislation is enacted to improve productivity, the labor-distribution ratio decreases and the number of contract or part-time workers increases. It has been pointed out that our society is now ‘difference-expansion’ and ‘downstream’, but such observation should not be treated seriously, considering the fact that the national income distribution gap, employment consciousness, part-time employment, and ‘neets’ are all increasing. It is crucial that we promote young people’s business abilities, current practical skills, and careers, and to develop talented individuals who can adapt themselves to corporate environments that are prone to sudden change. We need to create ‘small government’ through new legislation, such as: the privatization of Japan Post; the consolidation of government-affiliated financial institutions; weeding out pork barrels from among government corporations, and a decisive thinning of the many public-interest corporations. These should be among the key national strategies toward improving economic growth, bringing about a restructuring towards a knowledge-based society, and the improvement of the labor-production and capital-facility proportion. | |
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Reference: |
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Sorimachi, Katsuo (2006). ‘Japanese Reforms In Progress’ (2006), Tokyo: LEC: Tokyo Legal Mind, K.K.
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Note: |
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*1*1see for example, “The Divide in Japanese Diplomacy” (Nippon Gaiko no Bunsuirei), Okazaki Hisahiko, PHP research institution, 2000
*1 Prime minister Koizumi, speaking of Japan-U.S. relations during his 2006 opening press conference, said, “…there is a vital meaning in the Japan-U.S. relationship, more than that with other countries. This is because there cannot be any progress in policy without achieving peace. The Japan-United States Security Treaty is still in effect. This plays the most significant role in promoting domestic politics without the threat and invasion by other countries, though we are rarely aware of that. There is no country besides the U.S. that considers an attack or invasion on Japan to be an attack on the States. If you consider the fact mentioned above, you will understand how important the Japan-United States relationship is. Subsequently I will forward the plan to build up relations with China, South Korea, the other Asian nations, and countries around the world.” Office of Prime Minister: ‘Koizumi Speech’ http://www.kantei.go.jp/jp/koizumispeech/2006/01/04press.html *2 The ASEAN members (Indonesia, Singapore, Thailand, Philippines, Malaysia, Brunei, Vietnam, Myanmar, Laos, Cambodia) ? three nations (Japan, China and Korea) framework. *3 President Bush used the words ‘Free’ and ’Freedom’ repeatedly ? a total of 34 times ? during his second-term inaugural speech on January 20th, 2005. *4 In the preamble to Marx’s “A Contribution to the Critique of Political Economy” (1859), Marx’s materialist concept of historical superstructure development is based on infrastructure. In other words, a state, a legal system, social institutions and ideas arise from productive relationships within a society. However, I agree with increasingly prevalent belief that the superstructure also defines the infrastructure for innovative changes, because it is the ultimate goal of any revolutionary force to take firm control of superstructure development. I think this can be very unilateral. By the same reasoning, structural and regulatory reforms can be regarded as superstructure ruling over infrastructure. This is how the government will maximize private sector vitality - by changing national legislation and regulations, and drafting new legislation, especially the designated special zones for structural reform, and the market test law. *5 “Economic outlook for year 2005, and basic policies for economic and fiscal management (Heisei 18 nenndo no Keizai mitooshi to Keizai zaisei unei no kihonteki taido).” (approved by cabinet meeting on December 19th, 2005.) *6 “Horitsu Bunka,” May issue, 2005, featuring “Reform of the civil service system: Proposals by eminent experts from various fields (Komuin-seido Kaikaku, Kakuarubeshi).” “Horitsu Bunka,” February issue, 2005, featuring “Implementing the Market Test as an ace up: Toward a new step to denationalization (Kozokaikaku, Kansei shijo kaikaku no kirifuda, Shijo test ga ugokidasu).” “Horitsu Bunka,” May issue, 2004, featuring “Set out to denationalization by private initiatives: Creation of an independent Japanese society (Minshudo no minkan kaiho wo mezase!) “Horitsu Bunka,” September issue, 2003, featuring “Privatizers for the Japanese version of PPI and PFI projects: Report from work front (Nihonban PPP, PFI project wo suishin suru hitobito).” “Horitsu Bunka,” December issue, 2002, featuring “Changing Japan with the implementation of regulatory reform special zone by local government initiatives (Jichitai shutai ni yoru tokku jikken ga Nihon wo kaeru ).” *7 “Working toward the realization of decentralization of authority in a local manifesto: Interview with Hiroya Masuda” in Chapter 3 “Manifesto (Manifesuto)” in this book. “Snap decision making in local politics: Interview with Issei Nishikawa” in Chapter 3 “Manifesto (Manifesuto)” in this book. “Some operative examples of ‘evolving civil society’ programs in Shizuoka: Interview with Zenkichi Kojima” in Chapter 4 “Local Autonomy (Chiho Jichi)” in this book. “Let’s live, meet and think together in Shinjuku, and Create a new Shinjuku!: Interview with Hiroko Nakayama” in Chapter 4 “Local Autonomy (Chiho Jichi)” in this book. *8 “How to understand the Tokyo Tribunal of War Criminals from an international law perspective” in Chapter 7 - From a Japanese Perspective (Nippon no Katachi)” in this book. *9 Kazuhisa Ogawa (2003) “Right to collective self-defense for a visible nation: A private plan for the ‘peaceful nation model’ (Kao ga mieru kuni no shudanteki jieiken)” in “A Survey on organizational operations and business development (Soshiki unei to jigyo kaihatsu ni kansuru chosa kenkyu),” The Nippon Foundation. *10 In spite of the fact that Japan needs to rush to increase armaments in its own defense, it might be effective and meaningful to bring up the issue of North Korea’s missile intimidation as a means of rational persuasion. *11 In the Chapter 3 “Manifesto (Manifesuto)” in this book. One useful newspaper reference was a published questionnaire completed by 1,000 twenty-year olds (“What do they really think?”) in the Nihon Keizai Shimbun, January 9th, 2006. *12 One of the references in this matter is “Accelerating overseas operations in manufacturing business slows down the amount of tax payment” in “This Week’s Index”, vol. 598, January 17th, 2005, Cabinet Office (Naikaku-fu). For further information on financial statements and consolidated financial statements, please go to: http://www5.cao.go.jp/keizai3/shihyo/2005/0117/598.html |
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