MW-82 -- It Really Doesn't Matter Anyway

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J@pan Inc Magazine Presents:
M O N E Y W A T C H
Weekly Financial Commentary from Tokyo
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Issue No. 82
Monday, June 28, 2004
Tokyo

CONTENTS
@@ VIEWPOINT: It Really Doesn't Matter Anyway

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@@ VIEWPOINT: It Really Doesn't Matter Anyway

The reports from Sea Island documenting Prime Minister Junichiro Koizumi
panting with adoration at the feet of George W. Bush were like deja
vu. When I was a boy, my puppy would lay at my feet and gaze into my
eyes with complete adoration. The Koizumi/Bush scene was almost pathetic.

Don't get me wrong, I actually like George W. But do we really have to
continue putting up with old Lionheart? Katsuya Okada at the Democratic
Party of Japan would have us think his party offers a viable option,
but look at his recent Japan Times interview and you will be scratching
your head at his semantics and logic. It went something like this:
The SDF is in Iraq because the CPA asked them to be there, so when the
new Iraqi government takes office the SDF should pack up and leave,
and only return when the new government asks the SDF to return.

Given that the SDF has just finished unpacking because of all the time
they spent playing music at Iraqi schools, the actual work by the SDF
will never finish. The DPJ will not take power because of bad planning
by Naoto Kan and Koizumi's ambivalence in overcoming Ozawa's subterfuge.
And history, such as the "Madonna" movement that propelled the
Socialists into prominence a decade or so ago, proves that a "victory"
by the opposition is usually followed by embarrassment.

Where are those Socialists today?

According to a Jiji Tsushin survey, 74 percent of Japanese feel the
pension issue is the most critical issue of the election. But who
really cares? Until it really hits the Japanese public over the
head, the pension issue is essentially insignificant. 74 percent
of voters won't even vote.

Continued LDP power is the result of this voter apathy. Japanese
voters would rather golf, shop, or watch TV -- do just about
anything -- than go out and vote.

Think of all the big issues in the past. Remember the housing loan
scandals? A hefty 600 billion yen-plus was infused with great uproar.
Yet the LDP is still in power. Remember the banks? First, they
save distressed debtors, and then the government, or more accurately,
the taxpayers, save them not once but twice -- for sums that
make the infusion into the housing loan companies look like your
first paycheck when you worked at McDonald's.

With Koizumi we have all those promises regarding highways and
other non-materializing banner reforms. Actually, I should correct
myself, as the LDP's election materials claim they are "working
on" 93 percent of the reforms proposed by Koizumi, whatever
"working on" (ugoiteiru) means. Of course, there are still
constant scandals involving LDP politicians (a group with a
remarkable inability to learn from experience).

Feeling a sense of crisis, I and some of my colleagues were
desperately trying to come up with an alternative to Koizumi.
Then it dawned on me: It just doesn't matter. In Japan, more
than any other country that I know, it doesn't matter who's in
office. The bureaucrats run this country. They have kept any
effective reform or restructuring (i.e., layoffs of central
government bureaucrats) at bay. All the LDP does is proffer bills
given to them by the bureaucrats. You would be hard pressed to
name an original idea from the LDP or any of Koizumi's
commissions that made it to the voting floor with any noteworthy
elements remaining.

Japanese politics and the effect on the Japanese economy? Who
really cares?

The LDP leadership hasn't been up to the task at hand in decades.
That is, in and of itself, a bright spot. The much-touted Japanese
miracle of the 80s lacked substance. That's not true of
today's recovery. Despite all the crappy governing, overregulation,
and excessive taxation that destroy the entrepreneurial spirit and
obstruct business, Japanese business is making a comeback.

Look at Matsushita, for example, and see the miracle: Matsushita
is continuing with its restructuring program, despite having
turned its performance around. The politicians do not get it,
but now the industrial core of Japan is getting it -- remarkable
what a bit of real competition can do.

If only there were real competition in Japanese politics.

For all of you still interested in my cynical crystal ball on the
upcoming elections: I see can see the probability of the "Bin
Ladin Factor." Not terrorism, but the government successfully
arranging for Hitomi Soga to meet Charles Robert Jenkins and the
rest of her family two or three days before the Japanese election,
most likely somewhere in Southeast Asia.

And, of course, the LDP will celebrate a huge landslide victory
because of Koizumi's supposed skills and prowess in arranging the
meeting. It must have something to do with that hairdo.

-- John Charles-Decourcy

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STAFF
Written by John Charles-Decourcy (jcd@japaninc.com)

Edited by J@pan Inc staff (editors@japaninc.com)

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