What is the poorest population in Japan



Japan: the managed standstill / by Michael Ehrke. - [Electronic ed.]. - Bonn, 1996. - 21 pp. = 70 Kb, text. - (FES analysis)
Electronic ed .: Bonn: FES-Library, 1998

© Friedrich Ebert Foundation







*The Japanese economy didn't collapse, it just stopped moving. The heaviest Reassignment post-war history began in 1991 and has been considered over since October 1993. But the onmomentum lets on wait, the economy stagnates.

*This inability to move is due to the overvaluation of the yen and the financial crisisstems (five bank failures) burdened by the aftermath of the bubble economy. The stagnation also goes for the first time accompanied by a noticeable employment crisis, the true dimension of which is officially reported at 3.4% Unemployed is by no means covered.

*The current critical situation marks the transition of Japan into the stage of a "mature" industrial societyshank with low growth rates, employment problems, an aging population and risingthe social costs.

*This means that institutions are available that have made the rapid growth possible, but only in the surrounding area high growth ratesnen: Lifelong employment and wagespayment after Seniority principle in large-scale industry, the keiretsu companygroups, the administrative Lenkung of Economy and the protection of traditional economic sectors from domestic and foreigntough competition.

*The resignation of Prime Minister Mura, who was "sometimes overwhelmed" by his own farewell wordsyama am January 5, 1996 was only the provisional end of a stage of stagnation.

*There is no guarantee that the old coalition government under the new helmsman Hashimoto will do more than that Conservative platitudes existing "Vision of Japan" that the new premier will realize under this title Published in 1993 as a poor "program".


A main topic in the Japanese media at the end of 1995 was poisonous spiders: thousands of poisonous spiders of a species native to Australia had been discovered in several cities. It is believed that the spiders came to Japan with Australian fruit imports - a new argument against premature market opening. The spiders have been said to have been spinning their webs in Japan for several years and so far they have not harmed any human being. No reason not to take precautions. Every hundred spiders discovered was worth extensive media coverage; School children were warned of the danger with the help of large demonstration boards. Despite the protests of the spider scientists, the massive use of insecticides was used to destroy the danger.

The poisonous alien spiders seem that Mood in the country at the end of the yearres 1995 too symbolize. Because in 1995 Japan became with the Kobe earthquake of the greatestten welldoorkataVerse of the post-war period haunted. The myth, the land is on thelike Katastrophen prepared, collapsed just like that Myth that Japan has one even in times of crisissituatiOnen compestrong and effective management. The Poisongasathit the Aum sect on them Tokyo subway, an assassination attempt on the Police chiefsten, a flightwitness kidnapping and, last but not least, a serious one Incident in the Schnell BrüTer von Monju scratched that Myth of yespans all-encompassing security. One Trade war with the USA could the MITI-Beat theten barely fend off - but in the second yearhalfte verthey were gloomypanisch-amerikanirelationships after relatives of the in Okinawa statiounited US troops Schoolgirl verhad tremendous. In the 50th year after the end of the second worldwar profileted the Japanese politicians through just oneso endloose like embarrassing Deaskedte about the warfault their country. Local elections with a record low in participation brought in thethe largest cities Japan's Kodianten in the mayor's office, their oneIt was due to the fact that they were none Partyand did not campaignhad ben. Just to round off the picture: The longingtig expected economic Wende also came in 1995 Not. Instead, the collapse of not less than five banken on what unsafe financial fundamenten the Japanese The economy stands. The resignation of after his own parting words "sometimes overwhelmed" Prime Minister Murayama on January 5, 1996 was like that only the provisional conclusionpoint of a stage of the Stagnation without gaof course the old one Government coalitiontion under the new helmsman Hashimoto now more than those from conservatives Platitudes existing "Vision of Japan"will realize that the new premier is taking this title in 1993 as a poor "program" had published.





The Murayama government, a coalition of the Liberal Democratic Party (LDP), the Social Democratic Party of Japan (SDPJ) and the small Sakigake party - contrary to what many observers had expected - at least reached the end of 1995 until Murayama withdrew in January 1996 and the Since then, LDP with Ryutaru Hashimoto has also formally headed the government again.

Murayama held out for so long despite the fact that his Social Democrats suffered a heavy defeat in the upper house elections in July. Only 16 out of 41 Social Democratic candidates were re-elected; the number of upper house seats in the SDPJ fell from 63 to 38. Normally, the party leader should have taken responsibility for the defeat and resigned, but in anticipation of a landslide, Murayama had set his party's goal so low before the elections that he spared resigning stayed. He was also needed - by the larger coalition partner LDP, which is still dependent on the votes of the Social Democrats in both houses. After the trauma of the election defeat in 1993 and the temporary loss of power, the LDP was torn by internal conflicts; it needed an "external" figurehead. Like the Social Democrats, the LDP also seeks to avoid a break in the coalition and new elections to the lower house: the electorate, especially in the big cities, whose electoral weight has grown after the electoral reform of 1994, has become incalculable. And the largest opposition party, Shinshinto (New Frontier Party), has come ominously close to the LDP in the upper house elections.

The Murayama government had proven itself to be a reliable agent of the stagnation. Instead of politics, she pursued business as usual. Against the economic stagnation, it did what is traditionally expected of a Japanese government: It passed another stimulus package (now the fifth since the beginning of the recession), this time with a volume of 14 trillion yen. It lowered the central bank interest rate to a record low of 0.5%, and it acted as a crisis manager in buying off vulnerable banks with taxpayers' money. However, it is now accepted that the traditional financial and monetary control instruments are exhausted, that the economy now needs new initiatives aimed at reducing excessive administrative regulations and the overly confidential cooperation between regulatory authorities and regulated economic sectors. However, the government was hardly in a position to take new initiatives that could also provoke conflicts. This proved to be the case in 1995 when it failed miserably in two situations that required more than business as usual: after the Kobe earthquake and on the occasion of the 50th anniversary of the end of the war.

During the Kobe disaster the government was absent in the first crucial hours and days, and the local and national, civil and military authorities fought over competencies rather than providing quick aid. The Prime Minister was not informed of the extent of the disaster when the private television stations had long since their helicopters circled over the disaster area. And although he has the legal means to guide and coordinate the authorities in the exceptional situation, he did not intervene. The Shinshinto's attempt to persuade Murayama to resign for inaction was publicly criticized as unfair and failed in parliament - no one in Japan expects the head of government, even in an extreme crisis, to rise above routine.

The plan to mark the 50th anniversary of the end of the war also turned into a scandal Warfault Japan in a solemn declaration by Parliament. The explanation turned into a farce. 50 LDP MPs left parliament along with 171 Shinshinto MPs when the vote came - and although the explanatory text itself was vague, it did not include an apology to neighboring countries, but Japanese aggression with "other examples of colonial rule and aggression "relativized. In addition, the nationalists from LDP and Shinshinto started a prevention campaign in the run-up to the declaration, which presented the historical picture of a large part of Japanese politics and society in great clarity. The spokesman for the rejection front, former LDP justice and education minister Eisuke Okuno, said that Japan had waged an anti-colonial war of liberation in Asia against the supremacy of the white race. The USA and Great Britain, not Japan, were the war criminals and aggressors. An admission of guilt is a "blasphemy" - a dishonor for the Japanese war dead who were blessed in the Yasukuni shrine and thus elevated to gods. Former Foreign Minister Watanabe added fuel to the fire when he claimed that Korea's colonial submission was peaceful (withdrew when Korean students set fire to the Japanese consulate in Seoul). Murayama was able to avert the worst by making a personal declaration of war guilt himself, although it is not clear whether he was speaking as a private citizen or as a representative of the government. The possible positive effect of his declaration abroad fizzled out in the following months, when several high-ranking politicians, including the director of the Management and Coordination Agency (in the ministerial rank), Takami Eto, tried to justify the Japanese colonization of Korea and thus an ongoing dispute with the Korean one and eventually triggered the Chinese government. Murayama aggravated the dispute - probably without intending to - by emphasizing the legal validity of the annexation of Korea - a statement which he withdrew.

The Murayama government was foreign-like economically paralyzed, incapable, more than performing the usual routine. The reason for that lies in the composition of the koalition itself, a connection uroriginally ideological opposing forces that are primarily responsible for this serves to block political change. This is simply by changing the position of MiniFirst presidents are not fundamentally different become, even if the new prime minister as "tough", but is also considered an advocate of the status quo.

The LDP and SDPJ were the main actors in the traditional party system that existed between 1955 and 1993, the LDP as a permanent government and the SDPJ as an equally permanent (and satisfied with its role) opposition party. With the emergence of a new force which, although programmatically, structurally and politically indistinguishable from the LDP, actually strives for a change of government, the two favorite opponents of the old system were pushed into the same boat. They could not agree on more than a few vague basic principles - and even these basic principles, as the disputes over the war guilt question showed, are anything but sustainable. When Murayama took office, the only common common denominator between the Social Democrats and Liberal Democrats was a "peaceful and moderate" foreign policy, including a compromise with neighboring countries. In the LDP, the party chairman and foreign minister Yohei Kono stood for this "nonassertive" foreign policy. Kono is a reformist who headed the LDP split-off New Liberal Club from 1975-86 and is considered an exponent of the party's liberal wing. In the autumn election of the party chairman, he was no longer able to prevail. It was already clear in advance that he would have no chance against MITI Minister Ryotaru Hashimoto. He left the field to his rival, a politician who - not least as president of the Association of War Victims and Bereaved - represents the nationalist wing of the LDP. The original business basis of the Murayama government had thus shrunk considerably - without the Social Democrats, who had thrown all the programmatic ballast overboard in order to be able to form the coalition with the LDP, even perceived this as a problem.

For SDPJ and LDP, it's about survivalben. The situation of the SDPJ in particular is dramatic the last general election of 1993 half of their Had lost mandates and now thanks to her almost principle lack of principle also still the threatens to drive out the hard core of their regular voters (like the result of the upper house electionsindicates). Since they have at least since the 70sare never serious the LDP for the directionrival power, are the soSocial Democrats have become functionless (They have always refrained from a social democratic program that addresses the country's problems and suggests solutions).

Under the current conditions they have only two chances of survival: either neither the LDP nor the Shinshinto will win an absolute majority in the next general election, so that the Social Democrats will "tip the scales" despite the further shrinking of their electorate. This presupposes, however, that they are not completely marginalized by the voters and that they can come to an agreement with the other small parties, primarily the Sakigake. Or the SDPJ politicians make a deal with the LDP; i.e. both parties agree on common candidates in the next elections, which could secure a number of Social Democratic MPs with a strong local base to remain in parliament. Whether such a deal comes about will depend on how strong the LDP considers itself to be, whether it thinks it needs the remaining social democratic votes or not. So far, in any case, she has refused to nominate joint candidates.

Since the end of 1994, the SDPJ has been using the Self-dissolution and re-establishment of the party debated. A politable-programmatic concept is not the basis of this debate, rather it works exclusively about the Bestood in the frame of the party the new politiconstellation, i.e. its tactical Position between the two great conservativen Parties. The re-establishment as a "social democratic-liberal force" has now been announced several times and on a large scale, but it has been postponed just as often. A start-up would only make sense if it succeeded in joining forces with the other smaller parties and parliamentary groups in order to create a bloc capable of acting between the LDP and Shinshinto. The most important addressee of this tactic, the Sakigake party (whose survival is also threatened), has so far indicated that it does not care much about a merger of a cosmetically refreshed, reversed SDPJ. The Social Democrats are hesitant to found a new one, probably because it would make the possible deal with the LDP more difficult. While the party as a whole does not seem to move on this issue, two smaller groups of MPs have already split off, on the right (if the terms "right" and "left" still have any meaning in Japanese politics) a group around the former party leader Sadao Yamahana, on the left a group around MP Yabate.

The situation of the LDP is particularly new with its new one popular party leader and premier less more dramatic than that of the SDPJ: It is still that strongest party in Japan and will in all likelihood after also in the next general election an akzepachieve tables result. Its very existence is not immediately endangered - but it would be endangered if it were to lose government power for more than a year (i.e. for more than a budget period). The LDP is not a conservative program party, but a party whose cohesion depends on the control of government power and the budget. Should she be forced into the opposition for a longer period of time, the same thing would happen as was observed in her brief opposition period under the Hosokawa and Hata governments: In every political crisis, LDP MPs would leave their party to switch to the ruling party.The LDP is faced with the alternative of either putting the cooperation with the SDPJ and Sakigake on a more permanent basis (which includes putting up common candidates in the next elections), or moving into the next elections alone with Hashimoto as the strong top candidate .

The Shinshinto got in the upper house elections unexpectedly fared well, the party is the only alternative to the government coalitiontion (although they are the same political spectrum from social democratic to conservative-nationalist covers). Two factors could act as a burden as well as an asset of the party: firstly, the heavy weight of the Soka Gakkei sect, which after the self-dissolution of the Buddhist Komeito party moved into the arsenal of the Shinshinto. The Soka Gakkei is an asset insofar as it effectively controls its members, a limited but stable electoral group. Soka Gakkei candidates are generally safe candidates. However, with the terrorist attacks by the Aum sect, the relationship between religion and politics in Japan has fallen into twilight. After all, the Soka Gakkei also has a militant anti-state tradition. Although the sect has now made its peace with the state, the way in which it controls entire districts and terrorizes non-members is very similar to the methods of the Aum sect. The LDP took advantage of this and, in the shadow of the conflict over the Aum terror, introduced a law for the control of religious communities through parliament, which primarily targets the Soka Gakkei and thus Shinshinto (as a result, the control remains quite lax, count large Buddhist sects but also among the financiers and supporters of the LDP). But even regardless of Aum, the Shinshinto is not eligible for many liberal-secular Japanese because it is in a relationship with the Soka Gakkei.

The second factor is the party's new leader, Ichiro Ozawa, former general secretary of the LDP, who is seen as the driving force behind the LDP split in 1993 and the gray eminence of the Hosokawa and Hata governments. With his election as party chairman, Ozawa stepped out of the semi-darkness behind the scenes. He replaces the liberal and popular Toshiki Kaifu and was able to prevail in the internal party elections against the likewise liberal Tsutomu Hata. The ideological fog in which the Shinshinto has operated so far has cleared a little with the election of Ozawa. Ozawa is considered a nationalist who advocates the revision of the constitution, i.e. Article 9, which prohibits Japan from maintaining its own armed forces. At the same time, Ozawa is one of the few Japanese politicians who not only strive for a reform of politics, economy and society, but also openly say what this reform should look like. His programmatic bestseller Blueprint for a New Japan (Some of the ghostwriters at MITI contributed to the drafting of this) is rather vague and poor in detail, but it documents a serious will to reform with regard to the deregulation of the Japanese economy and society. Ozawa's openness and clarity freely contrasts with his role as successors to Kakuei Tanaka and Shin Kanemarus, Japan's two most notorious post-war politicians, and his involvement in the LDP's old corruption affairs. The person Ozawa therefore polarizes the electorate in a similar way to the Soka Gakkei. This could prove to be a hurdle.

About the timing of the next subhouse elections, the first to come under the new choiceLaw can only be speculated. All The coalition is expected to be at least until Completion of the budget for the fiscal year 1996, i.e. by April 1996, survive, now under the Fühtion of Ryutaru Hashimoto, the chairmanthe greatest Ruling party. Murayamas retreat from the highest Governmentat the beginning of January 1996 the Liberaldemokrats with a closer relationshipwork with the Social Democrats also with the next General election, the irsometime between Fall 1996 and January 1997 would take place, honor. Should the coalition break up against it, is new elections to be expected in the summer of 1996. The The result is, of course, not least because of the new Suffrage, unpredictable. Japanese politics did after decades of sedate calculability in transformed into a sphere of instability - this seems but also the only result of the for the foreseeable future To be a departure from 1993 and political reform.





The Japanese economy is not togetherbroken, it just doesn't move anymore. The worst recession of the nightwar story that bears the epoch name of Tenno Heisei, continued in 1991 and has been considered terminated since October 1993. But the OnMomentum is a long time coming, the economy stagnates, even if it is always at the end of the year positive growth rates betweenbetween 0 and 1% let off. The OECD estimates the 1995 result at 0.3%, after 0.1%, 0.8% and 0.2% in the first three quarters of the year. Investment and private consumption show an erratic growth pattern that makes it difficult to make clear forecasts for 1996 (the OECD forecasts 1.8%). The Economic Council assigned to the Prime Minister, an advisory body made up of scientists and entrepreneurs, has forecast average annual growth rates of 3% for the remaining years of the decade - provided, of course, that the economy is systematically deregulated. In the areas of goods and passenger transport, energy supply, trade, telecommunications, financial services, agriculture, industrial standards, import certificates, public works and housing construction in particular, deregulation is indispensable, otherwise - according to the committee - the annual average growth rates will not exceed 1.75% . However, under the given political conditions, it is completely out of the question that such a comprehensive deregulation program will be launched: the government would neither risk nor survive the pre-programmed conflicts with the interests of the industry concerned. The remaining growth rate of 1.75% without deregulation could, according to critics of the Economic Council, still be too optimistic.

The immobility of the Japanese economy goes back to various causes. Is to be mentioned first, the overvaluedtion of the yen. The value of the The yen rose to 79.9 from 121 yen per US $ at the end of 1993 Yen in the summer of 1995 to then thanks to the coordinatorth intervention of the Japanese, Americaniand German central bank to 100 yen per US $ falling behind. The relative stabilization of the yen in the second yearhalf must of course not be forgotten let the Japanese currency continue to overturnis valued and that one is still significantche Difference between the international value and the domesticpurchaseby virtue of the yen. A The second crisis factor is the financial system (see below), the is burdened by the consequences of the bubble economy. Third, the stagnation comes with a for the first time perceiveemployableactivitykrise along, their true dimension with the officially identifiedsenen arworkno lottery ticket quota of 3.4%away is detected. A few weeks ago the Ministry of Labor denied that it had unofficially estimated unemployment at over 8%. However, in view of the survey methods (unemployment is determined by means of a survey, with people working at least one hour a week and not actively looking for a job), it is hardly possible to make a serious comparison of Japanese unemployment with that of western industrialized countries.

The current crisis is a turning point in the Japanese Economic development, versimilar to the first 1973-74 oil crisis, which resulted in the average annual waxrate of 11% (from 1955 to 1972) to 4.8% (1975-1991), one in the industrialized countryimmediately still noticedsize, sink. For the foreseeable future, 2% applies Annual average economic growth as optimistic treasuretongue. The current critical situation marks the transition of Japan to stage one "mature" industrial society with neverdrigen Growth rates, employment problems, one aging population and rising social costs. The transition is so difficult because institutions are now becoming Facing the rapid growth of the disposition have made possible past decades, but of theiron the other hand only in an environment of high growth rates can existnen: The lifelong employmentsupply and the wagespayment according to the Seniority principle in of large-scale industry, which keiretsu companygroups, the administrative management of the economy and the Protektion of the traditional Economic sectors before domestic and foreigntough competition. At the same time and herewith in Togetherthe Japanese industry forced to purchase, for cost reasons, Production, sales, research and developmentlung increasingto relocate abroad (imports from the Asian developmentcountries took part in the third Quarter 1995 by more than 27% - despite the stagnation of the inlandmarket). Under the present conditionsthey can do itpanicked unternehmen no longer afford to rely on efficiencyreserves too refrain from breaking down regulations and traditional management practices as well as in the Outsourcing by hosteconomic activities. These "Restructuring" that is far from complete is, the international opering companies Strengthen Japan, but not "Japan as a location".







The Japanese financial system is 1995 by five institutes got poorer. The bankruptcy riot was opened in February by two smaller Tokyo credit unions, Tokyo Kyowa and Tokyo Anzen. CreditCooperatives are traditionally conservative Instituition; they collect deposits in their reregional environment and lend to local small and medium business. Over the years the bubble Economy, however, the years of bilmoney and the to astronomix heights swelling Stock and real estateprices, they said Kreditgenossenlike many other moneystitute, companymen and households on the field of Stock market and real estate speculation - and saw each other after the Seifenblase a growing Volume notleiof the loans. So had Tokyo Kyowa and Tokyo Anuntil the beginning of 1995 together 150 billion yen in bad loans accumulated. They had sovereignly circumvented the ban on cooperatives on lending more than 20% of their equity to a single debtor - and the two cooperatives' largest borrowers were their CEOs Harunori Takahashi (Tokyo Kyowa) and Shinsuke Suzuki ( Tokyo Anzen).

In particular, Takahashi's prehistory throws the spotlight on the Japanese banking crisis: Takahashi was not only president of Tokyo Kyowa, but also owner of the real estate and golf course development company EIE International, a company that first attracted attention with the acquisition of the Hyatt Regency Hotel on Saipan in 1985 and made a fortune of one trillion yen in the bubble years, primarily from property purchases in the Asia-Pacific region. After the bubble burst, EIE found itself in difficult waters until its largest financier, the Long Term Credit Bank of Japan, ended its financial support. Since then, EIE has been financed primarily from Tokyo Kyowa funds. It received 38 billion yen in loans, more than ten times the cooperative's equity. About 90% of these loans are considered bad debt.

Another borrower from the cooperatives was entrepreneur Katsuto Nemoto. Nemoto enjoyed the privilege of not having to provide collateral for the loans he had taken out. The reason: He is the nephew of the House of Commons and former Labor Minister Toshio Yamaguchi. Yamaguchi had used his political weight to illegally arrange loans for Nemoto and other family members at the cooperatives to cover personal debts. One can guess what kind of consideration was expected from Yamaguchi: his commitment to a tacit buyout of the cooperatives with public funds. In addition to Yamaguchi, the former defense minister Nakanishi was also one of Takahashi's favorites and the Tokyo Kyowa: Takahashi bought tickets worth 60 million yen for a Nakanishi fundraising party. And last but not least, high officials of the Ministry of Finance were given consideration. In March, the head of the Tokyo Customs House, Hiroaki Taya, was suspended from duty because he had been invited by Takahashi to take a flight to Hong Kong in his private jet - an amigo affair á la japonaise. Another official was warned by the finance minister, and the entire top of the ministry right down to the permanent state secretary was warned for neglecting the duty of supervision.

Both cooperatives had tried to cover the expansion of their lending by attracting new deposits with attractive interest rates. Long Term Credit Bank paid in 24 billion yen in 1991 and did not withdraw this deposit when it broke off its business relationship with EIE in 1993. These and other deposits now had to be saved in the spring of 1995, with the lead finance ministry trying to include both the larger private banks and taxpayers in the costs as usual. A new, semi-public bank was established, Tokyo Kyoudou Bank, which took over the business of the two cooperatives. In addition to the few deposits remaining with the cooperatives, their operation was based on capital grants from the central bank and private banks as well as funds from deposit insurance. Tokyo Kyoudou Bank is to sell 150 billion yen in bad loans at a discount price to another newly established institution, which in turn will be financed from funds from the National Federation of Credit Unions, Long Term Credit Bank and the City of Tokyo (which formally oversees the two credit unions had) financed.

However, this resulted in a crisis management crisis: the rescue of the cooperatives, the management of which had obviously moved outside the legal framework, took place in the run-up to the local elections in Tokyo. All candidates for the mayor's office have now declared that they would not release any funds from the city to save the cooperative deposits. The candidate who was most likely to keep this promise was elected: the non-party member of the House of Lords and former comedy writer Yukio Aoshima. When Aoshima initially stuck to its promise even after his election, the private banks threatened to withdraw their pledges of support. The renovation program threatened to fail.

The next victim of the financial crisis in July was Cosmo Credit Corp., Japan's fifth largest credit union. The volume of bad loans at Cosmo was estimated at 360 billion yen, 73% of the bank's portfolio. Cosmo had also speculated in real estate and quadrupled its lending at the time of the bubble in just two years. In contrast to the crisis of the Tokyo Kyowa and Tokyo Anzen, the collapse of Cosmo was accompanied by a bang: For the first time since 1962 there was a bank panic, a run, long lines of customers demanding their deposits back.

Usually banks and the Treasury Department in Japan deal with banking crises in a discreet manner, but this time the country's largest daily newspaper, Yomiuri Shinbun, reported in detail on the critical situation at Cosmo and helped turn the crisis into a spectacular panic. It is believed that the Treasury Department deliberately supplied the newspaper with material to trigger a run. Mayor Aoshima should be pressured to end his opposition to Tokyo City's involvement in buying out failed financial institutions. A new package was put together to save Cosmo's deposits (if they were below 100 million yen). The executive body was again the Tokyo Kyoudou Bank, which took over the business of Cosmo. And this time Aoshima announced that in addition to the central bank and the deposit insurance of the credit unions, the city of Tokyo would also participate in the buyout of Cosmo (in September he finally broke his election promise and gave the city funds to save the deposits of Tokyo Kyowa and Tokyo Anzen free). The largest creditor banks, including four large city banks, were originally supposed to write off 100% of their loans to Cosmo; after a dispute, they reached an agreement with the Treasury Department to write off 60% of the loans; The financing gap is to be covered by low-interest loans from the city banks to Tokyo Kyoudou.

At the end of August, two more financial institutions in Osaka went de facto bankrupt: the Kizu Credit Union, the country's largest credit union, whose deposits were larger than those of the three failed Tokyo institutions combined; and Hyogo Bank, the largest regional bank in Japan. The Kizu Credit Union had 600 billion yen in late 1994 and 960 billion yen by August 1995, while Hyogo Bank had 1.5 trillion yen, 790 billion of which are considered bad loans. In the case of the Kizu Credit Union and the Hyogo Bank, too, a rescue program was launched that involved the larger private banks and the central bank in buying out the failed institutions.

Jusen: Against the background of the crisis of the Kizu Credit Union and the Hyogo Bank, Finance Minister Takemura declared that the peak of the banking crisis had now been reached - and made an exception: the country's eight mortgage banks (Jusen), seven of which were founded by major banks and one by the agricultural cooperatives had been. The problems of the hypharmacy banks are the same as the five that went bankrupt Institutes. Your urThe original order was that Housingmortgage lending, in the bubble they dedicated however, also the speculation with real estate. In part, they made it possible for the founders' banks which impose on themth legal restrictions in real estatebypass speculation and yourself were able to participate indirectly in the real estate business. Officially, the bad loans are the Mortgage banks to 6.4 billion yen estimated, private observers gehen rather from 7 to 8 trillion out.

The rescue package for the mortgage banks is part of the budget approved in December for the fiscal year 1996. A Jusen Disposal Organization (JDO) is to be set up to handle the business of the mortgage banks. The seven parent companies are to write off their entire loans to the jusen in the amount of 3.5 trillion yen and provide the JDO with low-interest new loans. Other banks have to write off 1.7 trillion yen and also help the JDO with low-interest loans. The agricultural cooperatives are better off: They should get back the 5.5 trillion yen that they had lent to the mortgage banks without any deductions, in return they should donate 350 billion yen to the Disposal Organization. The government, i.e. the taxpayer, is said to be responsible for an additional 680 billion yen. These funds are intended to be used by the deposit insurance company to cover the remaining losses. Whether the sum will be enough is controversial.

The case of the mortgage lenders is in threeslei Significant. For one thing, it shows that also economically conservative forces like that Agricultural cooperatives in the years of the boyble have been massively involved in the speculation. Due to their close relationshipThese are the tendencies towards the LDP Agricultural cooperatives, of course, strong enough to - on Taxpayers' costs - averting excessively high lossesthe. It should also be taken into account that the ladder the cooperaassets for losses as ofpersonally liable are, i.e. they would have to, the cooperatives would fully open be involved in the losses of the mortgage banks, your priPut your father's fortune up for grabs.

Second, at least some of the gefailed Mortgage lenders her motherhouses in the crisis pull. The largest sums will be three long term Credit banks have to write off the Industrial Bank of Japan (955 billion), the Long Term Credit Bank of Japan ($ 881 billion) and Nippon Credit Bank ($ 409 billion) Billion). While the Industrial Bank of Japan this one Loss truecan apparently catch, this is with the last twonamed banks not so sicher.

Third, the case of Hypothekenban raisesken a Light also on the finance ministerrium as responsible regulatory authority. Not just wearing that Treasury (and the central bank) one Part of the responsibilitywortion for the bubble and the thanks a lax banking supervision possible exprocesses; also has financeministry the banks downright greendung of the jusen, possibly around another reservoir of items for the "second." Career "the beamten (those aged 55 in the of them beforefro regulated area of ​​the private Switch sector) to sheepfen.

Buying out the mortgage lenders will be the Japanese 5,500 yen (approx. 80 DM) per head - one Sum that seems acceptable when it comes to that Securing a public good like one healthy financial system. But it is Public in the wake of the financial scandals of the Year 1995 clearly gebeen how hard the Accumulation notleidender credits on or beyond the limit of legality and how lax the controlls of financial institutions by the authorities was. In anticipation of public criticism, the permanent state secretary of the Treasury, who is considered the most powerful official in the country, resigned from his post at the turn of the year, and in his New Year's address Prime Minister Murayama appealed for understanding for the use of public funds. The problem lies but in the fact that it cannot be foreseen whether with the Sanietion of the mortgage lenders the culmination of the Banking crisis is really over. The burdengene are basically just verpushed - from the smaller ones Financial institutions to the largebanks and from this to Zentralbank (the ihre rescue loans without Sigrants) and the state budget.

Daiwa: In the summer of 1995, the British Barings Bank collapsed under the pressure of US $ 1 billion in losses accumulated in Singapore by trader Nicholas Leeson in a short period of time. In September, Japan's Daiwa Bank fell victim to speculation by a single trader. The New York representative of Daiwa, Toshihide Iguchi, had accumulated US $ 1.1 billion in losses incurred in "simple" trading in US Treasury bonds, not, as in the case of Barings Bank, in trading more complicated derivatives . In order to make up for an original loss of US $ 200,000, Iguchi traded in securities that the bank managed as trustee - and thus violated the strict separation of trustee management and trading required in the USA. Daiwa has been banned from all activities on the US market for three years by the American supervisory authority.

The loss of Daiwa is not a specific problem facing the Japanese banking system. As the Barings case shows, other banks can run into similar problems due to the diversification of financial products, the volatility of the global capital market and the difficulty of controlling traders. Nevertheless, some aspects of the Daiwa scandal can be seen as characteristic of the Japanese banking system: On the one hand, it took the New York Daiwa representative eleven years to collect a loss of US $ 1.1 billion. The bank's internal controls should not have been too strict. Iguchi was considered hardworking, he was constantly working overtime, and this seemed sufficient evidence of his trustworthiness for the Tokyo headquarters.

Second, Daiwa's management was in no hurry to educate the public about the loss. On July 24th, the (meanwhile resigned) president of Daiwa was informed of the developments in the New York branch, two days later the bank issued new shares to the value of 50 billion yen - without the buyers being informed about the new one Situation of the bank would have been informed. It was not until September 12 that Daiwa officially informed the Treasury Department and the Central Bank, which on September 18 notified the American authorities.

Thirdly, the Treasury Department was informally informed of the Daiwa case very early on (on August 8) without disclosing its knowledge to the Japanese public and the American authorities. In the shadow of Cosmo's crisis, regulators preferred to grant Daiwa a period of several weeks instead of complicating the already critical situation with a second terrifying news. But it is precisely this lack of transparency, the lack of both internal controls and serious supervision by the competent authority, that threatens to worsen the Japanese banking crisis.


The cause of the Japanese financial crisis is an expansive monetary policy in the second half of the 1980s, which led not to an increase in consumer prices but to an astronomical rise in the prices of assets - stocks and real estate. Stock and property prices rose far beyond what was justified by the expected income (dividends and rents). The strong demand for assets was based less on the anticipation of future revenues than on the expectation of almost unlimited increases in value. At that time, the banks and other financial institutions had lost their most important borrowers: the large industrial companies were no longer dependent on bank loans and financed their investments independently on the capital market without the intermediary of the banks. The banks had to look for other customers, and the rapidly increasing demand for loans taken out to purchase assets made what appeared to be an attractive substitute for industrial companies. The banks, too, succumbed to the myth that real estate can only go up in value, and they willingly lent anyone who had land to offer as collateral. In view of the low interest rates, it was apparently a brilliant business for the borrowers to use the loans to purchase shares or land or to develop land, i.e. to combine smaller pieces of land into larger units and convert living quarters into office space.

The bursting of the bubble as a result of a again restrictive Monetary policy led to a dratic burglary the stock market and with timedelay on the Real estate market. For many borrowers - in the first place Real estate linelien companies and with the propertymarket related financeinstitutes, but also other businesses, households, etc. - richten from the acquisitionshe has a fortunedid not exploit income for the to finance borrowings taken out. The information According to the Treasury Department, banks have 40 Trillion yen (10% of the national product) at no accumulated more serviced credits. The portion doesn't beserviced credit makes business with the elevenCity Banks 4.7% of outstanding debts; at it is 8.2% for the three long-term credit banks and 8.2% for the seven trust banks 9.7%. These proportions look at the not threatening at first sight. This treasuretogenes did not necessarily give the real extent the credit crunch again since the heliftingmethods Room for manipulationlet. Second are smaller financial instinaturally did the crisis strongerker exposed than the big banks, and it's not outconcluded that the togethernessbreak smaller institutes trigger a domino effect that also larger banks (such as Long Term Credit Bank of Japan) in pityshank draws.

The normal path of bank restructuring, as taken by the Savings & Loan Companies in the USA - the Savings & Loan Companies had gotten into a crisis similar to the Japanese financial crisis, although the volume of non-performing loans was only half that of the Japanese banks - would be the sale (auctioning) of the property brought in as security in order to win back at least part of the outstanding debts. This path can hardly be followed in Japan: real estate prices have fallen drastically, but the lack of transparency in the real estate market does not allow this decline to be quantified precisely. The relevant information from the National Land Agency only relates to the price development of the few properties actually traded.

Would the supply of land as a result of a Auctionrenation of the brought in as security Dramatically expand plotstert, could the real estate prices ins (by Japanese standards) Bottomless sink. It is already estimated today that the vacant office space in the three centraldistricts from Tokyo would be enough to see the whole Hong Kong's office capacity underbring to. The Credit crunch would continue under these conditions tighten. The banks themselves must fear that the open trade of real estate their sicherheith further devalued, and are therefore more likely to be concessions at the loan servicetion machen as massive To agree to distress salesmen. In addition, the sale of the collateral is made more difficult by the fact that many properties are mortgaged several times and, in the event of a sale, only the first claimant would get his collateral, while subsequent claims remain unsatisfied.

In addition, the sale of Immovables often used by the Japanese gangsterssyndicates the Yakusa is prevented. In the bubble years, the prospects for quick profits in stock and real estate speculation were so attractive that organized crime added legal financial and real estate services to its traditional activities. The Nikkei Business Journaltung are Yakusa at more than half of the debt in the Zusamconnection with real estate speculation directly or indiright involved. Just as at the height of the boom the Yakusa terrorized owners of small properties unwilling to sell in order to persuade them to sell to a development company, so today they use intimidation to prevent real estate from being sold to new owners. Some of them threaten the bank managers directly - the as yet unsolved murder of the branch manager of Sumitomo Bank in Nagoya in 1994 is brought into connection with the Yakusa; Overall, Sumitomo Bank managers have been victims of attacks 22 times since the end of 1993 - in some cases they "occupy" the buildings for sale and, through their presence, prevent a new owner from taking possession. In some cases, the creditors who would end up empty-handed if a property were sold are also apparently selling their rights to the Yakusa in the hope of being bought out by the first claimant.

Buying out failed financial institutions with Taxpayers' money means under the counterbenen Beconditions that taxpayers are forced to ultimately also criminal or semilegal activities co-finance. Doing so would use public funds to rehabilitate the banks in Basically assume that the debtor's assets are so as far as possible to the Beequation of schoolthe can be used. Overcoming the savings and loan crisis in the USA will also set an unattainable example for Japanese crisis managers in this respect. In the course of the redevelopment, 1775 bank managers were brought to justice, 1013 were sentenced to prison terms. In all likelihood, the Japanese crisis managers will not proceed in a similarly consistent manner.





Japanese-American relations were strained in the spring by a trade dispute over imports of automobiles and automobile parts. The conflict was resolved through an agreement that saved face on both sides. In the fall, a new shadow cast over the "most important bilateral relationship in the world": Members of the American troops stationed in Okinawa kidnapped and raped a twelve-year-old guilty girl. The reaction of the people of Okinawa was massive: 85,000 people demonstrated against the presence of the American armed forces, it was the largest mass demonstration in Japan for many years. The governor of the archipelago, Masahide Ota, refused to sign the extension of the leases for the US bases. Ota's case will have to be judged in court; Prime Minister Hashimoto will probably sign the relevant contracts himself.

The dispute over the Americansch Troop presence on Okinawa is weniger one more Japanese-American than an inner-Japanese Conflict with deep historiroots underlying. Along with the Ainu in Hokkaido, the Korean population and the pariah caste of the Burakunin, Okinawa is one of the minority problems in Japan - whose politicians are so fond of praising the "ethnic homogeneity" of the Japanese people as one of the secrets of their country's success.

The Rykkyu Islands, which Okinawa is one of, do not belong to Japan historically. Until the beginning of the 17th century, the islands formed an independent kingdom that lived in the manner of a Far Eastern Venice from trade between Japan, China and Southeast Asia. In 1609 the Japanese province of Satsuma annexed the archipelago under the tolerance of the shogunate government.Satsuma, whose population consisted of 40% samurai at that time, was considered to be the most backward and most combative region of Japan; The rule of the Satsuma clan, especially its disastrous tax policy, meant an economic catastrophe for the previously prosperous islands, their income fell by 60% within a few years. However, the Rykkyus were not formally annexed: at a time when Japan was beginning to isolate itself from the outside world for 200 years, the islands and their trade relations could be used by the Satsuma clan in order not to completely break off exchanges with the Asian countries to let. The formal annexation did not take place until 1871, after Japan was forced by the Western powers to open its markets. Japan was ahead of China, which also made claims on the islands. Since then, Okinawa has been considered Japanese since prehistoric times - which did not prevent the islands' population from being despised as racially inferior. "Forbidden to Koreans, Okinaws and dogs" - this sign still adorned many localities in motherland Japan in the first years of the 20th century.

Okinawa did not participate in the economic development of Japan after the Meiji Restoration. The islands remained a colony rather than part of the Japanese motherland. But the greatest decisive battle of World War II in East Asia (and the last battle before the start of the nuclear age) was fought on Okinawa in order to bind the enemy's forces and keep them away from the motherland. While the Japanese elite were evacuated from the islands before the American troops moved into Japan, the imperial army raised conscripts among the population to fight the Americans, including Masahide Ota, the current governor. The 32nd Japanese Army was stationed on Okinawa to fortify and defend the islands. Their strategy and tactics to defend the island to the last man and square meter against the American superiority meant catastrophe for the civilian population - especially in the last phase of the 84-day battle, in which a large part of the population was forcibly evacuated and retreated the army had to join the southern parts of the island. In this retreat movement, the Americans could no longer distinguish between the military and the civilian population; both fell victim to the area bombing (a total of 1.7 million tons of ammunition and bombs fell on the relatively small territory). There was also massacre of the civilian population of Okinawa by the Japanese army, suspected of defeatism or simply viewed as a competitor for scarce food. About 115,000 soldiers fell on Okinawa on both sides and 90% of the 32nd Japanese Army was wiped out. The number of civilian casualties is estimated at 150,000, a third of the population. It is significant that even in the post-war period no precise surveys of civilian casualties on Okinawa were made, while accurate records of the victims of the atomic bombing of Hiroshima and Nagasaki are still kept today. The material cultural assets of the islands were completely destroyed.

The population least involved in the war of Imperial Japan was hit hardest by the war - and faced the heaviest burdens of the post-war era. Obviously, after 1972, when Okinawa returned to Japanese sovereignty, the Japanese authorities were able to convince their American negotiating partners that the troops they stationed in Japan would have far more freedom in Okinawa than on the main islands of Japan. Okinawa, the one percent of the japaniEuropean territory, is now home to it 70% of the americans stationed in Japanting Armed forces. 20% of the territory is from US bases okkupiert, bases of the Japanese Self-defense forces are added. The peopletion of Okinawa, still the poorest province Japan, bears an oversized portion of the cost of the American-Japanese Security Pact: Shortage of land, aircraft noise, ecological and agricultural damage, the existence of a Army enclave, the sporadicen GeViolent outbreaks by members of a ghettoiized occupation troops - like the last Rape the schoolgirl who the pent-up discontent among the peopletion to Brought to explode.

Okinawa's problem is not that of the american-japaniche security contract or that of the American military presence in Japan. There is none for this under the given conditions Alternative. As the disputes over Japan's declaration of war guilt showed, Japan would not be in a position in terms of foreign policy to take the initiative for a multilateral Asian security system without a US presence with "confidence-building measures" (which is supposed to offer not only protection for, but also protection from Japan ). If the Okinawa problem is presented to the Japanese public as one of the American military presence, this distracts from the real conflict: the extreme concentration of this military presence in a historically deeply burdened region. The solution would primarily be a task for Japanese politics - but it is unlikely that a Japanese government will risk a conflict with the local population on one of the main islands in order to relieve the population of Okinawa, who are not quite part of it anyway.


© Friedrich Ebert Foundation | technical support | net edition fes-library | March 1998