Changing Japan

EDITORIAL - The Boston Globe: "JAPAN'S PRIME Minister, Junichiro Koizumi, won a landslide victory in Sunday's parliamentary elections against the opposition Democratic Party and antireformists in his own Liberal Democratic Party. An enlightened US response to Koizumi's triumph would be to welcome his tradition-shattering campaign to privatize Japan Post -- the corrupt postal and savings service with $3.55 trillion in assets -- while discouraging him from promoting a revived Japanese nationalism that threatens to annul or disregard Japan's constitutional ban on use of the country's military except for self-defense.

In a country that has appeared frozen in its bad habits, allowing an unaccountable permanent bureaucracy to dictate faulty domestic policies while complacent politicians shuffle in and out of Cabinet positions, Koizumi has sought a popular mandate to make overdue changes.

He has already had some success in cleaning up a banking system that was suffocating under mountains of bad debt. But the biggest bank in the world in terms of its assets is Japan's government-owned postal service, which Koizumi himself headed a decade ago. Ever since, he has argued the need to take those assets out of the hands of his party's bosses. In a vicious economic circle, they had been using the savings and pension funds deposited in Japan Post to buy political backing by conferring contracts on favored construction companies to build roads and bridges to nowhere, primarily in rural areas.

All this time depositors were receiving negligible interest rates. Now Koizumi has gained control of more than two-thirds of seats in the lower house of Parliament -- the votes needed to override the upper house's recent veto of his postal-service reform bill. He should be able to change a corrupt and calcified system that kept incomes for Japan's aging population artificially low, depressing consumer spending and contributing to deflationary pressures since the financial implosion of the early 1990s.

Welcome as Koizumi's domestic reforms may be, the Bush administration should discourage him from fostering a recrudescent Japanese nationalism. Not only must Koizumi cease making annual visits to the Yasukuni Shrine, where major Japanese war criminals are interred; he must also refrain from the remilitarizing of Japan. Japan's participation in an expensive and dubious US missile defense shield and an accompanying military build-up can harm US interests in two crucial ways: by provoking China to become an anxious competitor in a regional arms race; and by strengthening Japan's rightist militarists, who are no friends of the United States."