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Japanese Privatization: A Political Earthquake.

In the spirit of bringing you underreported (but thoroughly significant) news, Riding Sun explains the significance of recent political events in Japan:

As the Japanese say, seiji wa issun saki ga yami — in politics, one step ahead is pitch black. Koizumi's political earthquake is coming. Whether the LDP can withstand it remains to be seen.

Go read the entire post. The headlines may seem boring or insignificant, but this is about far more than the mere privatization of Japan's postal system. It's about a central bank with assets 50% larger than the entire British economy, and whether that bank will continue its central planning and graft, or whether those assets (3 trillion dollars worth) will be applied to their full potential in Japan's market economy.

This is a the kind of moment that could determine whether Japan remains a global economic power in the next half century, or whether Japan continues to handicap itself, dooming its economy to stagnation and relative decline. The U.S. needs a strong and vibrant free-market Japan, so let's hope they get it right.

It's also an interesting parallel for Social Security reform (but let's not get carried away with the analogy). You have entrenched interests fighting hard to oppose any change from the broken status quo, based on cynical short-term political calculations.

Ultimately, we need our leaders to focus on solving long-term policy problems. And ultimately, good policy is good politics.

Posted by Will Franklin · 9 August 2005 02:12 PM

Comments

Posted by: Zsa Zsa at August 9, 2005 07:06 PM

Posted by: Zsa Zsa at August 9, 2005 07:37 PM