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POINT OF VIEW/ Kaoru Okano: U.S. pressure behind postal privatization drive

While public attention is fixed on such pressing pocketbook issues as pension, welfare and employment, Prime Minister Junichiro Koizumi remains obsessed with his initiative to privatize postal services.

Koizumi has loudly vowed many times to carry through the initiative, calling it the biggest policy challenge for his administration and the centerpiece of his reform agenda. His obdurate attitude on this subject is quite perplexing.

I have long been studying politics in Western countries like Sweden and conducting research into Japanese politics using a new practical approach I have formulated and dubbed ``clinical politics.'' And, with regard to the issue of postal privatization, I have been quite disturbed by the enormous gap between the government's intent and the people's desire.

In September last year, I agreed to head a group of self-styled ``post office fans'' founded by some university professors and company executives. Unaffiliated with any political party or election campaign organization, the consumer group lobbies for effective use of the current post office system.

The group, which only accepts individuals as members, is engaged mainly in grass-roots awareness and promotion activities. I joined the organization because I sensed pressure from the United States behind the government's postal privatization drive.

Insufficient info

Koizumi has given nothing but a very simple and sloppy explanation for why postal services should be privatized, saying only that the private sector should be left to do what it can do. He has not made any serious effort so far to provide sufficient information concerning the issue or to convince consumers of the need for privatization.

Koizumi has adopted this same approach on many other important policy issues as well, offering little more than such catchy slogans as ``international contribution,'' ``humanitarian aid'' and ``structural reform.' By emphatically repeating phrases, which at a glance seem to represent a strong argument for a proposal, he has been craftily manipulating public opinion. As a result, certain abstract concepts have come to be regarded as sort of national goals, threatening to disrupt the nation's democratic political process.

On Sept. 10 last year, Koizumi had a set of basic principles for postal privatization endorsed by his Cabinet, flying in the face of strong opposition from a large majority of lawmakers in both the ruling and opposition camps.

In an unusual break with the tradition of policy-making in Japan, Koizumi put the Cabinet's seal of approval on the principles before obtaining a nod from the ruling Liberal Democratic Party.

During his ensuing trip to New York to attend the U.N. General Assembly meeting, Koizumi met with U.S. President George W. Bush on Sept. 21. When asked about progress in his postal privatization campaign, Koizumi reportedly said to Bush, ``I intend to work very hard (to carry it through) despite the large opposition (to the initiative).'' His remarks apparently suggest he offered his initiative to privatize Japan Post as a gift to President Bush.

This raises the concern that Koizumi is so fixated on postal privatization because his government has made a virtual promise to the United States to achieve it.

SII

The current situation, I believe, has its roots in a 1993 agreement between then Prime Minister Kiichi Miyazawa and then President Bill Clinton to launch a new round of bilateral trade talks called the Structural Impediment Initiative (SII).

The SSI was designed as a U.S.-led cooperative effort between the two governments to eliminate structural obstacles to bilateral trade. Koizumi was the posts and telecommunications minister in the Miyazawa Cabinet at that time.

Focused on removing structural barriers to trade, the SII talks set a new framework for sector-specific negotiations to open the Japanese market further.

Washington launched a big diplomatic offensive under the framework spearheaded by the U.S. Trade Representative (USTR). It demanded that U.S. companies be given better access to the markets where Japanese government regulations hindered their activities, including the auto, insurance and financial services markets.

Adopting a clearly results-oriented approach, the United States urged Japan to set a target for the foreign share in each sector of the Japanese market as a measure of market liberalization.

Investment fund

Reading the reports the USTR has been submitting to the Congress since 1994 makes clear what the United States is shooting for. Postal privatization seems to be seen as part of the liberalization of financial services in Japan.

If the postal savings and insurance operations are turned into private businesses, the 350 trillion yen of savings in these systems will flow into the financial markets as private funds. U.S. investment funds noted a number of lucrative business opportunities as Japan went about the process of cleaning up the bad debt mess in the banking system. A similar situation is likely to develop with regard to postal funds as well.

Is it really in Japanese people's interest to accept the creed of economic rationality peddled by the United States, which is revving up its trade strategy focused on financial markets?

The Koizumi administration's attempt to privatize postal services without giving the public a convincing reason or sufficient information should be examined rigorously from the viewpoint of the most fundamental of democratic principles: a fair reflection of public opinion in policy-making.

Allowing Koizumi to push through his postal privatization initiative despite his arrogant disregard for the Diet would seriously undermine the health of the nation's democracy, which, like any democratic system, is founded on the people's trust.

A former Meiji University president specializing in comparative politics, the author now heads a citizens group supporting the post office.(IHT/Asahi: February 18,2005)




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