- The Washington Times - Friday, March 21, 2003

TOKYO About two years ago, the emergence of unconventional politician Junichiro Koizumi, who won the presidency of the ruling Liberal Democratic Party without the support of its major factions, took the world by surprise.

With his "change the LDP and change Japan" slogans, Mr. Koizumi promised to overhaul the country's banking system, rid the nation of its bad debts, and privatize major government agencies.

However, as the country's stalled economy shows no signs of recovery and continues to fall, the Japanese prime minister has been bombarded with scathing criticism and ominous economic indicators. But he has shrugged off the bad news and managed to survive.

At the onset of his government, Mr. Koizumi's popularity was staggering as he basked in an unprecedented degree of public support and his Cabinet's approval ratings hovered comfortably above 80 percent. More than a million of his posters and many other so-called "Koizumi goods" were snapped up throughout the country, according to the LDP.

Such enormous popularity saved the LDP, which has ruled Japan for most of the past half-century, some of whose members adamantly resisted the prime minister's reforms.

As Japan's economy worsened, however, Mr. Koizumi's popularity began sagging. But when his surprise visit to North Korea in the fall to meet its enigmatic strongman, Kim Jong-il, led to the return of five Japanese who had been kidnapped by the country nearly a quarter-century ago, Mr. Koizumi's ratings soared again.

His visit to Pyongyang coincided with the presidential election of the Democratic Party of Japan (DPJ), the main opposition party, so the historic Kim-Koizumi meeting also upstaged the balloting.

Yet, it is clear that Mr. Koizumi's bold campaign promises have not been delivered, critics say.

Japan's crime rate the number of offenses per 100,000 people surged 39 percent from 1,607 in 1998 to 2,236 in 2002. Since Mr. Koizumi took office, the unemployment rates has hovered near 5 percent, rising to 5.4 percent in January from 5.0 percent in December last year. And last week, the Nikkei 225 stock index dropped below 8000 its lowest point in 20 years. The index has fallen more than 40 percent since Mr. Koizumi took office.

Furthermore, contend some critics, though one of Mr. Koizumi's priorities was to accelerate the process of disposing of nonperforming loans, his government's actions have been "too little, too late."

"We have had this problem a nonperforming-assets problem for 10 years. Nothing has been done. Mr. Koizumi promised to do it, but didn't deliver. He only talks," said Eisuke Sakakibara, an influential former vice finance minister nicknamed "Mr. Yen" and now director of the Global Security Research Center at Keio University in Tokyo.

"What we lack is leadership and management in both public and private sectors," Mr. Sakakibara said. "Japan has potential, human resources, technology, world-class companies. Why not utilize that?"

Not surprisingly, as Mr. Koizumi's popularity has declined, LDP power brokers have blamed the prime minister and Heizo Takenaka, his minister for economic and fiscal policy and for financial services, urging them to change policy. But the prime minister refuses.

Former Prime Minister Ryutaro Hashimoto, ousted by Mr. Koizumi in the 2001 LDP election, said: "If we had had a market like this under my prime ministership, our Cabinet could not have lasted even 30 minutes."

That doesn't apply in Mr. Koizumi's case. Even when he recently said that breaking his public promises was "no big deal," much of the public took this in stride. And he remains in office with 40 percent to 50 percent approval ratings, according to recent polls.

Moreover, according to a survey last month by the Nihon Keizai Shimbun, a major economic daily, while 68 percent of the Japanese public is not satisfied with the Koizumi Cabinet's handling of the economy, 46 percent still support his government. The poll also revealed that 69 percent opposed U.S. military action against Iraq.

"People ask: 'Who's the alternative?'" said Atsuko Kusanagi, a Tokyo-based journalist. "In fact, there seem to be some young statesmen with innovative ideas who could lead, but the LDP's rigid seniority system and conservative outlook block them from emerging."

Kazuyuki Kawano, deputy director of Rengo Kagoshima, agrees. Rengo Kagoshima is the local chapter of the Japanese Trade Union Confederation in Kagoshima City, on Kyushu, southernmost of Japan's four main islands. Rengo Kagoshima supports the DPJ and traditionally has strong ties with the Social Democratic Party (SDP).

Mr. Kawano, however, added that he doesn't have high expectations of the opposition parties.

"Unfortunately," he said, "the DPJ has not been able to present effective measures. And speaking of the SDP, even its existence is in jeopardy."

In Kagoshima, more than 8,000 union supporters took to the streets on March 8, demanding decent job opportunities and better working conditions. The demonstration was the largest in Rengo Kagoshima's 12-year history. The city is the birthplace of Junya Koizumi, the prime minister's father, who served as defense minister in the mid-1960s.

Mr. Kawano said the demonstration less than two weeks ago was spurred by frustration over the protracted recession which has especially affected female and part-time workers plus long-term unemployment, rising bankruptcies of medium and small companies, and few job openings for new high school graduates.

Local leaders and commentators say such economic problems are much more serious in the provinces than in Tokyo, and they criticize national political and business leaders there as being totally out of touch with their suffering.

Business owners outside the capital say they understand the importance of disposing of nonperforming loans, but they want the federal government to put greater emphasis on reviving the economy nationwide, Mr. Kawano said.

Critics such as journalist Tsuyoshi Hamahata see the prime minister's calm reaction as sheer bravado.

"Mr. Koizumi is dangerous because I can't help feeling that he does his job by intuition, not with much deliberation. And he isn't held responsible for what he says," Mr. Hamahata said. "Perhaps, the public likes the aspects I don't like. And it seems what I don't like looks 'fresh' to them."

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