ATCA - September 28, 2006
Why is Japan's New Prime Minister -- Shinzo Abe -- so important to the World at large and Asia in particular?
Dear ATCA Colleagues
[Please note that the views presented by individual contributors are not necessarily representative of the views of ATCA, which is neutral. ATCA conducts collective Socratic dialogue on global opportunities and threats.]
We are grateful to Jesper Koll, Chief Economist at Merrill Lynch Japan, based in Tokyo, for his submission to ATCA, "Welcome, Prime Minister Abe! -- Why is Japan's New Prime Minister so important to the World at large and Asia in particular?"
Shinzo Abe, 52, has recently been elected Japan's 90th Prime Minister, elected by a special session of the National Diet (Parliament) on September 26, 2006. Mr Abe is the first Prime Minister born after World War II. His maternal grandfather, Nobusuke Kishi, was Japan's Prime Minister and his father, Shintaro Abe, was Foreign Minister. Mr Abe was born in Nagato and studied political science at Seikei University, graduating in 1977. He later moved to the United States to study politics at the University of Southern California. In April 1979, Mr Abe began working for Kobe Steel. He left the company in 1982 and pursued a number of governmental positions: Executive assistant to the Minister for Foreign Affairs (his father), Private Secretary to the Chairperson of the Liberal Democratic Party (LDP) General Council, and Private Secretary to the LDP Secretary-General. He has been elected four times since 1993. Mr Abe's profile increased four years ago when he arranged the repatriation of Japanese nationals abducted to North Korea.
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Jesper Koll, Chief Economist & Managing Director, Merrill Lynch Japan, has been researching Japan's economy and financial markets since becoming a resident of Japan in 1986. Prior to joining Merrill Lynch in August 1999, he was a Managing Director of Tiger Management LLC. Before that he was the chief economist and head of economic and market research for JP Morgan in Tokyo. Mr Koll has been serving on several Japanese government advisory councils, including the MITI committee on "Big Bang 2001 - Japan's financial system reform." He was a member of the Economic Planning Agency council for anti-deflation policy measures. Since 2002, he has been a member of the Koizumi administrations' project team of private sector analysts. He currently serves on the Ministry of Finance Advisory Council on Global Capital Flows. Mr Koll is also one of the few non-Japanese members of the Keizai Doyukai, Japan's Association of Corporate Executives.
For the first two years of his stay in Japan, Mr Koll was a research fellow at the Kyoto University Economic Research Center and the Tokyo University Institute for Social Sciences. After that, Mr Koll served as an aide to a Japanese Member of Parliament for two years. He is the author of many articles and two books, "Towards a New Japanese Golden Age" (2000) and "The End of Heisei Deflation" (2003). Both are in Japanese. Before his Japan specialization, Mr Koll worked as an assistant economist for the OECD in Paris. He holds a Masters degree from The Johns Hopkins University, SAIS and is a graduate of the Lester B Pearson College of the Pacific (1980). He is a native of Germany and was born in 1961. He writes:
Dear DK-san and Colleagues
Re: Welcome, Prime Minister Abe! -- Why is Japan's New Prime Minister so important to the World at large and Asia in particular?
Prime Minister Abe is off to a good start. First polls suggest his public support rate is around 65-70%. Although below the awe-inspiring 75-90% Koizumi basically maintained throughout his five-year rule, Abe's initial popularity is well above the pre-Koizumi norm. The initial strong popular mandate should give the young prime minister confidence and room to act boldly. He is poised to do so in foreign and security policy, more so than economic policy.
Abe's policy priorities are very different from those of Koizumi. The reason for this is a fundamentally different economic backdrop. Five-and-a-half-years ago, when Koizumi came to power, Japan's economy was in a desperate state. The banks were bankrupt, unemployment was surging and the economy was at the brink of a deflationary spiral. Koizumi and his team had one priority - fix the economy.
The Japan that Abe faces could not be more different. The economy is fixed, banks are lending, unemployment is falling and land prices are rising. The latest world competitive survey, published on the day Abe was confirmed as prime minister, finds Japan upgraded to seventh-best country in which to do business, behind the US in sixth-place and well ahead of England, Taiwan and Korea. In the last five years, Japan has climbed about 10 places.
For Abe, the message is clear: The economy is fine and basically can be managed on autopilot. This gives him room to focus on his real passion, foreign policy in general and Japan-China relations in particular.
Focus on Japan-China relations
Right from the start, Abe's first public policy statements show great enthusiasm for more active political engagement between Japan and China. He said Japan and China see it in their mutual interest to cooperate more closely. This is a marked turn-around from Koizumi's policy of de-facto neglect and almost exclusive focus on Japan-US relations. Make no mistake: Prime Minister Abe is paving the way for a historic Japan-China summit meeting.
Although we do not know any details about what a concrete Japan-China diplomatic initiative may yield, Abe's foreign policy focus has the potential to turn the US-Japan bilateral relationship into a more complex US-Japan-China trilateral power axis. Indeed, true and constructive Japan-China cooperation and friendship has the power to de-throne the US as global hegemon.
Think the unthinkable
What could be discussed at a Japan-China summit meeting? Here are three points that I believe might signal true constructive engagement:
1. A Japan-China clean energy initiative;
2. An Asia airbus project; and
3. A Japan-China Free Trade Agreement.
While these are highly speculative ideas, we believe they help focus the debate on what may be at stake and the far reaching consequences a true engagement between Asia's two biggest economies may mean.
1) A Japan-China clean energy initiative
Japan and China have the power to set the global standard for a new energy policy. The world clearly needs a decisive push toward more ecologically sustainable, less fossil-fuel-dependent energy. If China and Japan could jointly develop the new standard for the next generation of hybrid or hydrogen passenger cars and trucks, agree on the design and specifications of ecologically sound and economically efficient alternative energy plants, both countries would set a new global gold standard for what should and can be done.
Like the French-German coal and steel union in the 20th century, the joint development of a new energy policy and ecological standards is poised to forge deep-rooted alliances between both countries. The new growth opportunities from China and Japan agreeing on what will become the de-facto the new global standard for energy policy are obvious. By working out jointly the new global standard, deep-rooted Japan-China fears and mistrust around technology transfer and intellectual property issues should be solved naturally. Not in theory, but in practice.
There is another key benefit to such a project. Successful promotion of a new and ecologically sound, yet efficient energy policy at the commercial and private use level is poised to elevate both China and Japan to the status of true global leaders. Both countries would become an inspiration to other governments around the world.
2) An Asia airbus project
This idea is straightforward. Japan and China would agree to develop an "Asia Airbus" commuter plane, possibly in joint cooperation with Korea. Nothing pulls people together like working together. For example, if China developed the wings, Korea the cabin and Japan the engine, a powerful bridge across Asia could be built.
3) A China-Japan Free Trade Agreement
From an economist's perspective, Japan and China is a match made in heaven. Both countries are hugely complementary, given Japan's overwhelming capital endowment and China's outstanding labour supply. It has been estimated that gains from more free trade could add as much as 0.3-0.5% to Japan's potential growth rate. China's path toward sustainable growth meanwhile should be aided greatly by more active Japanese technology transfer.
All of these proposals would mark the start of a fundamentally different Japan-China relationship. A new rules-based policy of engagement between the two largest economies in Asia would begin, not just with lofty diplomatic ideals, but with specific projects.
Clearly, a more constructive Japan-China relationship would force more active engagement of the US. If both Japan and China agreed to cooperate, however, the US would join the debate as a virtually equal partner, rather than a unilateral hegemon. For example, the energy policy initiative could not be ignored by the US simply because of the enormous economies of scale implied by China's 1.2bn people combining with Japan's 125mn.
Reality check
For Abe, the challenge is clear. He has taken first bold steps to seek active reengagement of Japan-China diplomacy. This is long overdue, given the already very strong economic ties between the two countries. However, it is not enough to merely re-establish proper top-level diplomatic dialogue. The world, particularly Asia, needs constructive ideas and constructive policy leadership that builds institutions, and sets legal standards that allow lasting and stable regional integration, independent of the whims of individual political leaders.
The good news is that, in contrast to Koizumi, Abe seems passionate and willing to lead this process. Chances are high that his Chinese counterparts are just as pragmatic and visionary. By redefining Japan-China relations, Abe could do a lot to redefine Japan's new national identity, just as Chinese leaders could help redefine China's global leadership role. Whether he will deliver remains to be seen. To put it bluntly, true and constructive Japan-China cooperation would pose a most viable challenge to US global dominance. Perhaps this is what makes it so difficult to conceive, with both the Chinese and Japanese elites having too much vested interest in maintaining their primary focus on their US bi-lateral relations. At the same time, the greater the risks of US isolationism, the higher the probability of Asia's two great powers working together.
[ENDS]
We look forward to your further thoughts, observations and views. Thank you.
Best wishes
For and on behalf of DK Matai
Chairman, Asymmetric Threats Contingency Alliance (ATCA)
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ATCA: The Asymmetric Threats Contingency Alliance is a philanthropic expert initiative founded in 2001 to understand and to address complex global challenges. Adhering to the doctrine of non-violence, ATCA conducts collective Socratic dialogue on global opportunities and threats arising from climate chaos, radical poverty, organised crime, extremism, informatics, nanotechnology, robotics, genetics, artificial intelligence and financial systems. Present membership of ATCA is by invitation only and has over 5,000 distinguished members: including several from the House of Lords, House of Commons, EU Parliament, US Congress & Senate, G10's Senior Government officials and over 1,500 CEOs from financial institutions, scientific corporates and voluntary organisations as well as over 750 Professors from academic centres of excellence worldwide.
The views presented by individual contributors are not necessarily representative of the views of ATCA, which is neutral. Please do not forward or use the material circulated without permission and full attribution.
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Posted by ATCA at September 28, 2006 11:50 AM
Dear Mallika
Thank you for your thoughts and delighted to note that you found this ATCA contribution by Jesper Koll at Merrill Lynch Japan useful.
Best wishes
Horatio
I think that sounds very positive and appealing to me. One thing that is much more advanced about Japanese culture is they do not have the religious impediments, and sexual hangups that the United States and the UK have. China has some human right issues but they also lack religious impediments. It is also true now that individuals in positions of power in United States has taken away the freedoms and has become like those they used to judge.
The rest of Europe is at least a little bit more liberal regarding sex and doesn't seem to have as much a problem with religion issues getting in the way of progress.
The United States and the Muslim countries both have a problem with sexual repression which is going to be their downfall.
There should be no such thing as a sex scandal.
So I see great value in China and Japan playing a bigger role in the world.
In fact what I am looking for from a global perspective is.
When two polarities are integrated, they form a balanced and harmonious whole and become indistinguishable, the Illusion of duality is dissolved.
~Richard Thomas
So I think by boosting China and Japan we can create a balance, in fact they can be the leverage to bring change in the West.
Let me give you an example of the difference between Japan and the United States.
There is a natural healthy sweetener used in Japan called Stevia. In the United States it is illegal to sell it as a sweetener. The reason being is this natural sweetener would compete with the harmful "patented" artificial sweeteners. It can however be bought as a supplement. Apparently Rumsfeld was involved with the company that produced Aspartame
Go ahead Google rumsfeld sweetener (amazing yes?)
The FDA actually publicly burned books that told all about it's use as a sweetener. Read about it http://www.stevia.net/bookburning.htm
This is an atrocity; this is why the United States is so messed up, where corporations and individual greed are allowed to bring harm to the Nations People.
Obviously the people and corporations that use the United States Government as a tool for profit are not in position to judge any other country.
The other thing that is great about Japan is a large number of the population takes and is informed about the benefits of Co-enzyme Q10. If the citizen population of the United States practiced the same it would cost the medical industry hundreds of million of dollars.
The people using the United States Government as a tool for profit are the Largest Criminal Enterprise in the world and it is time we stopped being fooled by the "appearances" they create.
They are far worse than the "Mafia" ever was, and have killed millions.
Of course there is corruption in every country and this is why we need transparency and self government by the people.
So the other week my friend out of the blue said
You know why we are not progressing as a civilisation? Greed and patents.
I kind of took that as divine guidance.
I have an energy technology, I have debated whether to patent it or or simply give it to the whole world.
So I came up with a plan to profit and make it available to the world.
The release of the New Technology and the plan to transfer incumbent wealth from the few to the many.
Back in my 8th great Physics class, I figured out something, how something we all know might work. Perhaps it was a great insight that was bestowed upon me I don't know. Some years later I built a prototype, tested it and the glass in the device cracked, it seemed to work for an instant but it didn't really work as needed.
This device did not create or generate energy since that is impossible, we are surrounded by energy and it is not created or destroyed. This device captured energy, but would not store it. There was something missing that was needed to make it work. So the idea sat on the back burner.
Twenty years later that missing something was discovered by science. Excited I began to work the numbers, design and angles out on paper much to my dismay I found that I had miscalculated before and the design would not actually work. I was depressed, I thought for sure it was how they were supposed to have worked.
A few days later while searching on the Internet using a search engine I stumbled on something quite by accident. I guess this is what you might call synchronicity. I wasn't looking for it. There was an obscure fact regarding the behavior of energy in the realm of quantum physics. Energy did not behave according to what we would expect based on our high school physics class. This was bizarre, the implication was that my design would work.
A solution to the worlds energy problems. It actually can do much more, in my long hours of study I found the connection between the tangible and the intangible. How can something intangible manipulate or interact with something tangible? Well I seem to have figured out the connection which means a whole slew of new amazing devices.
So now the dilemma
I could patent it get really rich and solve the worlds energy problems and even the conflict in the middle east related to oil. There are some ramifications, it would totally transform the worlds economies and systems in a rather dramatic fashion leading to a bit of chaos. The entire Oil supply chain industry would be almost eliminated in a short number of years. All the the jobs and infrastructure would be diminished. On the other because of all the "new" applications and changes to the world's systems infrastructures the global economy would boom. There would be a large amount of work to be done which means jobs.
In some sense the device could be a threat to National Security in more ways than one. It could be used as a weapon. After giving it great thought and study I realized there were even greater ramifications the end of cheap plastic. You see Oil is not just about energy, it is about cheap plastic.
Funny that all the academics haven't figured that out like I did. The production of gasoline creates the waste by products that are used to produce cheap plastic. So this may be the real reason the alternative energies have not been used to replace oil.
In theory when I release the technology oil prices will plummet as everyone tries to sell their reserves as fast as they can while they still can.
So then I thought it could not be released until there was a transfer of power from the few (corruptible) to the many, which when acting collectively are not corruptible and would not allow the technology to be used to oppress or control. So being a 20 year IT person I set out to design a system to transfer power from the few to the many. Once in place the world would be safe from the misguided and dark minded.
There was one great obstacle related to the patent. If I patented it I would probably end up only being able to sell it to the US Government which would probably lock it down making it unavailable to the world.
For years, the U.S. government has made use of secrecy orders to identify and hold secret patent applications containing subject matter relevant to traditional notions of national security.
In the past, defense contractors have been forced to deal with patent secrecy orders, but the nation's new focus on domestic terrorism may force private sector companies to surrender their technology for national security reasons--and suffer financial hardship in the process.
The other option is to simply not file for a patent in the first place, since the government's authority over purely private ideas is limited by constitutional considerations. Other types of intellectual-property protection, such as trade secret protection, might be available. Yet another approach is to try to become a government contractor if a secrecy order issues. I might also be able to concurrently patent throughout the world and then the United States government would not be able to suppress it outside of this country.
I don't really have an objection to just giving it to the world. But this would mean no protections and no prosperity. I have been laboring years without recognition or a return on the energy spent (money). Not that I want to be really wealthy I would like to be able to spend more of my time working to make the world a better place, and be able travel anywhere I want to see the wonders of the world and meet and talk to all the wonderful people on the planet and see and experience the diversity of their cultures. I might even set us on the path to hook up with the rest of the intelligent life in the Universe.
The Solution
So I figured out a way to meet both objectives. I would give the technology to the world, which is simple enough, I have the email addresses for every university on the planet. I have the email addresses for every embassy and major news outlets. So getting the technology out is just a couple hours and a few key strokes.
Being in control of the release of the technology I know when, where, and how it will effect the marketplace. I can sell this information to investors but also provide information to a large special group, that will be able to play the market such that Billions can be earned just by having the foreknowledge. This will initiate a transfer of wealth from the rich 2% to the 98%.
So that is the plan I will organize and educate the worlds middle class and even the poor to know where and when to place their investments and money timed with the release of the technology. This time the average Joe will profit when the market drops.
So you are probably wondering how am I going to keep this a secret so the dark minded do not find out? I am not going to worry about keeping it a secret. You see like attracts like. So if I communicate with the light minded, in the places they hang out, then they will become aware, and they will communicate it to other light minded individuals. So the like minded light minded will become aware and the dark minded will remain oblivious. Since they do not associate with the dark minded and the places where it is posted is not visited by the dark minded they shall remain ignorant which is fitting since they propagate ignorance.
Then again maybe the dark minded if they visit The Source they may become light minded, which would be very nice.
If you would like to parcipate in the venture please contact me.
Richard,
I've worked for Japan's best interest for almost 30 yrs.
If you had any idea of what the big shots are like...
Oh, they love any reason to party,
and their wives?
Always in their shadow...
never "making a scene"...
never asking of their whereabouts...
a maid with certain priviledges,
certainly knowing their place in the scheme of things.
Those of Chinese origin that I have known,
despise the Japs. They do not move "up the ladder".
We do a lot of work in Taiwan now,
nigging out of the Phillipines, for some reason.
Hong Kong has no business with us.
The American bosses are quite afraid and nervous
every time the really "Big Shots" show up.
Clean, clean, clean and hide all of the re-works.
We seperate all our refuse and waste now,
only to buy out the recycling business.
Every decision they make is in their favor,
they care not to "play fair".
They make it look very good to the public
and throw around money to "other" Jap companies
with whom they obviously have stock futures.
"The door swings both ways" is their favorite saying.
I Am a slave...but only for 8 of 24 hours.
God help me the rest of them!
Well Keith I guess ego is the same everywhere.
I feel so not of this world sometimes.
It is amazing to see how relationships are a tool and a mirror of our evolution, as much on the international scale as on the individual one.
Japan and China have had a difficult relationship for ages, because of their national ego. Historically, China has considered and declared itself the center of the planet, and Japan has reacted like an angry, ignored child, trying to prove itself.
But it seems that national egos are letting go of their grip, and the fact that the two nations are now ready to talk is a great positive sign. Just like with individuals, only when they can let go of the past, of the image they have had of each other, of the blame and the pride, only then can China and Japan start to explore the enormous possibilities lying ahead of them.
This is an exciting time, I hope more and more nations will folow with the same insights. Thank you for the article.
Dear Horatio,
Thank you for posting this.
I always hail collaboration among countries and the Japan-China alliance is no exception. If this alliance will set new, higher standards for cleaner sources of energy -- to be followed by other countries -- that's great.
In the nineties, I lived in Japan for two months and I was very impressed with the refinement of its cultural heritage, and with the industriousness and creativity of the Japanese people. I hope that closer economic and cultural exchanges between China and Japan will happen without taking anything away from the uniqueness of Japan's cultural identity. I find that at times economic interests prevail over the preservation of cultural beauty.
In Europe, for example, the process of Americanization -- with its leveling influence -- has done much damage, and has caused many sociologists and intellectuals to express concern about the proliferation of McDonald's in the historical centers of many capitols. I once heard an author declare that the only good thing about America was that it could not become Americanized. I hope that the flooding of markets with inexpensive Chinese products will not be followed by the disappearance of the beautiful (but costlier) craftsmanship in Japan and elsewhere.
Love,
Donatella
P.S. Dear Richard, You are right about Stevia. It is supposed to have many health benefits and, on the contrary, Aspartame has been found to be toxic, causing neurological damage in rats. (I do not advocate tests on animals, though.)
Dear Keith,
I find your work experiences -- in 6 --interesting. Thanks for sharing them
Love,
Donatella
Engagement is better than neglect, name-calling, and ultimatums.
Nothing is less effective at a summit than intransigent, hardline leaders who don't listen.
That's why America can't negotiate solutions to its current international problems.
We hope Japan and China take a more enlightened approach.
Over here, we have to wait until 2008 to get the dead weight off our backs.
With the continued erosion of US credibility, liaisons between countries that have been US-facing will become infinitely more feasible.
For the US, this is ultimately a good thing. Despite the interim pain of adjusting to a new position, the change is required, in terms of the laws of dynamics, as well as ethically and humanistically.
The US has borne too much of the weight of world responsibility, for many decades. The US has allowed itself to become too greedy for other countries' various forms of wealth, for even more decades.
If the US is remain viable as a geopolitical entity, it must adjust itself to a fairer share of all things on this globe and beyond. Fairer means smaller.
The hubris that has accompanied US expansion in all fronts is the gun with which the US is now shooting itself in the feet. This self-crippling is leaving voids in world economics and politics, which are then filled by other countries. The other countries feel less constrained by their US relations, and bond more closely with each other, increasing the pressure on the US to fit properly with the share of the earth's resources that rightly belong it.
In this light, stronger Japan-China relations are healthy for the US, although they will probably be painful, as well.
For the world as a whole, stronger Japan-China relations are a good thing, too, increasing Asia's portion of world power in general, and intensifying the challenge to India to get its infrastructure and legal system problems dealt with, so India can fully participate in the world economy.
I agree "The US has borne too much of the weight of world responsibility, for many decades."
The British passed the buck to the US citizens (there was actually a program to do this) and now I think the citizens of India, China, and Japan should pay the cost :).
Daer Richard
In about a half-century, you may get your wish, assuming we can solve the water deficit problem by then and we're still alive.
love, Heather
Heather,
Have you been listening to those bad agents?
Did you happen to notice that the surface of the Earth is 70% water?
Who was able to convince you there is a water shortage?
Let me guess the same people that convinced the world there is an energy shortage. Did you notice the Sun in the sky? Don't embrace these Illusions.
Remember that scarcity and shortages are a tool to create an artificial inflation of value and are used for control.
Ignore everything that does not come from The Source.
Hello, Donatella!
I didn't get fired today and I can always say
that the "hacker" stole my I.D. and wrote that!
At a whole 5 ft. 7...I am priviledged to be able
to look down on most of the "Big Shots".
.
I played in the golf league at work for many years
so I do have a lot of 19th hole recollections.
To beat the "Top Gun", one-on-one, in match play,
was a feeling unmatched in the workplace.
Oh, but do watch your manners and play strictly by the rules,
and if you wish...you may run with us,
hurry, hurry, hurry like were on the clock or something.
Hurry up and get to your ball so you can stand there and wait
for 10 minutes before your next shot.
Hurry up and wait...the life of an assembly worker.
Golf, like life, should be played as if you
were on vacation, not as if you were on crack!
By the way an infant body is 70% water and in single cells water content is about 70%.
If you take a sophisticated computer model of the planet and change that water percentage to 60 or 80% guess what happens?
Now ask your self what would it take to ensure that a planet had a surface area of 70% water?
Could it happen by accident?
What is the exact size core needed to generate a magentosphere to shield a planet from the sun so that it can support highly evolved life forms?
The planet was fabricated.
If you were going to fabricate a planet, what would you need? Look at the other planets.
When the core degrades so that it cannot support advanced life what happens to the planet.
look at mars.
So plants generate oxygen, and I bet you wonder why if the planet was fabricated, would the engineers have created dinosaurs on it?
Well it is a bit like the canary in a mineshaft and more of course.
They are a means of monitoring the environment and providing a source of entertainment, watching dinosaur battles of course on interGalactic TV. :)
and now their watching you.
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(If you haven't left a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Thanks for waiting.)So plants generate oxygen, and I bet you wonder
By the way an infant body is 70% water and in s
Hello, Donatella!
I didn't get fired to
Heather,
Have you been listening to tho
Daer Richard
In about a half-century, y
This article was educational and enlightening for me. Thank you for posting. A China-Japan alliance could undoubtedly change the balance of power in the world. I found the specific initiatvies outlined above -- like the clean energy initiative -- interesting.
It will be interesting to see where the US stands twenty years from now. So many of our friends are moving back to Asia, because that is where there is excitement and opportunity. My brother-in-law is moving to China to work on wind power initiatives for Asia -- that opportunity was so much more exciting for him than what was happening in the same field in the US.
What is happening on China-India front? I must admit ignorance on the status, although I think the a potential alliance would no doubt change the world.
Mallika