In this edition of TPR News: local election campaigns heat up as Tokyo Governor Ishihara’s Olympic dreams are challeneged, the Six-Party Talks falter, Patriot missiles come to Tokyo, amakudari is not gone after all, the 1995 sarin gas attacks are remembered, and plenty of business and economy news.

Politics

Campaigning in gubernatorial elections in thirteen prefectures and mayoral elections in four major cities officially begins on Thursday. Campaigns are expected to focus on local issues, especially those dealing with local economies and welfare programs. The April 8th elections are widely seen as being important precursors to the July House of Councillors elections.

During his Sunday announcement that he will run for Governor of Iwate Prefecture, current Prefectural Assemblyman The Great Sasuke expressed his intention to continue wearing his mask even if he is elected as governor, saying, “I have been allowed to wear this when I am acting as a prefectural assembly member.”

Saying, “Japan now has no dream. But (if Tokyo hosts the Olympics), it would be a huge gift to the wasted spirit of our youth,” Tokyo Governor Shintaro Ishihara declared a bid to host the 2016 Summer Olympics to be the centerpiece of his campaign.

His challengers disagreed. The strongest of them, former Miyagi Governor Shiro Asano, said hosting the Olympics in Hiroshima or Nagasaki to emphasize peace would raise the national spirit, but saw no value in bringing the Olympics to Tokyo.

Former Adachi ward Mayor Manzo Yoshida said the international trend was to control the growth of large cities and that Ishihara would have mend relations with Japan’s Asian neighbors - relations made worse by Ishihara’s intemperate remarks over the years - in order to host the Olympics.

Ishihara has argued that bringing the Olympics to Tokyo would force the national government to build loop roads which would then reduce traffic jams, a notion criticized by architect Kisho Kurokawa, who said, “Traffic jams will not be resolved just by building loop roads.”

Kurokawa argued for moving the central government buildings out of central Tokyo’s Kasumigaseki district and into the country in order to create space in the city center, a “void,” in his words. He also said money spent on the Olympics would be better spent on welfare, urban planning, or environmental improvements.

While Tokyo may not see the Olympics, it will see the arrival of Patriot missiles deployed to protect the Diet building, Prime Minister’s residence, and other key targets in the capital. The missiles will be placed at SDF garrisons in Nerima and Ichigaya in Tokyo and at the ASDF Iruma base in southern Saitama.

Iruma will be the first of four areas in Tokyo, sixteen nationwide, to recieve the Patriot Advanced Capability 3 system, set to arrive by the end of this month.

Despite the efforts of LDP Secretary-General Hidenao Nakagawa, the practice of amakudari - “descent from Heaven” or a golden parachute - is not going to end after all. Prime Minister Abe told a press conference on Friday that he wanted Ministries to stop setting retiring bureaucrats up with cushy private-sector jobs. However, as is Abe’s wont, he shortly thereafter contradicted himself when he instructed new Minister for Administrative Reform Yoshimi Watanabe to set up a centralized human resources agency to place retiring bureaucrats in private sector jobs.

Abe had said in January that he wanted to end the practice of Ministries using their budgetary power to force their alumni on private companies. Watanabe proposed a policy that would end amakudari and a number of Ministry officials and LDP Diet members expressed opposition.

Japan has a new friend. After six decades with the US as its best and only ally, Japan signed a security pact with Australia during Australian Prime Minister John Howard’s visit to Tokyo last week. While the Australian press expressed vocal displeasure with Prime Minister Abe’s unfortunate remarks on the comfort women issue, the Australian public retains vivid memories of World War II, or at least grudges stemming from it, and Australian environmental groups vehemently oppose Japan’s whaling program, Howard said, “Australia has no better friend or more reliable partner within the Asia-Pacific region than Japan.”

The two countries worked side by side on humanitarian and peacekeeping missions in Iraq, where Australian troops provided security for their Japanese counterparts, Cambodia, Timor-Leste, and in the aftermath of the Indian Ocean tsunami in December 2004 and insisted that the improved military cooperation and intelligence-sharing provided for in the pact would enhance such endeavors.

Nevertheless, the question of China, a growing power in the region and a voracious consumer of Australian iron ore and uranium and Japanese direct investment, was paramount. Australian Foreign Minister Alexander Downer said, “China is a good, constructive commercial partner, but in terms of ideas and values, it will never be anywhere near as close to us as Japan. It’s quite clear: Japan is our best friend in Asia.”

After Shinzo Abe engaged in a Clintonian game of semantics, quibbling over a “narrow” versus a “broad” sense of coercion with regard to why Korean, Chinese, and other women entered sexual slavery during World War II, US Ambassador to Japan Thomas Schieffer said,

I think [the women] were coerced to engage in prostitution. That means they were raped by the Japanese military at that point in time. I think that happened, and I think it was a regrettable, terrible thing that it happened.

The latest round of Six-Party talks began in Beijing on Monday. However, the negotiations have already run into a hitch over the release of Pyonyang’s frozen funds.

The Daily Yomiuri has begun a series of articles detailing the deterrents Japan could use to counter the North Korean nuclear threat.

Business and Economy

The International Herald Tribune has questioned whether or not recent pay raises at large Japanese firms will actually help spur domestic consumption. The IHT quotes Yasuo Yamamoto, a senior economist at Mizuho Research Institute, as saying that wage increases “will provide some boost for consumption, but the impact will probably be limited” due to the fact that most wage increases are tied up in employee bonuses, and the nation’s part-time workforce is not eligible to receive these bonuses.

Speaking of part-time workers, a recent Asahi Shimbun editorial points out that out of Japan’s 12 million part-time workers, “the Ministry of Health, Labor and Welfare’s proposed changes to the employee pension plan would only allow 100,000 to 200,000 [of them] to join the employee pension plan.” Under the existing plan, those part-time workers who put in an average of 30 hours or more per week are eligible for the system. The new proposed plan would lower the minimum number of hours to 20, but place the following restrictions on their eligibility to enroll in the system: a person must earn more than 98,000 yen a month, have worked for at least one year at the same company, and work for a company with 300 employees or more. The Asahi points out, “Such limits restrict the number of newly eligible workers to a mere handful. It all makes us wonder if the new plan is really meant to include part-timers.”

In another editorial piece concerning recent wage increases, the Japan Times has stated that during the current economic expansion:

Executives’ salaries have risen steeply and the amount of dividends paid out by major companies have tripled in the past 10 years, labor’s share of the wealth has been decreasing since the late 1990s.

Most households have not felt the benefits of the economic recovery. In fact, the Cabinet Office’s statistics on real gross domestic product shows that in 2006, personal spending increased only by 0.9 percent from the previous year while equipment investment by the corporate sector grew by 7.6 percent from the previous year. GDP deflator, which shows comprehensive price movements, dropped 0.9 percent, showing that the deflationary pressure was still strong.

Against this background, Prime Minister Shinzo Abe and leaders of the ruling Liberal Democratic Party called business leaders to reflect the corporate sector’s high profits in workers’ wages. But management insisted on the importance of maintaining Japanese firms’ international competitive edge in the midst of intensifying global competition. It was reluctant to raise the monthly base wage because such a raise would be permanently embedded in personnel costs, thus raising overall production costs. It argued that when companies realize profits, workers should share the fruit in the form of one-time bonuses. The outcome of the wage-raise negotiations shows that management’s argument has prevailed to a great extent.

On the heels of the announcement that department store giants Daimaru and Matsuzakaya will be merging their operations, the Japan Department Store Association has announced that Japan’s department store sales in February were up 1.7% from February 2006, reaching 529.58 billion yen. This is the second straight monthly gain in department store sales, after last month’s reported +0.0%. February’s survey included figures from 277 shops owned by 95 companies, showing an increase of one retail outlet.

Clothing sales, which make up the largest chunk of revenue at department stores by sector, were up 0.3%, after having fallen 1% last month. Food sales were up 1.3%, sundry goods up 2.7% and the sale of household items rose 1.7%. The Japan Department Store Association attributed the rise in revenue to a combination of early sales of spring clothes, large corporate orders and effective sales promotions.

Figures in Tokyo were not quite as rosy, showing a decline in year-on-year sales for the fifth consecutive month, with a fall of 0.3% to 126.2 billion yen. The Tokyo report included figures from 28 shops owned by 13 companies, unchanged from January.

In a move nearly universally anticipated by watchers of the Japanese economy, shortly after lunchtime on Tuesday the Bank of Japan declared that it would leave the nation’s overnight call rates unchanged at 0.5%. The decision had been predicted by all 49 economists surveyed by Bloomberg. With unified elections coming up in April and a July upper house election, it seems unlikely that the BOJ will be able to raise rates again until sometime after those events pass (with the upper house election bearing far more importance to the BOJ’s decision). There thus becomes the possibility towards the end of the year of both a hike in interest rates and an increase in the consumption tax from 5 to 10 percent.

Society

Twenty Subway workers at Kasumigaseki station observed a minute of silence at 8:00 a.m. this morning to mark, precisely, the twelfth anniversary of the March 21, 1995 sarin gas attacks by Aum Shinrikyo on the Tokyo Subway that killed two Subway workers at Kasumigaseki, ten other people elsewhere, and sickened approximately 5,500 commuters.

Under Article 772 of Civil Law, babies born within 300 days of a divorce are presumed to be the children of the mothers’ ex-husbands. Article 733 of Civil Law prevents women from remarrying within six months of a divorce in order to make paternity issues clear. Article 772 also states that children born on or after the 200th day of a marriage are presumed to be the children of a woman’s current husband. These rules have been unchanged since they came into being in 1898.

A growing number of cases highlighting the limitations of the old rules and a feeling that preventing only women from remarrying is unfair have led some LDP lawmakers to consider reducing the ban on remarriage to 100 days, a move first proposed in 1996.

There are, of course, conservatives in the LDP who are steadfastly opposed to any reconsideration of the 1898 Law.

After being sentenced to two and a half years in prison for violations of securities laws, Takafumi Horie took the stand as a defense witness at the trial of Yoshiaki Murakami on Tuesday. Murakami is on trial for insider trading of shares in Nippon Broadcasting System, in which Horie’s company, Livedoor, purchased a large stake.

While prosecutors claim Murakami learned of Livedoor’s decision to buy a large chunk of NBS during meeting between Murakami Fund and Livedoor executives on Novermber 8, 2004, Horie claims he didn’t decide to buy the shares until early 2005.

Horie is the seventeenth witness from Livedoor to testify in Murakami’s trial, most of whom have given testimony advantageous to Murakami.

Because of time constraints and large differences in views, Japanese and Chinese historians have given up on their joint study project. Instead of writing one unified history, the two sides have agreed to write separate histories and exchange notes on contentious points.

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