THE
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Akio Yamazaki and Mami Mori, two Japanese natives who currently [December 2005] live in San Francisco, have completed a study of their home country government's economic policies as compared to the MIEPA list of policies as outlined above. The studies on Japan are shown below. The ratings herein are based on the following rating scale:
RATING SCALE
5.0 Perfect Facilitation of Wealth Creation
4.0 Midway between Perfect and Neutral
3.0 Neutral Effect on Wealth Creation
2.0 Midway between Neutral and Obstructionist
1.0 Perfectly Obstructionist to Wealth Creation
[Rating scale copyright Mike P. McKeever, 2005. Used herein with permission]
To read a disclaimer about the analysis in this file, scroll to the bottom of the file.
JAPAN - Akio Yamazaki
Comparison of Japan's economic policies to MIEPA criteria as prepared by native student of Japan, Mr. Akio Yamazaki, studying in the US in December of 2005.
RATING SUMMARY
POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE
1 5.0 15.0 15.0 100 %
2 4.5 13.5 15.0 90
3 4.0 12.0 15.0 80
4 4.5 13.5 15.0 90
5 4.5 13.5 15.0 90
6 5.0 15.0 15.0 100
7 5.0 15.0 15.0 100
8 4.5 13.5 15.0 90
9 4.5 13.5 15.0 90
10 5.0 15.0 15.0 100
11 5.0 15.0 15.0 100
12 4.5 9.0 10.0 90
13 5.0 10.0 10.0 100
14 5.0 10.0 10.0 100
15 3.0 6.0 6.0 60
16 5.0 10.0 10.0 100
17 4.0 8.0 10.0 80
18 2.0 4.0 10.0 40
19 4.5 9.0 10.0 90
20 3.0 6.0 10.0 60
21 4.0 8.0 10.0 80
22 5.0 10.0 10.0 100
23 4.0 8.0 10.0 80
24 5.0 10.0 10.0 100
25 3.5 7.0 10.0 70
26 3.0 6.0 10.0 60
27 4.0 8.0 10.0 80
28 3.0 6.0 10.0 60
29 2.0 2.0 5.0 40
30 5.0 5.0 5.0 100
31 3.5 3.5 5.0 70
32 5.0 5.0 5.0 100
33 4.0 4.0 5.0 80
34 2.0 2.0 5.0 40
TOTAL 140.5 311.0 375.0 82.9%
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INDIVIDUAL POLICIES
1. Freedom from internal control (5.0)
All the people in Japan are free from internal control. Everyone can move around in Japan freely. They can move to anywhere and anytime they wish.
Source; Personal experience
2. Freedom of speech (4.5)
Freedom of speech is protected under the Constitution of Japan Article 21, hereby the freedom of assembly, or of association; and the freedom of speech, or of press, shall be reserved to the people. But sometimes the freedom of speech conflict with the right of privacy, therefore it has been somewhat controversial. “Freedom of assembly and association as well as speech, press and all other forms of expression are guaranteed.” (Japanese Constitution, Article 21)
Sources; E- Gov http://law.e-gov.go.jp/htmldata/S21/S21KE000.html; KAWAHARA Kazutoshi http://list.room.ne.jp/~lawtext/1946C-English.html
3. Effective, fair police force (4.0)
The police forces of Japan are overall highly effective due to the ability to protect its citizen. Even though only 1% of total population is immigrants, there have been discriminations over certain types of ethnic group. Therefore the fairness of police force on minorities is somewhat controversial these days. Also occasionally police scandals come up in society such as bribes and sexual harassment issue. Therefore there may be a certain period of time that police force may lose their trust from their own citizens. Now it may not sound like Japanese police force is not really effective or fair, but for most of time they treat all members of citizens equally and are seen as fair.
Source; Personal Experience
4. Private property (4.5)
Japan has a law towards construction, which is called the Construction Standards Law. There are so many codes that have to be passed before even starting the construction and also are so many steps and paper works that have to be gone through by public/ government office. It is certainly difficult to pass the law but in Japanese society as whole, safety of the building regarding fire, earthquake, environmental issue, etc have more strong priority over cost of construction. Therefore even though it may be cheaper to ignore the law and build a building illegally, but almost all of the building in Japan has been legally constructed because of the high- standard minds of Japanese society.
Source; Personal Experience
5. Commercial banks (4.5)
The commercial banks of Japan both lend money to enterprises and the majority of citizen place their cash deposits within the banks. After the bubble burst, a lot of commercial bank went broke due to the unreturned –loan from business that the banks lent money to. As result, commercial banks had lost their trust from citizen. Since then, gov’t decided to back up commercial banks through Bank of Japan, which is backed up by Ministry of Finance. Therefore now commercial banks have taken back their trust from citizen. And also a lot of local or small commercial banks have merged with big commercial bank which has a big trust from citizen so that the small/ local commercial banks can avoid the risk of bankruptcy. .
Source; personal experience
6. Communication systems (5.0)
Japan has numerous communication facilities and they are widely spread throughout Japan. In 2005, there are almost 90 million people out of total population of 120 millions own a cellphone, which is about 75% of all the population in Japan have cellphone. Japan has more than 20 internet service provider companies and 10 major telephone companies all over Japan. 71.149 million telephone lines are in use. Almost every family has internet access and telephone line. And we also have a great number of newspaper and magazine companies. We can buy any kind of newspapers and magazines at just about anywhere. Of all the communication system, Japan Cellphone industry has been much more advanced than any other countries in the world.
Source: Radio Tuner http://radiotuner.jp/; Telecommunications Carriers Associations - http://www.tca.or.jp/japan/database/daisu/yymm/0510matu.html
7. Transportation (5.0)
Japan has the world best transportation system throughout the country. Especially Railroad system is by far the best. Most of Japanese people use train for their commute because it is fast and spread everywhere in Japan. Also transporting freight or merchandise is effective and fast through railroads, air, roads and ship. Usually it only takes within 2days to mail anything to anywhere in the country. Japan has 5 main international airports located on main land of Japan, which are Narita, Tokyo (Haneda), Kansai, Osaka, and Chubu. That will allow Japan to import and export efficiently from/to all over the world. And we have more than 174 domestic airports that allow passengers, mails, and merchandises to get anywhere in Japan. Because of its Japanese geographical advantages (small and surrounded by ocean), it is really easy to transport products via ship. And we have a lot of home-delivery service company throughout the country via truck and air, so it is really easy and fast to transport products.
Sources: Ministry of Land Infrastructure and Transport - http://www.mlit.go.jp/list/katsuryoku_01.html
8. Education (4.5)
The number of people who goes to school (secondary school and above) is relatively high. 94% of middle school (7th~9th grade) graduates continue to go to high school, while in U.S. 88% of middle school graduates continue to go to high school (In Japan, up until 9th grade, all the children are mandated to attend school, hence after 10th grade, schooling decision leave up to individual.) 76% of high school graduates go to higher education (university, community college, etc), while in US, 60% of that go to higher education.
In terms of quality of education in Japan, it is certainly high compare to other parts of the world. According to International Association for the Evaluation of Educational Achievement (IEA), the Trends in International Mathematics and Science Study (TIMSS) has shown that Japan has placed in pretty high rank, which proves that Japanese educational quality is relatively higher than other countries. One of my examples is Math, in Japan, math that is taught to students are so much more advanced than that taught in US.
Sources; Ministry of Education, Culture, Sports, and Science and Technology - http://www.mext.go.jp/b_menu/houdou/17/01/05012102.htm; http://www.mext.go.jp/b_menu/shingi/12/chuuou/toushin/pdf/8.pdf#search='IEA????????????????????; http://www.mext.go.jp/b_menu/houdou/16/12/04121301.htm; Personal experience
9. Social Mobility (4.5)
For the most part in Japanese society, each individual person has ability to obtain any job they want accordingly as we work hard or not. In terms of getting higher position in certain company, there may be a case where which University individual went to play a huge role as they seek for job. Therefore, the harder you work or the smarter you are, the more likely for you to get great job, although there may be a time when family connection is used.
Source; personal experience
10. Freedom from outside control (5.0)
Japanese citizens are free from control by any citizen or agency of any other country. They are subject only to the laws of the Japan.
Source; personal experience
11. Foreign currency transactions (5.0)
Yen (\) is the only currency that’s acceptable throughout the Japan.
Source: Common Sense (personal experience)
12. Border control (4.5)
In 2003, there were 5.7 million illegal immigrants in Japan. It had been increased by 10% of that of 2002. Most of illegal immigrants are Chinese. But the number of illegal immigrants in Japan is relatively small, compare to other countries in the world because of its Japanese geographical advantages, which make illegal immigrants to require get through airport every time they try to come to Japan. Even though it is hard for illegal immigrants to pass through airports, but there are still a lot of smugglers. Within last 5 years, the amounts of smuggled drugs had been 10 times as much. But as the amount of smuggled drugs increase, the level of security against smuggled drugs has been becoming higher and higher, that’s why the National police agency and Narita airport customs has been able to truck down a lot of smuggled drugs in last 5 years.
Sources; Narita Airport Customs - http://www.narita-airport-customs.go.jp/index/index_houdou.html; Ministry of Finance Japan - http://www.mof.go.jp/jouhou/kanzei/ka160210b.htm; National Police Agency - http://www.police.pref.saitama.jp/kenkei/hanzai/toukei/fuhoshuro/fuhoshuro.html
13. Currency (5.0)
There is only single national bank issues currency, which is the Bank of Japan.
Sources: the Bank of Japan http://www.boj.or.jp/
14. Cultural, language homogeneity (5.0)
There are more than 10 different dialects with slightly different from one another in Japan, such as Kansai, Hakata, Okinawa dialects. But everyone speaks and understands Standard Japanese and all have basic traditional cultures. There are really small proportions of ethnic groups, such as Chinese, Brazilian, Pilipino, etc, which is only less than 1% of whole population (rest of 99% is Japanese)
Sources: the Japan National Pension Association - http://www.nenkin.or.jp/data/c02/c102_07.html; Wikipedia - http://ja.wikipedia.org/wiki/%E6%96%B9%E8%A8%80
15. Political effectiveness (3.0)
In January 17th 1995, The Great Hanshin earthquake occur in Japan. 6,400 people died and 43,792 people injured over the disaster. The total damage cost was 10 trillion yen. National government agencies contributed 340,000 person-days to search and rescue, but only after considerable delays. At the time, Japan had no national disaster agency and no response plan for a non-military disaster of the earthquake's scope. Prime Minister Tomiichi Murayama waited for almost a day before dispatching military troops to aid in the search for survivors. Therefore it took 3 days for military troops to fully activate the rescue operation. Also the government wasn’t able to provide enough shelters. Even though Japan has been experienced a great earthquake before, the government mobility towards disaster was still slow. But this disaster was 10 years ago (now 2005). Since then Japan has been creating new measures for natural disaster. One of the biggest measures toward disaster is to set up Urgent Firefighting Support Corps, who are commanded by mayor or state governor, not by prime minister. And also the Ground Self-Defense Forces were given automatic authority to respond to earthquakes over a certain magnitude. So now the Great Hanshin earthquake proved to be a major wake-up call for Japanese disaster prevention authorities.
Sources: Hatena Dairy - http://d.hatena.ne.jp/keyword/%BA%E5%BF%C0%C2%E7%BF%CC%BA%D2
16. Institutional stability (5.0)
The Supreme Courts and all the courts system was created more than 55 years ago and never have been changed at all. And most of university has been established more than 100 years ago and hasn’t changed either.
Sources; Supreme Court of Japan - http://courtdomino2.courts.go.jp/mado.nsf/8073ebf03cd81bb049256b1e00419a95/793db751c852182c49256b6e000c86ce?OpenDocument; welcome to 12 Tokyo Univ. - http://www.tokyo12univ.com/~van/tokyo12_2002/presen/
17. Honest Government (4.0)
According to Corruption Perceptions Index 2004 in Transparency International, Japan was ranked 24, scored 6.9 (10 being the highest). And now Japan has been ranked 21 scored 7.3. Therefore Japan has been on its way of clean country.
Sources; Transparency International - http://www.transparency.org/pressreleases_archive/2004/2004.10.20.cpi.en.html; Infoplease - http://www.infoplease.com/ipa/A0781359.html
18. Common Law (2.0)
To bring lawsuit in any court in Japan doesn’t cost any money. But as a case proceeds, expense will be needed in order to continue. Therefore it is believed to be hardship towards poor. Although lately the law aid association has been established to help out financially poor victims to bring a case, it is hardly equal in potential of trial between rich and poor.
Source; Wikipedia http://ja.wikipedia.org/wiki/%E8%A3%81%E5%88%A4
19. CENTRAL BANK (4.5)
The roles of the Bank of Japan are issuance and management of banknotes, maintenance price stability by operation, and financial system stability. They have been completely independent organization since 1882, although the Bank of Japan issue banknotes, and sometimes, according to the bank of Japan law, minister of finance will get to have a say in financial decisions
Source; Bank of Japan http://www.boj.or.jp/index.html
20. DOMESTIC BUDGET MANAGEMENT (3.0)
Fiscal budget is 82 trillion yen in 2005, which includes 44 trillion yen of tax budget. But annual expenditures budget is 84 trillion yen, which shows that Japan has 2 trillion yen of deficit on budget.
Source; Ministry of Finance http://www.mof.go.jp/jouhou/syukei/sainyu/h17/1707a.htm
21. GOVERNMENT DEBT (4.0)
The amount of Domestic Loan was 540 trillion yen, Government Borrowing was 60 trillion yen, and T- Bill was 70 trillion. Total government debt is 670 trillion yen in 2003. And according to general account in national finance, annual payment for bond expenditure is 17 trillion yen in 2004 in government annual expenditure, while total fiscal budget is 82 trillion yen. Therefore the amount of annual payment towards gov’t bonds is 21% of fiscal budget. Also to compare to GDP, it is only 3%.
Source; Ministry of Finance - http://www.mof.go.jp/gbb/1512.htm; Ministry of Internal affairs and communications - http://www.stat.go.jp/data/nenkan/zuhyou/y0504b00.xls
22. ECONOMIC STATISTICS (5.0)
In every 5 years, a business establishment / company statistics surveys are taken by Statistics Bureau in The Ministry of Internal Affairs and Communications (MIC), and all kinds of other statistics such as census are also taken by MIC. All the statistics are based on Statistical law and Statistics report adjustment law, which are basically to prevent having false statistics. Therefore those statistics that are taken by Ministries are accurate.
Sources; Ministry of Internal Affairs and Communications - http://www.stat.go.jp/index/seido/index.htm; http://www.stat.go.jp/data/jigyou/2004/sokuhou/index.htm
23. PROTECTION OF PUBLIC HEALTH AND SAFETY (4.0)
According to Ministry of Health, Labor and Welfare, after the World War, The number of newborn baby death was 84,204, but in 2000, it’s only 2,106, which means that it has been 1/40 of that since WWII. And not only the number of newborn death has been decreased, Survival rate of a premature baby has been increased, now it is 90%, which although may very depends on the baby’s weight. Therefore Japan has been very much in improving of health care condition. And to compare with other countries, according to World Health Organization (WHO), in Japan, child mortality for both boy and girl is 4 per 1000 kids, while in US, 7 girls and 9 boys per 1000 girls/ boys, and, in Mexico, is 25 girls and 31 boys per 1000 girls/ boys. It clearly shows that Japan has very low rate of childe mortality.
In beginning of year 2004, another 30000 people have been infected by Tuberculosis. Rate per 100000 populations is 23.3%. It has been decreased gradually. Compare to other country in the world, it is not that severe, but still 4 times as many as of U.S.A.
Sources; Shiga medical college Hospital - http://nmcg.shiga-med.ac.jp/NEONATE97/sld035.htm; Ministry of Health, Labor and Welfare - http://www.gender.go.jp/sabetsu/5th_report/toukei/1213.pdf; World Health Organization (WHO) - http://www3.who.int/whosis/country/compare.cfm?country=JPN&indicator=MortChildMale,MortChildFemale&language=english; The Research Institution of Tuberculosis Japan Anti – Tuberculosis Association - http://www.jata.or.jp/rit/re/epro1_top.htm
24. HIGH WAGE POLICY (5.0)
Average income in Japan is about 5.8 million yen, which is about 53 thousand dollars. It has been decreased over time. But most of Japanese are able to afford to buy normal goods such cars, TVs, and so forth.
Source; Money guide JP, http://rh-guide.com/money_db/archives/2005/08/580.html
25. ENVIRONMENTAL PROTECTION (3.5)
Ministry of the Environment has been supervising every single environmental protection laws. Since Japan is one of the developed countries in the world which have great influence in world environment, we have great responsibilities to maintain good condition of environment and enforce environmental protection regulations as much as possible. Lately Japan has been able to maintain the level of polluted air along regulation such as Carbon monoxide (CO), Sulfur dioxide, and so forth. Especially with CO, it has been achieved an environmental standard in all measurement station. Yet not every environmental protection regulations are enforced precisely. Even though outcome of regulation hasn’t appeared immediately, Japan has been doing better at enforcing the environmental protection regulations over times.
Sources; Ministry of the Environment - http://www.env.go.jp/guide/seisaku/h16_jigo/jigo.html
26. Strong Army (3.0)
Japanese Self- Defense Force (JSDF) is consisted of 3 branches, which are Japan Maritime Self- Defense Force, Japan Ground Self- Defense Force, and Japan Air Self- Defense Force. The main purpose of having these Self- Defense force is only to protect our own country, not to initiate any kind of dispute or threats against other countries. JSDF is based on the Article ?,Constitution of Japan, “Aspiring sincerely to an international peace based on justice and order, the Japanese people forever renounce war as a sovereign right of the nation and the threat or use of force as means of settling international disputes. In order to accomplish the aim of the preceding paragraph, land, sea, and air forces, as well as other war potential, will never be maintained. The right of belligerency of the state will not be recognized.” This is basically why we call Japanese army “Japanese Self- Defense Force”. Totally we have about 240,000 members of all three branches. Compare to U.S. army, it is really small number, and also military expenditures in percentage of GDP is only 1%, where U.S. has 3.3%. Japan is currently ranked 134th in the world.
Sources; Wikipedia--http://ja.wikipedia.org/wiki/%E6%97%A5%E6%9C%AC%E5%9B%BD%E6%86%B2%E6%B3%95%E7%AC%AC9%E6%9D%A1; CIA - http://www.odci.gov/cia/publications/factbook/geos/ja.html#Military; Japan Defense Agency- http://www.jda.go.jp/
27. Foreign Trade Impact (4.0)
In 2003 Gross Domestic Product and Expenditure Account, it shows that Exports of goods and services was 60 trillion yen and Imports of goods and services was 51 trillion yen. And GDP in the year was 501 trillion yen. The calculations of [(Export + Import) ÷ GDP] ×100 is 22 %.
Source; Economic and Social Research Institution, Cabinet Office - http://www.esri.cao.go.jp/en/sna/h17-nenpou/n90a1_en.xls
28. PROTECTION OF FOREIGN CURRENCY EARNING ENTERPRISES (3.0)
Japan has no protection for any specific exporting industries. But among Ministry of Economy, Trade and Industry, there has been a certain economic policy to encourage foreign trade and investment, so-called “External Economic Policy.” One of the actions in the policy is to set trade administration to supervise what’s coming in and out, so that Japanese economy will be more activated than ever, and also to create certain rules about international business.
Sources; Ministry of Economy, Trade and Industry (METI) - http://www.meti.go.jp/main/meti_policies.html; External Economic Policy Site, METI - http://www.meti.go.jp/policy/trade_policy/index.html
29. Management of Foreign Currency Budget (2.0)
In 2004, Japan sum total of export was approx. 61 trillion yen, which is 550 billion dollar at the time of exchange rate of 1 dollar 110 yen, and import was approx.49 trillion yen, which is 460 billion dollar at the same rate above. These totals reveal Japan current account balance to be approx. 12 trillion yen, which is 110 billion dollar. It shows you that current balance in foreign current budget in Japan is a bit surplus. Since 1981, Japan is having surplus of foreign current budget.
Source; Ministry of Finance - http://www.customs.go.jp/toukei/suii/html/nenbet.htm
30. Layers of Collective Action (5.0)
In every one of prefectures and cities, mayor and members of the Diet are elected directly by people from their cities. Therefore we, local people, have the power to elect own members of diet including mayor. When it comes to election of House of Representative and Councilors, it’s also done by direct election. The only election which is not done directly by people is election of Prime Minister. The members of House of Representative and Councilors are the ones vote for who is going to be the Prime Minister. Other than that pretty much all the thing that has to be done by election is voted by citizen of own cities, prefecture, or even whole citizen in Japan.
Source; Wikipedia and personal experience - http://ja.wikipedia.org/wiki/%E5%9C%B0%E6%96%B9%E5%85%AC%E5%85%B1%E5%9B%A3%E4%BD%93
31. Pro Business Climate (3.5)
There have been a lot of corrupt companies in Japan lately such as a credit company, an insurance company, and so forth. Also bribing is occurring among some hospitals, businesses, or even governors. It has not been a big concern but unfortunately there have been bad influence to society by these actions. Yet owning the business is pretty respectful thing. We tend to consider business success as major success in life, because everyone in Japan is eager to achieve certain level of business success. Sense of value towards business is high, which is one of the reasons why recently a lot of Japanese people study abroad to get more knowledge about what they are up for in career.
Source; Personal experience
32. GOVERNMENT ENTERPRISES (5.0)
In 1980s, the government had privatized a couple of government enterprises such as Japan Rail, Japan Telephone, Japan Tobacco and Salt Corporation. Now there have been debates about a privatization bill towards Japan Post and Japan Highway Public Corporation. Japan has been very much advancing in privatization these days.
Source; Technical Consulting Record Information Service and personal experience - http://www.ct.jacic.or.jp/corins/00/200504/pdf/sinkyu_1dg5_6.pdf
33. INTERNATIONAL SECURITY AGREEMENTS (4.0)
The Treaty of Mutual Cooperation between Japan and the USA provides that we both, the US. and Japan, help each other when there is a foreign threat or dispute against either one of us, which means that U.S. will defend Japan. In Japan-U.S. Security Arrangements, the U.S. is allowed to keep force bases in Japan for the security. The great number and sizes of bases are mostly located in OKINAWA Island and KANAGAWA prefecture. But there have been complains about bases being too many, enormous noises being made, etc.
Sources; Japan Defense Agency - http://www.jda.go.jp/j/library/treaty/anpo/anpo.htm; Tokyo Metropolitan Government - http://www.chijihon.metro.tokyo.jp/kiti/index.htm
34. Protection of Domestic Enterprises from Government Mandated Costs (2.0)
Japan has a great number of regulations on domestic enterprises and also on materials which enterprises uses that other countries do not have. Such as the Construction Standards Law, Automobile NOx·PM Law (which is to set the level of Nitrogen Oxide and Particulate Matter as exhaust gas), A large-scale retail store Law (which is to regulate large scale retail store to protect medium and small retail store), and so forth. Therefore there are a great number of thing that have to pass law, which will cause raise in cost; such as extra expenses on fireproofing the house walls, attaching the exhausting-gas-reducer on buses or trucks.
Sources; A Japanese environmental maintenance education center - http://www.alles.or.jp/~kankyojr/free/law/stady4.htm; Ministry of the Environment - http://www.env.go.jp/air/car/pamph2/
JAPAN - Mami Mori
Comparison of Japan's economic policies to MIEPA criteria as prepared by native student of Japan, Ms. Mami Mori, studying in the US in December of 2005.
RATING SUMMARY
POLICY NUMBER RAW SCORE ADJUSTED SCORE POSSIBLE PERCENTAGE
1 4.5 13.5 15.0 90 %
2 4.0 12.0 15.0 80
3 4.5 13.5 15.0 90
4 4.5 13.5 15.0 90
5 5.0 15.0 15.0 100
6 4.5 13.5 15.0 90
7 5.0 15.0 15.0 100
8 4.7 14.1 15.0 94
9 2.8 8.4 15.0 56
10 4.0 12.0 15.0 80
11 3.0 9.0 15.0 60
12 4.5 9.0 10.0 90
13 5.0 10.0 10.0 100
14 4.0 8.0 10.0 80
15 4.8 9.6 10.0 96
16 3.5 7.0 10.0 70
17 4.5 9.0 10.0 90
18 3.0 6.0 10.0 60
19 2.5 5.0 10.0 50
20 1.0 2.0 10.0 20
21 5.0 10.0 10.0 100
22 5.0 10.0 10.0 100
23 4.8 9.6 10.0 96
24 4.0 8.0 10.0 80
25 4.0 8.0 10.0 80
26 4.0 8.0 10.0 80
27 5.0 10.0 10.0 100
28 3.0 6.0 10.0 60
29 2.0 2.0 5.0 40
30 4.5 4.5 5.0 90
31 3.5 3.5 5.0 70
32 3.0 3.0 5.0 60
33 4.0 4.0 5.0 80
34 2.0 2.0 5.0 40
TOTAL 133.1 293.7 375.0 78.3%
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INDIVIDUAL POLICIES
1. FREEDOM FROM INTERNAL CONTROL 4.5
After World War II, Japan became a democratic society, and the Japanese Constitution ensures freedom and rights for all. Emperors became just a symbol of Japan. Under democracy, all citizens have the right to choose their jobs and accumulate assets. When moving domestically from one place to another, no passport is necessary.
Resource: E-Gov Japanese constitution - http://law.e-gov.go.jp/htmldata/S21/S21KE000.html
2. FREEDOM OF SPEECH 4.0
Freedom of speech is guaranteed by Article No. 21 of the Japanese Constitution. There is no limitation on freedom of speech and no one can infringe on others? speech. In reality, however, there are some limitations on freedom of speech. For example, public music performances without police permission are illegal.
Resource: E-Gov Japanese constitution - http://law.e-gov.go.jp/cgi-bin/idxsearch.cgi
3. EFFECTIVE, FAIR POLICE FORCE 4.5
The police treat all citizens fairly and impartially, and they are effective. The crime rate is still lower than in the U.S. and Europe, but it has been increasing year by year.
Resource: Personal experience
4. CURRENCY 4.5
The Japanese currency, the yen, is one of the strongest currencies in Asia and the world. Yen can be accepted at some shops and restaurants for tourists in South Korea. Most commercial banks offer foreign currency deposits. In the Tokyo metropolitan area, using US dollars is possible at some electric shops and cafés.
Resource: Personal experience
5. COMMERCIAL BANKS 5.0
After a long recession, the Japanese economy has been rebounding since 2004 and the six biggest banks have had new record profits. In addition to regular financial services, some banks offer lotteries, foreign currencies deposits, and overseas travel insurance. Mergers and acquisitions between commercial banks sometimes occur. Tokyo Mitsubishi Bank merged with UFJ Bank in October 2005 and the new name of the bank is Mitsubishi Tokyo UFJ Bank. Its total assets are 200 trillion yen (about two trillion US dollars); this is the highest in the world, even more than Toyota Motor Corporation, the biggest auto company in Japan. The bank?s total market value is fifth in the world.
Resource: Tokyo Mitsubishi Bank - http://www.btm.co.jp/info/gappei/; Nikkei Business News - http://www.nikkei.co.jp/news/keizai/20051003AT2Y0300203102005.html
6. COMMUNICATION SYSTEMS 4.5
Most households in Japan have TVs and radios. The number of people who read newspapers everyday is 77 percent; as of 2003, 90 percent of these people also use the internet to get their news. A cell phone is the most advanced, popular, and useful tool for communication in Japan; the number of cell phones subscribers increased to 86.7 million in 2003. Household ownership of cell phone equipment was 91 percent in 2004. At the same time, the number of public telephones dropped from 832,735 (in 1990) to 503,135 (in 2003). Fixed-phone service subscribers also have decreased every year to 51.6 million in 2003. Due to the spread of the internet, household ownership of personal computers was 77.5 percent and internet use at home was 55 percent in 2004.
Resource: Public survey on newspapers - http://www.ku-so.co.jp/result/2002/401/; Statistics Bureau & Statistical Research and Training Institute - http://www.stat.go.jp/english/data/figures/index.htm
7. TRANSPORTATION 5.0
It is very easy to plan and get to many places in Japan and the rest of the world by public and private transportation. There are four major types of transportation.
AIR: Japan has three major airline companies, 96 domestic airports, and four major international airports. Chubu International Airport near Nagoya city opened this year. The main reason it was developed is because the headquarters of Toyota Motor Corporation is in this area. Some small domestic airports also have flights to Guam, South Korea, and China.
SEA: There are lots of seaports because Japan consists of main four islands plus a group of southern islands, Okinawa. The major ports are the cities of Yokohama and Kobe. All the ships and ferries run punctually according to their timetables.
RAIL: The rail system is very developed, reliable, and useful. There are published timetables for sale of bookstores, and the trains usually come on time and the frequency of daily use by citizens is high. There are basically four kinds of trains: local, semi-express, express, and bullet trains. In Tokyo, there are 21 public and private lines. Still, it is very crowded in the morning and at night. California recently signed contracts to develop a Japanese-style bullet train system from San Diego all the way to Sacramento.
ROAD: The roads are well-developed, but tolls are relatively expensive.
Resource: Ministry of Land, Infrastructure, and Transport - http://www.mlit.go.jp/english/index.html; Yokoso Japan - http://www.mlit.go.jp/koku/visit_japan/index.html
8. EDUCATION 4.7
Japanese education levels are still among highest in the world. According to PISA, which gets test scores from high schools in most countries, Japan ranked 6th in mathematics, 14th in reading, 1st in science, and 3rd in problem solving in 2003. However, the reading level in 2003 was lower than in 2000. Education through the 9th grade is compulsory. English classes usually start in junior high school, but some elementary schools have begun introducing English classes.
Before entering high schools, colleges, and universities, competitive entrance exams are required. Students who fail have to go to non-competitive schools, which do not provide enough education to qualify for prestigious colleges or universities. Thus, this education system screens students to find the best. It is hard to take exams again because they are only offered once a year and two-year colleges are not designed to teach basic skills.
Similar to the U.S. and Europe, students in Japanese high schools are mostly the same age group. However, while in U.S. colleges, students have a wide range of ages, (due to there being many re-entry students), historically, almost all university students in Japan come directly from high school. Recently, however, since the birth ratio is low, some universities and colleges have begun to accept adults and working people to avoid financial problems.
Resource: OECD Programme for International Student Assessment (PISA) - http://www.pisa.oecd.org/pages/0,2987,en_32252351_32235731_1_1_1_1_1,00.html; Ministry of Education, Culture, Sports, Science and Technology - http://www.mext.go.jp/; Personal experience
9. SOCIAL MOBILITY 2.8
Japanese society is democratic; therefore, in general, better education leads to better jobs. Some people without family connections but with skills and education, can succeed at non-traditional companies such as IT companies, venture capital firms, and foreign companies. Still, family connections are one of the most important factors for becoming successful at big Japanese companies.
Resource: Personal experience
10. FREEDOM FROM OUTSIDE CONTROL 4.0
Officially, other countries do not exert control or suppression of freedom in Japan. However, sometimes Japan politically cannot say 'No' to the U.S. Since World War II, the U.S. has tried to control several aspects of Japan, such as the import and export of goods and military policy.
Resource: Personal experience
11. FOREIGN CURRENCY TRANSACTIONS 3.0
Banks and security firms offer foreign currency transactions in many ways: currency exchange, travelers? checks, savings accounts, accumulation accounts, time deposits, money market mutual funds, foreign bonds, stocks, funds, and pension plans. Foreign investment is in big demand for the younger generations. However, foreign currency is not generally accepted at shops and restaurants. The use of US dollars is only possible at some electric shops and cafés in the Tokyo metropolitan area.
Resource: Nikko Security firm - http://www.nikko.co.jp/index.html; Personal experience
12. BORDER CONTROL 4.5
The Japan Maritime Self-Defense Force uses helicopters, submarines, boats, and airplanes to maintain border control. The Japan Coast Guard also owns several types of airplanes, helicopters, and boats. The most recent concerns have been the abduction of Japanese citizens, shipping of illegal drugs, spies, and trial missile launches by North Korea. Other problems are illegal immigrants, mostly from China and South Korea, and the shipping of illegal drugs and guns from the U.S. and other countries. Security has been stricter recently, so a few camouflaged ships from North Korea were found. It is likely that in the future, more smugglers will be found.
Resource: Japan Maritime Self-Defense Force - http://www.jda.go.jp/JMSDF/; Japan Coast Guard - http://www.kaiho.mlit.go.jp/e/index_e.htm
13. CULTURAL, LANGUAGE HOMOGENEITY 5.0
Japan is a homogeneous country and its compulsory education to build up literacy is strict and good for everyone. The literacy rate is very high: 99.8 percent overall even though there are several local dialects.
Resource: Wikipedia - http://en.wikipedia.org/wiki/Literacy
14. POLITICAL EFFECTIVENESS 4.0
Internally, after Mr. Koizumi became the prime minister of Japan, he tried to implement his ideas aggressively even though some political parties opposed his ideas. This has slowed down his reforms. Internationally, Japan has paid enormous amounts of money to the U.N. Security Council, second only the U.S., and much more than any European country. However, even though Japan has recently been aggressively trying to become a permanent member of the U.N. Security Council, it has not been accepted. Locally, prefecture and city governments typically act slowly. However, response to natural disasters, especially the 1995 Kobe earthquake, is quick so the cities recover rapidly.
Resource: Nikkei Business News - http://www.nikkei.co.jp/; Prime Minister?s website - http://www.kantei.go.jp/
15. INSTITUTIONAL STABILITY 4.8
Major Japanese companies and schools are very conservative and rarely change. Founded in 1877, Tokyo University is the oldest public university. Keio University was founded in 1858, and was the first private university in Japan. There was a big and exclusive financial clique once called Zaibatsu; there were four Zaibatsu: Mitsui, Mitsubishi, Sumitomo, and Yasuda. They were exclusively all-family businesses. Before World War II, they were technically dissolved by the GHQ (General Headquarters); however, their names still exist today. Most institutions are passed down to the next generation. But these days, new schools and businesses are being created. At these newer institutions, there is a greater likelihood for change.
Resource: Tokyo University - http://www.u-tokyo.ac.jp/index_e.html; Keio University - http://www.keio.ac.jp/01/01.html; Wikipedia - http://en.wikipedia.org/wiki/Zaibatsu
16. HONEST GOVERNMENT 3.5
Under the current prime minister, Koizumi, the government has been honest to citizens. He has promoted wide-ranging structural reforms such as financial, taxation, regulatory, and expenditure reforms; and privatization of the postal service and public road companies. Now many senators agree that reduction of the number of civil servants is needed. There is a collision between parties over some issues; however, he is doing the reforms to try to create a better economy. Still, bribes are a part of political culture, which make citizens suspicious and less trusting.
Resource: Prime Minister?s website - http://www.kantei.go.jp/foreign/koizumispeech/2005/09/26shoshin_e.html
17. COMMON LAWS 4.5
Under the Article No. 14 of the Constitution, all citizens are equal and they are not politically, financially and socially discriminated in terms of race, belief, gender, or social status. Most citizens feel that judicial system is fair to all; however, the number of people who file lawsuits has been increasing due to influence from the U.S.
Resource: E-Gov Japanese constitution - http://law.e-gov.go.jp/
18. CENTRAL BANK 3.0
The Bank of Japan is a central bank, but unlike the U.S. Federal Reserve, there is only one branch in Japan. The bank?s mission is to maintain the Japanese economy and money supply. The major tasks are the issue and supply of bills; implementation of fiscal policies; management of commercial banks; management of treasury funds; and management and service of international financial trade.
Resource: Bank of Japan - http://www.boj.or.jp
19. DOMESTIC BUDGET MANAGEMENT 2.5
The general accounting budget for the year 2005 is 82.18 trillion yen, which is slightly below the budget for 2004, which was 82.11 trillion yen. Total expenditures were an all-time high of 89.3 trillion yen in 2000, and they have gradually decreased since then.
Resource: Ministry of Finance - http://www.mof.go.jp/english/budget/pamphlet/cjfc2005.pdf
20. GOVERNMENT DEBT 1.0
Government bond issues are 24.4 trillion yen and are 41.8 percent of total revenues. Government bonds outstanding have increased due to continuous bond issues in recent years. The total amount will be up to approximately 538 trillion yen, which is a heavy burden for future generations. In terms of the ratio of general government fiscal balance as a percentage of GDP in 2005, Japan is at the worst level among developed countries, -6.1 while the U.S. is -5.6 and Canada is 1.2.
Resource: Ministry of Finance - http://www.mof.go.jp/english/budget/pamphlet/cjfc2005.pdf
21. PRIVATE PROPERTY 5.0
The Japan Civil Code has been in effect since 1896, and now all private properties are legally bought and sold through real estate channels. No one can illegally buys or sells properties.
Resource: The Japanese Civil Code - http://www.ron.gr.jp/law/law/minpo_so.htm; Mizuho Real Estate - http://www.mizuho-sf.co.jp/
22. ECONOMIC STATISTICS 5.0
The Ministry of Economy, Trade and Industry; and the Economic and Social Research Institute offer statistics for business indicators every month. The Statistics Bureau & Statistical Research and Training Institute offers domestic statistics regarding population and consumers as well as world statistics. They are all accurate and are updated every month or every year.
Resource: Ministry of Economy, Trade and Industry - http://www.meti.go.jp/statistics/; Economic and Social Research Institute, Cabinet Office, Government of Japan - http://www.esri.cao.go.jp/
23. PROTECTION OF PUBLIC HEALTH AND SAFETY 4.8
Every city or town has a healthcare center to improve sanitation and prevent transmitted diseases such as HIV and tuberculosis. Required vaccinations and regular annual medical checkups at schools are provided for children free of charge. Seniors are able to receive medicine, medical examinations, and home care services. Genetically, Japanese people tend to contract Creutzfeldt-Jacob disease from mad cow disease so the Japanese government stopped importing beef and beef-related products from other parts of the world where mad cow disease has been found, such as Europe, Canada, and the U.S. Japan kept the ban on U.S. beef even though the U.S. strongly lobbied them to import U.S. beef and tried to impose restrictions on importation of Japanese-made products.
Resource: Ministry of Health, Labor, and Welfare - http://www.mhlw.go.jp/english/index.html
24. HIGH WAGE POLICY 4.0
Japanese GDP (purchasing power parity) was ranked 5th in the world and its GDP per capita was ranked 21st in the world in 2004. Its economy is gradually recovering from long recession. Most Japanese citizens are middle class and they usually have enough purchasing power to buy typical household items such as two TVs, a washing machine, a music player, and a computer per household. Demand for luxury-brand goods such as Louis Vuitton is always high. However, the middle class has recently been splitting into rich and poor like the U.S. in recent years, so expensive and cheap goods tend to sell better than traditional common goods.
Resource: CIA - http://www.cia.gov/cia/publications/factbook/rankorder/2001rank.html; Personal experience
25. ENVIRONMENTAL PROTECTION 4.0
Japan ratified the Kyoto Treaty to control and reduce emission of carbon dioxide by six percent. Japan is going to introduce environmental taxes, effective January 2007. The tax burden for each household will be 180 yen (US$1.50) per month. This tax will also apply for companies in the coal, fuel, natural gas, and gasoline industries. Moreover, the Ministry of Environment works on safety and protection of the environment because Japan, as one of developed countries, has a big negative impact on the earth. In the last ten years, extensive and strict recycling programs have been implemented.
Resource: Ministry of Environment - http://www.env.go.jp/
26. STRONG ARMY 4.0
After World War II, Japan declared never to go to the war again and to not possess nuclear weapons. The Japanese military no longer exists and Japan has a self-defense force to protect itself from natural disasters and other countries? attacks. The number of people in the Japanese self-defense force in 2002 was 239,900, which ranked 20th in the world. Defense spending was about US$371 billion, which ranked 5th in the world in 2002. Defense spending increases every year and is US$483 billion in 2005. Its burden per capita in 2002 was US$290, which was only one percent of the GDP.
Resource: Japan Defense Agency - http://www.jda.go.jp/; Published book 'World news' unexpected another side of the world?, 2005, Rom International
27. FOREIGN TRADE IMPACT 5.0
Since Japan is a small island and its resources are limited, it depends very much on importing goods. Japanese imports and exports hit another new record in 2004. The amount of exports was US$565 trillion, which was 20.3 percent more than 2003; that of imports was US$455 trillion, which was 19.3 percent more than 2003. The total amount of imports/exports was 19.8 percent more than 2004 and the trade surplus was US$110 trillion, which was US$220 billion more than 2004. Japan?s imports/exports with the U.S., EU, China, Asia NIES, ASEAN are at a surplus. 57 percent of its imports/exports were with East Asia, particularly China.
Resource: JETRO (Japanese External Trade Organization) - http://www.jetro.go.jp/
28. PROTECTION OF FOREIGN CURRENCY-EARNING ENTERPRISES 3.0
Japan does not have officially any protection against foreign competition.
Resource: Japan Customs - http://www.customs.go.jp/index_e.htm
29. MANAGEMENT OF FOREIGN CURRENCY BUDGET 2.0
Japan's official total reserve assets were up to US$842 billion as of October 2005 and they have tremendously increased since last year. Its assets consist of foreign currency reserves of US$823 billion; an IMF reserve position of US$443 billion; SDRs of US$260 billion; and gold of US$110 billion. These assets are sometimes used for the purpose of maintaining the foreign currency market. The total amount of import/export was 19.8 percent more than last year and the trade surplus was US$11 trillion, which is US$220 billion more than last year.
Resource: Ministry of Finance - http://www.mof.go.jp/english/
30. LAYERS OF COLLECTIVE ACTION 4.5
Elections for members of the Diet, governors, and mayors is democratic and directly selected by the people. Thus, each region has its own power instead of just central power. The voting rate unexpectedly increased this year because young people became more interested in politics.
Resource: Election system in Osaka - http://www.pref.osaka.jp/senkan/seido/seido.html
31. PRO-BUSINESS CLIMATE 3.5
Most Japanese companies were based on a lifetime employment and a seniority system until the Japanese bubble economy burst in 1990. Since then, many companies have given up these systems. Nowadays, some big companies have introduced 401k pension plans and some IT venture capital companies have become focused exclusively on profit without worrying about the employees. People used to have financial and employment guarantees if they had graduated from universities, but not anymore.
Instead of being regular businesspeople, some people tend to have focused skills and they want to be a specialist such as a chef, an accountant, or a dog trainer. Also, some people are likely to open their own business instead of being businesspeople at large corporations, especially during recessions. According to Kanto Bureau of Economy, Trade and Industry, the minimum capital requirement has been decreasing for venture capital companies since February 2002. The law was revised to assist developing businesses. People now get respect when they open their own business and become successful. On the other hand, they lose respect completely if they end up in bankruptcy.
Resource: Personal experience; Kanto Bureau of Economy, Trade and Industry - http://www.kanto.meti.go.jp/seisaku/sogyo/index_tokurei.html
32. GOVERNMENT ENTERPRISES 3.0
Most public companies such as Japan Rail, Japan Telephone, and Japan Tobacco Corporation were privatized in the 1980s. Recently, Prime Minister Koizumi has proposed privatization of the Japan Postal Service and four highway-related public corporations. The Japan Postal Service has offered several kinds of life and health insurance, and banking services in addition to regular postal service, and the Japanese government uses the money from them. That is a different from the United States Postal Service. The Diet has rejected this privatization bill before and Koizumi turned in this bill to the National Diet again in October 2005. If it is passed, the starting day would be October 2007.
The Promotion Committee for the Privatization of the four highway-related public corporations was established by law in order to review the situation. This is still an ongoing matter.
Resource: Cabinet's official website - http://www.cao.go.jp/disclosure.pdf; Prime Minister's official website - http://www.kantei.go.jp/foreign/m-magazine/backnumber/2005/0825.html; http://www.kantei.go.jp/foreign/policy/road/index_e.html; Nippon Keizai Newspaper - http://www.nikkei.co.jp
33. INTERNATIONAL SECURITY AGREEMENT 4.0
In September 1951 in San Francisco, the security treaty between Japan and the U.S. was signed for the purpose of contributing to the security of Japan and the maintenance of international peace and security in the Far East. According to the Japan-U.S. alliance, the U.S. protects Japan from foreign threats. For this purpose, U.S. forces have bases all over Japan and 75 percent of the forces are in the southern islands of Okinawa, which was given back to Japan from the U.S. in 1972.
Resource: Japan Self-Defense Agency - http://www.jda.go.jp/e/index_.htm; Okinawa prefecture - http://www.pref.okinawa.jp/english/index.html
34. PROTECTION OF DOMESTIC ENTERPRISES FROM GOVERNMENT-MANDATED COSTS 2.0
The basic income tax rate in Japan has four categories: 10 percent, 20 percent, 30 percent, and 37 percent depending on annual salary. For example, with an annual salary of more than US$150,000, the tax rate is 37 percent and the deduction is US$23,000. Compared to the U.S., taxes are higher; therefore, it is common for some professional athletes, celebrities, and business people to move to the U.S.
Resource: Personal experience; Tax Answer - http://www.taxanser.nta.go.jp/2260.htm; Ministry of Finance - http://www.mof.go.jp/english/tax/taxes2004e.htm
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