Japan Ex-PM Miyazawa Dies at 87

Reviewed by Takahiro MIYAO

Article:
Japan Ex-PM Miyazawa Dies at 87
CNN.com (6/28/2007)
http://edition.cnn.com/2007/WORLD/asiapcf/
06/28/japan.miyazawa.reut/

Comments:

Former Prime Minister Kiichi Miyazawa died on Thursday at the age of 87. In the western media, he is characterized as one of the important leaders in postwar Japan with close personal ties with the U.S. Actually, many observers sarcastically said that his English was clearer and more comprehensible than his Japanese.

He became Prime Minister in November 1991, when Japan's "lost decade" started and the economy turned downward rather sharply. As a former Finance Minister and an economic expert, Mr. Miyazawa was among the few who already noticed the seriousness of the bad loan problem caused by asset deflation in its early stage and, therefore, lifted the government regulation on real estate financing, which was instituted in April, 1990. He also contemplated a possible use of public funds to bail out major banks, but could not propose such a measure at that time, because of strong public resistance and rejection to any such seemingly favorable treatment for financial institutions, which then were considered too profitable due to the land boom in the late 1980s. In any case, he had to resign as prime minister in August, 1993, without doing much to prevent the subsequent decline of the Japanese economy, as the LDP lost its majority and the era of political turmoil started.

One might wonder what would have happened to the Japanese economy if he had somehow kept his premiership beyond 1993. Possibly he might have applied drastic policy measures to help solve the bad loan problem and curb asset deflation long before such measured were actually adopted in the late 1990. Unfortunately, there is no "if" in history, and now Mr. Miyazawa is gone, leaving the Japanese economy still in an uncertain position regarding future growth and deflation.

Acknowledgment:
This review is adopted from the following blog (with its Japanese translation):
http://glocom.blog59.fc2.com/blog-date-20070629.html