Turning Pessimism into Confidence: Containing Mad Cow Disease

John de Boer (University of Tokyo)

Despite all eyes seemingly fixed on the looming war on terrorism, domestic concerns within Japan have not gone unnoticed. A recent survey conducted by the Nihon Keizai newspaper found that 92 per cent of Japanese are pessimistic about the future of the economy with many workers fearful for their jobs. This eclipsed the previous record of October 1998 following the banking crisis that led to the nationalization of the Long Term Credit Bank of Japan.

As the Koizumi government and various ministries frantically maneuvered to try and restore public and consumer confidence, it was announced this week that Mad Cow Disease had been confirmed in Japan. Both the government and venders of beef products rushed to assure the general public that things were under control and that products on the market were safe. However, consumer moods remain skeptical and most are concerned about how deep this crisis will penetrate.

The immediate effect of the confirmed case of bovine spongiform encephalopathy, or B.S.E. was a 20 per cent decline in beef prices. Also 2,000 schools withdrew beef from their lunch menu, more will likely follow. Venders have tried to instill calm and restore confidence by declaring the source of origin of all beef products. McDonald's, that has 3,700 outlets in Japan, prominently posted signs claiming that all of its beef came from Australia. Meat packing companies followed suit labeling their beef as either imported from Australia or the United States, two nations deemed free of the disease. Although the world famous Kobe beef is not believed to be at risk, global bans have been placed on beef imports from Japan no doubt severely affecting sales.

The fact is that nobody knows how many cows could be infected. The Yomiuri newspaper says as many as 2,000 could have contracted the disease. According to newspaper reports 145 tons of bone meal, that could have been contaminated by the cow that tested positive for BSE in Shiroi Chiba, has to be tracked down. The Agriculture, Forestry and Fisheries Ministry (MAFF) announced a $25 million project to test one million cows. Some say that this is too little too late. James Brooke of the New York Times reported that this same ministry lowered the nation's guard to the problem by suppressing a European Commission report last summer that concluded that the disease could develop in Japan. The ministry objected to a rating of 3 for Japan on a scale of 5, with countries already infected rated 4 and 5. At the time, the Agriculture Ministry defended the decision to play down the report, saying officials were concerned that the announcement of an incorrect evaluation would cause unnecessary public alarm. We now know that such an alarm may have been necessary.

A considerable amount of confusion on the part of Agriculture officials has contributed to the no-beef reaction on the part of consumers. The MAFF first announced that the BSE-suspect cow had been destroyed but later retracted its statement saying that the cow's body had been ground into meat and bone meal. Nationwide criticism over the lax safety measures on farms prompted Agriculture Minister Tsutomu Takebe to apologize Saturday. Takebe told reporters that the ministry had failed to issue precautionary directives to dairy farmers.

Although the United Kingdom has experienced devastation as a result of Mad Cow Disease, many other European countries such as Spain and France have managed to control outbreaks at an early stage and restore consumer confidence in the beef industry relatively quickly. Before the situation gets any worse in Japan, the government, business leaders and farmers must form an effective crisis management task force that will not only determine the exact source and extent of the disease but also instills public confidence in the measures that they take. The likelihood of someone contracting the fatal human variant of BSE, the Creutzfeldt-Jakob disease, is extremely low. However, the economic and psychological impact that this potential threat can create is enormous. Pessimism in Japan is already widespread, making it all the more imperative for Japan's leaders to implement effective and rapid reactionary measures that will transform Japanese pessimism into confidence.

Articles:

• "Job fears hit eight in 10 Japanese," Singapore Straits Times, September 26, 2001
• James Brooke, "Mad Cow Disease Sets Off a Scare in Japan" The New York Times, September 27, 2001
• "Officials scramble to find last 4 BSE-suspect cows," The Asahi Shimbun, September 24, 2001
• "Feed for Thought: The meat of mad cow issue," The Asahi Shimbun, September 26, 2001
• "Mad Cow Case Is Confirmed in Japan," Los Angeles Times, September 26, 2001