The banks limp along, meantime, just this side of a crisis.
We're now invited to watch as the Resolution and Collection Corp, the government's loan-salvaging agency, increases its role. We'll have to see where this leads, but on the banking question an important distinction must be made. It has to do with ownership.
The parallel debt problems in the public sector, detailed in recent columns, are Finance Ministry property. There's no way the bureaucrats in those square blocks of glass and concrete that rise in Kasumigaseki, Tokyo's administrative quarter, can avoid responsibility for this mess.
Non-performing loans in the banking sector, by contrast, are viewed as the banks' problem. Hence the signals we've long received from the government: This one isn't our fault. We'll step in, but only after all else has failed.
A century and some ago, when Japan began modernizing, all manner of slogans arose to capture the mood of the times.
"Civilization and enlightenment," signifying the desire to open up to Western influences, was the most prominent. "Rich nation, strong army" was another that came along, and we know where that sentiment eventually led.
Back in the 1980s, "internationalization" was the theme.
Now "reform" and its variants -- "restructuring" is popular, as is "structural reform" -- are the slogans of the day. They mean different things to different people, and like the heraldic phrases of earlier eras, from the mouths of some people, they don't mean much of anything.
I take the "R" word seriously in Japan, but I also take the growing recognition that reform will be a long time coming as the important new story. Richard Katz, a skillful Japan analyst and senior editor of the Oriental Economist, forecast a strong recovery in a speech at the Foreign Correspondents' Club last week -- and named all the reasons Japan will require 10 years to achieve it.
Koizumi's time may now be short. But I'm not sure it matters much. What matters is the process set in motion even before he came along. Our habit of watching the rise and fall of individual politicians will probably not be applicable in Japan for some years to come, until there are more young people such as the new mayor of Yokohama in place.
Jun-san will be long gone, certainly, by the time Katz's forecast can be judged. I can't think now what place he will occupy at that point in the long story of reform in Japan. He may not warrant more than a few paragraphs.
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