JAPAN TO-DAY

Press, Volume LXXXIII, Issue 25272, 26 August 1947, Page 7

JAPAN TO-DAY

“HAPLESS COALITION GOVERNMENT”

EXTENT OF RECOVERY (By Dennis Warner, N.Z.P.A.-heuter Correspondent.) T . TOKYO, Aug. 24. It is for the Canberra conference on the Japanese treaty and the conferences that follow to determine what is and shall be to-morrow. The dangers are obvious. What the peacemakers must determine is where justice ends and foolhardiness begins. Japan is governed to-day by a coalition of three parties, Social Democrats, People’s Co-operatives, and Democrats; it is led by a shy Socialist, Tetsu Katayama, and the suave Hitoshi Ashida, Deputy-Prime Minister and Foreign Minister, whose diplomatic training, manner, and polish are in marked contrast to the nervous diffidence of his leader. In opposition, pouncing on the Goverment’s difficulties and errors, is the Liberal Party (Conservative), with Shigeru Yoshida, the former post-war Prime Minister, as its leader. For the moment the Liberals are content to watch the hapless coalition ploughing into a maelstrom of economic difficulties. Any attempt to usurp power before the peace treaty would be a cardinal error. The Liberals know they are regarded as the “Old Gang,” and that responsibility in these difficult days would be disadvantageous to their own cause in Japan.

No one could envy Katayama his position. Almost without previous political experience and certainly without administrative knowledge and background, he has an economic crisis on his hands incomparably worse than that now confronting the British Labour Goverment. A combination of circumstances by the end of the war had reduced Japanese industry to a state of helpless inertia. All civilian production had been discontinued to meet the needs of the armed forces, the Superfortress raids had destroyed nearly all Japan’s famous backyard factories and had blasted the economic triangle—Tokyo, Nagoya, Osaka—into a vast junk heap. Because of the war urgency, those factories and plants that remained had received little maintenance since 1941. There was no international trade upon which industry might hope to revive. Nor were there any foreign credits to build the shattered plants. Finally, over all this depression, hung the threat of reparations and reduction of whatever industry remained. But the Japanese are tireless, if slow workers. Like ants, they crawled out of the holes they used for homes in their devastated cities and began to rebuild. The result to-day is fantastic. You may live in Tokyo, as I do, and rarely notice war damage. Osaka, once completely devastated, will be a thriving centre of private trade. Hiroshima proper, where once you could count only 13 buildings still standing, is now a hustling, bustling frontier town.

“Facade of Recovery” All this is largely front, of course. The houses and shops are flimsy shanties. The whole facade of recovery is largely a myth. Stalls along the Kinza (Tokyo’s broad main street) are filled with watches, cameras, and china but nearly all of it is gimcrack stuff that no country to-day can afford to buy. And with the development of synthetics, the bottom is fast dropping out of the silk market. The reopening of private trade will help, but there will be many disillusioned foreign traders in Japan in the next few months. . The Zaibatsu, the old capitalistic clique, whose wealth was spread by a directive of General MacArthur, has virtually vanished from the industrial scene. Its place has been taken by the new ven millionaires, whose source of income is the movie theatre, the striptease show, the taxi dance hall and the beer garden, and by black marketeers who control rice, wheat, fish and salt in a land staving off starvation only because of the interest of the United States. The Japanese cjaim that recovery will be impossible without foreign credits and a relaxation of some of the terms of the Potsdam declaration. By foreign credits they mean dollars. Already the occupation has cost the

United States a fabulous sum. Even black marketeering by American troops before the introduction of military scrip is estimated to have involved the United States Treasury in a loss of some 60,000,000 dollars. Congress may not feel over-enthusiastic at the prospect of financing a former enemy when many Allies are still in distress. For the moment at least, there is Japanese readiness to support the United States. If General MacArthur wanted 1,000,000 Japanese to fight Russia and called for volunteers he would get them in a day, a former Japanese naval officer told me. It will be interesting to watch the peacemakers and their reactions to: (1) the international situation as it affects Japan; (2) to the realities of Japan’s internal situation. i