Mori’s halfhearted contrition couldn’t settle Japan’s stock market. Worried foreign fund managers fled the Tokyo Stock Exchange, triggering the biggest sell-off since Japan’s economic bubble burst in the early 1990s. On Friday the benchmark Nikkei average hit a 17-month low. As lawmakers convened to examine the scandal, confidence ratcheted lower when Mori named LDP octogenarian Hideyuki Aizawa, a World War II veteran and outspoken financial conservative, as the FRC’s fourth new chairman this year. “The commission is essentially hamstrung,” says Chris Calderwood, chief economist at Jardine Fleming Securities in Tokyo. “It’s hard, at age 81, for Mr. Aizawa not to be identified with the problem.”
The “problem,” experts lament, is the LDP’s innate tendency to dither on financial reforms needed to revitalize Japan’s economy. “To the extent that the situation is not an emergency, they pull back,” says a senior Western diplomat in Tokyo. “The risk is that they’ll kill the baby in the cradle.” Established in December 1998, the FRC is itself a child of crisis. It was created to monitor a $600 billion bank bailout enacted by the then Prime Minister Keizo Obuchi to stave off a full-blown financial collapse. In a few heady months, under founding chairman Hakuo Yanagisawa’s assertive leadership, the commission laid the groundwork for sale of the failed Long Term Credit Bank to foreign buyers and opened the door to Nasdaq Japan, a new market courting Silicon Valley-style technology companies.
Once Japan’s economy stabilized, however, party conservatives went back to their old ways. Obuchi dumped Yanagisawa and handed the FRC to Michio Ochi, a party stalwart who took a “doctor-like” approach aimed at saving, not shuttering, weak financial institutions. He postponed a plan to cap deposit guarantees, encouraging consumers to leave their money in tottering banks and credit unions. He also eased reserve requirements placed on regional banks. Then last February, Ochi was forced to quit after opposition lawmakers recorded him promising regional bankers “utmost consideration” when confronting “severe” bank inspections–comments that undermined his stature as an impartial regulator.
Ochi’s replacement, the fresh-faced, fiftysomething LDP lawmaker Sadakazu Tanigaki, took a strong reformist line ahead of June parliamentary elections. Yet after the LDP’s slender victory, Mori replaced him with Kuze, a senior member of a rival LDP faction. “The reshuffling was done the same old way: through seniority and factionalism,” says Hirotaka Otaki of the opposition Democratic Party of Japan. “The most serious problem that the LDP suffers is their belief that the government can control markets. They consider the FRC post light and unimportant.”
Aizawa’s appointment lends credence to such charges. A career Ministry of Finance bureaucrat who entered politics in 1976, he briefly headed Japan’s Economic Planning Agency in 1990, when closed markets, cozy bank-business ties and strict regulations still defined Tokyo’s financial world. That record, plus membership in the Committee to Reconsider Deregulation, an antireform group established inside the LDP last year, cast doubt on his resolve to deregulate banks, securities houses and insurance companies. “Mori probably intended to ride out his present difficulties by having an expert take charge of financial matters,” postulated the Asahi Shimbun’s lead editorial on Aug. 1. “Based on Aizawa’s record, however, we are concerned that, rather than seeing through his mission as head of the Financial Reconstruction Commission, he may turn back the clock.” Foreign fund managers, too, are worried. Which is why they’re on the sideline.
title: “Turning Back The Clock” ShowToc: true date: “2023-01-12” author: “Kayla Welch”
Some of the movies truly took us back to the 1960s. Julie Taymor’s batty Beatles musical “Across the Universe” tells an insipid love story, propelled by cover versions of the Fab Four’s hits, about a Liverpool lad named Jude (hey!) who falls in love with war-protesting American coed Lucy (Evan Rachel Wood). Far more fascinating is Todd Haynes’s playful, puzzling, wildly uneven “I’m Not There,” a fantasia on the slippery myth of Bob Dylan. Haynes casts six actors, including the astonishing Cate Blanchett, to represent both real and imaginary aspects of the icon.
Director Sean Penn’s gorgeous and disturbing road movie “Into the Wild,” based on Jon Krakauer’s nonfiction best seller, may be set in the ’90s, but its idealistic protagonist couldn’t be more ’60s in spirit: an affluent kid (Emile Hirsch) who gives away all his money and lights out for Alaska, with tragic results. Penn’s movie celebrates his rebellious spirit even as it gives you room to find him a self-important pain. The spirit of Terrence Malick (“Days of Heaven”) hovers over “The Assassination of Jesse James by the Coward Robert Ford,” a poetic reverie on the final years of the legendary outlaw, played by Pitt. Andrew Dominik’s uncompromising, ’70s-style Western turns its back on the fast-cutting style in current fashion. Equally indebted to the ’70s—think “The Parallax View”—is Tony Gilroy’s gripping anticorporate thriller “Michael Clayton,” with Clooney as a law-firm “fixer” risking his life to staunch a scandal. Coproducer Clooney, a huge fan of ’70s cinema, seems determined to revive the socially conscious genre movies of that era.
Watching these movies in Toronto felt like eavesdropping on a dialogue between two generations. There was a sense of directors’ trying to shed the cobwebs of convention that had overtaken Hollywood, seeking inspiration in the past to find a way to address the uneasy present. The rest—the glamour and the glitz—was just marketing.
