Steamrollers, nuts and odd-shaped balls

For some weeks I've been scouring the news for an analogy- some incident or statement that perfectly encapsulates the self-destructive absurdity of Japan in 2007. I wanted something that neatly demonstrates the new national logic: "Nuts need cracking! Summon the ministerial steamroller!"

I was hoping for something spectacular: maybe a bureaucrat deciding to abolish Wednesdays or perhaps  the Bank of Japan replacing the monetary policy committee with a team of Daleks reprogrammed to scream "Up-the-rate! Up-the-rate!".

But in the event, the analogy has come from the hallowed halls of academe. Of course, when I say "hallowed", I mean "shallow". When I say "halls", I mean "balls". And when I say "academe", I mean Kanto University.

So here, in a nutshell, is the story. Kanto University has an elite rugby team which, more or less, wins everything. It's the Manchester United of university rugby: annoying, rich, and run by a ruddy-cheeked tyrant. Two of its naughty players were arrested for growing a few sprigs of marijuana. The authorities considered their options and...the entire 200-man squad has been told it cannot play for the rest of the season. 

Apparently, says the rugger correspondent for the Daily Yomiuri, Kanto was offered a choice by the Japan East Rugby Union - sack the coach, or keep him on and sit the remaining five months of the season out. So of course - this being Japan in self-destruction mode - the whole team takes an early bath.

The schedule for the whole University rugby season has accordingly been abominated and plenty of good, drug-free players who should rightfully be running around on the pitch are not doing so. In the same way that plenty of people who should be borrowing money from consumer lenders or building houses are not doing so because some legislative insanity has mashed that little dream into oblivion. It is a microcosm, but what we might call the "rugby industry" of Kanto Uni has crumpled under the same sort of blow from on high that has also left the housing market and consumer finance industry on their knees. 

It's such classic Japanese stuff. Obliterate the macro to deal with the micro.

And yet, who is actually to blame? In this case, the rugby authorities have done their usual steamroller/nutcracker switcheroo because that is what Japanese bodies of authority do. The Japan Rugby Union is simply too blunt an instrument to deal with a couple of kids growing wacky baccy. Similarly, the Japanese state simply does not have the delicacy of weaponry for the kind of battles it is called upon to fight by a nation desperate for top-down instruction. The coach, inflated with myth of his own success, has not even entertained the notion that he should leave, which ultimately puts the wrong institutions in charge of sorting out the day-to-day discipline of the university rugby team.

And it is precisely this dynamic that is eating the Japanese corporate world alive. Government, legislation, and knee-jerk regulatory changes are simply too crude a toolkit for dealing with the tsunami of problems - major and minor - thrown out by the day-to-day workings of Japan Inc. Thus drastically market-illiterate district courts end up deciding what offers shareholders should be allowed to consider [Steel Partners/Bulldog]. Government ends up attempting the equivalent of laser eye-surgery with a chainsaw and a croquet mallet [Aneha Quake-proofing scandal]. And everyone ends up blinded.

But it is all too easy - and Urban Dirt has stumbled into this punji-pit before - to see the government as the sole source of the problem.  It is, I now realise, an unhappy bit player. The real crime lies with Japan Inc itself and the total lack of willingness to self-regulate. So government steps in where governance is lacking.

What should be happening when trouble arises is that a board - preferably with some outside directors - has a debate on whether the company is competently run. If some decide that it is not, they should be able to suggest changes in management.  Yes, of course there should be fines and punishments for companies that act illegally, but that aspect of Japanese legislation has never really been at fault.

The true horror lies with this statistic - that only 1% of listed Japanese companies have a committee-style corporate governance system. Only 40% even have a single outside director - and that figure is entirely deceptive because in most cases, he is just a retired ex-president of the company. Oh, and we're not talking about penny-stocks here - Toyota and Canon have no outside directors.

So because that mechanism of internal checks and balances consistently fails to function as it might elsewhere, the government feels obliged to respond to the smallest trouble with an eye-watering array of legislative and regulatory weapons.

Thus a minor accident caused by a small bump in a road may be dealt with as follows: 1) Order every  automaker to improve the suspension on all vehicles or risk heavy fines and possible business suspension 2) Impose draconian restrictions on road construction workers, requiring everyone to sit 12 days of "bump awareness" examinations and 3) Ban all road construction in Japan until parts 1) and 2) have been completed to the satisfaction of a government inspector* 4) Order all foreigners to re-take a Japanese driving test, so that they are aware of Japan's unique bump-in-road conditions 5) halt all credit financing on new car sales because more cars might increase the overall number of accidents involving bumps in the road.

*government inspector numbers will NOT be increased to cope with the additional duties arising from conditions 1) to 5).

Comments

[Gilbert Murray]

Suppose the workers in the Companies had some say. A real say. Would that ameliorate the situation? Presumably you don't intend to specify a genetic flaw in Japanese people.?