Japan's Prime Minister Has Unenviable Task

Sun (Auckland), Volume I, Issue 170, 8 October 1927, Page 26 (Supplement)

Japan's Prime Minister Has Unenviable Task

!E Cabinet formed by Baron Tanaka this year has had a stormy existence. For one thing, is has had to make decisions practically re-

versing the policy in China of its predecessors; and has had to accommodate its views to those entrusted to the Japanese delegates who went to the Limitation of Armaments Conferences at Geneva. Both these developed into crises, and called for all the calm steadiness for which the elder statesmen are famous.

But greater far than foreign difficulties has been the necessity for economic reconstruction at home. Japan, just as it was the last of the great nations to feel the effects of the war, has been the iast to pay the piper for post-armistice prosperity. But Japan is also paying for the earthquake of 1923 as well, which broke in its wake unrealisable bank credits that were never liquidated. As usual after a widespread destruction of credit, Japanese banks and business concerns are now forced to write down their questionable assets to what they are really worth. The country will no doubt emerge strong and more efficient after these painful months of house-cleaning, but we all know that depression and dullness follow such periods of adjustment; for this country, France and Germany are still suffering from such a commercial calm. We have paid the price of inflation. Even the United States in 1920 and 1921 had its dose of corrective medicine. Japan had a slight readjustment in 1920, but it was evidently mild and

insufficient. Its industrial machinery was expanded tremendously during the war, and, as in most countries, many industries after the conflict were over-equipped for peace-time marmets. The anti-Japanese boycott in 1920 had seriously damaged the Chinese market. The Government was carrying on its business by

means of subsidies when the devastating earthquake came. On top of all this came the present disturbances in China, which have seriously crippled Japanese trade. The new Government seems aware of the unsoundness of perpetually beclouding the true economic situation

by the patent medicine relief of government subsidies. Endoubtedly, although the corrective dose is si stringent one, Japan will be better ofwhen the present: financial fever has run Its course.