Friday, January 6, 2012

Will Japan's Children Be Sacrificed to (Try to) Save its Economy

Asahi: "Parents raise concerns about radiation in Nikko"

[paraphrasing] Nikko is a common destination for Japanese children's field trips. Japanese parents are concerned that their children will be exposed to unacceptable levels of radiation in Nikko:

[Excerpt] "According to the science ministry's radiation map created in August, some areas of Nikko showed 100,000 to 300,000 becquerels of radioactive cesium per square meter in the topsoil."

The Nikko mayor, fearing a collapse in tourism, assures Japanese citizens that their city is safe.

Majia here: This is a tragic situation. Japanese city officials are trying to save their city from economic collapse while Japanese parents are trying to minimize risk to their children's health.

I think this story points to an ominous development in Japan's economy.

Buried in the Wall Street Journal today is an article with the headline: "Japanese Banks Get 'Stress Tests'" 1/6/2012 p. C3

The article explains that the IMF is conducting stress tests to see how vulnerable they are "to a potential drop in the value of their huge holdings of Japanese government bonds...The move could sharpen investors' focus on the risk to Japan's economy from its ballooning debt."

 I believe this audit must be understood in the context of the earthquake, tsunami, and Fukushima radiation damage, although the article makes no mention of these calamities. 

Japan's government debt-level was high before the disasters. Now with the clean-up and rebuilding, the nation is assuming considerably more debt; simultaneously, the value of assets and exports is in question.

Collapses in tourism and in exports because of radiation contamination together will further compromise Japan's reeling economy.

I have reported recently on the financial exodus of Japanese corporations.

The country is in trouble and for this reason (perhaps more than any other), the Japanese government officials insist, smiling, that there is "no risk, no danger"....

Sacrificing children to save an economy is a false, and ultimately self-defeating, bargain.

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