Posted on 09/27/2009 11:10:34 AM PDT by Orange1998
For over 50 years, one party ruled Japan virtually uninterrupted. During that time, Japan remained a loyal ally and supporter of U.S. policy. This month, a historic event took place.
Japan has new leadership. In a landslide victory, a new party has done the seemingly impossible. A new freshman class of leaders now governs the Land of the Rising Sun. The effects are already rippling across the Pacific toward America.
Yukio Hatoyama is Japan’s new leader. He officially took office last Wednesday, and he is already threatening to split with the United States.
Hatoyama blames America for the global economic crisis and says that the U.S. is responsible for “the destruction of human dignity.” He campaigned on protecting traditional Japanese economic activities and reducing U.S.-led globalization.
During the run-up to the election, Hatoyama’s finance minister told the bbc he was worried about the future value of the dollar, and that if his party were elected in the upcoming national elections, it would refuse to purchase any more U.S. treasuries unless they were denominated in Japanese yen.
Japan is the world’s second-largest economy. It is also America’s second-most-important creditor. The U.S. government owes Japan over $724 billion! The only nation America owes more money to is China ($800 billion). The U.S. also imports $140 billion worth of goods from Japan each year.
If Japan were to follow through with its threat to only lend in yen, the dollar would probably fall hard. What would that mean? America gets more expensive consumer goods, higher unemployment, and currency inflation. If other nations like China follow suit, we would be looking at a currency crisis—Zimbabwe-style.
The new government in Japan has also pledged to diversify its foreign currency reserves away from the dollar. This means that at some point, it will need to dramatically reduce how much money it lends to America. America is planning to borrow record amounts over the next couple of years, so something isn’t adding up here. Where will the money come from?
“The financial crisis has suggested to many that the era of U.S. unilateralism may come to an end,” Hatoyama wrote in an August 26 New York Times article titled “A New Path for Japan.” “It has also raised doubts about the permanence of the dollar as the key global currency.”
But Hatoyama isn’t just charting a separate economic course for Japan. His campaign also promised a more “independent” foreign policy from Washington, and closer relations with Japan’s Asian neighbors.
More alarming for American policymakers, Hatoyama has authorized a wide-ranging review of the U.S. military presence on Japanese soil. He is reexamining the agreement that permits U.S. warships to dock at Japanese ports, and has said Japan should take a second look at why it is spending billions to house and transfer U.S. troops between its islands. Hatoyama has also moved to quickly end Japan’s fueling support for the U.S. naval anti-terrorism efforts in Afghanistan and Pakistan.
On Wednesday, an even bigger torpedo hit. Both U.S. and Japanese officials confirmed that discussions were underway to remove all U.S. fighter aircraft from Japan.
So many alarm bells have been clanging in Washington that the Australian reports the U.S. administration has requested “immediate clarifying discussions” on just how far Japan wants to take the disengagement. But there may not be too much America can do if Japan is intent on reducing America’s presence in Japanese territory. Regarding the U.S.-Japan security relationship, Richard Armitage, former U.S. deputy secretary of state, said: “If the government of Japan asked us to change things, we’d argue, we’d kick and scream, but ultimately we’d have to do it.”
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No mention that the new rulers of Japan are leftists who will continue to bankrupt that country? They have already taken back many reforms, and promised more social spending.
The Obama admin proposed moving some of our air forces out of Japan in April.
One North Korean missile landing in downtown Tokyo should take care of that...
Did anybody ever find out the real deal on those bonds the Japanese fellows were sneaking in to Switzerland with? They were real, then they were fake, then it turns out one of the guys worked for the Japanese Treasury dept or somesuch, so they were probably real again... it just went round and round, and it never made any sense at all to me that they’d be smuggling fakes, because they would be just to easy to authenticate. If you were smuggling fakes, you’d smuggle them in to South Africa, not Switzerland!!
When it doesn’t work all over the dollar stays in power by default. It is true the course of empire is moving west from us but until it becomse the Empire of Freedom that we could again lead if we get rid of the Ci-cago gang. It ain’t over yet.
So we retreat back to our borders and Obama orders the drawdown in personnel. Greaaat! Nothing good will come of this and it will be difficult to recover from, no matter who is president in 2012.
I'm sure N Korea will love that.
If Japan needs to learn a lesson, let them.
As far as trade shifting from east/ west to north south on the worlds continents, that was already happening before this joker was elected in Japan, and that is our own doing.
Until our government learns that it MUST get spending under control and eliminate that national debt, we are going to remain in a weak trading position. We've over spent, and banks have over lent, and the rest of the world isn't going to carry the load anymore, because they have lost trust that the US government can protect their investment.
North Korea and China are soooooo happy. Japan without us to back them are are "sitting ducks"...
Being the world’s policeman fighting everywhere for a hundred years with no end in sight has not helped. Check out how this model worked for England where the sun now sets.
Yummy.
What’s so unusual about it?
One North Korean missile landing in downtown Tokyo should take care of that...
If I were Japan I’d announce work to begin on nuclear weapons and build up my conventional weapons stash. That should raise some eyebrows and it might force a rethinking by all the parties involved relating to Far East policies.
The Japanese are no dummies, and they are clearly seeing the obvious, and adjusting accordingly. America has so overspent and over-promised that there is no possible way it can either keep its promises or even meet its obligations. So then what happens?
Well, first of all, Japan has to get out of US Treasuries as soon as it can, even at a substantial loss, because the alternative is to lose all of that $750B. But this is actually a *minor* point. What is far more important is that the “Pax Americana” (the American peace in the world) is rapidly coming to an end.
The US military, with a collapsing US economy, will no longer be able to provide for much of the defense of the world. This means both Europe and Asia are going to be on their own, as things were before World War II.
This means that Japan is going to have to rebuild their military, and either diplomatically or militarily contend with China, Russia, and who knows who else. Neighbors who have been kept neighborly by the US suddenly find themselves without a policeman to keep the peace.
Of course, the US will not be completely out of the game, but it will no longer be able to provide support as much, or critically, as fast, as Japan will need.
“Anyone else notice the unusual change in the US/Yen lately.”
Yea - the Yen skyrocketed Friday, while the dollar was otherwise pretty mixed. It looks like the markets are taking him seriously. I don’t have a problem with him going it alone, and I really hope he does stop loaning us money...we need to stop handcuffing our productivity (i.e., no ANWR, yes Delta Smelt, no Nukes, yes solar-unless it takes up land in California, etc.) and the ONLY way we will be forced to live with our policies is if other nations stop giving their wealth to us.
I also hopes he builds some nukes, because they will soon be needed in his neighborhood - and Obama is joke when it comes to looking out for our allies.
And those places where Britain ruled still show benefits. India for example. There would be no massive democracy in that Asian region to counter China had it not been for Britain.
“A North Korean missile landing in downtown Tokyo might prompt a letter of protest from Obama and little else.”
Hey DUMMY, that would be a UNILATERAL ACTION. We don’t do that anymore. Rather it would be the introduction of a resolution in the United Nations to state disapproval...and if it passes, boy will that teach them a lesson.
Yes. The yen is getting stronger vs. the dollar, and it about to break some longer-term technical levels which might lead to a surge in yen strength by forex traders.
Whatever you might think of the new ruling party in Japan, the previous party has worn out its welcome and has produced no lasting economic improvement for the Japanese people since their market imploded 17 to 18 years ago. It has been nothing but one scheme after another, followed by one excuse why the scheme didn’t work, after another.
After their export-based economy has taken hits every bit as bad as the 1930’s in the last year, the people are furious and they want someone who is going to do something different than the status quo.
Nonsense. Fighting for and establishing freedom in the world is our duty, and a right of people of this world. It isn't being the worlds policeman.
If you are suggesting that we shouldn't have stop the Japanese Imperial army, and their enslavement of millions of people all along the pacific Asian coast and Islands, you haven't a clue about world history, and what the world would look like today if we didn't fight these fights.
A free world is also a more prosperous world. We are seeing prosperity diminish in this world partly because liberty and freedom are diminishing in this world.
If you think we can sit on this continent with our heads in the sand and mind our own business, that the world will be just as well off without us, and that they will leave us alone, you are dead wrong.
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