Cablegate: Tokyo Media Reaction - Financial Crisis

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SIPDIS

STATE FOR I/RF, PA/PR/FPC/W, IIP/G/EA, EAP/PD, R/MR,
EAP/J, EAP/P, PM;
USTR FOR PUBLIC AFFAIRS OFFICE;
TREASURY FOR OASIA/IMI;
SECDEF FOR OASD/PA;
CP BUTLER OKINAWA FOR AREA FIELD OFFICE;
PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR

E.O. 12958: N/A
TAGS: OIIP KMDR KPAO JA
SUBJECT: TOKYO MEDIA REACTION - FINANCIAL CRISIS

1. LEAD STORIES: Top stories on Monday morning included
a plan by the Japanese government to inject up to 10
trillion yen in public funds into domestic financial
institutions as part of its emergency market-support
measures.

2. "Establish Economic System That Can Control Market"
An editorial writer for the liberal Mainichi insisted
(10/27): "...Only a year and half ago, G7 financial
ministers and central bank governors hailed the world
economy as being in its best shape in decades. Economic
theory based on neoliberalism supported such
optimism.... The idea of 'small government,' which
advocates deregulation and privatization, was pioneered
by the Thatcher administration in the UK and the Reagan
administration in the U.S. and became widespread in the
1990s. However, as the housing bubble burst in the
U.S., the defects of an economic system that took pride
in an unregulated market have become clear. We may need
to implement ad hoc measures for the time being to
prevent the current financial and economic crises from
developing into a worldwide panic. An emergency summit
is one of those measures. However, those steps are only
stopgap measures. What kind of economy we create is
important. Specifically, a shift to an economic system
that can control reckless moves by the market is
important."

SCHIEFFER

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