Click here for Full Issue of EIR Volume 22, Number 20, May 12, 1995 Great Britain's six-year destabilization of Japan by Kathy Wolfe The chronology that follows demonstrates that for the past a Sept. 20, 1989 speech to the Losi Angeles World Affairs six years, British intelligence, officials of the Bush adminis­ Council: The "end of the cold wrut," Webster announced, tration, and the London and Wall Street financial elite have means that Japan and Germany, n�t Russia, are the main carried out a campaign to destroy Japan as a sovereign indus­ threat. "The national security impli4ations of a competitor's trial nation. The weapon has been a ridiculous number of ability to create, capture, or controllnarketsof the future are petty financial scandals, which have brought down six elect­ very significant." , ed governmentsin rapid succession. This is partof the picture of Briti,h global attacks on U. S. The endless scandals are "all very dangerous for Japan," foreign policy in Asia and elsewhe�, which begins to shed a top Tokyo source told EIR during the 1992 Sagawa Kyubin light on the "coincidence" of so many recent atrocities in tiff. "This could be like Watergate, a way for the Anglo­ Tokyo, from the March 20 sarin ga� attack, to assassination American establishment to try to force their ideas of change attempts and threats against National Police Agency Chief on Japan. You should remember the Tanaka case [the 1976 Takaji Kunimatsu, intelligence chi�f Yukihide Inoue, and Lockheed scandal]; the Takeshita case [the 1989 Recruit Prime Minister Tomiichi Murayam�. scandal] is the same. Now the Sagawa scandal is like Wa­ tergate," for Japan's governing circles. Inducing 'financial AIDS' The scandals, not coincidentally, have been coupled with While much of Japan's strengthlis behind the curtain, in repeated demands from London and New York for the whole­ its powerful unelected ministries such as the Finance and sale financial and industrial deregulation of Japan's econo­ Foreign ministries, the chaos has be¢n such as to cripple their my. Along with this, the Thatcher-Bush group has demanded opposition to banking deregulatioQ. It has also paralyzed that Japan join the U.N . 's "new world order" in police actions Japan's development diplomacy. 1lte result is that Japan's against developing nations such as North Korea, China, and banking system is now bankrupt, its jindustrial companies are Iraq, rather than assisting these nations economically. illiquid, and it has failed to create "*jorexport development Seen from the standpoint of London's policy since the projects in the Third World. Japan �us remains hopelessly 1840s Opium Wars, today's British strategy is quite clear. dependent on exports to the crumbliQg U. S. and British econ­ Japan, as one of the only nations in Asia to have industrial­ omies. ized, is a symbol to the developing sector. Worse, in Lon­ The real financial crisis in Tokyo dates from the Hong­ don's view, from the 1970s, a faction in Japan developed kong and Shanghai Bank-sponsored, Nomura scandal, which which was committed to mobilizing Japan's economic destroyed Finance Minister Ryutaro Hashimoto, who repre­ strength to industrializing these nations, something London sented the faction in the ministries opposed to what he called could not permit. Wall Street's "financial AIDS." At �e Sept. 25, 1990 meet­ The chronology shows, for example, that each time a ing of the International Monetary fund in Bangkok, Thai­ Japanese leader makes a peace overture to North Korea, land, Hashimoto proposed an overhaul of the world monetary he is attacked. Any Japanese government that attempts to system, "to explore a more stabl� monetary system, that establish a positive policy for the integration and industrial­ solidly substantiates a spirit of coo�ration." A Finance Min­ ization of China-as opposed to the British geopoliticalpoli­ istry official said this meant a "reference range" target zone, cy of dismembering China-is promptly attacked. within which the rates for the dollar, !the yen, and the Europe­ This attack upon Japan is a British policy, and not an an currencies would be fixed. American policy, as President Clinton's efforts to reverse Because of the 1991 Nomura sqandal, however, Hashi­ Bush's confrontation prove. It was introduced by the circles moto and the Finance Ministry c�e under heavy attack associated with George Bush, beginning during the second and finally gave in to allowing broad deregulation, opening Ronald Reagan administration, and escalating during the Tokyo to trade in foreign financial �rivatives, which mush­ Bush years. It became official Bush policy when presented roomed. by Bush Director of Central Intelligence William Webster in Most damaging to Japan' s econ�my was abolition by the EIR May 12, 1995 Special Report 63 © 1995 EIR News Service Inc. All Rights Reserved. Reproduction in whole or in part without permission strictly prohibited. Bank of Japan of its central bank "window guidance." Under source told EIR. this credit policy, Japan since the 1870s had followed U.S. The previous Hata goverment, dominated by Kissinger's Treasury Secretary Alexander Hamilton's policy of issuing friend Ozawa, who has used thelscandals to destroy the ruling directed credit by government lending to banks, based on a LDP, was trying to push Japan into "the Brent Scowcroft judgmental evaluation of how productive the loan would be doctrine" in Korea, the source s�id. In a June 15, 1994 Wash­ to the overall increase in new technologies to be generated in ington Post editorial, Bush Na�onal Security Adviser Brent the physical economy. As a result of this sound and truly Scowcroft called for a preemptive bombing of Pyongyang. "American System" Hamiltonian policy, Japan had intro­ Ozawa, the source said, was urging President Clinton to duced increasingly more productive technologies, and the bomb "whoever does not submit" to the U.N.' s NuclearNon­ Japanese government had never run a deficitnor a significant Proliferation Treaty (NPT), pr6mising that Japan would join national debt. with U.N troops to help police Asia. Ozawa was "continually After enormous pressure from the Bush Treasury Depart­ receiving privileged information on North Korea" from ment and the London-controlled internationalfinancial press, Scowcroft, Bush CIA head Robert Gates, and "friends." Japan shifted to U.S. Federal Reserve-style "open market" Murayama's Socialists, hqwever, left the Hata-Ozawa operations, issuance of money via government borrowing. government in opposition to war with North Korea. Now, This allowed Japanese banks to go into the wild "financial the Murayama-LDP coalition i$ a "sea change" for Japan, he AID S" type of activities being generated in London and Wall said. "President Clinton will find Murayama very useful in Street, and into related categories of real estate speculation. dealing with North Korea. MI1. Murayama has had ties in The effect on Japanese industry, in particular, was to Pyongyang for years, and he apd his friends can help Clin­ make impossible the previously planned strategy of long­ ton." LDP coalition members iled by Vice Prime Minister term, low-interest investment in large-scale infrastructure and Foreign Minister Yohei Kpno, chief of the LDP, also construction and investment programs in the developing na­ want to avoid war in Korea. 4'We will aim to resolve the tions, such as the original form of the 1970s Mitsubishi Re­ dispute over North Korea through peaceful dialogue, and try search Institute's Global Infrastructure Fund. Such programs to avoid sanctions," Kono sai� on June 30, 1994. LDP Fi­ could have prevented Japan from becoming the untenable, nance Minister Masayoshi Takemura, who met the late North financiallyoriented, trading company economy it is today. Korean leader Kim II-sung, has also come out against sanc­ Especially nasty in the scandal process has been the inside tions or military actions agains� Pyongyang. role of Henry Kissinger's close friend, Japanese parliamen­ Kono, Takemura, and Murayama also oppose deploy­ tarian Ichiro Ozawa. "Ozawa and [former Prime Minister ment of Japanese troops into U.N. war zones, a policywhich Tsutomu] Hata are very close to the American establish­ Ozawa was using the Korean crisis to attempt to push ment," a top Tokyo intelligence source told EIR. "They are through. trying to make a reform of the Japanese political system Clinton is also committed to developing the economy of which will make their friends in Washington, such as Kis­ China and other Asian nationsi. U.S.-Japan cooperation on singer, happy. Ozawa knows Kissinger well. Ozawa wants that, too, is not ruled out. The British could never tolerate to break up the LDP. Hata is also a very influential member either the United States or Japan having such a policy; they of the Aspen Institute, very close to the American establish­ will stop at nothing to destroy iany alliance of the U.S. and ment. If you trace the movement of the OzawalHata group, Japan to do this. you will find it is strongly supported by the Bush estab­ lishment." 1988, Recruit scandal Sea-change in Tokyo Japan, however, as of 1995, has not been broken, but is June: Recruit scandal against Prime Minister Noboru working to form a new alliance with U.S. President Bill Takeshita. New York Times anj:l Japan's liberal Asahi News Clinton. This is focused on cooperation in rebuilding North reveal that shares of Recruit Cosmos Co. were sold to leading Korea's economy, based on peaceful nuclear electricity Japanese at bargain prices, priqr to being listed. plants. Japanese leaders traveled to Pyongyang in April to July: Recruit Chairman Hiromasa Ezoe and Nikkei (Ja­ help Clinton's negotiations, and Prime Minister Murayama pan Economic Journal) President Ko Morita resign.