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Thursday, June 30, 2011
Hope and reconstruction
After two and a half months of deliberation, the Reconstruction Design Council on June 25 submitted to Prime Minister Naoto Kan a set of proposals for the reconstruction of the Tohoku-Pacific coastal region, which was devastated by the March 11 earthquake and tsunami, and Fukushima Prefecture, which is suffering from the crisis at the Fukushima No. 1 nuclear power plant.
The time has come for the government, which has been slow to respond to the disasters, to push reconstruction at full speed.
Mr. Kan and his Cabinet members and aides must make strenuous efforts to put the reconstruction on a smooth path: flesh out the council's proposals by working out the details of bills needed to implement them, and writing second and third fiscal 2011 supplementary budgets to pay for the effort.
In its proposals, the council presents a basic approach of "disaster reduction," in place of the traditional approach of completely containing major natural disasters.
In addition to building "hardware," such as embankments and sea walls, the new approach pushes "software," such as an emphasis on evacuating people to safe zones once a calamity strikes and restrictions on the construction of buildings in areas likely to be hit by disasters. Given the experience of March 11, the new approach seems reasonable.
The central and local governments must adjust to this new approach to disaster planning when adopting policies and budgets.
As a principle for reconstruction, the council stresses that municipalities and residents should play leading roles in reconstruction planning and that the central government should support them. This is a reasonable approach, too, but it is easier said than done.
It is very likely that opinions within municipalities are divided over designs of their future communities. The reconstruction efforts will offer local governments and residents a chance to learn anew the democratic process for finding the best solutions.
The council proposes creating "special zones" in selected devastated areas to revitalize local industries through such means as tax privileges and deregulation. The central government should determine local needs and devise the best solutions for each zone.
The central and local governments should refrain from imposing their ideas on special zones on local residents and industries. In fact, fishing cooperatives have expressed opposition to the idea of allowing private companies to enter the fisheries business.
Focusing on Fukushima Prefecture, which is exposed to radiation from the crippled power plant, the council is calling on the central government to monitor radiation levels there coherently and continually, and to remove radioactive debris and soil quickly. It also calls for the establishment of a research center for the development of renewable energy sources and to concentrate medical-industry related research in the prefecture.
In view of the severity of the crisis at Fukushima No. 1, the council is calling on the central government to establish new safety standards for nuclear power plants.
The council also stresses the importance of promoting green energy sources by making power companies buy electricity generated by such sources at fixed prices as well as of promoting a system under which small power generating facilities are dispersed throughout the nation.
The council did not call for the long-term goal of phasing out nuclear power generation. This points to the existence of strong pressure from bureaucrats within the council's secretariat who represent the views of Japan's nuclear power establishment.
Apparently concerned about Japan's deteriorating financial conditions, the council proposes raising consumption, income and corporate taxes to repay "reconstruction bonds" the government will issue to cover the cost of the reconstruction, which is expected to total more than ¥10 trillion.
It is clear that the Finance Ministry exerted its influence on the council members to adopt this proposal. But the government already has a plan to raise the consumption tax to pay for welfare spending. It will also have to increase taxes to pay compensation to people who have been infected by hepatitis B through mass vaccination.
Under the government plan, people would face triple tax increases, which would negatively impact Japan's economy. The government should seriously consider whether there are other ways to raise funds and be very careful about the timing of tax increases.
In pushing reconstruction, the central government must take utmost care so that administrative jockeying over turf by various government ministries and agencies does not impede or slow the rebuilding work and that local governments receive sufficient grant funding without any strings attached. It may have to take drastic measures.
The council will have to carefully monitor whether the government faithfully carries out its proposals, which are designed to bring "hope" to people, and to restore and strengthen their sense of "bonding."