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Sunday, Jan. 22, 2006

REAPING REFORM'S REWARDS

Yokohama: model city for the nation?


Staff writer

'Change Japan -- from Yokohama."

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Yokohama's Minato Mirai 21 waterfront development, with the Landmark Tower in the center

That's the motto of Hiroshi Nakada who, since 2002, has been the charismatic mayor of Japan's second-largest city. And change Yokohama he has, with a brand of populist politics that is very rare in a nation where rocking the status quo or trying to roll over vested interests is not only frowned on by the (often hidden) powers that be, but is also generally the stuff of political suicide.

Having first come into the public eye as the lawmaker who refused to wear a tie in the Diet in summer 2002 -- a stand that eventually led to the prime minister's popular "Cool Biz" campaign in 2005 urging office workers to shed their jackets and ties to save on air-conditioning costs -- the Yokohama-born mayor is now referred to with grudging respect as "Gomi no Nakada (Nakada of the Garbage)" for his introduction of stricter regulations regarding recycling of the city's trash.

Married with two daughters in elementary school, Nakada often appears on prime-time television and is the subject of several books -- including five he has written himself, with one being his 356-page autobiography. Now, though, he is in the spotlight more than ever as his four-year term at the helm of the Kanagawa Prefecture capital draws to an end in March and a mayoral election looms. In what commentators interpret as a canny PR exercise from a natural-born performer, Nakada is still keeping everyone guessing as to whether he will be a candidate or not.

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Yokohama's Mayor Hiroshi Nakada

Having risen from relative obscurity to his present lofty status, it is unlikely that Nakada -- who has degrees in both economics and politics -- is about to leave public service. Unlike most political bigwigs, though, he did not graduate from the University of Tokyo, was never a bureaucrat and does not hail from a family of politicians.

Nonetheless, Nakada's entry into politics was through his father -- or specifically, his father's constant grumbling about politicians wasting taxpayers' money.

"I didn't want to live my life constantly complaining about the state of the world," the sharply besuited 41-year-old says from the comfort of an armchair in the Yokohama City government offices. "So I decided to make it my mission to change the system."

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At 296 meters, Yokohama's Landmark Tower is Japan's tallest building.

That mission began in earnest in 1992, when Nakada was just 28. Having graduated from the Matsushita Institute of Government and Management, an incubator for politicians, he got a job as secretary to Morihiro Hosokawa, founder of the now-defunct Japan New Party (JNP).

Within a year, his new boss was prime minister, having led his fledgling party to a shock electoral victory which was, for eight months, to be the only break in the Liberal Democratic Party's postwar stranglehold on power. Although the JNP-led government was short-lived, it meant that Nakada had been at the very heart of Japan's government within less than a year of entering politics.

After being elected to his first term in the House of Representatives in the election that followed the JNP's collapse, Nakada went on to serve as a member of the shadow cabinet of the newly formed New Frontier Party (NFP). When that party dissolved in 1997, Nakada co-founded a group of independent lawmakers, which became affiliated with the Democratic Party of Japan. But then the DPJ cut him off when he voted for Junichiro Koizumi rather the DPJ candidate in the prime ministerial election of 2001.

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Hisayuku Mogami's 1994 sculpture, Mokumoku Wakuwaku Yokohama Yoyo, by the Landmark Tower

According to veteran political commentator Atsuo Ito, despite his work representing Japan's position to the International Whaling Commission and hawkish comments regarding relations with China and South Korea during his time in the Diet, Yokohama's Mayor Hiroshi Nakada cannot be characterized as a rightwinger. Ito suggests that his backing for Koizumi as prime minister was an expedient, rather than an ideologically motivated, move.

"Nakada is a very clever man and an extremely shrewd political maneuverer," says Ito. "He is constantly evaluating the political climate and acts according to the prevailing conditions."

The charming mayor's vocal support of Koizumi's reform programs, including post office privatization, paid off when, in February 2002, he surprisingly announced his candidacy for the post of mayor of Yokohama. After receiving tacit support from Koizumi, he soundly defeated the incumbent 72-year-old LDP stalwart to become the youngest mayor of one of Japan's 12 major cities.

Once in office, the tall, smooth-talking politico swiftly delivered reams of measures that surprised the political establishment, but which are now credited with having turned around the fortunes of this city of 3.6 million people. A radical agenda that included sweeping cuts in city office staff and making Yokohama's finances open to the public was a frontal assault on the nebulous networks of powerful, entrenched interests and obdurate bureaucrats who for generations had effectively held the levers of power. Instead, Nakada has consistently sought to involve citizens and market forces at every level of local government.

"Up until now, Japanese political policy-making has overwhelmingly regarded the value of industry highly, and I think that we need to reverse that," he says. "Whenever I'm making policy decisions, I always put the overwhelming precedence on the side of the people."

This govern-for-the-people philosophy had its first major test shortly after his election in 2002, when Nakada defied an order from central government to integrate the city's residency data with the national network of registries, launched in August 2001. With recent scandals over breaches of personal data confidentiality in mind, he insisted on the Yokohama residents' right to decide whether to allow the central government to have access to their personal information.

His next move came in December 2002, with the release of a redevelopment strategy outlining his intended reforms. Called the Yokohama Revival Plan, this was based on, and named after, the Nissan Revival Plan of 1999, which was introduced to such great effect by the company's then-Chief Operating Officer Carlos Ghosn.

At the crux of this plan, and two subsequent policy outlines released in October 2003, were the introduction of market forces into the running of the city and opening up the city's abysmal financial condition to scrutiny.

Tackling the city's estimated 2 trillion yen debt mountain was a central part of Nakada's election manifesto, but it wasn't until he took office that the mayor uncovered the true extent of the problem. Yokohama actually owed more than 6 trillion yen when taking into account the debts of city-financed corporations, the depreciation in the value of city-owned land and other factors.

Nakada is still working to reduce the debt by cutting costs and streamlining the city staff, which has been cut back by 4,452 in his four-year period of office. As well, he has focused on reducing expenditure on public works projects -- and in so doing he has raised the hackles of some of his most vocal opponents.

"There was a time," Nakada says, "when creating a city was about building things, but that's not what we need anymore. Now it's about ideas and good management."

Nakada's predecessor had previously been a high-ranking bureaucrat in the Construction Ministry, and during his time local construction companies profited handsomely from city projects. The new mayor, though, was adamant that all new construction projects would be tendered for on an open-bid basis. This meant that bigger, more cost-efficient firms took work away from local contractors -- something that Nakada argues is in the best interests of the people of Yokohama.

While local construction firms may have been hit hard by the new system, the announcement, in May 2005, that Nissan would relocate its headquarters to Yokohama in 2009 has been a huge coup for the city. While other areas hoping to attract business focus on building infrastructure, Nakada's approach was to offer incentives in the form of far-reaching tax breaks and a 5 billion yen cash incentive representing 10 percent of Nissan's investment in the relocation.

"We've devised the most attractive scheme to attract business in Japan," Nakada declares. "Others rely on energetic persuasion, but this setup allows managers to make a decision based on business logic."

According to Ryoichi Takarada, chairman of the board of trustees at Yokohama City University, and an active member of several citizens groups, the key to Nakada's accomplishments is that he is a grassroots politician who, by virtue of being neither a former bureaucrat, nor the scion of a political dynasty, nor a Todai alumnus, is free from the influence of the special interest groups upon which so many high-profile people in politics in Japan depend on for support.

"It's partly because he is so young," says Takarada, "but he has far fewer ties to the 'powers that be' than other operators. He's all on his own, and that means that he pretty much has free rein."

Citing a new recycling program that has reduced the city's garbage output by 30 percent since it was implemented in April last year, Takarada says that the mayor is highly adept at persuading people to come on board.

"Having to sort your trash into 10 different categories is actually quite bothersome," he says. "But Nakada has managed to get people to cooperate."

The recycling program is, however, only the highest profile of a raft of innovative measures that have earned Nakada yet another nickname -- that of The Ideas Mayor.

Some of the key planks of that raft have been transforming the city's Konan Ward Office into a customer-oriented Peoples Ward Office; persuading Sega Corp. to build a 63,000-sq. meter entertainment complex in the Minato Mirai district by 2008 (at a cost of some 30 billion yen); introducing monthly Meet the Mayor sessions; initiating a scheme to introduce English-language classes in all city-run elementary schools by 2009; and even collaborating with cosmetics giant Shiseido to produce a limited run of 2,000 bottles of fragrance called Motomachi as part of a push to promote that upscale shopping district.

The key to implementing so many new schemes while maintaining a firm grip on the day-to-day running of the city is Nakada's seemingly inexhaustible energy despite working very long hours and regularly appearing at public functions. In fact, Takarada even tells how the mayor sometimes attends functions of the Chinese chefs from Chinatown, which are held after restaurants have closed at around 10 or 11 at night. Even though most of those there are Chinese and don't have voting rights, he says Nakada is always happy to show his face at their events.

Nakada may have won over the chefs of Chinatown, and anecdotal evidence suggests he is popular among residents, but there are still those who oppose his agenda.

Manabu Minami, a professor at Kanda University of International Studies, and coauthor of a book about Nakada's efforts to turn around Yokohama's fortunes, says that despite the mayor's best efforts, his reform agenda is being hampered by a plodding bureaucracy.

"There are many opponents to Nakada's plans," he says. "The biggest obstacle is the public servants. The jobs-for-life culture in local government means that a lot of the bureaucrats just don't pull their weight, and they don't like being told to shape up."

Besides shedding more than 4,000 city staff since he took office, Nakada has reduced costs by more than 18 billion yen in each of the past two years and cut municipal bonds (equivalent to debt) by over 10 billion yen, or 8 percent in each of the past two years. In addition, he has introduced a performance-based remuneration system and a program that rewards initiative in creating new public services, as well as allowed officials from the managerial ranks to compete for top positions within the city government.

All of these measures have public servants in Yokohama, and across Japan, quaking in their boots.

But political pundit Atsuo Ito says that the Ideas Mayor has done a great job of quelling discontent in the ranks of city officials, and has set the tone for similar reforms in other local government offices across Japan.

"This seems to be a bright age for local government. Nakada has handled the restructuring very well, and has managed it without too much of a fight," says Ito.

But the fight is not over yet. Prof. Minami says that the ingrained culture of bureaucrats means that the progress made so far is by no means assured of lasting into the future.

"The most important thing is for Nakada to groom his successor," he says. "The public servants who oppose his reforms are just keeping their heads down, waiting for the next mayor. Whoever it is, if they're not in the same mold as Nakada, the system will quickly revert to how it was before."

With the March's election looming, and the city's own son yet to announce his candidacy, reform-minded Yokohamans are on edge, hoping that Nakada will be their champion for another four challenging, exciting and progressive years to come.



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