The reformist administration of Prime Minister Junichiro Koizumi is in a crisis as a result of strong resistance to the slogan of structural reforms with no safe haven, under which he formed his Cabinet in April 2001.

Expectations are dwindling that the Cabinet will achieve rapid reforms of Japan’s impoverished economic structure, now that Koizumi has lost much of the overwhelming public support upon which he entered office.

Nevertheless, society is steadily changing as if to cast off its old self, even though Koizumi may not be directly credited for it.

A typical example is seen in changes in the annual list of large-income taxpayers aired in May. In the singer category, recent stars, including Ayumi Hamasaki and Hikaru Utada, lead the list for 2001.

In addition, nine of the 13-member Morning Musume group, including two junior high school students, paid more than 10 million yen in income tax and so became subject to public notification.

The group as a whole comprised the seventh-largest taxpayer.

In 1989, at the height of the asset-inflated bubble economy, then big-name singers, including Shinichi Mori and Saburo Kitajima, led the list as usual.

Indeed, Japan has become so open a society that even junior high school students can become stars and big income earners overnight.

While the government will put together a package of antideflation measures featuring drastic tax reforms in June, we should continue to support Koizumi in his fight for structural reform.

The Tokyo stock market bottomed out on Feb. 6 and is now on a medium-term rising streak. The change in market trends reflects increased perceptions that the economy has bottomed out as well as strong expectations of a rapid recovery in corporate earnings.

In addition, selling pressure is easing thanks to foreign investors’ active share purchases and companies’ successive buybacks of their own shares.

Given the stimulus effect of the World Cup soccer finals in June, the chances of an economic downturn are slim, and thus the key 225-issue Nikkei average can be expected to test the 13,000 level sometime this summer, a level unseen since late last June.

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