The reshuffled Cabinet of Prime Minister Junichiro Koizumi has a powerful economic portfolio that may well be described as "deputy prime minister for economic affairs." As state minister in charge of economic and fiscal policy as well as financial affairs, Mr. Heizo Takenaka is now the de facto economic czar of the Koizumi administration. That is the most salient feature of Monday's Cabinet reshuffle.
Mr. Takenaka, a former economics professor, joined the Koizumi Cabinet as economics minister in April last year. Now he also serves as financial services minister, taking over from Mr. Hakuo Yanagisawa who had called for a more measured approach to banking reform. Mr. Takenaka's double appointment is evidence that he has the full backing of the prime minister, who wants to push bad-loan disposal more aggressively in a coordinated effort with the Bank of Japan.
Mr. Takenaka's expanded position also shows that the bad-loan problem is reaching a point where drastic action is needed. With stock and bond prices falling, the government faces mounting pressure at home and abroad to work out a "crash program" for banking and industrial revival -- a program that can accelerate debt disposal and corporate restructuring in an integrated manner.