The daily morning journal and courier., 1907-06-22
JAPAN'S NEW
 ECONOMIC REGIME How the Government Co., operates With Com mercial Syndicates. REAL PATERNALISM. The Governments Absolute Monopoly of Transport
 ation Facilities.

One cannot fail to be impressed by
 the remarkable energy and enthusiasm
 with which persons in all walks of
 life in Japan are throwing themselves
 into the movement to lift the nation
 into commercial and industrial su-
 premacy in the Pacific The national
 spirit engendered by the war with
 Russia has been adroltly shifted by
 Japanese statesmen into the pursuits
 Of peace, where 1t is directed by the
 same firm hand that carried to success
 the military and naval operations.
 But war and peace are very different
 conditions, and usually, In the course
 of history have required different
 management. Even in war, as it pro-
 gresses, enthusiasm subsidies and bel
 ligerency becomes mechanical, it's re-
 maining incentive being chiefly sup
 piled by discipline. Japan's newly
 created paternal system of national in
 dustry and commerce just now as-
 sumes rather warlike attitude. The
 people are summoned to it's support as
 by call to arms, and with the intox-
 ication of victory stll coursing through
 their veins they respond A reaction
 from this initial enthusiasm is inevit-
 able, but while it lasts 1t is giving the
 new movement a tremendous impetus,
 and some of its manifestations are
 very interesting to westerners. The
 genesis and development, so far as
 they have progressed, of the national,
 industrial and commercial ownership
 policy, of the various stimulative and
 competitive methods proposed and al-
 ready employed, and of the present
 and probable effects of the movement
 upon foreign interest in Japan and the
 far East, are worthy of examination.
 The tremendous impulse given to
 commercial and industrial activities in
 Japan since the war has attracted
 much attention, and been the cause of
 much comment, usually optimistic.
 Since peace was declared (taking the
 latest official statemen) there have
 been S14 new enterprises capitalized or
 old capitalizations increased, with an
 aggregate capital of $197151,514 gold.
 This is nearly one-third of the total
 capitalized industry of the country
 previous to the war. The enterprises
 represented in this enormous capitaliz-
 ation cover wide field, but they near ay all belong in the category of what may be termed modern industries, in fhe sense applied in Japan. For in-
 stance, there are fifty one new electri-
 cal companies, with an aggregate cap ital of $55,000,000 gold ten new naviga- tion and dock companies, with a total
 capital of s20,00o,0O0; five new insur- ance companies, with total capital of d50o000 New banking concerns
 aggregate capital of $11,OGO,0OO. There are eleven new steam railway compa- nies, with $10,00O 900 capital; fourteen new mining companies, with $6,500,000 capital; while old corporations have increased their capital $34,0OO,OO0 To many of them direct government as- sistance is being given, while nearly al of them have had or hope to secure 1 stimulation through the government | by indirect methods.
 This enumeration of the new com- mercial activities of the nation does | not, however, include the greatest en- terprise of all This is the national | corporation, with a proposed capital of | slOO00OO0O gold, for the purpose of | pushing Japanese commerce and in- terests in Korea and lIanchuria This great company, in so far as its com ponents have become public, is to in- | clude the government, with all the as- sociated interests it can marshal, and | is to be thrown open to popular sub- scription with view of inducing the i common people and middle classes to in- vest, thus enlisting their sympathy | and direct pecuniary interest in the success of the scheme.
 Persons who see, as anyone may by | 8 study of the Japanese budget, that the government is deeply in debt, that it is at its wits end to devise means | to secure enough revenue to meet ad- ministrative expenses and interest Il charges, that It's pro rata taxation is far higher than in any other large na- tipn and that its people are the poor est, that the extraordinary war taxes have been extended for thirty years with no certainty of being able tp re- move them even then may well be II puzzled as to how all these undertak- ings are to be carried out. To put the { matter in a nutshell, the plan is to draw foreign investors to the support ( of the various companies and the gov l ernment is used to stalk the foreign ( investor. lt
 Three years ago. before the war with 2 Russia, no sane business man familiar ( with the situation in Japan would { have dreamed of indorsing any sugges- t ton for great and immediate ex- t pansion of the capitalized interests of a the country. On the then existing | capitalization, quotations on four hfths of the organized industries in a Japan had been steadily declining in s ghe market for decade, and a leading c financial authority had counseled reor- Ii ganization of some enterprises on a 0 more moderate basis. Since then the c nation has fought long and exhaust p Ing war which, to say nothing of the q wastage of human material, has quin- II tupled the national debt and nearly c doubled the rate of taxation, which t there is no prospect of reducing within f, } generation; and the bulk of the in- u crest on the national debt has to be Il sent abroad, and is thus lost to the b country. At the time the war began n md even at it's close, the national t; ,redit was so unstable that the gov- srnment was compelled to give coHat- Ii ,ral security for the payment of inter- tt sst to foreign investors and all the for a 'ign war loans are backed by security n Iuch as it is, si