Foreign aid

Charles Jannuzi b_rieux at yahoo.com
Thu Aug 1 05:13:09 PDT 2002



>>Subject: Re: Foreign aid

On Sun, 28 Jul 2002, Ulhas Joglekar wrote:


> What is so radical about a Japanese style
Vietnamese postal savings > system?

It's quite socialistic, actually -- a state-owned

bank, which encourages local savings and village accumulation, while leveraging funds for national infrastructure projects. Absolutely scandalous to the neolibs, of course, whose notion of village development begins and ends with microcredit -- the ideology of "let them eat

credit cards".

- -- Dennis<<

The postal financial system in Japan extends into both savings and insurance products, and Dennis's description does capture where the money goes. Incidentally, both the savings and insurance ran nice profits in the last period reported.

The Ministry of Finance, being the spokes-ministry of Japan's city, trust and credit banks, is against the postal savings and insurance. The systems are run under the Ministry of Posts and Telecommunications (this has actually been reorganized into a ministry with a longer name designed to dilute the power of the bureaucrats Koizumi made a career of bashing).

Koizumi made his 'reputation' as an appointed head of the posts ministry where he proceeded to fight every day with all the bureaucrats. Both he and Tanaka (the now fired Minister of Foreign Affairs) never ever showed an ability to work with bureaucrats, though Koizumi shows some closeness now to the Ministry of Finance (in my opinion, the worst of all ministries here and one that should be put completely out of business).

Another system that helped in the development of Japan was the Japan Agriculture. It started out as wholesale and retail cooperatives and as credit unions (more or less). Collectively, the JA credit unions--now referred to as JA Bank (not ginko, which is Japanese for bank, but 'banku', which is an English loan word meaning, I guess, 'a new kind of bank'). Such efforts were more bottom-up coops, but they came to have strong ties with the Ministry of Agricultural, Forestry and Fisheries. It might be argued that indeed in many areas the JAs were more important. They took in money and loaned it out directly to the local communities, so you might get a loan at the same JA you had your life savings and bought your insurance.

In the area of food retail they became quite corporate in nature. This lead to a turning away from them, with farmers and consumers forming new prefectural level coops for agriculture. Also, CGC supermarkets which are all over the place also started out as coops.

CJ

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