The Real Reason Japan is not Cashless…but eventually will be

Lots of silly western journalist reportage from the likes of the Financial Times (FT) and PYMENTS.com have attempted to explain the ‘cash addiction’ of Japanese society by spinning it as a failure of Japanese contactless payment technology: FeliCa, QR Codes, etc. They have failed miserably.

They would have done much better if they had gotten up from their desktops, loaded up Apple Pay Suica with a full charge of ¥20,000 and actually bothered to travel outside of Tokyo, with a few local train trips to the Japanese countryside to talk with Grandma Japan. Grandma Japan holds the family purse strings. Grandma Japan has credit cards and transit cards but those are just window dressing.

She is set in her ways, ways that have safely seen the family thought generations, the real household management is arranged around multiple hard cash osaifu ‘purses’. These purses are different accounts at different banks. Bank A is the medical purse, bank B is the insurance purse, bank C is the loan payback purse, and so on.

The Japanese Government knows this and is, slowly, weeding down the number of local banks, twisting arms, encouraging bank mergers while changing banking rules. X Day will finally arrive when Grandma Japan is forced to put all those purses in a single bank. The bank will kindly offer to manage all those purses for her, and oh, here’s this convenient Rakuten Super Suica + credit card that works everywhere in Japan for transit, shopping, getting cash when you need it, and getting points. You can also gift your grandkids with those cards too, and control how much they can use.

Get the picture? At that point Grandma Japan juggling too many hard cash accounts at one bank will be too much because it’s not traveling from bank A to bank B anymore. It’s all virtual in one place. She will throw up her hands and go cashless, and at that point Japan will truly become cashless in the more important way because it’s not about technology, it’s about households and family life. Unfortunately it’s a point that most western journalists in Japan don’t get, and can’t get, until they get their head out of technology and their body out of Tokyo.

Sayonara 10% Consumption Tax

There have been consistent rumors that the 10% consumption tax with cashless point rewards due to start in October was going to be spiked. Now that there are rumors of a ‘double’ election this summer, and especially after President Trump mused about scrapping the whole postwar American-Japanese defense treaty system, I think we can safely assume the 10% consumption tax is never going to happen. Prime Minister Abe can have a tax increase or he can change the constitution. He can not do both, and no politician is going to support the tax increase publicly going into the summer election, even thought the Komeito is said to want it enacted.

So who are the losers? Well, Komeito for one which the Abe government needs sidelined in order to amend the constitution, and Rakuten for another as they were hoping to ride the cashless point reward with consumption tax wave. Buckle up everybody, it’s going to be a long hot summer with lots of political debate over the constitution and Japan Self-Defense Forces.

Skin in the Game

The so called Renault-Nissan ‘crisis’ has been fascinating to watch, not the actual event but how it is reported in the western press. It’s like time warping back to culturally biased 1980s style ‘Japan Inc. doesn’t play by the rules, has vested interests (what country doesn’t?), etc.’ reportage. When things get hot western journalists trot out the old stereotypes and prejudices with titles like “Carlos Ghosn: A criminal or just a foreigner?”, because it still sells. French cartoonists and FCCJ based journalists who should know better take the easy path and pander to the gutter, cringe worthy nasty stuff, instead of doing actual research and reporting such as Ghosn illegally funneling Nissan profits to Renault-Samsung to cover loses and show profit instead.

Only now is Reuters picking up the French connection side of the story which has been reported in Japanese media since day one and is a well-known narrative: Seeds of Renault-Nissan crisis sown in Macron’s ‘raid’When Ghosn came to Japan to fix Nissan he promised that Nissan stay separate and would never be merged with Renault. Macron the “former Rothschild dealmaker” broke that promise:

Then, on the evening of April 7, (2015) Macron called Ghosn to let him know – as a courtesy – that the state had bought another 4.73 percent of Renault for 1.2 billion euros ($1.4 billion), would announce its maneuver in the morning and planned to sell back down to 15 percent only after defeating his (Ghosn’s) opt-out.

and

With that step, seen by detractors and admirers alike as an unprecedented government “raid”, the simmering battle of egos between Ghosn the global CEO and Macron the wunderkind banker-turned-minister had burst into the open.

Brushing aside warnings, Macron pressed ahead and defeated the opt-out. The vote handed France an effective blocking minority at Renault, which in turn controlled Nissan shareholder meetings via its 43.4 percent stake in the Japanese firm.

Alarm bells rang in Tokyo as that sank in, ratcheting tensions higher over the months that followed.

Macron’s actions to push a Nissan-Renault merger broke all the trust Ghosn had built over the years with Nissan. Ghosn is certainly a victim as the western press likes to portray him but not at the hands of “the Japanese”, but by Macron himself. As the Reuters story makes clear, “President Macron himself has skin in the game,” Ghosn was just a disposable tool and stepping stone to the Élysée Palace.

Twitter Follows YouTube Purge of Conservative Japanese Commentators

First YouTube and now Twitter is freezing mainstream conservative commentators. Kazuya’s bogus YouTube purge for ‘spam’ a few days ago, now reinstated after a overwhelming response from online Japanese across the political spectrum, has been followed by Twitter freezing his account. Two attacks this close together is not coincidence. I smell a rat.

The Twitter takedown is particularly bogus: a ‘well known’ lawyer lodged 4 copyright complaints on a Kazuya tweet that URL links to Kazuya’s own YouTube Channel video. In short somebody claimed copyright on content they don’t own. Twitter froze Kazuya’s account anyway. This is somebody hijacking DMCA rules to take down somebody else they don’t want on Twitter. Maybe Twitter wants it that way.

The YouTube purge has already damaged YouTube’s credibility in Japan because they don’t offer real reasons for banning or reinstating Kazuya’s account or other similar conservative commentator YouTuber accounts that are still frozen. YouTube comes across as being completely arbitrary or worse, politically motivated, a huge turn off for many Japanese.

If Twitter doesn’t do a better job of filtering bogus copyright claims and falls into the trap of becoming somebody else’s tool, Twitter credibility in Japan will be destroyed too.

Your choice Twitter.

UPDATE
Now Twitter has been caught engaging in Shadow Banning of conservative Twitter users but changed it overnight when caught by Vice. Meanwhile Kazuya’s Twitter account still remains frozen for unexplained reasons.

YouTube Purge Hits Conservative Japanese Channels

The YouTube purge of conservative and right-wing channels as described by Tim Pool earlier this year has hit Japan hard recently with many high-profile and popular channels such as Tsuneyasu Takeda and Kazuya taken down for vague YouTube community violations, spam mostly.

This is not fringe but mainstream commentators who write books, major magazine articles and appear on Japanese TV. Tsuneyasu Takeda is a university professor whose family are descendants from the Meiji Emperor. You cannot get more mainstream than that.

The takedowns are exactly the ‘one strike you’re out purge’ method that Tim Pool describes under the YouTube spam violation policies.

YouTube Spam Policies
Dubious spam violation is a favorite YouTube purge method

Takeda and Kazuya have both setup new YouTube Channels while their cases and uploaded catalog are ‘reviewed’ but subscriber numbers are way down as you’d expect. Pre-purge Kazuya had 490,000 subscribers, now he has 38,000. If YouTube’s intention here is to disrupt Japanese conservative commentators ahead of Japanese Diet elections due later this year, they certainly achieved that.

Regardless of politics I think YouTube’s purge first review later (if ever) action for dubious reasons is deplorable. This has already thrown a chill on Japanese online communities. Japanese take pride in listening to and respecting opinions of others even if they don’t agree with them. I think a lot of younger Japanese, and bloggers will think twice before trusting YouTube, or Google again.

UPDATE
The Japanese response to YouTube’s purge of the Kazuya Channel was so overwhelming that 3 hours after informing Kazuya that the YouTube review of his channel confirmed that it violated YouTube spam policies, without giving any specifics, and would not be reinstated, he received yet another email stating that the YouTube review found his channel did not violate spam policies and was reinstated. Again without offering any details or explanation. Kazuya thanked his followers in a comeback video but observed that YouTube’s actions may have damaged its reputation in Japan.

It already has.

UPDATE
Unfortunately the YouTube purge is spreading to Twitter.