Going Postal
	The battle over reform
	By Hanna Kite

Posted Monday, September 5, 2005; 20:00 HKT
Japan Post is under fire. Here's why:

Q: What is Japan Post?
A: Besides delivering mail, it provides cheap life insurance to 68 million and is the world's largest savings bank. Its 24,700-office branch network also provides government services, such as pension distribution, in rural areas.

Q: Why is Koizumi pushing to reform it?
A: Critics say Japan Post is a bloated, anachronistic, patronage-ridden bureaucracy (some postal jobs are passed from father to son) that does jobs the private sector could handle more effectively. Reformers also say the system locks up $3.1 trillion in savings deposits and other assets that could be redeployed into higher-paying investments and finance businesses that would use the money better.

Q: What's Koizumi's plan?
A: He wants to privatize and restructure the post office by creating four stock-issuing companies—a bank, an insurer, a mail carrier and a chain of convenience-store-like outlets.

Q: What do Japan Post's defenders say?
A: They argue that mail services will be compromised if the post office has to turn a profit. The current system also provides a social safety net that reaches rural areas and the poor. If privatized, some fear unprofitable facilities such as remote branches would be closed and life-insurance premiums would increase, as would fees for money transfers and other banking services.

Q: What's this battle really about?
A: Koizumi has cast it as a war between old and new Japan, between pork-barrel politics and transparent government. His postal privatization minister Heizo Takenaka says a vote for privatization is a vote for "establishing a smaller government ... and revitalizing the economy."

Q: Who will win?
A: If enough pro-Koizumi legislators win seats in the lower house, he'll have the votes to pass his bill. Even then, though, reform wouldn't be completed until 2017.

with reporting by Toko Sekiguchi/Tokyo

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