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Tuesday, April 4, 2000

Premier’s collapse
won’t hurt Japan

Bullet The issue: Prime Minister Keizo Obuchi suffered a stroke and must be replaced.

Bullet Our view: Japan has a stable political system that ensures continuity of policy.

THE collapse of Prime Minister Keizo Obuchi leaves Japan with caretaker leadership for the moment but there is no reason for the rest of the world to fear that Japan will fall into turmoil. It seems certain that Obuchi will be unable to continue, but this is a stable political system and it will function with scarcely missing a beat.

Talks planned this week with North Korea were to go ahead as scheduled. And officials insisted that Obuchi's stroke would not interfere with economic policies.

Chief Cabinet Secretary Mikio Aoki, who assumed the post of acting prime minister, immediately incurred criticism for delaying the announcement of Obuchi's stroke and then trying to minimize the seriousness of his condition. The Japanese are no longer willing to accept such practices.

In any case, Aoki was not considered a strong candidate to succeed Obuchi. The successor will undoubtedly come from the ruling Liberal Democratic Party -- probably the party's secretary general, Yoshiro Mori -- and can be expected to emphasize continuity of policy in both domestic and foreign affairs.

In recent decades, prime ministers have only rarely lasted more than two years in office, mainly because of factional shifts within the LDP. But the frequent turnover has not disrupted government operations.

The unassuming Obuchi became prime minister in July 1998 with a low profile and low expectations but surprised many analysts with his ability to get his policies through parliament.

His main concern has been the nation's economic weakness, which spanned most of the past decade. In his first year, he secured legislation to stimulate the economy through accelerated government spending, consolidated his party's dominant position in parliament and championed measures strengthening Japan's regional security role. However, no one considered Obuchi an indispensable leader. Recent polls have shown declining support for his government as the recession persisted.

Obuchi's collapse comes as the government is preparing to host the annual Group of Eight summit meeting in July, but this is not a major problem. One probable result is early parliamentary elections; under the constitution, elections must be held by October but the opposition parties will want them held sooner -- possibly before the G-8 summit.

The meeting will provide an early opportunity for Japan's new leader, whoever he may be, to become acquainted with his counterparts in other major countries. It will be important for President Clinton to use the occasion to assure the new prime minister of the United States' continuing friendship and partnership with Japan.

Microsoft domination

Bullet The issue: A federal judge has found Microsoft in violation of antitrust laws after government settlement negotiations collapsed.

Bullet Our view: The Justice Department should continue its vigilance until the issues are resolved in court.

FACED with lengthy litigation and a row of companies lined up at the courthouse door with even more, Bill Gates' Microsoft Corp. has rejected an out-of-court settlement with the Justice Department's antitrust division and 19 states.

Gates' decision may be regarded as bold or risky. Whichever is the case, the collapse of negotiations is an indication that the government is aggressively representing consumer interests involved in corporate practices in the computer world.

Competing companies and individuals will be able to cite U.S. District Judge Thomas Penfield Jackson's ruling in pursuing their own lawsuits against Microsoft. Gates fully expects such an onslaught, and his company may be large enough to sustain it.

Jackson's ruling was expected following the stalemate. In November, he issued factual findings that made clear he would conclude -- lacking a settlement -- that Microsoft is a corporate bully that may need to be broken up to protect consumers. He agreed with the Justice Department's allegation that Microsoft had used illegal, anticompetitive practices that have allowed it to dominate these early stages of the digital age. Ninety percent of computers run with Microsoft's Windows operating system.

While computer prices have gone down in recent years, Microsoft's price for its operating system has risen. A key complaint is that Microsoft had required manufacturers of computers equipped with Windows to use its Explorer Internet browser instead of Netscape Communications Corp.'s Navigator. Complicating what seemed at one point to be a lopsided fight, Netscape has recently been acquired by America Online, which has in turn bought Time Warner Inc. Goliaths abound.

In its last settlement offer, the Justice Department would have required Microsoft to set a uniform pricing schedule for Windows, regardless of whether the manufacturer chose to have Netscape installed in its product. Microsoft would have been required to reveal, for a fee, the most basic Windows computer code so manufacturers could adapt Netscape's browser to it.

However, Microsoft insisted on reserving the right to withhold technical support for parts of the software that had been adapted to fit. Government lawyers complained that and other Microsoft counter-proposals would have undermined the intent of the settlement.

The Microsoft case is likely to be fought in the appeal process for several years. The Justice Department's vigilance will be needed far beyond the end of the Clinton administration to require a level of competition that is crucial in the rapidly growing computer industry.

But by the time a final decision is reached in this case, advances in technology in this constantly changing field will probably have made the narrow issues involved of only historical interest.

Published by Liberty Newspapers Limited Partnership

Rupert E. Phillips, CEO

John M. Flanagan, Editor & Publisher

David Shapiro, Managing Editor

Diane Yukihiro Chang, Senior Editor & Editorial Page Editor

Frank Bridgewater & Michael Rovner, Assistant Managing Editors

A.A. Smyser, Contributing Editor

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