[Title] REPORT ON COMPREHENSIVE NATIONAL SECURITY

To: Acting Prime Minister MASAYOSHI ITOH

The Comprehensive National Security Study Group has examined the various issues involved in comprehensive national security since its establishment on April 2, 1979, at the behest of Prime Minister Masayoshi Ohira. We have now completed this Report and would like to submit it together with our prayers for the late Prime Minister's repose.

This Report is based upon discussion at the meetings of the Study Group, and Executive Member Kosaka was instrumental in its compilation.

The Comprehensive National Security Study Group

July 2, 1980

Summary of the Report

I COMPREHENSIVE NATURE OF NATIONAL SECURITY POLICY

Security means protecting the people's life from various forms of threat.

Efforts required for security consist of three levels efforts to turn the overall international environment into a favorable one; self-reliant efforts to cope with threats; and as intermediary efforts, efforts to create a favorable international environment within a limited scope while protecting security in solidarity with countries sharing the same ideals and interests.

This is true for both security in the narrow sense and economic security.

Since these three levels of efforts are mutually complementary and at the same time contradictory, it is important that balance be maintained among them.

The security question is of a comprehensive nature not only in the sense explained above but also in the sense that the fields of security interest and the means at our disposal are diverse.

II CONDITIONS AND TASKS

In considering the question of Japan's security, the most fundamental change in the international situation that took place in the 1970s is the termination of clear American supremacy in both military and economic spheres.

Militarily, the military balance between the United States and the Soviet Union has changed globally and regionally as the United States has held back on strengthening its military arsenals since the mid-1960s while the Soviet Union has continued to build up its military force. As a result, U.S. military power is no longer able to provide its allies and friends with nearly full security.

As a consequence, it has become necessary for the allies and friends to strengthen their self-reliant efforts, especially in the area of conventional forces, and the credibility of the U.S. nuclear umbrella cannot be maintained in the absence of cooperation with the United Sates.

Economically, U.S. economic strength has declined both in absolute terms and in relative terms against the economic development achieved by Europe and Japan. As a result, it has become impossible to primarily rely upon the Unites States as in the past for the maintenance of the international currency system and free-trade system.

Another major change in the international situation has been the emergence of new powers of the South. Were the demands of the South to shift from reform to rejection of the existing system, this would constitute a major threat to the international political and economic systems.

The stable development of North-South relations is of special importance to Japan; Japan must play a major role for the developing countries' economic development and the formation of orderly North-South relations as part of its comprehensive efforts for national security.

The era of the "Pax Americana" upheld almost single-handedly by the United States is over, and it has given way to a new era of "peace maintained by shared responsibilities," in which all countries cooperate in the maintenance and management of the international system. It has become impossible for Japan to pursue solely its own economic interests within this system.

Today, Japan is enjoying unprecedented freedom and economic wealth achieved by the strenuous efforts of its people. In order to protect the political and economic systems from threat of external aggression, it is necessary for Japan to strengthen its self-reliant efforts as well as to contribute to the maintenance and strengthening of the international system.

III ANALYSIS OF SOME SPECIFIC ISSUES

Relations Between Japan and the United States

The fundamental reason why the maintenance of close cooperative relations between Japan and the United States assumes the highest priority for Japan's comprehensive national security is that Japan shares with the United States the aspirations for the free and open international order.

As the relations between Japan and the United States in military, economic, cultural, and other spheres are heavily out of balance, the two countries will probably face major trials in the 1980s.

Given these conditions, it is necessary for Japan to build more comprehensive Japan-U.S. alliance relations as a whole and more concrete cooperation in the military field including strengthening its own defense efforts. It is particularly important that Japan strongly support the United States when Japan feels on its own judgement that America needs to be supported.

With Japan now accounting for 10% of the world's total GNP, it is vital that Japan accept commensurate international responsibilities and endeavor to protect the free political, economic, and social systems.

Strengthening Defense Capability

Japan's defense policy has been based on the stance that Japan, under the Japan-U.S. security arrangements, relies upon the United States for nuclear deterrence and for the repelling of large-scale aggression, and resists small-scale and limited aggression with conventional forces by itself and prevents the easy establishment of a fait accompli. This stance to possess Japan's defense capability as a "denial force" is basically correct.

The problem is that the present Self-Defense Forces does not even possess the minimum necessary denial force.

As seen in the lack of system for integrated command and control of the three services, the SDF has many defects in the software needed for its effective operation in the face of any emergency. In the field of combat capability, there has been neglect in making efforts to devise effective, pure self-defense, to secure survivability, and to consolidate logistic support. The lack of efforts in these areas poses problems.

Morever, partly because the overall defense budget itself is too small, personnel and provision expenditures have come to account for much of Japan's defense spending, creating absolute weakness of arms and equipment both in quantity and in quality.

Equipment purchases now account for only 20% of Japan's total defense expenditure. As a result, even if this is raised to 30% in order to procure the necessary equipment, the overall increase of defense expenditure will be small. The defense expenditure will still be between 1.0% and1.1% of GNP. The Self-Defense Forces may be able to possess substantial denial force and become meaningful by improving software aspects, studying new arms systems for purely defensive purposes, and curtailing unnecessary expenditures, while at the same time increasing defense expenditure by about 20% from the present level.

Relations with China and the Soviet Union

The reaction of the Soviet Union against the conspicuous development of Japan-China relations of late has been one that gives rise to adverse effects, and there has been a resultant deterioration in Japanese-Soviet relations. It is most undesirable for Japan's security that this be left unattended, since the Soviet Union is the only country for the time being that could pose a threat to Japan.

Building friendly relations with the Soviet Union is difficult for many countries. It is mainly due to the Soviet Union's unique philosophy of power. Expanding contacts with the Soviet Union has become even more

difficult since the Soviet intervention in Afghanistan. However, it will become possible and necessary to expand contacts with the Soviet Union in a few years.

The crux of having relations with the Soviet Union is to avoid making the Soviet Union regard Japan as either a weak or a threatening country. In other words, the question is how to harmonize the two needs, namely, to have relations with the Soviet Union in a self-confident and at the same time unhostile manner.

Energy Security

With the end of the era based upon the assumption of abundant and cheap oil, and as full-scale use of renewable energy resources will not be expected until the 21st century, there is a very real possibility of an energy crisis over the medium or long term.

In preparation for this, it is first necessary to work to secure global energy supply. Basically, this means promoting energy conservation, development and use of alternative energies, and the development of new energy technologies through international cooperation. In terms of practical efforts, it is important to promote cooperation among the industrialized countries and dialogue between the oil-producing and oil-consuming countries in order to facilitate smooth transaction of oil, to cooperate for the oil-producing countries' industrialization, and to seek to encourage the recycling of petrodollars.

Morever, it is necessary to make efforts to promote closer economic relations with the major oil-producing, coal-producing, and uraniumproducing countries that are important to Japan and to make Japanese efforts to explore for and develop oil from the continental shelf surrounding Japan and to promote the development and use of nuclear energy and coal.

A short-term energy crisis is assumed to arise from such political causes as war or conflict, such physical causes as oil field accidents or tanker collisions, or such economic causes as a breakdown in negotiations for oil procurement.

In addition to international efforts, such as ensuring the effectiveness of the IEA's emergency allocation system and the safety of marine routes, Japan's own efforts, such as further enhancing its stockpiles of oil, coal, and uranium and preparing arrangements to accurately anticipate crises and to manage supply and demand appropriately in case of emergencies, are also important in dealing with this short-term situation.

Food Security

Among the conceivable threats to Japan's food security are such short, medium-and long-term causes as disruption of sea lanes, poor harvests in major supplying countries, deterioration of diplomatic relations with major exporting countries, and global disequilibrium in the balance between the world population and its food production.

The possibility of such crises appears remote at present and it seems that any crisis that might occur will be of limited scope and duration. However, if it should occur, the impact of a food shortage would be indeed great.

The argument to realize Japan's self-sufficiency in food production and the argument to abide by the principle of free trade in agricultural products both seem unrealistic. If combined with an appropriate agricultural policy, the principle of free-trade can be promoted without further deterioration in Japanese agriculture.

This means that both international cooperation and self-reliant efforts are needed also for food security.

Among the efforts for international cooperation, it is important that we contribute to the increase of global production of foodstuffs, especially with agricultural cooperation to the developing countries in the medium-and long-term perspectives. As a short-term policy, it is necessary to establish international buffer stocks.

Concerning self-reliant efforts, in addition to maintaining a high level of potential productivity that will enable the swift increase of production in times of emergency, it is also important to study the expansion of stockpiles at all levels from consumers to the state level and the establishment of emergency distribution systems.

Countermeasures for Large-Scale Earthquakes - Crisis-Management Systems

Countermeasures for large-scale earthquakes should include, first, an improved ability to predict earthquakes, and, second, the compilation both of micro-zoning maps showing the main causes of earthquake-related damage and of damage scenarios conceiving various types of disasters.

Based upon the above, the countermeasures must be developed in a comprehensive manner. Disaster-control considerations should be reflected in urban and regional planning, transport and traffic policies, communication policies, and all other relevant policy measures.

In improving the emergency management capabilities of the national and local governments for a time of emergency, it is especially important to ensure appropriate command, control, and communication mechanisms through such measures as the establishment of command and control centers with sufficient survivability and the improvement of multichannel radio communications networks.

At the same time, each household, school, and company must acquire "survival know-how" by improving independent disaster-control capabilities, including the stockpiling of food, water, and medicine.

Conclusion

It it our hope that this report will serve as a catalyst for widespread and active national debate on comprehensive national security and that this will lead to productive results.

At the same time, we hope that all ministries and agencies of the government will bear comprehensive security considerations in mind in implementing various policy measures.

We should also like to propose the establishment of a "Comprehensive National Security Council" as a body for promoting comprehensive and integrated security policy.

We strongly hope that the proposals put forward in this report will be realized at an early date.

The Report

I COMPREHENSIVE NATURE OF NATIONAL SECURITY POLICY

National security policy is comprehensive by nature.

First, national security policy is inherently comprehensive in the sense that it must be composed of efforts on differing levels. These efforts come under the three levels of (1) self-reliant efforts, (2) efforts to turn the overall international environment into a favorable one, and (3) efforts to turn the overall international environment within a limited scope. Since the efforts on these three levels are generally complementary but at the same time may contradict one another, it is necessary to grasp their interrelationship accurately.

In the abstract, national security can be defined as the protection of the people's life from various forms of external threat. Two types of efforts immediately emerge from this definition. One is the efforts to eliminate threats, or efforts on the environmental level; the other is the efforts to cope with threats, or efforts on the self-reliant level. In more specific language, the statement that "a true security policy aims to create a peaceful world" refers to the former type of efforts, while the statement that "a nation cannot exist without firm determination to defend itself with its own power" emphasizes the latter type of efforts.

These remarks seem exceedingly clear and simple, but except in certain specific cases,*1* security efforts cannot be simplified as in either of the two types of efforts mentioned above. First of all, it is apparent that self-reliant efforts are only a partial answer. However, much wealth a nation may consume to acquire a powerful military capability, it cannot gain security if it continues to take actions which make many or almost all countries its enemies in international society. This was how Japan failed before World War II.

By contrast, a world without conflict or danger of war is certainly a safe world. Indeed, when the international economic order was firmly established under Amercian{sic} leadership after World War II, "economic security" was not a problem. However, two difficulities{sic} can be pointed out in a security policy that aims for the creation of a peaceful world.

First, the world is not a peaceful world at present, nor is there any possibility that it will become a peaceful world in the foreseeable future. In other words, precisely because ours is an imperfect world marred by confrontation and conflict, security efforts are required.

Second, even if it were possible to create a peaceful world or even if it were desirable to move in that direction the question remains as to who should make such efforts. A nation that overpowers all the other nations would be able to create such a peaceful world, but this would amount to a policy of coercive transformation of the world in line with the nation's own ideology. By contrast, to preach a peaceful world and to put hope in it only means to depend on others. Japan has tended to act in this manner since World War II.

As a matter of course, the countries that compose the international order can make joint efforts for the creation of a peaceful world. Due to the decentralized character of international society, however, each nation will not cooperate for the creation of a peaceful international order to the extent of entrusting its basic interest and security to that order. Since the international order that has come into being as a result is imperfect, each nation's self-reliant efforts are required, and the order itself presumes this self-reliance as an essential factor of its composition.

When security efforts cannot be classified simply as either environmental efforts or self-reliant efforts, as a practical matter efforts that are intermediately located between these two categories become important. Because it is not realistic to place total dependence on the international order and because there is a limit to the effectiveness of self-reliant efforts, such intermediary efforts will be the means to try to attain security by relying on cooperation among a group of nations sharing common ideals and interests.

National security policy thus is composed of efforts on three levels. In fairly concrete terms, the following characteristics can be posited for security in a narrow sense and economic security.

Security policy

First-level efforts creation of a more peaceful international order:

- International cooperation

- Cooperation with countries that may become enemies, i.e., arms control and confidence-building measures*2*

Second-level efforts - sintermediary measures:

- An alliance, or cooperation with countries sharing common political ideals and interests

Third-level efforts - self-reliant efforts:

- consolidation of denial capability, i.e., capability to prevent the easy establishment of a fait accompli; at its base, fostering of denial capability of the state and society as a whole, i.e., a strong will to protect the state's independent existence even by making sacrifices

Economic security policy

First-level efforts - management and maintenance of the interdependent order

- Maintenance of the free-trade system

- Resolution of the North-South problem

Second-level efforts intermediary measures:

- Promotion of friendly relations with a number of nations that are important to a nation's economy

Third-level efforts self-reliant efforts:

- Stockpiling

- A certain degree of self-sufficiency

- Basically, the maintenance of the nation's economic strength, i.e. maintaining productivity and competitive export power

These three levels of efforts are mutually complementary but can also be contradictory. Self-reliant efforts and intermediary measures in particular, due to their exclusive character, are contradictory in some respects to the efforts for the creation of a more peaceful international order. Self-defense efforts, if excessive, can pose a threat to other nations. The same is true for an alliance of nations. Self-reliant efforts and intermediary measures can also be contradictory to each other. Difficulties in the management of alliances often arise from this kind of contradiction.

In this respect, maintenance of a proper balance among the three levels of efforts is vital to a national security policy. This is not any easy task. Furthermore, the optimium{sic} balance among these efforts is not predetermined. The placement of emphasis will change according to the nation's strength, the position it finds itself in, and the general situation of international society. The placement of emphasis also depends on what kind of security a nation desires, e.g., military, economic, or other security forms.

Second, security policy is comprehensive in the sense that both our fields of interests and the means at our disposal are diverse.

The expansion of the fields of interest in national security has become apparent especially since the oil crisis. Before then, the problem of security was taken up essentially as a question of coping with military threat; aside from this, only the question of security from natural disasters was debated. The oil crisis, however, demonstrated that there are other problems apart from those discussed above that could threaten the people's life. Furthermore, from a medium-or long-range perspective, the possibility of a food shortage is being pointed out. Given these serious threats other than those in the military sphere, it is necesssary{sic} to formulate a comprehensive policy encompassing all the areas.

The expanded range of the fields of interest gives rise to the necessity of increasing the amount of "resources" to be devoted to security purposes. What is also important is the fact that our policies in different fields can be either complementary or contradictory. For example, the development of a cooperative system among advanced countries for economic security also contributes to their military security. But as the Iranian issue reveals, Japan's need for close cooperation with the United States may run counter to its need to secure oil supplies. Because of the comprehensive character that security policy has come to assume, some policy measures stand in a trade-off relationship with others. This means that we have come to be faced with difficult choices.

A further point to note is that security policy requires a comprehensive range of measures. This has already been partially pointed out. There has been, for example, an argument in the security debate centering on measures against military threats that one must not ignore nonmilitary means, such as to ease or eliminate confrontations through "peace diplomacy" or to remove causes of conflict through economic cooperation. Such observations are true to some extent but still show a lack of complete understanding. This is because the dynamism of international relations is governed by an all-encompassing mix of both military and nonmilitary means, and because every country, as a matter of course, gives weight to military means in coping with the question of military security. This observation remains true today just as it was true in the past. The only difference today is that military means are not brought to light as conspicuously as they were in the past. Military capability is a major factor governing the foreign policy of each country.

The aforementioned comprehensive nature of security has become all the more significant by the expansion of security fields. Just as the measures to achieve military security are not limited to those of a military nature but require comprehensive means, measures to achieve nonmilitary security are not limited to those of a nonmilitary nature but require comprehensive means. Of course, it is hardly possible to protect economic security by the direct use of military force, such as by occupying oil fields, but this possibility cannot be totally discounted, and military measures must be taken into consideration.

In this way, "linkage" becomes an important means of diplomacy. Weaknesses in the field of economic resources are offset with strengths in the field of military resources, and vice versa.

From the above analysis one can appreciate why a security policy must be based on the comprehensive effect of a mix of various measures.

II CONDITIONS AND TASKS

The comprehensive nature of national security, as noted in section I, makes it difficult to bring our discussion into sharp focus. A simple reflection on the diversity of the fields of interest and the policy means clearly shows that security policy involves a large matrix of factors. Moreover, the levels of security efforts are numerous, and there exist among them complementary and trade-off relations.

It follows that in order to examine Japan's security problems, we must begin by trying to define what constitute important tasks. Here we shall examine the international political and economic conditions that emerged in the 1970s and that are likely to prevail in the future, in the light of their relation to Japan's national security. Several important tasks will emerge out of this examination.

The most fundamental fact in the changing international situation in the1970s is the termination of clear American supremacy in both military and economic spheres. Until the end of the1960s, the United States had been the "policeman of the world" and at the same time the "bankers of the world" as the main pillar of the IMF and the GATT system, which covered most of the earth. This is not the case any longer.

Military and Political Situations

In the military and political spheres, the change of the United States was noticed in both material and psychological aspects.

The balance of power between the United States and the Soviet Union has shifted due to the Soviet's military buildup from the second half of the 1960s. While U.S. military expenditures declined from 9% to 5% of its GNP, the Soviet Union maintained its military expenditures at 11% - 14% of its GNP, and hence Soviet outlays have come to exceed U.S. outlays in absolute terms in recent years. This entailed three changes.

First, in strategic nuclear weapons,*3* the Soviet Union has overcome its inferiority of ten-odd years ago and stands today in rough "parity" with the United States.

Second, through the expansion of naval forces and with the acquisition of long-distance air transport, the Soviet Union now has the capability to exert military power in remote places. This was demonstrated in the airlift of military materials and Cuban troops to Angola in the mid-1970s, then repeated in Ethiopia later.

Third, the theater balance has shifted. The Soviet Union has traditionally enjoyed superiority in its land forces and has been expanding its conventional forces for more than a decade both quantitatively and qualitatively. The shift in the theater balance follows from the combination of this fact with the aforementioned two facts.

For example, in areas close to the heart of the Soviet Union such as Europe, the West has tried to complement Soviet superiority in land forces by maintaining superiority in strategic and theater nuclear weapons,*3* apparent superiority in aircraft, and qualitative superiority in tanks and guided missiles. As a result, Western Europe gained considerable resistance capability in conventional arms, and complemented by its strategic and theater nuclear weapons, it acquired a high degree of reliable security. In other regions, U.S. capability in swift long-distance intervention, supported by strategic nuclear weapons superiority, provided the requisite security.

But today, the Soviet Union has come to possess a capability for longdistance intervention. The Soviet Union, by its geographical location in the center of Eurasia, has better access to wider geographical areas than the United States. Moreover, with the deployment of SS-20 medium-range missiles and Backfire bombers, the Soviet Union is considered to be superior to the West in theater nuclear weapons. It has also reduced its qualitative lag in conventional arms and in some fields overtaken the West.

Due to these changes, the United States is no longer able to singlehandedly protect wide ranging areas on all levels. The United States' shift from a "2½ strategy" to a "1½ strategy"*4* is also a reflection of the change in its power relative to that of the Soviet Union, even though the shift was also made possible by the change in international circumstances. Moreover, because the United States is compelled to deploy it military power where it is most needed, it has to bear in mind in its deployment that the "1" in the "1½ strategy" is to face the European front and that the "½" is to face the Middle East in view of the latest international developments in the region.

The allies and friends of the United States were given nearly full security by American military power in the past. However, this is not the case any more. They are thus required to make greater efforts toward self-reliance in conventional arms on the one hand while strengthening cooperation with the United States and among themselves on the other. This point, for example, can be illustrated with the "nuclear umbrella." the credibility of the nuclear umbrella was high while the United States had superiority over the Soviet Union in strategic nuclear weapons, but now that a "party" in nuclear forces has been achieved, the credibility of the nuclear umbrella cannot be maintained for allies and friends who do not have a close relationship with the United States.

In this connection, the change in the American will is also important. As a result of the failure in the Vietnam War, the American people have grown skeptical about intervention, as illustrated by the fact that they have watched in silence the Soviet indirect intervention in Angola and Ethiopia.

As stated in the Nixon Doctrine, "... the United States will participate in the defense and development of allies and friends, but America cannot - and will not - conceive all the plans, design all the programs, execute all the decisions and undertake all the defense of the free nations of the world." The new position of the United States is that "we ( the U.S. people) will help where it makes a real difference and is considered in our interest." These words must be taken to mean that the United States will take part in the defense and development of its allies and friends only if they have considerable self-reliant capabilities and are cooperating with the United States. Otherwise Washington cannot be expected to come to their aid.

The changes outlined above have had the effect in Japan's case of augmenting the task of military security. Formerly, when the United States maintained nuclear supremacy and the Soviet naval forces were powerless, Japan was almost completely safe as long as its relations with the United States were in good order. It was not without reason that security debate in Japan was limited essentially to the Japan-U.S. Security Treaty question. But the situation has now changed. Japan of course continues to be an extremely important ally of the United States, and the United States will continue to contribute to Japan's security. Likewise, the American nuclear umbrella in the narrow sense, i.e., as a means of deterring other countries from resorting to nuclear weapons, remains in place. But, as noted earlier, the United States is no longer able to provide a high degree of security, and in maintaining regional balance of power, the military capabilities of the countries in the region have grown in importance. The credibility of the nuclear umbrella, too, has come to depend on greater allied cooperation with the United States than in the past.

Thus it has come about that Japan must seriously consider self-reliant efforts for the first time since World War II. More than just retaining overall friendly relations with the United States, it has become necessary for Japan to prepare for well-functioning military relations with America as well.

The ending of clear American supremacy in the military spheres poses much wider diplomatic implications. The change of U.S. policy toward China was an acknowledgement that the past policy of ignoring China was inappropriate, but at the same time it conformed to the policy need to exploit Sino-Soviet confrontation to cope with Soviet expansion. Thus, normalization of relations between the United States and China possessed a dual meaning. On the one hand, to normalized and stabilized the political order in the Asia-Pacific region; on the other, since it served as a means of restraining the Soviet Union, to some extent it aroused the Soviets. This is an extremely delicate diplomatic game played by the United States; the United States is seeking a breakthrough in U.S.-Soviet relations by creating the potential for entering into a kind of "entente"*5* with China. Should the United States fail to maintain this subtle balance, should, for example, Sino-U.S relations actually assume the character of "entente," the Soviets will vehemently react and adopt policies that will be disruptive to the international order.

Japan is involved to a great extent in this game. Accordingly, how to balance relations with the Soviet Union and China has become an important task for Japan's security policy. In the past, Japan's respective relations with the Soviet Union and China were matters related to the aftermath of World War II; hence Japan was exclusively concerned with reducing friction as much as possible and increasing friendship with these hostile bloc countries. But today Japan's increase of friendship with China and the Soviet Union necessarily poses power-politics implications.

There are several other potential threats to the stability and peace of the Asia-Pacific region. To begin with, the aforementioned Sino-Soviet confrontation is superimposed on the traditionally contentious relations among Vietnam, Cambodia, and Thailand, turning the Indochinese Peninsula into an arena of fierce struggle that effects the entire Southeast Asian region in the form of the refugee problem and in other ways. Next, North-South relations remain tense in the Korean Peninsula, and meaningful dialogue and exchange are yet to be seen. Should a war break out in the Korean Peninsula or should the Indochinese fighting greatly intensify the tension over the entire Southeast Asian region, Japan cannot remain unaffected. Accordingly, it must be Japan's responsibility to perform a political role for the stabilization of these areas. Fortunately, efforts for a dialogue in the Korean Peninsula have not been totally abandoned, and ASEAN is contributing to the stability of Southeast Asia. Japan can play a significant role in supporting and encouraging these moves toward stability.

Japans's{sic} diplomatic efforts in the Asia-Pacific region are the cornerstone of the first-level efforts - efforts to create a more peaceful international order - by which Japan can make a meaningful contribution. Among the fields in which Japan can take the initiative in the region seem to be arms control as well as those contained in the "Pacific Basin Cooperation Concept." Because there was less urgent need for arms control in the Asia- Pacific region than in Europe, this has been a field neglected by and large. But of late, there has been an increasing emphasis placed on regional arms control in general, and it must be noted that the significance of the issue is increasing with regard to the Asia-Pacific region.

Economic Situtation{sic}

The end of clear American supremacy in the economic sphere also has a dual meaning.

First, the U.S. position has declined relative to those of Western Europe and Japan because of their economic reconstruction and subsequent growth. This certainly signifies the success of the free-trade system of which the United States has been the central pillar since World War II. But at the same time, this very success has thrust upon Japan and many other countries the task of preserving the free-trade system. As seen in past history, a free-trade system is operated most easily when one country surpasses all the others in economic might.

Moreover, the American economy since the latter half of the 1970s has begun to show symptoms of internal weakness. The rate of increase in productivity has fallen off sharply while prices continue to rise. The causes seem to lie much deeper than mistaken economic policies of the U.S government. Of course, the United States possesses an excellent capacity for technological innovation and a rich resource endowment, and its economy retains firmly rooted strength. Still, the decline of America's international competitiveness is undeniable. Coupled with the large increase in oil imports, this decline has caused deterioration in the U.S. balance of payments and invited a weakening trend of the U.S. dollar. As a result, instability has come about in the international monetary system resting on the U.S. dollar as the key currency.

While the IMF and GATT system stood firm, Japan could pursue its own economic interests without making particular efforts for the stability of the international economic system. Now, however, it is no longer possible for Japan to depend so easily on the system.

It can be seen that the days are gone when Japan could count on a system maintained single-handedly by the United States, be it in terms of military security, politics and diplomacy, or the economy. Japan must now contribute to the maintenance and managemnt{sic} of the system as an influential member of the free world. There has been a shift from a world of "Pax Americana" to the world of "peace maintained by shared responsibilities."

Nevertheless, an inclination persists in Japan of refusal to acknowledge this reality or of seeking refuge in the assertion that it would suffice for Japan to fulfill its responsibility in the economic sphere. In view of Japan's conditon{sic}, to be sure, its central role will be economic. But apart from its economic role, Japan must also play a considerable political role and be concerned with global security problems. This shortcoming on the part of Japan is reflected in its exclusion from "politcal{sic} summits."*6* Today, when politics and economics are closely linked, Japan cannot adequately safeguard its national interests if left out of political summits. Moreover, Japan's "economic role" is mere talk, unsupported by concrete actions, as clearly shown in Japan's economic cooperation and assistance.

The North-South Problem and Economic Cooperation

Here we must remind oursleves{sic} that today's world is characterized not only by the end of American supremacy but also by the emergence of new powers. This is most obvious when considering the international economic arena. Developing countries began to exert increasing pressure in the 1970s. The divison{sic} of the world into rich advanced nations and poor developing nations has long been regarded as problematical, and it has been pointed out that to rectify the situtation{sic} extra efforts are required on the part of the advanced nations. Some efforts have been made in this regard, but their result have been less than adequate while the political power of the developing countries increased remarkably against the background of heightened nationalism. Consequently developing countries have come to demand a reshaping of the international economic system.

If the advanced industrial nations fail to meet the demands of developing countries, the latter countries may escalate their demands from reform of the existing system to its total rejection. Thus, economic interests of Japan and other advanced industrialized countries could be impaired in concrete terms in the form of unstable trade and economic relations with developing countries and the breaking out of xenophobic riots. Furthermore, the ensuing confusion in international political and economic systems could even threaten the existence of all countries including the developing countries themselves. Hopefully the U.S.-Iranian dispute is not a harbinger of things to come.

In relation to the first-level efforts described in section I for creating a more peaceful international order, the future unfolding of the North-South problem is a matter of grave concern. It will be a very critical task for Japan and other advanced nations to contribute to the domestic development of the South through the promotion of economic cooperation and assistance, thereby maintaining and strengthening friendly and mutually beneficial relations with those countries.

Japan is a peace-loving nation, but this report most strongly emphasizes that that should not be used as an excuse for neglecting self-reliant efforts in defense. But even were Japan to make the maximum efforts we think necessary for self-reliance in defense, defense outlays as measured against GNP would still be clearly less than those of other major powers. To this extent Japan should be more forthcoming than other advanced countries in offering economic and technical cooperation. In addition, Japan is expected to continue maintaining a higher growth rate than other countries, thus having a comparatively larger capacity for allocating resources to economic and technical cooperation. It should also be noted that Japan's economy is extremely dependent on outside sources for materials and energy, and that many of these sources are located in developing countries.

Economic cooperation is also central in pursuing second-level efforts: promoting friendly relations with countries that are important to Japan politically and economically. Though not assured of bearing fruit in the short run, economic cooperation has great potential for creating friendships over the long run. Since Japan's military capability is strictly limited to what is necessary for self-defense, Japan cannot exert influence on other nations with military power or build friendly relations by contributing to other nations' military security. Economic cooperation is the only positive means at Japan's disposal for use in internatinal{sic} relations.

Nevertheless, the application of economic cooperation must rest on comprehensive judgments that take into account political as well as economic considerations. At the same time, in view of the extensive economic relations Japan has throughout the world, it should also promote economic cooperation with newly industrializing countries as well as with advanced industrial nations in a form similar to that now being employed for economic cooperation to developing countries. To that end Japan must broaden the framework of economic cooperation currently in force. In addition, since economic cooperation in the form of first-level efforts does not always dovetail with economic cooperation in the form of second-level efforts, we must ascertain that these two types of cooperation are well coordinated.

As can be seen from the foregoing, there are many reasons why Japan must vigorously promote economic cooperation as an intergral{sic} part of its comprehensive national security policy. Japan has completed its modernization in less than one hundred years in a context that is completely different from Europe culturally and ethnically. This is a source of great encouragement for developing nations and also is the reason for their aspiration to learn especially from Japan's experience. Many countries are from hopeful of assistance from Japan also because it is a reliable economic power that can be counted on to be free of political ambitions. It can even be said that Japan's world historic mission is to play a leading role in creating an order between the North and the South.

It is highly undesirable that Japan's official development assistance remain limited to 0.26% of GNP (1979). The need is evident for an increase in the amount of ODA as well as for expanding the framework of economic cooperation, as noted previously. On these points, particularly the need for an increased and improved ODA program, numerous comments have been made public, so the need will not be belabored in this report. But that should not be taken as a sign of our indifference to its importance.

The Resource Issue

Last, let us touch on the issue of resources - with emphasis on the energy problem - insofar as it recently has come to constitute the greatest specific threat The oil crisis of 1973 presented the energy problem in a most dramatic fashion, teaching us the need to think of economic security. As of the present time, the energy problem confronting us is not one of an absolute shortage of oil. Rather the problem stems from projected oil shortages in the future, constraints and regional imbalances in oil supply-and-demand relations, and the unrest in the internatinal{sic} economic order with the increasing self-assertiveness of developing countries, which linked the political and the economic spheres. But whatever the causes, there can be no doubt that problems over oil and the supply of energy are with us. One can argue further that the securing of other resources as well, at least food, which is most fundamental to the people's life, has become a task for security policy.

Tasks for Japan's Security

We are living in an age when "Pax Americana" is nearing an end without any substitute order taking its place. This change has transformed the scope of the security issue from a limited one to a comprehensive one and made the issue pressing. When an order is shaken, danger is great. Unlike the past when we could rely on the sound functioning of the system, the present calls on us to work for the system's maintenance and to make self-reliant efforts to compensate for imperfections in the system.

Japan's national security efforts thus far, however, have been deplorable indeed. Over the thirty-odd years since the end of the World War II, Japan has firmly established an internal political system resting on the foundation of freedom and democracy, and it has also achieved great success in developing its national economy. There is no denying that the vitality of Japanese society is in itself a factor reinforcing security, but at the same time we must be aware that a vital society is not just a means but also an objective of national security.

While making great sacrifices, the Japanese people have at last attained the goals of modernization and industrialization that were set at the time of the 1868 Meiji Restoration. Today's economic affluence and free institutions are due in particular to the excruciating efforts made by the people as they recovered from the ruins of World War II. As indicated in many opinion surveys, the Japanese are highly content with their living conditions. Would it be posssible{sic} that they would agree to give up their freedom and well-being and submit to the ambitions of another nation were one to present itself?

Not until the Japanese people become clearly aware that their state and society are irreplaceable and must be defended will the security issue become a national task. Such an awareness is steadily increasing according to recent opinion surveys, but it leaves much to be desired; the Self-Defense Forces are not sufficiently appreciated and concern about national defense is largely absent in the people's mind.

In this respect, the most serious problem lies in the near total absence of state (goverment{sic}) machinery to deal with national security problems. This point can be demonstrated by considering the logically evident need for security against natural disasters. Measures for this purpose are being discussed; scattered planning is underway; and some measures are even operational. But a posture and system for coping with an emergency have yet to be realized. One can say that the Japanese government has existed in complete-disregard of crisis management, a most basic duty incumbent on any state. It has survived so far by leaving external crisis management to the United States and internal crisis management to the society at large.

In the pages that follow we deal with five security tasks, each corresponding to part of the existing conditions examined above. The five tasks are:

(1) Promoting Japan-U.S. relations which in terms of military cooperation are more concrete and in terms of overall cooperation are more comprehensive.

(2) Strengthening defense capability.

(3) Improving the management of relations with China and the Soviet Union.

(4) Achieving energy security.

(5) Achieving food security.

Finally, the issue of a crisis-management system is considered using the example of preparations to deal with a large-scale earthquake.

In dealing with these practical tasks arising from the aforementioned conditions, we must not lose sight of the fact that harbingers of a new order are also present. In the transition from a bipolar to multipolar international order, complex and subtle power games have come into being. But the potential for the advent of a new system also exists. The increasingly vocal demands of developing countries, if properly handled, may be the leverage for creating a more equitable international system. The ending of American supremacy has also meant a corresponding rise in the importance of various coordinating mechanisms starting with the "economic summits of major industrialized nations" and including conferences of their finance ministers, consultative organs among allies, economic organs such as the Organization for Economic Cooperation and Development (OECD), and various informal channels of cooperation. These are the avenues through which maintenance of order is now being approached on the basis of shared responsibility.

Our basic attitude must be one of remaining alert to such potential for change as we deal with the specific tasks confronting us.

III ANALYSIS OF SOME SPECIFIC ISSUES

RELATIONS BETWEEN JAPAN AND THE UNITED STATES

The close cooperative relationship with the United States has always constituted a major pillar in Japan's comprehensive security policy and it will without doubt remain to be so. We must reaffirm the importance of this relationship and understand the significance of the relationship in its broad context.

Normally the importance of the United States for Japan's national security is regarded to be the extension of the so-called U.S. nuclear umbrella to Japan and the deterring of a large-scale military attack on Japan. However, although this is important, it is not the most significant factor in the relationship. The most fundamental reason why the Japan-U.S. relationship is important lies in the fact that Japan and the United States share the same basic political principles. Japan aspires for a free and open order both domestically and in international society, and hence belongs to the "free world." Such an order is what the United States also desires, and as it is the strongest power in the "free world," it is only natural for Japan to adopt the basic policy of maintaining and developing a free and open order in cooperation with the United States.

A similar statement can be made about economic relations. Japan's economic prosperity is inseparably bound up with a free and open world economic order. Accordingly, it is the basic policy of Japan to maintain and develop such an economic order in cooperatioin{sic} with the United States and other countries. The United States has further importance to Japan as a vast market, a supplier of technology, and the largest exporter of food.

Japan-U.S. relations are also important as the basis of Japan's foreign policy. Japan is situated in Asia, where China and the Soviet Union confront each other and the potential for many conflicts exists. If Japan did not have a friendly relationship with the United States as the basis of its foreign policy, it might well be drawn into the Sino-Soviet feud and lose its diplomatic stability. Friendship between Japan and the United States stabilizes not only Japan's position in the international relations of Asia but also Asian international relations themselves. Were Japan-U.S. relations less firm, Japan's policies toward China and the Soviet Union would be extremely difficult. Any alliance of course has negative effects by instigating other countries, but when we give thought to the realities in the Asia-Pacific region, we perceive that the positive effects of the Japan-U.S. alliance in providing Japan with a stable foreign policy foundation exceed such negative effects by far.

Japan-U.S. relations, however, will probably face major trials in the 1980s basically because the positions of the two countries are undergoing a change. The relations between the two countries in military, economic, cultural,and other spheres are seriously out of balance, and this may lead to various forms of friction between the two countries.

Let us first turn to the economic sphere. Japan's gross national product has already reached 15%-16% of the combined GNP of the OECD member countries and around 10% of that of the entire world, including the socialist countries. The U.S. economy appears likely to remain stagnant for some time to come. By contrast, assuming that North-South relations remain stable, Japan's economy will no doubt enjoy a growth rate higher than that in the United States, although it will suffer a blow from the second oil crisis. As a result, it is quite likely that Japan will overtake the United States in terms of per capita GNP at some point in the 1980s. The reason behind this differential in economic growth is a gap in productivity increases. With a higher productivity increase rate, Japanese manufactured products will by and large be more competitive on the international market, and Japanese exports will continue to expand faster than U.S. exports. In this sense the positions of the the{sic} two economies are being reversed, and this itself will entail difficult psychological problems.

However, the United States still remains a superpower and its strength vastly exceeds Japan's in both military and political fields. The United States will have to continue to bear the responsibilities of a superpower. In the aftermath of the Vietnam War and the Watergate affair, the United States was inactive in its foreign affairs for a while, but this is a situation that cannot last for long, and already U.S. foreign policy is becoming more forthcoming. Yet in the process, the United States is likely to experience failures, setbacks, and frustrations. This is because a superpower has never experienced such constraint on the use of its power and such limits on its influence on the course of events as in this nuclear age. For these reasons, American citizens are likely to be placed in complicated psychological positions; while they may criticize Japan's disproportionately small burden, at the same time there may lurk in their feelings a tendency to think poorly of Japan for its lack of military and political power.

Within the United States a "diffusion of power" has been taking place and many interests and contentions are at odds with one another. As a result the U.S. political situation has become confused, and the administration finds it difficult to assert its leadership to solve problems in a constructive manner. Thus, for example, U.S. energy conservation policies have been far from thoroughgoing.

Because of the above, there is a fear that U.S. foreign policy may take a narrow nationalistic turn when it becomes active again. It is unfortunately easier for the United States to take a hard-line stance against the Soviet Union over the Afghanistan issue than seriously strive for energy conservation; it is easier for it to criticize the "flooding" of the U.S. market with Japanese products than work to increase productivity or change the industrial structure.

Nonetheless, there is a possibility that the United States will draw a correct lesson from the Vietnam War and exercise mature leadership. This is to say that the United States may move toward the direction of respecting the interests and views of its allies and seeking to maintain and manage the world order through international cooperation.

Which road the United States will pursue will greatly depend on the positions adopted by its allies. If the allies simply force a large burden on the United States and indulge in only criticizing it, narrow-minded nationalism will probably gain force in the United States. But if the allies are disposed to cooperate positively with the United States, it is likely to assume a more mature leadership role.

The first half of the 1980s is an important period when the alliance order, with the United States at its helm, should be restructured through an increase in the roles of the allies of the United States. For this reason, Japan-U.S. relations must be given the highest priority in Japan's comprehensive security policy. Japan should of course seek to cope with tangible issues, such as to avoid economic friction with the United States, but a more fundamental task for the now economically powerful Japan is to fulfill the responsibilities befitting it. Japan's efforts to foster good relations with the United States are intimately bound up with its efforts to build a better international order. For the same reason,it is also very important to forge close relations with Western Europe, Canada, Australia, New Zealand, and other Western countries.

Japan may place stress on its efforts in the economic field to build a better international order, but this should never be used as an excuse for Japan to neglect its efforts in other areas. It is undesirable for international stability that Japan continue to remain a limping "economic giant = political dwarf." Based on its economic power, Japan can contribute politically to the stability of the Korean Peninsula, Southeast Asia, and even the Middle East. The question here is one of political will and political stance. When Japan has the political will, it will be able, for example, to take the initiative in arms control in the Asia-Pacific region or participate in the United Nations Peace Keeping Forces in the Middle East.

Japan has till now almost always supported U.S. actions, albeit in a lukewarm fashion. This has invited the criticism that Japan is a U.S. lackey on the one hand, and on the other, it has given the United States the impression that Japan is an unreliable ally. Japan must change this posture and assert the interests that deserve to be asserted, criticize what ought to be criticized, and support the United States strongly and forthrightly when it deserves Japan's support.

Finally, Japan also has to strengthen its defence efforts. If Japan continues to rely on the United States for its security in almost all respects, it will foster a negative image of itself as an irresponsible dependent. Furthermore, since the United States is trying to cope with the Soviet arms buildup in joint efforts with its allies as stated before, neglect on the part of Japan in such efforts will evoke even stronger criticisms against it.

STRENGTHENING DEFENSE CAPABILITY

Defense efforts do not constitute the whole part of national security policy, but they are extremely important targets today.

This is because of the changes in the military balance between the United States and the Soviet Union, as mentioned previously. Today the U.S.-Soviet military balance on both the global and regional levels is no longer in favor of the United States, as it was in the 1960s. Consequently, the United States has become unable to provide the high degree of security to its allies that it had provided in the past. The United States is of course aware of this change in the military balance, and it is working on measures to cope with this trend. However, the United States no longer intends to shoulder alone the burden of these measures, and it has asked its allies to bear their share. While this is to some extent due to limitations of U.S. national power, it is also partly due to the fact that the United States has come to think it more desirable to maintain international order through the sharing of responsibilities. This new stance of the United States is appropriate in the light of the relative changes in national power.

History has shown that it is necessary for the West to avoid deterioration in its position in the military balance vis-a-vis the Soviet Union. The Soviet Union has respected the autonomy of nations, such as Finland and Yugoslavia, that are determined to defend themselves and possess some degree of ability to do so. On the other hand, the Soviet Union has not hesitated to use its military power in places where the Soviet Union has considered it possible to obtain satisfactory results by military operations in a short period of time, as in the case of Czechoslovakia.

This, however does not mean that Japan should strive to build up its military power to the extent that the character of its military power is changed.

Japan has hitherto pursued its defense policy by depending on the United States for "deterrent force"*7* under the Japan-U.S. Security Treaty, while possessing the minimum self-defense capability as a "denial force" according to its national strength and state of affairs. In other words, Japan's defense policy has been based on the stance that Japan totally depends on the United States for nuclear deterrence and that, against aggression with conventional forces, Japan possesses defense capability as a "denial force" in the case of small-scale, limited military aggression to make such aggression costly and to prevent invasion of Japan from easily becoming a fait accompli, and it waits for the U.S. forces to come to Japan's aid in the case of large-scale aggression. As a secondary goal, Japan has aimed to establish a basic self-defense foundation for making efforts to respond to changes in circumstances.

As stated in the "National Defense Program Outline" (adopted by the Cabinet in 1976), which sets forth Japan's basic defense policy, the goal of Japan's defense capability is "the maintenance of a full surveillance posture in peacetime and the ability to cope effectively with situations up to the point of limited and small-scale aggression." This capability is to be provided with a foundation such that "when serious changes in situation demand, the defense structure can be smoothly adapted to meet such changes."

Japan's policy to possess self-defense capability as a denial force is in principle correct. There is a limit to the use of military power in the nuclear age, and that limit is quite low. Any country will try to avoid military action that might induce a nuclear war. At least such is the case with regard to military action against an ally of a superpower or a country that has close ties with a superpower. In the case of Japan, a large-scale military conflict is effectively avoided under the Japan-U.S. security arrangements. It is sufficient for Japan to possess this denial force in its defense capability with the premise of the Japan-U.S. security arrangements.

A policy of so-called autonomous defense would necessitate fairly enormous outlays. It would also lower the level of Japan's security by provoking aversion in other countries and thereby increasing the possibility of inducing threats which exceed Japan's ability to defend itself. Such a policy, therefore, should not be adopted.

As observed above, possession of a denial force is literally a minimum necessity. Even for a superpower it is difficult and sometimes even impossible to provide security to an ally that does not have such capability. It is the reverse aspect of the fact that it is nearly impossible to exercise largescale military power, and therefore that use of such a threat is not effective, as witnessed in the ineffectuality of the "massive retaliation strategy."*8* While it is possible for a superpower to deter other countries from imposing a threat to use their large-scale military forces against its allies, it is difficult for a superpower to save a nearly defeated ally by using its own large-scale military forces. Especially when one considers the fact that the United States has cut back its forward-deployed forces and thus can no longer provide as high a degree of security as before, the possession of a denial force is obviously the minimum need.

However, the objectives set forth in the "National Defense Program Outline" regarding firm maintenance of the Japan-U.S. security arrangements, possession of a denial force, and consolidation of a self-defense foundation have not been implemented. This is the problem.

First, regarding firm maintenance of the Japan-U.S. security arrangements, almost no plans or preparations exist for the effective use of U.S. military forces for Japan's defense. The only progress has been the Japan-U.S. Subcommittee on Defense Cooperation, set up in 1975, and the "Guidelines for Japan-U.S. Defense Cooperation," established in 1978. Few Japan-U.S. joint exercises have been carried out, and during the decade up to 1978, there had been no joint exercises by the Air Self-Defense Force and the U.S. Air Force. However, signs of improvement can now be seen in this regard.

Furthermore, almost no consideration has been given to measures to secure the sea lanes necessary for the United States forces to come to Japan's aid. If this situation is not rectified, it will be difficult to receive assistance by means other than air transport. Another problem is that a plan to provide logistical support to these U.S. forces has not been established, and the legal status of such forces has not been clarified.

Second, there are many defects in the software needed for the effective operation of the Self-Defense Forces in the face of an emergency. Until recently, no study had been conducted on measures to cope with a national emergency. Dealing effectively with a crisis requires prompt acquisition of accurate information, but Japan's ability in this field is still underdeveloped. Japan's ability to collect political and military information is especially poor. Furthermore, a decision-making system in the event of a crisis has not been established in concrete terms, and legal arrangements have not been worked out in many respects. The need for "emergency legislation" is but one of the many cases in point. Among the defects in legal arrangements is the problem of not being able to strengthen the SDF's surveillance posture and to improve its ability to respond quickly by taking, before defense operation orders are given, such interim measures as expropriating land for the construction of camps, procuring materials for military use, and calling up reserve SDF officers.

Third, looking at Japan's combat capability, in air forces Japan possesses enough aircraft not to easily hand over air control to another nation. However, Japan's air bases do not possess survivability,*9* such as air defense capability and the ability to repair damage, and its radar sites are deficient in survivability and ability to wage electronic warfare.*10* In the event of an attack, therefore, the defense system will be incapacitated by rendering both air bases and radar unusable even before the aircraft are destroyed. In a short period of time Japan will find itself without air forces even if it still has aircraft.

The current level of ground forces is, in a word, insufficient, and it is even worse at present than it was 15 years ago. This is mainly because the ratio of expenditures for equipment procurement, facility improvement, and maintenance has, as a result of budget restraint, been declining in the defense budget since the late 1960s, while much of the defense budget has been absorbed by expenditures for personnel and provisions. This trend became especially conspicuous in the late 1970s. In terms of equipment renewal, it has been possible to replace equipment only at the rate of 5% a year in recent years. It would thus take 20 years to replace all equipment, which means that about half of Japan's defense equipment is two generations old. In modern warfare, arms two generations old are virtually useless. In particular, Japan's ground forces were relatively weakened because of the fast technology progress in the 1970s. And as has been often mentioned, current stockpiles of ammunition are definitely insufficient.

Regarding naval forces, Japan's warships are very weak in electronic warfare capability and in anti-ship missile warfare capability. Most of Japan's warships lack the capability to prevent an enemy from landing on Japan because they are unable to protect themselves against air attacks or to attack enemy ships. While newly built warships are being equipped with such capability, the cost is high, and the number of warships may decline if modernization is carried out. Furthermore, most of the torpedoes and mines Japan possesses are obsolete and not ready for immediate use in an emergency.

Finally, the SDF has no system for integrated command and control of its three services. The smaller the military forces, the greater is the need for integrated operations, but the three services of the SDF possess no unity of structure, and it is almost impossible to expect the present Joint Staff Council to perform an intergrated{sic} control function. Furthermore, the SDF does not even have a central command facility.

In the light of these shortcomings, it is no exaggeration to say that only half of the defense capability that the SDF formally possesses as set forth in the charts and tables of SDF forces and equipment can be counted on as actual combat power in the event of an emergency.

The research and development that is very important for the consolidation of a defense foundation has virtually been neglected. This is clearly illustrated by the fact that the ratio of R & D expenses in defense expenditures is unbelievably low, only 1.0% in fiscal 1980 in Japan, compared with a ratio of about 10% in other industrialized countries.*11* When one considers that Japan's defense expenditures themselves are small, it can be understood how small are the R & D expenses for Japan's defense.

Remedying the above-mentioned deficiencies is a task deserving high priority. Such a remedy would be nothing more than the implementation of the "National Defense Program Outline." Actually, it is negligence on the part of the government that measures the government itself decided to take have not been carried out. The government has a responsibility to inform the people that even the minimum denial force has not been secured and to promote early implementation of the "National Defense Program Outline."

This goal can be achieved without deviating to any substantial degree from the Cabinet decision of 1976 that defense expenditures are not to exceed 1% of the GNP. Even if R & D expenditures are drastically increased to 5% of the defense budget, facility improvement expenditures are doubled to 5%, and equipment procurement expenditures are raised from the present 20% to 30%, total defense expenditures will still fall between 1.0% and 1.1% of the GNP, if coupled with curtailment of unnecessary expenditures, which will be discussed later.

The fact that Japan's overall defense expenditures are so small makes the ratio of personnel and provision expenditures high, and these expenditures plus base countermeasure expenditures, which are not really defense expenditures, constitute more than 60% of the total defense expenditures. In contrast, the combined expenditures for equipment procurement, R & D, facility improvement, and maintenance amount to less than 40%. Therefore if outlays for equipment procurement and other items are increased as proposed above, the impact on the proportion of defense expenditures in the GNP will be comparatively small. The real amount of increase will be no more than about ¥400 billion if calculated using the fiscal 1980 defense budget.*12*

This analysis indicates that Japan's defense expenditures currently fall below the minimum amount necessary for Japan's defense capability to be of significance. Yet the fact that the SDF has not yet been meaningful as a denial force is partly because the volume of arms, for which the budget is insufficient, has not reached a significant level and also partly because total combat forces have not been systematized. Setting up a system of command and control and strengthening air bases and radar sites are measures that can produce outstanding results at relatively little expense.

First, the fact that integrated operation of the three services of the SDF has not been planned out is due to negligence on the part of the Defense Agency. In particular, the three services keep their own district headquarters separately, and they have placed more executive staff members there than deemed necessary. This is both an impediment to comprehensive, systematic operations and a waste of the defense budget. Construction of a central command facility and a system for integrated command and control will become possible by curtailing these unnecessary expenditures.

Next, regarding the SDF's arms setup, there is a tendency to be satisfied with possessing a full set of frontline equipment. No devices have been instituted for the most effective implementation of pure self-defense, and survivability and logistical support have also been neglected.

For example, ground forces can be made more effective with the same budget by employing the missile as the major item of equipment and then organizing units accordingly. NATO's thoroughgoing policy to strengthen defense, for example, calls for large numbers of anti-tank missiles. For naval forces, small, high-speed missile boats would be a highly effective means for pure self-defense. Japan only uses its military forces for self-defense, which means that except for some of its maritime force, all its military forces are deployed only in the nation's immediate vicinity. Therefore it should be possible to contemplate a new arms setup. The aforementioned vulnerability of Japan's air bases and radar sites illustrates one instance of how lightly survivability is considered in Japan's defense setup. In particular, making air bases survivable would noticeably strengthen the capability of the Air Self-Defense Forces.

The absence of these efforts in the past should cause concern, for this shows that no efforts have been made to overcome the difficulties entailed by the defense budget restraint. If the above-mentioned efforts are carried out, it will be possible for Japan's SDF to secure a substantial and significant denial force by increasing defense expenditures about 20% from the present level.

In this report the "National Defense Program Outline" has been regarded as fundamentally correct, and our study has been based on this assumption. Of course the outline itself is the sort of document that requires revision when changes occur in the international situation. But on the assumption that Japanese military power is strictly for the purpose of self-defense, there will be an upper limit to the amount of military power needed, and this limit should not be changed easily as long as Japan-U.S. relations remain close. The problem is that there is no official setup to constantly observe, analyze, and evaluate changes in the international situation and to examine the significance that such changes may have for Japan's defense policy.

RELATIONS WITH CHINA AND THE SOVIET UNION

In the 1970s Japan-China relations made remarkable headway. The two nations normalized diplomatic relations in 1972 and, after a series of minor complications, concluded the Treaty of Peace and Friendship in 1978. Economic exchange between Japan and China made similar progress, and several large-scale projects were agreed upon in the late 1970s. Conversely, Japanese-Soviet relations showed little change. The Soviet Union regarded this situation as a deterioration of the relations between the two nations and made a response by deploying considerable military forces on three of the four "northern islands," namely, Kunashiri, Etorofu, and Shikotan.

The primary reason for the Soviet Union's apprehension over the progress in Japan-China relations is that the two-way economic exchange will contribute to China's modernization and thereby make China stronger. The Soviet Union is particularly sensitive to economic exchange that may lead to the strengthening of China's military power. Beyond that, the Soviet Union seems to regard the development of Japan-China relations as having a power-politics implication as well within the context of international politics. In other words, the Soviet Union seems to hold the view that the existence of the Japan-U.S. Security Treaty, the conclusion of the Japan-China treaty, and the normalization of Sino-American relations might lead these countries - the United States, China, and Japan-toward a tripartite alliance, and further that, taking into consideration NATO as another element, a net to encircle the Soviet Union is taking shape.

This Soviet reaction is excessive but not entirely groundless. One may point out that China is still far from achieving modernization and that the extent to which other countries can contribute to this modernization is limited. Still, given China's large population and the unreasonable apprehension with which the Soviet Union sees China, it is understandable that the Soviet Union looks at China's modernization with mixed feelings. The fear over the formation of a U.S.-Chinese-Japanese alliance is not a rational one, since Japan has no intention of forming such an alliance and neither the United States nor China seems to be contemplating to go that far. Nevertheless, regardless of Japan's own intentions, the development of the friendly relationship between Japan and China does carry implications of power politics. For one thing, fierce rivalry between China and the Soviet Union continues. For another, despite American and Soviet attempts at detente, a fundamental confrontation exists between the two nations, which gradually became critical in the latter half of the 1970s and was further intensified by the Soviet intervention in Afghanistan. In this situation, as is indicated in statements made by both American and Chinese leaders, the United States and China consider Sino-American relations as a part of their policy to control the Soviets.

The tendency toward development in Japan-China relations on the one hand and stagnation in Japanese-Soviet relations on the other will probably continue in the future. The following points would bear this out.

First, there is an actual dispute between Japan and the Soviet Union over the "northern territories," whereas no such situation exists between Japan and China. As background to this situation, it can be noted that Chinese politicians are appreciative of the sensitivity of the Japanese and have adopted a flexible attitude toward Japan, whereas Soviet leaders have been indifferent in their dealings with Japan. This difference may partly come from the fact that China places higher political and administrative priority on relations with Japan than the Soviet Union does.

Next, it is undeniable that the Japanese people have an affinity for China but look at the Soviet Union with caution. This is one of the reasons why Japanese politicians are less enthusiasitic{sic} to improve Japanese-Soviet relations than they are to improve Japan-China relations.

As a practical reason, we must not overlook the fact that the central part of China is closer to Japan than is the central part of the Soviet Union, and therefore Japan-China exchange takes place with greater ease.

Thus, the harmonization of Japan-China relations with Japanese-Soviet relations entails difficulties. Recent events in particular require that care be taken against the emergence of a vicious circle of steadily progressing Japan-China relations and steadily deteriorating Japanese-Soviet relations. In other words, the Soviet Union's reactions to the progress in Japan-China relations could have a counter-productive effect.

The Soviet Union adopts both hard-line and soft-line policies: On the one hand, the Soviet Union is gradually reinforcing its military posture by turning the northern islands into military bases; on the other, it is also calling for economic exchange. In this combination of policies, it is the former that stands out. Taking into consideration the factors cited above, it is likely that Japan will regard the call for economic exchange as insufficiently attractive in realistic terms and become more concerned about the buildup of Soviet military power. In fact, the Soviet Union's reinforcement of military power increases the real threat to Japan.

Moreover, it is an undeniable fact that the military nature of the Soviet Union's foreign relations is becoming increasingly obvious. This was confirmed decisively by the Soviet intervention in Afghanistan. Soviet diplomacy strongly reflects the philosophy of power.

If the vicious circle of better Japan-China relations and negative Soviet reactions is left unattended, thus greatly aggravating Japanese-Soviet relations, Japan's national security will be affected in an extremely adverse way. This is because the Soviet Union, at least for the time being, is the only potential threat to Japan. The diplomatic principle that friendly relations with more unsociable countries should be developed as far as possible also tells us that deterioration of Japanese-Soviet relations must not be left unattended. Thus, breaking or at least halting this vicious circle is a task of extreme importance in Japan's security policy.

However, establishing friendly relations with the Soviet Union will be no easy task. This has been a difficult question not only for Japan but also for many other countries. The reason for this probably lies in the way the Soviet Union looks at international politics, particularly in its unique philosophy of power. The Soviet Union's stance is twofold: On the one hand it tends to feel threatened by the rest of the world and hence to believe it necessary to ensure its security by equipping itself with a strong military force; on the other, it tends to wield its authority quite overtly in situations where it enjoys supremacy. This being the case, a country must maintain a profile so that it neither appears weak to Moscow nor appears threatening or likely to give a sense of isolation to Moscow. In other words, what is required are skills to deal with the Soviet Union in a self-confident and at the same time unhostile manner. The difficulty lies in how to harmonize these two needs.

By no means can consolidation of Japan's defense capability up to the level of a denial force pose a threat to the Soviet Union, and hence this consolidated capability will not obstruct Japanese-Soviet relations. This level of defense force is also necessary so that Japan will not appear to be an easily maneuverable country. The issue at stake is how Japan can augment its exchange with the Soviet Union and strengthen the bonds between the two nations. This problem has never been easy, and now it is being rendered all the more difficult by the Soviet invasion of Afghanistan. The present task throughout the world is to demonstrate that the strengthening of Soviet military power will not bear fruit. However, it will again become possible and even necessary to expand contacts with the Soviet Union in a few years. Although shifts may occur in the focus of emphasis due to changes of circumstances, there will be no substantial change in the basic line of Japan's policy of dealing with the Soviet Union in a self-confident and at the same time unhostile manner.

ENERGY SECURITY

As noted in section 1, efforts to secure energy must be comprehensive. Since Japan has an absolute dearth of domestic energy resources, particular care must be taken for first-and second-level efforts to create a favorable international environment entirely and partially.

Since such energy sources as oil, natural gas, coal, and uranium are all world commodities, no single nation can expect to secure enough of them at low prices. Therefore, the first thing we must consider is the efforts on the overall level to ensure adequate supplies for the entire world. On the basis of this consideration, Japan must endeavor to maintain friendly relations with oil-, coal-, and uranium-producing countries that are important to Japan.

Japan of course must not neglect self-reliant efforts in stockpiling, securing and maintaining domestic resources, and managing supply-and-demand relations in emergencies. But we must also realize that it is next to impossible for Japan, a country now accounting for one-tenth of the world economy, to survive for a long period of time by relying solely on its efforts in the field of energy.

There is another meaning in the comprehensive nature of energy security. This is that energy security policies must be worked out in general harmony with individual policies in such diverse fields as military affairs, world trade, the international monetary system, and the domestic economy.

It is beyond question that stability in the Middle East, particularly in the Gulf region, is a prerequisite to securing a stable supply of oil. It is also important to find ways to ensure the safe passage of tankers through the long transport route passing the Indian Ocean, the Malacca Strait, and the South China Sea. Since Japan cannot resort to its own military power to protect tankers in these areas, it must give adequate consideration to alternative policies for this purpose and be willing to support the cost they entail. In addition, it is well known that compatibility of developing nuclear power and preventing nuclear proliferation is hard to attain. An energy gap will result if the latter is pursued too vigorously.

The energy crisis dating from 1973 is at once a problem of quantity and a problem of price. Soaring prices for energy, because of the uneven allocation of resources, bring about drastic changes in income distribution between states as well as between corporations. In oil-consuming countries such soaring prices induce a decline in real income, thus causing serious political difficulties in implementing domestic economic policies, particularly anti-inflation policies. In oil-producing countries a vast amount of petrodollars has accumulated, which, coupled with the large trade deficit incurred by the United States as a result of its increased imports of oil, has shaken the international monetary system. On the one hand, the accumulation of petrodollars forces non-oil-producing developing countries to accumulate debts and causes stagnation in the international circulation of funds. On the other, it encourages oil-producing countries to take a resource conservation policy and to curb production, which in turn strains supply-and-demand relations of oil, further inviting higher oil prices. Thereby a vicious circle is set in motion.

In considering the problem of energy security, we must distinguish medium-and long-term crises from short-term crises that come suddenly. We must bear in mind above all that medium-and long-term crises are not something in the distant future but something already to a considerable extent upon us. The events in Iran after the Revolution have completely betrayed the optimism that followed the initial shock of the first oil crisis. The second oil crisis saw a doubling of oil prices within a period of little more than a year, with the amount of increase far exceeding the size of the price hike at the time of the first oil crisis. The gravity of the adverse effects of this price increase is gradually being felt throughout the world as economies stagnate, prices soar, and deficits grow in balances of payments. We must clearly realize here that the era built on a cheap and abundant supply of oil is rapidly coming to an end.

Oil supply and demand at the present time are in near equilibrium partly because of the decline in consumption caused by high prices. But in terms of medium-and long-range prospects, the energy crisis will become even more serious for several reasons.

First, the demand for energy should continue to increase, although not at a pace as high as before. The success of the advanced countries' energy conservation efforts is not guaranteed, and even if they are successful, developing countries will certainly consume more energy as they undergo economic growth in the future.

Second, it is becoming more difficult to increase oil production. Almost all OPEC nations are strengthening a resource conservation policy, and the capacity to increase the level of production is limited in nations like Saudi Arabia. The Soviet Union as well cannot be expected to expand its production capacity, while progress in the development of oil fields in other countries has not been very satisfactory. Oil has now become a highly politicized commodity; giving rise to concern that its supply may be reduced for other than physical or economic reasons. This would signify the advent of "a crisis that could not be solved with money."

Furthermore, the switch to alternative energy sources is running behind schedule. In the case of nuclear energy and coal, quantitatively the most promising alternative energy sources, plans have been delayed considerably due to unresolved problems involving safety, environment, and cost. The prospects for oil shale and tar sand are still uncertain. As to renewable energy sources, solar energy and biomass have good possibilities but will probably not be in general use until the 21st century, while wind energy, geothermal energy, and others are limited in their supply volume.

Generally speaking, the 1980s is a transition period from the old "fossil fuel era" centering on oil to the 21st century's "renewable energy era." In this decade, it is essential to implement programs suited to the new era in a vigorous and systematic way, and to seriously reassess the order and values based on abundant and cheap oil. People tend to lose sight of this perspective when temporary relief in supply and demand follows a shortlived crisis. However, since energy policies require considerable lead time, a delay in the formation of an adequate transitional program may have disastrous consequences.

Along with medium-and long-term crises, unexpected short-term crises are of great concern. Below are examples of such crises.

First are short-term crises triggered by political causes, such as turmoil in oil-producing countries or a war between nations in the Middle East. Since friction caused by modernization and industrialization is intensifying in the Middle East, there is no small possibility that revolutions or civil wars may occur in this region. Moreover, a war in the Middle East is also a possibility, for the Arab-Israeli dispute is still unresolved and the Soviet Union is showing an stance aimed at a southward push. A probable outcome in such a situation would be a complete stoppage or cutback of oil supplies, or an embargo, each lasting for some time.

Second are short-term crises triggered by physical causes, such as oil field accidents, tanker collisions, or nuclear power plant accidents. Although the amount of supply that would be cut off by any of these accidents would probably not be great, a tanker collision could have grave consequences depending on where it occurs, and an accident at a nuclear power plant would lead to increased oil requirements for substitute thermoelectric power plants.

Finally, a temporary supply deficiency could result from a breakdown in negotiations for oil procurement.

In response to these crises, Japan should adopt the following mediumand long-term policies.

(1) Japan should promote programs of energy conservation, development and utilization of alternative energy sources, and development of new energy technologies, by making clear priorities among these programs with regard to such factors as costs and benefits, lead time, and volume of energy output. Japan should also 'cooperate as much as possible in financial and technological terms with other advanced industrial nations. Although the so-called soft energy path*13* cannot immediately replace the traditional hard energy path because natural energy is low in concentration, Japan should make use of soft energy in certain regions where it can constitute enough energy supply, bearing in mind its economic efficiency.

(2) Recognizing the shift in oil transactions away from those through the oil majors to direct and governmental transactions, Japan should cooperate with other advanced nations in preventing confusion in transactions.

(3) Japan should promote dialogue between oil-producing and oil-consuming countries in which they discuss cooperation of advanced nations in the industrialization of developing countries, including oil-producing countries, and smooth recycling of the petrodollars accumulated by oil-producing countries.

(4) Japan should strengthen its relations with oil-producing countries and also countries producing coal and uranium, such as Australia, Canada, and the United States, and promote technical and other forms of cooperation with these countries.

(5) Japan should promote cooperative relations with the United States, the Soviet Union, Saudi Arabia, and other countries that decisively influence the medium-and long-term energy outlook, in accordance with the policies that best suit its own conditions, while keeping international cooperation in mind.

(6) For itself, Japan should explore and develop oil resources in its continental shelf and at the same time continue efforts for development and utilization of nuclear energy and coal.

As short-term measures to cope with an emergency, Japan should adopt the following in particular.

(1) Participate in and help improve the emergency allocation system of the International Energy Agency.

(2) Increase the stockpiles of oil, coal, and uranium.

(3) Examine alternative marine transport routes in case a situation occurs in which existing routes, such as the Malacca and Lombok straits, are blocked to traffic. Also, secure a constant volume of marine transport capacity.

(4) Improve information systems so that Japan can anticipate impending crises accurately and quickly; prepare workable supply-and-demand management programs for emergencies, including coupons and a rationing system for energy and other vital materials.

The government should seek public understanding of the necessity of these short-, medium-, and long-term security policies and make it clear that such policies may necessitate great patience and sacrifices on the part of the people. It is only on the basis of national support and confidence that a comprehensive energy security policy can be effectively implemented. of the people. It is only on the basis of national support and confidence that a comprehensive energy security policy can be effectively implemented.

FOOD SECURITY

Japan relies heavily on what it imports from abroad to feed its people. More accurately, Japan's food supply essentially has a dual structure. On the one hand, Japan is either completely or to a high degree self-sufficient in such items as rice, vegetables, fruits, and marine products. On the other, due to almost revolutionary changes in dietary patterns over the last 20 years and the increased consumption of bread, noodles, livestock products, and fats and oils, Japan is almost completely dependent on imports for its supply of wheat, soybeans, corn, and other raw materials for the production of these food items.

An "original calory" calculation will help put this situation in proper perspective, showing that Japan is far from being self-sufficient in its food supply. When one calculates self-sufficiency by means of calory counts of all food items consumed by the Japanese, converting such items as meat, milk, and eggs into the original calories of foods and feeds, one finds that Japan is less than 50% self-sufficient, a level that is expected to continue throughout the 1980s.

The above indicates that the Japanese diet is highly dependent on imports from abroad and that the nation's living will be severely affected should these imports be cut off by any chance. In this respect Japan is highly vulnerable. However, it would be too hasty a conclusion to insist that Japan must increase its level of self-sufficiency. It would be neither realistic nor necessary to do so. Japan must formulate its food security policy by considering the circumstances under which the supply of food from abroad might be stopped or reduced, by estimating such probabilities, and by considering the possible impact of such circumstances.

Theoretically speaking, the following cases can be postulated as threats to the flow of food from abroad over the short-, medium-, or long-term.

(1) Maritime transport to Japan might be paralyzed by strikes of longshore workers in exporting countries, by the disruption of transportation routes to Japan, or by the effects of international conflicts.

(2) Poor harvests in the major exporting countries might cause a reduction of food supply to Japan. The effects of this contingent situation would be most alarming if the major exporting and importing countries should experience poor harvests simultaneously.

(3) Worsening of Japan's diplomatic relations with the major exporting countries might lead to a political decision on the part of the exporting countries to limit exports to Japan.

(4) The emergence of disequilibrium between the world population and its food production from a longer-term perspective might make it difficult for Japan to obtain food from abroad.

The suspension or reduction of food supplies resulting from case (1) would have serious consequences but only of a temporary nature. In case (2), the suspension or reduction of supplies would last longer, but the adverse consequences would be of a limited nature. Since the major exporting countries at present and in the foreseeable future are the United States, Canada, Australia, Argentina, and other countries that are either allies or friends of Japan, and since the Soviet Union is the largest importer of foods, it is almost inconceivable that the major exporting countries would supply food to the Soviet Union to the detriment of Japan. Case (3) would occur only if Japan seriously impaired its relations with the United States, Canada, Australia, and other nations to such an extent that these countries became hostile to Japan. Such a turn of events simply means a total failure of Japan's diplomacy and is unlikely unless Japan makes a gross mistake. If this case should come about, the very existence of Japan would be at stake, hardly just food security. Case (4), which is the possibility of an emergence of disequilibrium between the world population and its food production, is almost inconceivable at this moment. However, such a case cannot be totally ruled out over the long run, and if it should occur, the consequences would be devastating. Such a crisis will not become real all of a sudden. Rather it can be foreseen well in advance.

As examined above, a suspension or serious reduction of food supply is unlikely to occur at present, and even if such a situation should occur, it would be limited in scale and in duration. Nonetheless, food is a basic material to the security of national life. Therefore, though the possibility of a food crisis is small, the consequences would be both far-reaching and serious if one should occur.

Among primary commodities, food as an international commodity accounts for the largest amount of trade next to oil. However, unlike manufactured products, food can only be exported when the producing countries have surpluses after supplying their own people.

In addition, if so-called petrodollars, increasing the excess in international liquidity, are channeled into grain markets in time of worldwide poor harvests, it is feared that international food prices might fluctuate even wider than they normally do in accordance with crop performance.

Furthermore, the possibility cannot be ruled out that a crisis as described in case (2) might not be of a limited nature as a result of the somewhat tighter general supply-and-demand relations that might emerge in 10 years' time.

Food security policy must be formulated with the above-mentioned considerations in mind. It is obvious that the argument strongly calling for an increase of food self-sufficiency, and the argument denying the importance of food self-sufficiency, are both simplistic and unrealistic. The former argument means the expansion of arable land in the country. This requires tremendous cost,*14* and it is also questionable as to what extent arable land can be physically expanded in Japan. Moreover, raising the level of self-sufficiency in food supply necessitates further protection of Japan's agriculture. However, the adoption of such a policy would lead to a greater burden on consumers, invite international criticism, and raise doubts about Japan's commitment to the principle of free trade.

The other argument is that since everybody benefits from cheap and abundant food which Japan can freely import from abroad, we should thoroughly apply the principle of free trade to the agricultural sector as well, even if this causes a deterioration of Japan's agriculture. However, this argument does not take into account the possible situation that may occur under case (4). If combined with an appropriate agricultural policy, the principle of free trade could be promoted without further deterioration in Japanese agriculture. Japan could, and also should, take this policy. Since even a short-term crisis may cause a sharp decline in the national diet and bring about social unrest, it is inappropriate to totally ignore the level of self-sufficiency.

Thus, it is essential for Japan to obtain a national consensus concerning the most suitable level of self-sufficiency by considering thoroughly the special characteristics of food production and the future supply and demand of food in the world market. A healthy combination of self-sufficiency and importation from abroad is the only way for a country like Japan with a densely concentrated population of over 100 million living in a highly industrialized society to respond to the diversified needs of its affluent people on the one hand and to meet the minimum conditions of its food security on the other.

The foregoing discussion demonstrates that the food security policy must be a combination of international cooperation and self-reliant efforts.

In short, one of the mainstays of the food security programs is to help increase the global production of food. This is particularly important as a measure against a food crisis which may be triggered by a long-term imbalance between supply and demand. A central part of such programs should be assistance to developing countries with a low level of food production technology for the improvement of their productivity. Japan's high level of food production technology can be utilized to assist developing countries in their agricultural production. Next, it should not be forgotten that incentives for increased production are essential in order to raise food production. In this regard, concerted international efforts should be made to create a stable level of demand. It should not be neglected that instability in the world grain markets also poses a great problem to the food-producing countries.

We cannot, however, depend totally on global supply-and-demand relations of food because we must survive even in a situation where food supply-and-demand relations worsen on a global scale. In dealing with such a crisis, one has to realize that it can be foreseen well in advance but that agricultural productivity cannot be raised immediately.

What is at issue here is not the degree of self-sufficiency Japan enjoys in normalcy. Rather it is the extent to which Japan can increase its level of food production to protect national life in time of emergency. Therefore, we are led to yet another mainstay of food security policy, which is to keep potential production capacity at the highest possible level. In this sense, it is necessary to keep an adequate amount of agricultural workers, seeds, and arable land even in times of normalcy, so that in times of emergency the output of rice, wheat, and potatoes can readily be increased.

Stockpiling is the most important aspect of policies for temporary food shortages. At present, government funds are spent to keep approximately seven months of rice, three months of wheat, and one month of edible soybeans and feed grains in reserve. The private sector dislikes to accumulate reserves because they increase the level of dead stock. Therefore, a system must be worked out to place reserves under the management of public authorities. Once the problem of old rice accumulated under the existing Foodstuff Control System is solved, the government should try to establish a rice reserve system that maintains a fixed quantity of rice for emergency purposes while disposing of surpluses for industrial use, livestock feed, and other uses in accordance with the principle of priority disposal.

Stockpiles are useless unless a system to make the best use of them is established. Therefore, to protect the lives of people in times of natural disasters or of reduced overseas supplies, a special distribution network for rice should be established which would enable public authorities to secure distribution channels and to manage the necessary amount of rice under their control. Also to be considered is a system enabling the authorities to enforce food rationing programs and to regulate distribution channels in an emergency.

Not only the national and local governments but also agricultural associations, food industries, and consumer households should keep their own reserves, and methods for this purpose should be devised. These reserves are very useful for such disasters as large-scale earthquakes.

In order to deal effectively with a short-term crisis, international cooperation is also needed together with self-reliant efforts. In particular, what will be indispensable in the future is the establishment of international buffer stocks to prevent wide fluctuations of prices, which may be caused by different crop performances.

Finally, the issue of information-gathering capacity should not be neglected. Although Japan is one of the leading importers of food, the ability of the Japanese government to gather information on the international supply and demand for food is extremely limited compared with that of the U.S. Department of Agriculture. The government's ability in this respect should be strengthened.

COUNTERMEASURES FOR LARGE-SCALE EARTHQUAKES - CRISIS-MANAGEMENT SYSTEMS

Among the major natural disasters that occur in Japan, large-scale earthquakes in densely populated areas stand out most for the extensive damage they cause and the frequency of their occurrence. Japan is one of the most earthquake-ridden countries in the world, with magnitude 7 earthquakes occurring at a frequency of about once every year. Japanese society is highly urbanized, and vital functions in the political, economic, and cultural fields are concentrated in large cities, where most of its population dwells. Furthermore, most large cities are located in areas with a weak geological foundation, and in terms of structure and layout they are-extremely vulnerable to earthquakes and such attendant disasters as fire.

If a major earthquake were to strike. Japan's large cities and if the secondary disasters that follow were not effectively controlled, there is no knowing how much damage would be done. A decline in industrial capacity, difficulties in supply of goods, rising prices, and credit uncertainty, which would be caused by such a calamity, would spread throughout the country. Japan might lose international economic competitiveness and even the very foundation of its role in international society might be affected. This is the reason why measures to cope with large-scale earthquakes should constitute a part of Japan's comprehensive security policy.

If the coming of an earthquake can be predicted, we can control much of its damage. This is especially true for secondary disasters, which generally cause much more damage in such from as fires than does an earthquake itself in such form as the collapse of buildings. Therefore, an increased ability to predict earthquakes is the first step in coping with them. Earthquake prediction efforts are currently being made by the Meteorological Agency, universities, the Geographical Survey Institute, and other organizations. Observations for earthquake prediction are being concentrated particularly in the Tokai region, an area designated for extensive earthquake countermeasures under the Special Measures Law for Large-Scale Earthquake Countermeasures. But to date, although gigantic oceanic-origin earthquakes (about magnitude 8) can be predicted with some accuracy, a magnitude 7 earthquake, especially of inland origin, is technically difficult to predict. (On the Japanese seismic scale, such a magnitude of earthquake is anticipated to reach the 6th or 7th degree depending on the geological conditions.) It is strongly needed, therefore, to attain greater ability in earthquake prediction by overcoming such technical difficulties.

The extent of damage caused by an earthquake is not estimated merely by the magnitude, that is, the amount of seismic energy released. Apart from geological characteristics, in large cities the presence of open spaces, the conditions and structures of buildings, the locations of gasoline stations and other hazardous facilities, and the flow of people on the streets and on public transportation are among the factors that will affect the extent and types of damage, especially that from secondary disasters.

Accordingly, the second step to cope with large-scale earthquakes is to draw up a carefully examined micro-zoning map for each area in large cities, showing the expected main causes of earthquake-related damage, and to prepare scenarios of conceivable damage based on these maps. These maps and scenarios are indispensable for undertaking and promoting disaster control efforts by the national and local governments; they are also useful for similar preventive efforts to be taken by business circles and households. For this purpose, micro-zoning maps and damage scenarios ought to be made available to the public after taking due account of their possible impact.

Since many factors are involved in the damage inflicted by large-scale earthquakes, disaster countermeasures must be especially comprehensive. To raise the safety level of the country as a whole including its urban areas, we should not address ourselves to a policy formation solely designed for disaster control. Instead, the disaster-control viewpoint must be brought into all relevant policy formulations, such as urban and regional planning, transport and traffic policies, communications policies, and environmental planning, and it is also necessary that all these be incorporated into an organic system. In order to realize such a comprehensive system, the functions of both national and local-level councils on disaster control must be expanded.

To minimize the confusion after the announcement of an earthquake forecast, to reduce damage when the earthquake has struck, and to achieve prompt reconstruction, national and local governments must be equipped with proper management at a time of emergency. Under the Basic Disaster Countermeasures Law currently in force, mayors of municipal bodies are empowered to issue evacuation orders, designate danger zones, call out firefighting units, and perform other functions. Emphasis is evidently placed on the "local front" in Japan's disaster-control system. It is important, however, that such local efforts be linked in an organic way with prompt and effective decision making at the national level.

In order to improve the aforementioned emergency-management capability, at least the following measures are suggested for implementation:

(1) Establishment of command and control centers with sufficient survivability against earthquakes and secondary disasters like fire.

(2) Improvement of fail-safe multichannel radio communication networks between command and control centers, disaster-control units, and the stricken "local fronts."

(3) Compilation by national and local governments of manuals furnishing the people with instructions and information during an emergency.

No matter how effective the crisis-management at the national and local government levels, administrative bodies alone cannot handle adequately the damage and confusion infflicted{sic} by a large-scale earthquake in urban areas. To cope with a series of disasters in which many areas suffer damage simultaneously, independent efforts at each household, business circle, and school are indispensable as well. While it is advisable that households and companies improve their disaster-control capabilities, it is also desirable to form voluntary community-based disaster-control bodies unifying individual local-level efforts. National and local governments must make efforts to facilitate these voluntary activities by, for example, setting up community centers for disaster control.

As witnessed in the case of the earthquake off the coast of Miyagi Prefecture, a large-scale earthquake causes the supply of electricity, gas, water, and other public utilities to be temporarily shut down. In a large urban area the supply of food, medicine, and other necessities may also be severely restricted. Therefore, households, schools, and business circles must improve their survivability in case of emergency. In concrete terms, it is desirable to stock a certain amount of food, water, fuel, medicine, and clothing, to acquire such "survival know-how" as first-aid and nursing, and further to improve underground shelters and other facilities.

The measures outlined above against earthquakes will naturally be useful in case of other natural disasters, accidents in industrial complexes, and even military and economic emergencies. Improvement of earthquake countermeasures, therefore, will largely contribute to the promotion of crisis-management capability at all levels, that is, national, local, and community levels, which is lagging behind extremely at present.

CONCLUSION

For more than a year we have conducted studies from various perspectives on the problems involved in comprehensive national security.

It is our hope that the issues raised in this report will serve as a catalyst for widespread national debate and that this will lead to productive results. It is the formation of a national consensus through wide-ranging discussions that will lead to united national efforts for Japan's security.

Looking back on the past national security debate in Japan, we have to admit that no national environment has been fostered to take up this question in a realistic manner. The debate has been split in two extremes, one in favor of a military buildup aimed at autonomous defense and the other in favor of complete disarmament based on "pacifism."

In particular, we strongly call for reflection on the fact that the debate in important political fora, such as the Diet, has never moved beyond formalistic and empty legal contentions or mere ideological assertions, and that the explanations of the government all too often have been no more than responses designed to pursue logical consistency with precedents and to deflect political difficulties by patchwork. We earnestly hope that the government will state its position on security issues with more candor and that the Special Committee on Japan-U.S. Security Treaty and Defense Matters newly formed in the House of Representatives will provide a forum for substantive debate.

Also urgent is to consolidate setups that enable extensive studies on security issues by scholars and leaders from various walks of life.

Inasmuch as Japan's security depends on comprehensive efforts in many fields and at different levels, it is not a task that can be left solely in the hands of the Defense Agency. The issue of national security concerns not only the the Ministry of Foreign Affairs which is responsible for Japan's foreign policy and the Ministry of Finance which is in charge of its fiscal policy, but also various other ministries and agencies, such as the Ministry of Agriculture, Forestry and Fisheries, the Ministry of International Trade and Industry, and the National Land Agency. It is necessary for all the ministries and agencies of the government to bear comprehensive national security considerations in mind in implementing various policy measures.

We hereby propose that the National Defense Council, which has outlived its usefulness, be replaced by a "Comprehensive National Security Council" as a body for promoting comprehensive and integrated security policy. Through the establishment of such a council, it is necessary to establish a system which constantly reviews comprehensive national security issues, including the task of ensuring "a smooth adaptation of the defense structure to meet serious changes in the international situation," as suggested in the "National Defense Program Outline."

It is also necessary to establish a system whereby the Prime Minister, as the highest official in charge of Japan's comprehensive national security, is always provided with the necessary information and is able to exercise effective command and control.

In concluding this report, we wish to express our earnest desire that the concrete proposals put forward in this report be positively reflected in future governmental policies and be realized at an early date.

*1* As regards security against nature, or the protection of life and property from earthquakes and other large-scale natural disasters, it is impossible to work upon nature to eliminate the threat. Some degree of damage from disasters, therefore, must be presumed, and the only task is to minimize this damage.

*2* Confidence-building measures: This is a phrase officially used for the first time in the Helsinki Final Act adopted in 1975 at the Conference on Security and Cooperation in Europe (CSCE). In the Final Act the phrase is used to refer to such measures as prior notification of major military maneuvers, acceptance of observers to such maneuvers, and prior notification of major military movements in order to strengthen mutual confidence among the 35 countries of the East and the West participating in the Conference and to promote security in Europe. The phrase is used here with a wider meaning.

*3* Strategic and theater nuclear weapons: Strategic nuclear weapons refer to long-range nuclear weapons that the United States and the Soviet Union can deliver against each other, such as intercontinental ballistic missiles (ICBM), long-range bombers, and submarine-launched ballistic missiles (SLBM). Theater nuclear weapons have a shorter range for use within a limited war theater, such as Europe. They include the Pershing missiles of the United States and the SS-20 medium-range missiles and Backfire bombers of the Soviet Union.

*4* The 2½ and 1½ strategies: Under the 2½ strategy, military capability in conventional forces is to be built up and maintained for coping with two large-scale conflicts and one small-scale conflict simultaneously; the 1½ strategy presumes the need to fight one large- scale conflict and one small-scale conflict simultaneously.

*5* "Entente": A bilateral or multilateral relationship based on mutual acknowledgement of shared views and interests with respect to specific matters. An entente comes between an "alliance" and a "friendly relationship."

*6* Political summit: The "economic summits of major industrialized nations" have confined themselves mainly to economic matters. A "political summit" refers to a similar conference devoted to political affairs, such as the 1978 meeting on Guadeloupe of American, French, West German and British leaders, where they conferred on security problems of mutual concern to the Western powers.

*7* "Deterrent force": This is the force to deter aggression by making it clear to an adversary that if it should launch an attack, the damage inflicted by a counterattack will be greater than the gain made through the aggression.

*8* "Massive retaliation strategy": This was a U.S. military strategy of the late 1950s whereby military conflict could be deterred by showing that one was ready to stage an immediate counterattack with massive retaliatory power, including use of nuclear weapons, in the event of aggression.

*9* Survivability: This is a degree of ability to limit damage, stage a recovery, and secure alternative systems in the event of external aggression.

*10* Electronic warfare: Electronic technology is currently being employed in almost every field of modern military activity, from communications and surveillance to the guiding of missiles. However, electromagnetic waves can be easily jammed. The term "electronic warfare' refers to detection of electromagnetic waves being transmitted by an adversary, manipulation to reduce or eliminate their effectiveness, and protection of self-utilization of electromagnetic waves.

*11* {A figure deleted}

*12* {A figure deleted}

*13* Soft and hard energy paths: These are two alternative methods of securing energy, as postulated by Amory Lovins in a forecast of a future reduction of oil supplies. The soft path refers to the method of utilizing renewable energy sources (such as solar energy, wind power, hydro power, and wave power) which meet energy demand situations in terms of quality, quantity, and geographical distribution. The hard path refers to the method of securing energy through large investments for the development of coal, nuclear power, and similar energy sources.

*14* For example, there is an estimate that if Japan tries to increase self-sufficiency in grains by 1% by increasing the domestic production of feed grains, the necessary arable land would be 150,000 hectares and the cost to cultivate the land ¥0.9 - ¥1.3 trillion.