By Chikako Mogi and Masaaki Iwamoto

Takashi Nakajima earns $100,000 a year growing lettuces, employs Chinese laborers to harvest them, and has four months off in winter to indulge his passion for speed skating. He’s the result of a protected farming system that Japanese Prime Minister Shinzo Abe is about to dismantle.

“I don’t trust the government at all,” said Nakajima, 35, whose village of Kawakami in the picturesque valleys of Nagano prefecture boasts incomes five times the national average. “They want to streamline Japan’s farming business. Small farmers won’t be able to survive and the community will die.”

Government support, including payments to some farmers for not producing, accounted for 56 percent of the total earnings for Japanese agriculture last year, behind only Norway and Switzerland, according to the Organisation for Economic Cooperation and Development. Abe plans to cut the 161 billion yen ($1.6 billion) support for rice farmers’ incomes and reduce import barriers, forcing thousands of hand-tended smallholdings like Nakajima’s to consolidate.

“The current system is so unproductive that it’s hurting the nation as a whole,” said Robert Feldman, head of Japan economic research at Morgan Stanley MUFG Securities Co. “The price of some agricultural goods is higher than it should be. Changing the agricultural laws is a good way to promote the conversion of land to more efficient use.”

At the heart of the battle is the Japan Agricultural Cooperatives group, or the JA, which has unique powers to finance and insure farms, supply them with equipment and fertilizers and buy their produce. With almost 10 million members, that makes the JA the country’s fourth-biggest financial services provider, its largest political lobby and the supplier of nearly half of rice distributed across the country.

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“In the absence of fundamental reform, the agricultural sector will continue to wither, trapped in a cycle of low productivity, low earnings and dependence on subsidies and import protection,” OECD economists Randall Jones and Shingo Kimura wrote in a May report.

Japan’s proliferation of small farms was the result of a postwar restructuring of land ownership under General Douglas MacArthur during the U.S. occupation, which broke the power of the landlord class and allocated plots to tenant farmers that tilled about one third of the nation’s fields and rice paddies.
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By Kirk Spitzer, Special for USA TODAY

Some top hotels and high-end department stores admitted serving cheaper alternatives instead of the pricey items ordered from menus.

STORY HIGHLIGHTS

• Some restaurants admit mislabeling menu items
• Prized Shiba prawns from Tokyo Bay were just shrimp from India
• Some companies have received the ultimate penalty in Japan: public shaming

TOKYO — This is a city where people spend hours in line for the trendiest bowl of ramen, drop $100 on a gift box of fruit or entertain clients several nights a week at chic restaurants.

So the news that prestigious restaurants have been swapping cheap substitutes for pricey menu items has created a major scandal that threatens to taint Japan's coveted worldwide reputation for exquisite cuisine.

"This is a foodie nation," says Jeff Kingston, professor of Asian Studies at Temple University's campus in Tokyo.

"People are proud of all the Michelin stars, and they generally eat very well, so the scandal has provoked outrage," he says. "People believe that this is simply a scam to improve the bottom line by selling cheap food as expensive cuisine."

Some of Japan's top hotels and high-end department stores in Tokyo, Sapporo and elsewhere admitted to a shocking transgression of ethics. The bait-and-switch was accidental, malefactors say, but at some spots it's alleged to have gone on for years.

People who ordered prized Shiba prawns, a rare and expensive delicacy from Tokyo Bay, were sometimes served bulk shrimp caught off India.

Wagyu beef refers to a special breed of cattle in Japan that is sometimes massaged by hand and fed beer to give its meat a highly marbled look and fattier content.

Some who ordered it got Australian beef. Organic vegetables from small Japanese specialty farms were actually shipped in from China.

The scandal has riled Japan's Consumer Affairs Agency, which says it will prosecute any business that intentionally misled diners. The agency said it will head off damage to Japan's reputation by proposing tougher penalties for food labeling violations, perhaps even jail time.

Japan's luxury Okura hotel chain executives bow their heads at a news conference Nov. 7 in Tokyo to apologize after the hotel served meals made with ingredients falsely labeled as being of top-end quality, such as Pacific white shrimp advertised as the much pricier Shiba variety.(Photo: Getty Images)


Some have received the ultimate penalty in Japan: public shaming.
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FirstPoint Japan's Advisory Board member, Kim Pedersen, was just interviewed by Asia Biz's Howard Lim. This is a very fascinating interview as Kim is one of the few foreigners to have been educated in the Japanese public school system rather than shipping of to the English-language curriculum's found in the international schools.