TOKYO, and all Japan, are sprucing up for three weeks of Olympic Games in October. The world’s largest city is undergoing history’s most extensive face-lifting, and the canny city fathers are Using the brief Olympic Games period as the best possible excuse to push the seventeenth-century Edo-Period capital of the Tokugawa shoguns into the twentieth century.

In the meantime, Tokyo is about as upside down as a city can be. Construction continues through Sunday night. The wood boards across Ginza area intersections are ripped away after office hours so workers, like ants, can dig away at new three-level subways. Tokyo addresses still are the longest in the world, with unending syllables worthy of Wales. But Arabic numbers are appearing, signs with English lettering are being designed, and now there are to be street names in a city which has always been just a rabbit warren of one-level houses.

The governor of Tokyo Prefecture, Ryotaro Azuma, a seventy-year-old former physics professor and a rowing enthusiast, is supervising this $3 billion face-lifting job. To get it going, he has had to become a sort of double-duty Robert Moses and Grover Whalen.

“We had an over-all plan for modernizing Tokyo, but until we thought about the Olympics four years ago it never got off the blueprint stage,” Azuma says. And he explains that all these vast improvements — the subway-system expansion, a new water supply, a sewage system, new roads, even a new Tokyo-Osaka Bullet Express dream train which will be the world’s fastest —will be financed with no increase in taxes. “Not necessary,” declares Azuma. “Under the government policy to double the national income, more tax money comes in by itself.”

From baubles to heavy industry

The income-doubling plan is one of Prime Minister Hayato Ikeda’s chief objectives, and it is succeeding fantastically well. true, Japan was given a big boost from its post-World War II doldrums by the Korean War, for Japan was a supply base during that war. But it has been the Japanese themselves, independent of any war prosperity, who have achieved the economic progress since Korea.

A few years ago, comparing an Asian nation with one in Western Europe would have been unthinkable. Yet today, Japan, with almost 100 million people and nowhere to expand beyond its four principal islands, has an economy as prosperous as Italy’s. Japan’s steel production in the current year will overtake West Germany’s and will follow the steel output of only the United States and the Soviet Union. Japanese wool cloth, key American economists in Japan agree, is already both better and cheaper than comparable U.S. wool products.

This year Japan was voted by the United States and the countries of Western Europe into their Organization for Economic Cooperation and Development (O.E.C.D.) and was also promoted to senior-nation status in the International Monetary Fund. The two moves signified to the world that Japan is a major financial power. No longer a country known for the manufacture of cheap Christmas tree ornaments, Japan is now a nation of heavy industry.

Japan’s role in Asia

Considering this flush of economic prosperity, considering that Japan has one of the world’s highest literacy rates and a population which has access to not one but several newspapers a day, considering Japan’s long cultural and intellectual tradition, do the Japanese now intend to assume leadership in Asia? For example, will the Japanese, the nearest and most affected by events in Communist China, help prepare China’s peaceful re-entry into world society?

The answers to this question vary in intensity, but they all fall on the negative side. “Whatever Japan does in this sense will always remind people of Japan’s ‘Asian Co-prosperity Sphere’ ambitions at the outbreak of World War II. Moreover, nationalism is very strong in some of the neutral nations of Asia and they would dislike us to take any action.” declares Yasuhiro Nakasone, one of the most forceful younger Diet members of the ruling Liberal Democratic Party.

Akira Iwai, the hardfisted secretary-general of Japan’s Sohyo laborunion complex, takes the view that Japan should first solve its domestic problems. And he adds that this quiet role should pertain as well to any evangelical ambitions that Japanese labor unions might have abroad.

“Japan should take the leadership in urging some American policy shift toward Asia.” declares If iron Wada, the Socialist Party’s foreign affairs expert and announced candidate for party chairmanship.

The two Chinas

Ideally, Japan’s leaders would like to see both Mao Yse-tung and Chiang Kai-shek represented in the United Nations. Mao as the representative of China and Chiang as “the representative of the something else,” as one Japanese Foreign Ministry official puts it. And ideally, Japan would like to become as friendly as possible with Peiping while still assuring itself that the island of Taiwan, to the south of the Japanese archipelago, remains part of the non-Communist world.

But any suggestion for putting these ideals into practice evokes only smiling evasion. Nor is it easy to provoke the Japanese. They readily acknowledge that it will be untenable for both domestic polities and inter-Asian relations if they support the United States in its opposition to China in a losing fight at the United Nations. Yet they are unwilling to face that day until it arrives.

Knowing Japan’s sentimental ties with the Taiwanese, and Formosa, which Japan once colonized, some have suggested a possible United Nations trusteeship of Taiwan, with Japan as the trustee power, but the Japanese recoil at this proposal.

The United States has show n some indications of wanting its ally, Japan, to take more of a leading role in Asia. But the United States has given no clear guidelines. American policy in the Far East is based on a military defense against Communist aggression, buttressed by bases all the way from Japan to the Philippines. Japan’s post-war constitution, written by its American occupiers, renounces war for all time.

American officials in Japan are grateful to Ikeda’s government for the cool head it kept after French President Charles de Gaulle announced at the beginning of the year that he was going to recognize Communist China. Instead of rushing in with the hope that De Gaulle had found the way to hold hands with both Mao and Chiang, Ikeda’s government waited. The Japanese quickly found that, despite all the advance hoopla from Paris, De Gaulle had found no way of holding on to both Chinese hands at once. Japan today is trying to make its relations with Mao’s mainland more normal through trade agreements, privately conducted but governmentally blessed. And by being a major purchaser of the products of Chiang’s Taiwan, Japan is trying to keep Nationalist China pacified.

The Chinese market

Kyushu, the southernmost of Japan’s four islands and the one with closest geographical and historical ties to the mainland, is particularly anxious for trade with Communist China. “The Chinese market may have little to offer us now, but there is a huge potential. And, anyway, if we don’t move in now, France and Britain are sure to,” a member of the Japanese Cabinet explains.

Kyushu is reacting to history. Its profitable, coal and steel industry was built up with the Chinese mainland as a market. In recent years, Kyushu has become Japan’s West Virginia. It has had crippling coal strikes and mine disasters, and now its rate of economic growth, while considerable, still lags behind that of the rest of booming Japan,

In 1935, at the height of the preWorld War II trade, 92.5 percent of Kyushu’s exports went to Asia, and half of this amount to China alone. Takeo Torii, managing director of the Kyushu Economic Research Association, thinks that in the short run, while China currently is rebuilding and rehabilitating itself and needs iron, steel, cement, and chemical fertilizers, Kyushu has indeed a good potential market in China. But Torii is dubious about this potential once the construction period is over. He says Kyushu does not produce the machinery China will then need, and because of negligible freight differences, Kyushu does not stand much of a chance in competing with the well-established factories in Japan’s big industrial center, Osaka. Torii does concede that China has four products that Kyushu can use: iron ore, cokingcoal. soy beans, and industrial salts.

Trade with the Reds

For the country as a whole, the Japan International Trade Promotion Association reported in February that trade with Communist China jumped 62.2 percent from 1962 to 1963 —to $137 million. United States officials in Japan estimate that the China trade now accounts for perhaps one and one half to 2 percent of Japan’s total trade and may expand in a few years to 4 or 5 percent; but they think it will be able to command little influence over political developments.

Earlier this year, a Chinese “peace offensive” called for an increase in trade, an exchange of reporters, and an air transport agreement. A key Kyushuan promoting this from Japan’s side has been Sasuke Endo, a Westernized businessman who heads the Fukuoka-Japan-China Trade Promotion Association and looks upon trade with China as a combination of “nostalgia and humanitarianism — just like the U.S. Marshall Plan.” Endo also says he fails to see how the United States can object to Japan’s selling to China when the United States sells wheat to Russia.

Similarly, Atsushi Hara, assistant manager of the Fukuoka branch of Japan’s mammoth Mitsubishi industrial complex, freely acknowledges that Mitsubishi, the very epitome of Japanese capitalism, has been trading with Communist China over the years through a dummy company approved by Peiping.

Kyushu’s biggest local firm, Yawata Steel, suffered a severe loss during the 1958 Nagasaki “flag incident” when China, enraged by the desecration of the Chinese standard, canceled all Japanese trade contracts pending at the time and refused further payments. But this spring even Yawata Steel announced it was sending a survey group to China at Peiping’s request, to “reexplore” trade possibilities.

The problem of Korea

Such Japanese overtures, however, do not seem to pertain to Korea — either the non-Communist South or the Communist North. Kyushu, in particular, looks with loathing on Korea and the Koreans, and with considerable skepticism on the negotiations that Japan began this year, with United States urging, to normalize relations with Seoul. Korea was Japan’s pre-World War II colony, and the Japanese were cruel and selfish colonists. Some Japanese seem to have some degree of bad conscience mixed in with their socio-economic evaluations.

There have been some street demonstrations this year against the Japanese-Korean negotiations, but they have been mild in comparison with the 1960 riots, when street mobs demonstrated against Japan’s mutual security treaty with the United States. Japan has come a long way in four years. The security treaty was revised, as intended, and is rarely mentioned now. The student rioters of 1960 have settled down with jobs. Nobosuke Kishi, the arrogant Prime Minister who was the butt of the 1960 protest demonstrations, was replaced by the mildmannered Ikeda. And American Ambassador Douglas MacArthur II, who lectured the Japanese instead of listening, was replaced by Edwin O. Rcischauer, a soft-spoken Harvard professor who knows the language and the people.

But it is no longer the question of Japan’s difficulties with leftists at home and conservatives abroad that is at stake. The real problem lies in Japan’s difficulty in trying to reassert its role of leadership in Asia without reawakening memories of World War II.