The immediate task for Prime Minister Junichiro Koizumi is to wrap up a specific reform package. While his slogans — "Structural reform with no sacred cows" and "No economic recovery without structural reform" — are basically supported here and abroad, stock prices have continued to fall.

One reason the market is disappointed is that Koizumi's initiative is tilted to the supply side, with no direct stimulus measures on the demand side; moreover, his supply-side program is still vague.

Another reason is the absence of safeguards for unemployment and bankruptcy, which will rise as reform begins to bite. Probably the biggest reason is that urgent measures like tax incentives to lure personal savings into the capital market have yet to be worked out.

Falling share prices will worsen banks' balance sheets and further delay their efforts to write off the bad loans, while rises in long-term interest rates on government bonds will make fiscal reform even more difficult.

The challenge for Koizumi is to take long-term structural measures and urgent short-term steps, particularly financial policy actions, in consistent and coherent ways. That is easier said than done. But unless it is done, there is no way that the Koizumi initiative will succeed. And if it fails, the Japanese economy will bog down in yet another protracted slump, as there is no leader who can do a better job than Koizumi.

At any rate, reform must begin in earnest. There is much to be done. For example, public corporations must be streamlined. Road-tax revenues set aside for road construction and maintenance must be made available for other purposes as well. The local public finances must be overhauled.

If, in tandem with further deregulation, inefficient areas of public finance are consolidated and chunks of government work transferred to the private sector, then the economy will pick up, creating more business opportunities.

The question is how to do this in an integrated manner. For that, the prime minister must come up with a detailed road map for reform as soon as possible.

Koizumi's reform campaign also carries a moral message. In his maiden policy speech to the Diet in April, he referred to an old story about "100 bushels of rice" — a story that he also introduced at the G8 summit in Genoa.

The famous story goes something like this: At the end of the Tokugawa shogunate in the late 19th century, the Nagaoka clan in what is now a part of Niigata Prefecture was hit by severe food shortages after it lost a battle against antishogunate troops. Fortunately, a friendly clan that had stayed out of the war came to its aid and gave it 100 bushels of rice.

Nagaoka's samurai demanded that the rice be distributed among them, but their leader, Torasaburo Kobayashi, told them that it should be sold so the proceeds could be used to build a school for children from all classes of people, including farmers and merchants. He had a long-term vision: developing future leaders for the clan and the country.

Kobayashi advocated an "open door" policy for the clan and the country to allow the introduction of Western knowledge and technology. Kobayashi argued that civil wars should be avoided at a time of national crisis. Branded a dissident, he was kept under house arrest until the clan was defeated.

That confinement strengthened his will and expanded his mind. After receiving the emergency rice, he persuaded the hungry samurai, saying: "If we distribute it among us, we'll eat it all in just three or four days. We should endure the hardship now for the sake of the future of the country, as well as the clan."

Underpinning Kobayashi's plan to build a school was a belief that a shortage of quality people, not only in his and other clans but in the country as a whole, had caused Japan to fall behind the rest of the world and plunged it into civil wars. In particular, he thought that the samurai, the elite class of the old establishment, had failed to fulfill their responsibilities.

Kobayashi believed it was necessary to develop quality people in all classes, including the samurai class. Being a samurai himself, however, he must have thought that the elite class should set an example of noblesse oblige.

And in fact, Kobayashi asked only the 1,700 surviving samurai to endure the hardship. He asked nothing of the farmers and merchants, thinking that if the samurai acted in such a spirit they would win the respect and support of others.

As planned, the school was finally erected with the proceeds of rice sales — and with the willing cooperation of farmers and merchants. It produced many brilliant people who played a leading role in Japan's modernization in the Meiji Era.

The story was published in the form of a novel by Yuzo Yamamoto (1887-1974) during the Pacific War. The military tried to exploit the book, contrary to the writer's wish, as part of their efforts to impose austerity on the people and mobilize national resources for the war.

Many military elites, however, lived safe and comfortable lives far from the front lines, mapping out one wrong strategy after another, even as rank-and-file soldiers continued fighting for their lives and as starving civilians struggled to survive. After the war's end, most of those elite officers evaded their responsibility to the people and continued to live as if nothing had happened. Noblesse oblige was conspicuous by its absence.

Koizumi lives in a modest house of the kind owned by middle-level company employees. A clean politician, he reportedly returns all customary gifts to their senders. The rice story, when told by such a leader, can be persuasive.

But those who need most to practice the spirit of "100 bushels of rice" are those politicians and bureaucrats anxious to preserve their interests and privileges at the expense of taxpayers; leaders of useless public corporations, inefficient producers organizations and tradition-bound industry associations; and executives of bungling banks that, while collecting deposits at near-zero interest rates, seem unable to clean up the bad-debt mess without government assistance.

First and foremost, it is these parasitic elites that must demonstrate noblesse oblige. Otherwise ordinary people will not be willing to share the pain of reform. Herein lies a key to the success or failure of the Koizumi initiative.