Did you hear the one about the Afghan vote-counting official who had both of his hands cut off?…rim shot.

When it comes to elections, even David Letterman seems to be getting into the act these days. That joke –which fell pretty flat, actually – came off his TV show Monday night.

So I guess I’m not the only who’s been thinking a lot about the election fixation in America these days, given how much military muscle and political “spin” was invested in a flawed exercise in democratic expression in Afghanistan, and how much ink will be spilled to analyze a vastly different, but equally flawed, democratic exercise in Japan this coming Sunday, August 30^th.

As a foreign correspondent, I spent time in both countries, and know well the tendency for Western diplomats, journalists and even some NGOs to focus intensively on the process of an election exercise. Americans seem to understand what an election is, and given the constant drumbeat of U.S. political news in this era of blogs and snarky commentaries, the running assumption that the word “election” in a place like Iraq or Afghanistan – or even in a wealthy, developed nation like Japan – must somehow share the “look and feel” of the voting process in the good ol’ US of A is a very tempting conclusion to draw.

Alas, it just ain’t true.

Let’s first take Afghanistan. It’s difficult to consider as serious an election in a nation that has yet to get its arms even around the fickle conception of “nationhood.” Even before the Soviet invasion, Afghanistan was a nation cobbled together by colonial powers –i.e., the British — governed by a nominal monarch, but steadfastly remained an uneasy, dislocated amalgam of warlords, tribal leaders and clerics. This land had no history of democratic rule, no real experience with democratic expression and a very meager sense of national destiny or collective purpose.

So throwing an “election” on top of this stewpot of ethnic rivalries and warlord factionalism only encourages the sort of gamesmanship and cheating we are seeing in this voting process – intimidation, ballot stuffing and the like.

Are we now really surprised to learn that a drawn-out battle to find a “winner” of this “election” between Hamid Karzai and Abdullah Abdullah will only stir up more of the divisiveness and tension that previously existed? If the roots of democracy are shallow,  is it any wonder that a Western-imposed exercise in democratic expression doesn’t carry the same weight?

Japan is a radically different case that only helps prove the broader point.

It is all but certain that the ruling Liberal Democratic Party, which ruled Japan for nearly all of its post-war years, will lose control of the Diet, or parliament, on Sunday. Many will rush to declare a “major revolution” because the Democratic Party of Japan – mostly made up of old retreads and failed functionaries from the former LDP – will claim victory and start to run the country.

Yet is likely that little will actually “change” in Japan after an election where, quite ironically, the opposition is aping candidate Barack Obama and using the word “change” as its mantra. As my friend Martin Fackler correctly notes in today’s New York Times

“voters expectations seem limited about what the Democrats would achieve given their inexperience and often lackluster leadership.”

After Decades, Japan Prepares for Likely New Ruling Party

Elected leaders wield little real power in Japan – the well-entrenched bureaucracy actually runs its highly regulated system, a system which usually short-circuits the free market, open trade, entrepreneurship or the innovative spirit of the young. While the opposition claims it wants to cut the size of the bureaucracy, it also wants to boost government spending at a time when Japan’s debt- to-GDP ration is beginning to resemble that of a Third World nation. The Democrats have announced few coherent policy innovations –except the idea that paying about $260 a month to every family with children will somehow boost the national birth rate which has fallen primarily because Japanese women don’t want to bear children in a society where most men take no responsibility for child rearing. It’s not clear that an economic bribe will overcome “womb strike.”

Of course it’s little wonder the ruling LDP is staring at the political abyss. Nearly twenty years after the “bubble economy” collapsed Japan is still wondering what kind of nation it should become in the 21^st century; how it should relate to its fast-growing neighbor, China; whether it should really open up to the outside world or keep itself closeted – a path that will lead to inevitable, if relatively comfortable decline. The LDP failed to get the economy healthy again, and never initiated a national conversation about how Japan would thrive in a post-industrial world. Even without the excesses of the subprime real estate debacle, Japan still got crushed by the collapse of domestic consumption in the far-off USA.

So let’s put some of this in perspective. Western-style representative democracy certainly remains a worthy goal for most nations, but let’s not inflate our conceptions of what democracies are, what they can accomplish and how individual nations mature and grow into democracies of the sort we might recognize. The Japanese could never accept the chaos that is an Indian election, and probably not American-style democracy either. Their democracy was imposed from above, from shoguns and samurai and from Gen. Douglas MacArthur; it did not result from a popular revolution from below.

Nor have the Afghans shown, through their history, a pre-disposition towards “democratic values.” The sort of self-expression and individualism that is so vital to the American conception of identity doesn’t exist quite the same way in Japan or Afghanistan.

So let’s not suppose elections are the end-all or be-all of political or social quarrels. And let’s not naively wonder with great angst and surprise after elections are held that some of the disputes haven’t really been settled at the ballot box.

There is a part of  “political culture” that is, indeed, irreducibly about  “culture.”

Okay, it’s not for every taste, but Elizabeth Warren’s August report to Congress on the TARP and bank bailouts makes for interesting reading — as well as a clear reminder that we’re not yet out of the financial woods, despite recent leaps in the stock market.

Warren’s Congressional Oversight Panel helps explain why, like a faulty plug in your sink, the fact that the Treasury and the Fed have poured billions into the banking system doesn’t necessarily mean that any more than a wee dribble makes it out into the “real economy,” where real businesspeople and home owners need credit in order to start companies, hire folks and get the economic wheels turning. That’s because there’s a plug in the sink — a big mess of bad loans.

As with Japan two decades ago, the COP points out, there is a serious question as to how much big banks really want to admit their loans have gone south, take the losses, and try to move on. This is the approach the Treasury has tried to encourage with its Public Private Investment Program or PPIP, designed to give the banks enough cushion to declare and right off their losses.

But banks seems to be bulking up on loan loss reserves without really writing off their bad loans. The trouble is — what is the right value to put on a loan that is defaulting. Do you say there is really no value at all to the asset? Do you say that the parcel in question or the office building is really worth what you thought when you made the original loan –and time will prove you right? Or is it somewhere in between?

As the COP group notes:

To the extent banks have not written-down troubled assets, they are in effect continuing to invest in those assets by holding them for a future return. That is not an unreasonable strategy in itself. But it only postpones the day of reckoning if it turns out that, rather than appreciating, the assets depreciate.

This is the same problem the Japanese faced: Why declare a loss now, if you can hold on long enough and perhaps find that you get yourself bailed out by an economic “rising tide.” The problem is…how long can you wait? And how long do you stop making attractive new loans while you wait for your older loans to recover any value? How many of you have tried to get a bank loan lately??

Warren’s panel points out that the banks that are “too big to fail” — think Citicorp and J.P. Morgan will probably be okay — because the Federal Reserve will ride to the rescue once again if they become imperiled. But the smaller neighborhood banks could be in trouble if unemployment continues to rise and retail and commercial real estate falls apart, since they are less geographically diversified and could be “taken out” by just a few major hits from failed loans.

Many suspect this could be the shoe that drops next.

North Korea’s official media has now announced that the two U.S. journalists being held for violating the DPRK border have been pardoned, and will be allowed to leave the country with former president Bill Clinton.

North Korea: 2 US journalists pardoned -

The release of reporters Laura Ling and Euna Lee was a sign of North Korea’s  “humanitarian and peaceloving policy,” the Korean Central News Agency reported.

This is a big win for Clinton, of course, and also increases the hopes that dialogue between Pyongyang and the Obama administration might be put on a better footing.

The fact that the former President met with ailing and reclusive leader Kim Jong-il on Tuesday for a banquet meal suggested that a release of the two reporters for San Francisco-based Current TV might be in the works. Now it’s possible that Clinton –through his  “informal”  visit — has laid the ground work for a more extensive dialogue between Washington and Pyongyang on a host of troubling issues, including nuclear proliferation.

Clinton will have stories to tell when he emerges from North Korea, as Kim has not met with a senior Western leader in many years.

Ironically, Clinton might well have traveled to Pyongyang in late 2000 to help repair DPRK-US relations if the battle over the presidential succession between Al Gore and George W. Bush hadn’t taken months to resolve. You may recall that his Secretary of State, Madeleine Albright, went to Pyongyang earlier that year to lay the ground work for a potential visit. The two reporters now work for Gore’s Current TV.

All of that ground towards progress was quickly lost when then-President Bush took great pride in labeling North Korea one part of the now-infamous “axis of evil,” along with Iran and Iraq.

Who knows? Maybe the Clinton visit can erase the past years of Bush’s baleful legacy and lead, eventually, to the final conclusion of the Korean war.

A lot remains to take place of course — but this is a hugely positive step and may someday change the “security profile” of Asia.

President Clinton speaks at the United Nations (Mario Tama/Getty)

No, it isn’t Secretary of State Hillary Clinton, but the former President who alighted from an airplane in North Korea early Tuesday.

Bill Clinton is apparently in the North Korean capital hoping to win the release of journalists Euna Lee and Laura Ling, correspondents for San Franciso-based Current TV, in which Al Gore, Clinton’s Vice President, is a partial owner. The two were convicted in June of illegally crossing the North Korean border from neighboring China and were sentenced to 12 years of hard labor.

The Associated Press reported

Clinton landed in Pyongyang on Tuesday and was greeted at the airport by North Korean officials, including chief nuclear negotiator Kim Kye Gwan, North Korea’s state news agency said in a brief dispatch. “A little girl presented a bouquet to Bill Clinton,” the report said.

Like most bold maneuvers, the dispatch of the former President to the closed North Korean capital offers risks as well as potential payoffs. The DPRK is longing for “Respect” from the West, and sending a former US President to beg for leniency for two U.S.  citizens  would certainly seem to offer ailing strongman Kim Jong-il something of the “face” he clearly demands and expects. The U.S., moreover, is really more interested in getting the North Koreans to rein in its nuclear development ambitions and the potential sale of rockets and nuclear technology to rogue states. Winning the release of two US journalists is, in the larger context a sideshow, albeit an important one.

It is hard to believe the Obama administration and Jeff Bader, the very able head of Asia policy for the National Security Council, would permit Clinton’s trip unless there was some signal from Pyongyang that some measure of tangible progress would result in a relationship that has been deadlocked for most of the past decade.

Yet there is also a possibility, at least, that Clinton could come away from this intervention empty-handed. The North Koreans have proven time and time again that they are master negotiators. Observers believe that Kim Jong-il is now ill, that the transition of power to his youngest son — a virtual unknown in the West – is incomplete and that the powerful leadership of the North Korean military will have to be assuaged if any denouement with the U.S. is permitted to take place.

But the North Koreans have also  signaled in the past that they would like to “come in the from the cold,” re-establish relations with the United States and get themselves removed from all economic sanctions.  So there may well be negotiating room for the ex-president.

If he scores a meeting with “Dear Leader” Kim and his son and heir-apparent, that in itself would signal a major achievement.

Manufacturing no longer pays. Ask Detroit autoworkers, men who used to forge steel in Pittsburgh, or the blue collar grunts who used to make motorcycles in Japan.

What, even Japan faces a blue collar crisis? The home of monozukuri or the culture of manufacturing?

An excellent piece in the FT today

Not made in Japan.

points out

the plunge in global demand and a sharp rise in the yen have thrown Japanese manufacturers into crisis, and reignited a debate about the country’s reliance on the sector. That is because it was not finance that transmitted this recession to Japan – it was manufacturing.

Japan, where manufacturing was THE basis of prosperity faces a new crisis, as blue collar jobs are being outsourced to China and Southeast Asia, or cheap workers from Brazil are being imported into the country to do the dirty jobs young Japanese are no longer interested in performing.

In America, we believe the service economy — think software, accounting, insurance, health care and yes finance — will be the ultimate savior of our troubled employment picture. But in Japan the service at banks and department stores may be impeccable…look at the 12 people who wait on you at a department store…but it doesn’t earn the firms any money. So without manufacturing…what will be left?

It also doesn’t help Japan’s search for reinvention that its inflexible, hierarchical and often silo-ed system of development doesn’t really help boost national innovation. Need we be reminded that Sony, the company that invented the Walkman, has never been able to compete with the I-phone and I-pod, which so seamlessly mesh lower-value hardware with high-value software? Or that Panasonic and Sony are now being out-muscled by Samsung and LG from Korea?

So even though the roots of financial crisis in Japan and the U.S. came from different places — Japan suffered because we American consumers got too indebted chasing overpriced real estate — the way “out” of the mess may be surprising similar: looking for innovative products that boost  sustainability and lower energy uses.