Regarding the Oct. 27 Kyodo article "NSA asked Japan to tap regionwide fiber-optic cables in 2011": This is not the first time that the Japanese government has backed away from creating a surveillance state.
And it is true that compared to many other Westernized countries, Japan has pretty good privacy in theory and in practice (if not so much culturally!).
That said, many politicians are trying to overturn the parts of the Constitution that protect Japanese residents from government spying and other violations of civil liberties, so things could deteriorate in the future.
from the japan times online
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