Commentary : After the Earthquake, an Economy Built on Quicksand Is Exposed : Japan: The country that awed Wall Street could barely deliver one rice ball a day to to the devastated people of Kobe.

The dismal failure of the rescue efforts after the Kobe Earthquake revealed Japan’s true self to the world: The vaunted economic superpower is a colossus with a feet of clay.

The country that awed Wall Street could barely deliver one rice ball a day to homeless quake victims freezing on the streets. The Self-Defense Force that was so eager to go the distance to Rwanda was pitifully late getting a few miles from their Osaka barracks to the town next door. The world’s most efficient production system--the Kansai-Inland Sea industrial heartland--turned out to be a Rube Goldberg contraption of wires and pulleys that collapsed into one messy tangle. To a former resident whose fondest boyhood memories are in that portside city, the revelations of the past week do not come as a surprise. Throughout the bubble-economy decade of the 1980s, Kobe was a disaster waiting to happen, a Madame Butterfly singing “One Fine Day.” Last week, the day finally came.

Kobe was once Japan’s most fun-loving and cosmopolitan city. Its commercial power rested on the shipyards and docks that sent vessels to all corners of the world. Its reputation as a gastronomic capital is rooted in its history as a concession to the foreign powers in the late-19th century. In the days when the city was less ambitious, Western merchants who loved the scenery, a throw of dice and the annual regatta were more interested in Kobe beef than in trying to outdo the economic statistics of their native lands.

Set along a narrow coastal strip where steep hills plunge into the Inland Sea, Kobe’s pine trees and seaweed-strewn beaches inspired some of Japan’s best literature, from the world’s first novel “Tale of Genji” to Junichiro Tanizaki’s modern masterpiece “The Makioka Sisters.” As a teen-ager, I lived a stone’s throw from Suma Pond, immortalized in such literature for its cherry blossoms.

Then, in the mid-1970s, with Japan’s drive to become an economic superpower, a grim madness took over. The old ferryboats that made for a pleasant ride across an isle-dotted sea were replaced by steel bridges and overhead highways. Whole hillsides were carved away and the dirt hauled into the sea to make artificial islands for industry. The narrow shore fattened like an overpampered waistline. Beaches were obliterated, the few rivers were encased in concrete, wells were covered. And Suma Pond was filled in for a shopping complex.

Kobe was transformed into a deathtrap of concrete and neon on a foundation of landfill. The fires that raged after the earthquake went unchallenged because once the mains snapped there were no alternative water sources left.

Kobe embodied the Japanese inclination to believe that modernity could eliminate tragedy. But that modernity, as authors like Tanizaki and Yukio Mishima lamented, was always half- baked. Urban centers like Kobe and Yokohama, deliberately created as modern cities in the Western mode, were never meant to provide a comfortable and enlightened sanctuary for residents, but to serve as a showcase. The skyscrapers and shopping centers were proof to Japanese that the country had made the transition into something called the present and need not feel shabby compared to the rest of the world.

Hence Kobe’s theme-park atmosphere--the faux Italian villas that house boutiques, sun-tan salons and beer halls, the ultrafast shinkansen bullet trains, the all-female Takarazuka revue and the church-like wedding halls. Behind this facade, the truth lay hidden in the pre-industrial neighborhoods crammed with wooden houses that had long since abandoned their community and clan networks, indeed the very survival instinct that saw them through hundreds of years of quakes, typhoons, fires. Last week, these neighborhoods went up in smoke.

The politicians, bureaucrats and business tycoons tried their best to maintain the false front. At first, the official NHK emergency-broadcast system claimed that there were no injuries, despite the presence of radio-equipped police officers on nearly every block. As the death toll began to creep upward, word among newspaper editors was that the delay was deliberate--to give the banks and large corporations time to shore up the stock values of construction companies in the Tokyo and Osaka exchanges to prevent an embarrassing global stock crash.

In fact, the Self-Defense Force troops were not summoned until five hours after the quake and didn’t arrive in full force until the next day. When they did, they came equipped with hand shovels rather than helicopters or land-moving equipment. Perhaps a thousand people or more died unnecessarily because of bureaucratic footdragging. On Day 2, when it was clear that local and national governments were doing nothing, the governor of Osaka provoked further outrage by advising the city’s victims to fend for themselves. Meanwhile, a Kobe official admitted that the city didn’t have enough coffins to handle the dead.

Economists and insurance analysts have been spinning out numbers as to the cost of repairing the Potemkin village. That giant sucking sound the world is about to hear will not come from Mexico but from Japan, as Osaka banks and insurance companies try to quietly sell their holdings in the New York and London stock and bond markets. Japan’s financial community may be tempted to fight the massive insurance claims, but if it does, the price of land will plummet and, with it, the banks’ asset ratings. The government deficit and fragility of Japan’s overstretched financial system portends a slow and fitful reconstruction rather than real economic growth. While the financial elite tries to paint rosy scenarios, dazed residents pick through the rubble like the lost souls in Akira Kurosawa’s “Dodeskaden.” Only now, in contrast to the end of World War II, nobody really knows where Japan will go from here.