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Political Transition seems imminent in Japan

Rajaram Panda, Ph.D. - 8/31/2009

Japan goes to the polls on 30 August 2009. The assessment of Japan’s current domestic politics leads one to believe that the ruling Liberal Democratic Party (LDP), which has virtually uninterruptedly ruled Japan for more than half a century is going to be ousted from power, paving the way for the Democratic Party of Japan (DPJ). If the DPJ wins and assumes power, it will be a welcome change for Japanese politics and a move closer to a possible two-party system in the future. But given the nature of Japanese politics, it might be unrealistic to assume major policy change, though there will be subtle change in emphasis and approach without diluting the basic contours of Japan’s foreign policy. Japan’s mighty and overbearing bureaucracy would frustrate any major shift in foreign policy, though the DPJ administration might experiment new ideas while addressing domestic issues. Nevertheless, what would be significant is the transition of power from one dominant party to another aspiring party to remain dominant in the coming years.

Successive opinion polls conducted by major Japanese dailies after Prime Minister Taro Aso dissolved the House of Representatives on 21 July and scheduling general elections on 30 August suggest that the DPJ holds a strong lead over the LDP. According to a survey released on 7 August by Major daily Yomiuri Shimbun, 46.5 per cent of those polled said they want DPJ’s Yukio Hatoyama as the country’s next prime minister, while only 22.1 per cent supported Aso as the prime minister. Japanese public is already disillusioned with LDP’s style of governance in recent years and want to give the DPJ a chance to prove its worth. A possible DPJ victory would mean that it will be for the first time in Japan’s history that the Japanese people would have voted for a change.

Though the DPJ has made enough noise to have a re-look some of LDP’s foreign policy approach, in particular the security alliance with the US, refueling issue and reviewing the Futnma Air base, once it comes into power and reality dawns, the DPJ will get bogged down on domestic issues, lest public confidence gets soon dissipated.

What do the manifestos say?

In their manifestos, though both the LDP and DPJ promise to look into the issue of the nation’s declining birth rate and aging population. At resent child care facility is inadequate. The state child care allowance of 15,000 yen a month is not enough even to meet the costs of diapers and other expenses. The financial burden of raising children is seen as one of the main reasons behind the decline in birthrate. The DPJ has recognized this fact and promised in its manifesto to make provision for child-rearing allowances available for every child. Similarly, the LDP promises to provide assistance for preschool education. At present, such costs are shouldered by parents. But will such mere assistance itself would address the issue of child rearing? That is what the Japanese women are asking. At present day care centers are high in demand and working women are often forced to quit their job, losing monthly income of 200,000 to 400,000 range-yen a month. Though both LDP and DPJ are making promises to look into this matter, there is no clarity in their promises.

In the past, the LDP-New Komeito coalition government implemented a three-pronged approach to tackle the declining birthrate: financial assistance such as child-rearing allowance; measures to improve the balance between child-rearing and work, such as through more child care leave; and local child-raising assistance such as facilities for helping parents raise small children. Clearly, this has not yielded the desired result.

According to OECD, public expenditure on child-raising for households in Japan accounts for 0.81 per cent of the nation’s gross domestic product, compared with more than 3 per cent in France, Sweden and Britain. In Japan, welfare policies since World War II have been based on the model of men working and women taking charge of domestic affairs and child-rearing but this assumption is no longer sound and the Japanese women have realized this.

The DPJ believes it can secure 5.3 trillion yen in government revenue for its new child-raising allowance by abolishing income tax deductions that currently save earners with spouses 380,000 yen each year and further a 380,000 yen for each additional dependent. However, abolishing the two types of tax deductions would secure only about 1.4 trillion yen.

On the other hand, the LDP had pledged to fully implement a plan to make education for children aged between 3 and 5 free within three years of the election, a move that would have required nearly 80 billion yen in additional government revenue a year. The LDP expected the cost to have met by revenues from the consumption tax. The LDP planned to share a little of the burden of increased public expenditure on measures for helping raise children among everyone, while the DPJ’s policy would raise the burden on specific types of households. Understandably, the public took keen interest in where the balance of assistance and burden lied.

What about the New Komeito, the coalition partner in the forgoing government? The New Komeito stipulated in its manifesto a measure to provide free education for preschool children for three years at such places as kindergartens and nurseries. The party’s move echoed similar child-rearing manifesto pledges by the LDP and DPJ. It also planned to double the allowance for children aged 3 and above to a monthly sum of 10,000 yen for the first child 10,000 yen for the second child and 20,000 for the third. It also planned to provide free health checks for pregnant women, raise the lump-sum payment for childbirth, eliminate waiting lists for nurseries and set up after-school programs for children.

The Japanese Communist Party planned to call for free medical treatment for children. The party also wanted to double the child allowance to 10,000 yen and raise the age limit for receiving it to 18 years old. It also wanted to abolish tax deductions for dependants and spouses. The party aimed to revive additional benefits for single-parent families and add a benefit for motherless families to the current allowances exclusively provided to fatherless children.

The Social Democratic party wanted to set up a measure to provide those aged 18 and younger with 10,000 yen per month in the cases of the first and second child, and 20,000 yen for the third. The party also called for free medical treatment for children in the third year of middle school and younger. It aimed to increase the quality of nursing system and after-school programs for children with working parents.

The People’s New Party called for tax cuts for families with children who live away from their families to attend school. The Japan Renaissance Party called for cheaper fertility treatment, tax cuts for households with children in need for care, and crime prevention ,measures aimed at children. Similarly the New Party Nippon planned to introduce measures to lessen the financial burdens associated with education.

From the manifestos of the smaller parties, it appears that the People’s New party and the more left-leaning Social Democratic Party are going to be likely coalition partners of the DPJ.

So, the 480 seats in the more powerful lower house are up for grabs. The system combines 300 single-seat districts and 180 proportional representation districts. At present, the LDP controls 303 seats and its coalition partner, New Komeito, has 31 seats. The DPJ has only 112 seats. The lower house chooses the prime minister. The term of the current lower house was to expire on 10 September, four years after the last election.

Apart from the issue of child care, declining birth rate and aging population issues, there are other issues such as global recession, unemployment (currently 5.5 per cent), pension reforms are also likely to confront the island nation of about 126 million people. While the DPJ seeks to spur consumer spending, its platform promises to give consumers more money by offering tax credits to families with children, making gas cheaper, and eliminating highway tolls. The LDP wants to invest in targeted industries to stimulate the economy and promises to create 2 million jobs, without specifying how it can do so. However, there are vested interest groups, who are unable to reinvest themselves. No new industries have emerged and therefore it is not clear how the LDP will stimulate the economy. The LDP government squandered $60 billion on road building and failed to lace priority on education and social security.

Bankruptcy in LDP leadership

Why is the LDP in such serious trouble and why is it likely to lose grip on power? It may be mentioned that after Junichiro Koizumi left the political scene, there has been a leadership vacuum in the LDP. Japan saw three prime ministers – Shinzo Abe, Yasuo Fukuda and Taro Aso – with none of them matching Koizumi’s maturity and deftness to steer Japan’s political ship smoothly. Soon after Koizumi departed in September 2006, the LDP faced a humiliating defeat in the elections to the upper house in July 2007, handing over complete control of the house to the DPJ, the first time in post-war history. The revelation that the LDP government had misplaced the pension records of 50 million people proved to be LDP’s undoing.

The prolonged economic downturns that battered the rural areas, which were LDP’s traditional strongholds further tarnished LDP’s popularity. Koizumi’s policy of structural reforms, particularly the controversial privatization of the post office, did not sell well with the people. People’s frustration deepened when more people were made to accept deep pay cuts in an export-dependent economy. Indeed, a major political shift began to take shape almost 20 years ago after the collapse of the Soviet Union when the raison d’etre of the LDP began to be questioned in some quarters. Simultaneously around this time, a sizable section of voters emerged with no commitment with any ideology, thereby marginalizing the LDP to some extent. This while the Opposition parties began to start gaining ground, the LDP had to look around for support from Soka Gakkai, Japan’s largest Buddhist organization, which is the power bas of the New Komeito Party. The denouement of the LDP was further accentuated by biased media accounts and volatile public opinion.

Foreign Policy Issues

With the DPJ in power, Japan’s foreign policy may also undergo major change. Both the LDP and DPJ have differing perspectives in foreign policy. The DPJ seeks to have close but equal alliance relationship with the US to serve the foundation of Japan’s foreign policy. The DPJ also would like to expand Japan’s overseas roles in the UN’s peace-keeping operations. DPJ leader Hatoyama is known to be a staunch advocate of a constitutional amendment to revoke Japan’s war-renouncing Article 9.

There will be clear shift in Japan’s neighbourhood policy. The DPJ under Hatoyama is likely to strengthen ties with China, South Korea and other Asian countries and likely to repair some of the damages done by Koizumi, in particular regarding China, with his successive visits to Yasukuni Shrine, which honors about 2.5 million war dead, including war criminals. Issues such as ‘comfort women’, the Nanjing massacre of 1937 continue to linger impacting Japan’s Asian policy and the DPJ is likely to have a re-look at these. Hatoyama has made it clear that he will not visit the controversial shrine and his party has proposed to build a new, secular memorial that would lack the controversial connection to Shinto.

The Chinese might not appreciate the cordial relationship that Hatoyama shares with the Dalia Lama and this may impact Japan-China relations under the DPJ rule. It seems therefore likely that DPJ’s, if it assumes power, Asia policy will see only cosmetic change and not major shift. Japan’s Asia policy will continue to be influenced by the US’ Asia policy irrespective of whichever party is at the helm. However, it would be interesting to watch what direction Japan’s foreign policy will take under the DPJ rule and if it would be different in any way from the LDP.

Surprisingly, none of the DPJ leaders have articulated the DPJ’s likely policy towards India. But if Hatoyama’s Asia policy is going to be somewhat different, one can expect a stronger engagement with India under Hatoyama. For the last few years, there have been annual prime ministerial visits and after Prime Minister Manmohan Singh’s visit to Japan in October 2008, it is time for a return visit to India by a Japanese Prime Minister. If Hatoyama chooses India as one his first countries to visit overseas after assuming power, that would send a powerful message in defining the future direction of India-Japan relationships in all fronts.