Fragility In Japanese Politics

Japanese politics is again heading towards a flux. The volatility seems to be never ending with Prime Minister Noda Yoshihiko indicating to the head of the main opposition Liberal Democratic Party (LDP) Sadakazu Tanigaki, and LDP Secretary-General Nobuteru Ishihara, the party’s No. 2 official, that he plans to hold a general election in early November. While the ruling Democratic Party of Japan (DPJ) enjoys a majority in the Lower House (House of Representatives), the opposition LDP has majority in the Upper House (House of councillors) and passing of bills, therefore, is a huge challenge for the Noda administration. Noda needs the support of the opposition to save a hard-fought deal to double Japan’s broad sales tax by 2015 and therefore had to pledge in return to hold a general election “soon”. His push to bring the tax to 10 per cent by 2015 was billed as a test of Japan’s resolve to tackle its snowballing debt that tops two years’ worth of its economic output, a record among industrialised nations.

The DPJ which surged to power in 2009 pledging to change how Japan is governed, looks set to lose that election, spelling more policy confusion as Japan grapples with a stagnant economy, rocky ties with China and South Korea on territorial issues, and declining global competitiveness. It may be remembered that it is just three years since the DPJ, a mix of conservatives, center-left lawmakers and ex-socialists, rode to power on a backlash against more than 50 years of almost non-stop LDP rule. The Democrats then descended quickly into infighting, with Noda being the party’s third prime minister in three years. The Democratic Party now faces a similar backlash over broken promises. The party’s handling of last year’s tsunami and nuclear crisis and Noda’s embrace of unpopular causes such as the tax hike and the restart of nuclear reactors have not endeared the Japanese people.

If Noda calls for snap elections in November as “promised” as a quid pro quo to the LDP’s support to his effort to double sales tax by 2015, it seems extremely likely that his party will suffer a drubbing. As said, Noda who took office in September 2011 as Japan’s sixth premier in five years scored a rare policy win in early August (2012) when the Diet enacted a law to double the sales tax to curb public debt. But he had to pledge to call snap poll “soon” to gain opposition backing to pass the bill in a divided parliament.

As a matured politician, Noda realised that members of the DPJ wanted to put off an election given their sagging support but he also realised that the opposition parties, which control the upper house of the Diet, could force his hand by blocking the bill to allow fresh bond issues to fund the budget in the current fiscal year. However, Keeichi Ishi, policy chief of the New Komeito opposition party and an ally of the biggest opposition LDP, backs Noda’s tax increase legislation but at the same time expects Noda to dissolve the Lower Louse in October and call for elections in November. Under the present scenario, it seems likely that the Diet will hold an extraordinary session early in October and may pass the deficit bond bill and an extra budget before the lower chamber is dissolved.

Finance Minister Jun Azumi says that unless the funding bill passes, the government could run out of money by the end of October. Lower House members’ terms run to August next year but most of them are betting on polls before the end of this year. It is speculated that Noda has November 4 or November 11 on his mind.

The LDP, however, is not expected to cooperate with the DPJ. There are speculations in the media that Noda is even considering October 7 as the election date. The LDP seems to be unwilling to leave the governing of Japan to the Democrats any longer. The LDP’s position is that despite three years and three prime ministers since the DPJ swept to power in August 2009, the party has largely failed to deliver on its promises to reduce bureaucrats’ control over policymaking and pay more heed to consumers and workers. The party’s malaise also centers a series of defections over the tax increase, and division of opinions amongst party members over energy policy as Noda tries to decide what role nuclear power should play amid a growing anti-nuclear clamour after last year’s Fukushima atomic disaster.

Noda cut the tax deal with the LDP at a heavy political price as it has ruptured his party, with 50 members defecting over the increase in July 2012. The LDP takes cognizance of Noda’s vulnerability and even may press for early dissolution of the Diet, even by the September 8 end of the regular session. The DPJ’s policy chief, Seiji Maehara, also hinted at the possibility of an autumn election, saying that he wants to see parliament dissolved during an extra session likely to be held after the current regular session ends.

If the parliament is dissolved in late October, it would give Noda time to handle key policy items, including a bill to allow the government to issue bonds needed to finance the fiscal 2012 budget. The time would also allow Noda to host a Tokyo meeting of the Group of Seven finance ministers from October 12 to 14. Both the government and the opposition are thought to want to avoid displaying political chaos for an international audience during the G-7 meeting.

As the Prime Minister of Japan, Noda has international obligations too to attend the summit of the Asia Pacific Economic Cooperation forum on September 8 and 9 in Vladivostak, Russia, as well as the annual meeting of the International Monetary Fund and the World Bank to be hosted in Tokyo from October 12 to 14. The opposition must realise that Japan’s prestige in the world will be at stake if political squabbling becomes the talking point at international gatherings.

Yet, political turmoil cannot be ruled out, given that no clear agreement exists between the ruling and opposition camps over urgent policy matters that require continued bipartisanship. Both the DPJ and the LDP are largely in agreement on the deficit-covering bond bill, an electoral reform bill and bills to establish a new nuclear regulator but the LDP stresses that bipartisanship should be limited to issues of national interest, and not to be extended to issues mainly benefiting the ruling party.

Even if Noda decides to gamble, there is virtual consensus amongst politicians and analysts that the Democrats will face sure defeat. But it is equally uncertain whether the LDP and junior ally New Komeito can win a majority given widespread voter dissatisfaction with mainstream parties. That dissatisfaction is reflected in support for populist Osaka Mayor Toru Hashimoto, whose Ishin no Kai party hopes to win some seats in parliament. This means the next government could be a weak coalition, spelling more confusion.

If the elections are held in November as speculated, the major issue will be how the DPJ will revise its manifesto, a document cynically called “a synonym for lies” that has disgraced the party. The main campaign issues in the next lower house election are shaping up to be the consumption tax rate increase, Japan’s possible participation in the Trans-Pacific Partnership free trade negotiations, and the nation’s nuclear and energy policies. As is the norm prior to elections, the ruling party hastily cobbles together policies which tend to be “discount sales” smacking populism and that goes against voters’ interests. The voters would expect that each parties holds down-to-earth discussions and come up with realistic policies.

The DPJ ought to realise how its 2009 manifesto was flawed when it did not mention consumption tax hike but made pledges that required 16.8 trillion yen in fiscal resources to implement its policy pledges through such measures as overhauling budget allocations. There was never any prospect this could be achieved. Keeping this glaring miscalculation, the DPJ needs to re-look its new manifesto to present to the people when elections are held.

Manifesto issue

Both the LDP and the DPJ are slated to hold their presidential elections in September and this could be a good opportunity for both to set the course for their election manifestos. However, howsoever meticulous manifesto-making process may be, events may occur unpredictably such as major disasters (March 11 earthquake and the nuclear disaster, for example) and abrupt changes in economic and international situations, which might call for major overhaul of manifesto promises. Therefore, a party in power should flexibly revise or withdraw its policy pledges if its manifesto obviously becomes unrealistic or difficult to achieve. The DPJ clearly erred on this.

It is preferable for the ruling party to carry out policies that are necessary and serve national interests, even if they run counter to the manifesto. In such cases, the ruling party ought to explain to the people reasons for the policy changes. While it might be essential for politicians to deliver on their pledges, it is insincere to insist on adhering to policies that are no longer useful. The party in power, therefore, ought to guard against falling into a trap of “manifesto supremacism”, if the policy does not serve the interests of the people in the changed circumstance.

A manifesto is supposed to be part of a cycle. Parties try to achieve their stated aims and voters evaluate each party’s level of past achievements in the hustings. The DPJ manifesto of 2009 caused fundamental problems in state politics and it must not repeat the mistakes.

The DPJ erred during the 2010 Upper House elections. After experiencing power for several months following its August 2009 victory to the lower house, it realised that its visions had been overly optimistic and therefore revised part of its 2009 election manifesto when it drew up the party’s pledges for the 2010 upper house election. In connection with the consumption tax, the 2010 campaign manifesto stated, “Suprapartisan discussions will be started on drastic reform of the tax system, including the consumption tax.” Subsequently, the promises for the 2010 election were put to one side and debate focused on the advisability of sticking to the manifesto for the lower house election.

In normal circumstance, the manifesto for a lower house election cannot be tied to campaign pledges for an upper house election. The DPJ did exactly that. The DPJ, therefore, owes to the Japanese people to clarify its stance on this point as well as its handling of the pledges for the upper house election in which it suffered a major setback. When the DPJ presidential election was held, increase of the consumption tax was a central point of contention. Noda was elected after clarifying his position in favour of a consumption tax hike. This marked a policy change by the party. The voters evaluate such discrepancies between promises and delivery.

Notwithstanding the fact that elections to the lower house will be held sooner or later, the truism is that the Diet will stay divided. This is because neither the DPJ nor the LDP holds a majority in the upper house by themselves and therefore irrespective of either party winning the elections for the lower house, it will need to form a coalition with a party or parties to have a stable government. If either party makes specific promises as the DPJ did in 2009 without able to fulfill them, it will only contribute to the perpetuation of instability. Therefore, major parties such as the DPJ and the LDP should shun populist lines so that they can take responsibility for Japan’s future. At the same time, voters must be aware that there are limits to the implementation of campaign pledges.

Irrespective of the fact that Noda is toying with the idea of calling a snap poll in November, the very fact that the passage rate of bills submitted by the government during the current ordinary Diet session is only 48 per cent and is likely to reach the record-low 54 per cent seen in the 2010 ordinary Diet session is not going to contribute to DPJ’s cause. The DPJ poorly managed the Diet affairs amidst resistance from the opposition parties and triggered by censure against two cabinet ministers. These led to the stagnation in the deliberations on bills. The challenge before the DPJ during the current Diet session is huge as a large number of issues need to be dealt with.

Prioritising important bills

Among the important bills that need deliberations include a bill to allow the government to issue deficit-covering bonds and bills on the revision of the Public Offices Election Law to alleviate disparity in the value of votes by reducing the number of seats at the House of Representatives by five. One important bill that needs passage aims to create a common personal identification number for social security and taxation systems, which is necessary for comprehensive reform of those systems. Major political parties must also recognise the urgency of Diet agreement on personnel appointments for a nuclear regulatory commission. Any delay on the appointment would lead to the delay on safety inspections necessary for reactivation of idle nuclear reactors.

Apart from this, there are other important bills pending before the Diet that need to be deliberated and decision taken. For example, the Diet has failed to approve international treaties. The government submitted 11 bills in the current session on international treaties for Diet approval, including The Hague Convention on treatment of children when international marriages fail and decisions on these are important. Unfortunately, none have been approved so far, due to confrontation between the ruling and opposition parties in the House of Representatives Foreign Affairs Committee. The Diet must stand up to its responsibility to the nation.

TPP and energy issues

Apart from domestic fiscal and social issues, there are also mountains of political issues that require consensus building between the ruling and opposition parties. They include possible participation in the Trans-Pacific Partnership multilateral free trade agreement, the realization of a new energy policy, including the role of nuclear power, and mid-and long-term reform of the public pension system. A stable political foundation is perquisite for addressing to these issues.

The truism is that neither the DPJ nor the LDP and Komeito have a majority in the upper house. Whatever election pledges or policy issues the three parties make in the next lower house election, they cannot be realized and will become only empty promises without a tripartite partnership among the DPJ, the LDP and Komeito as the Diet remains divided with the LDP and Komeito controlling the upper house. A tripartite partnership even after the election irrespective of which party emerges the winner in the elections is sin qua non for Japan’s political and economic future.

 By Rajaram Panda

(The author is former Senior Fellow at IDSA, New Delhi.)