Showing posts with label Abe Shinzo. Show all posts
Showing posts with label Abe Shinzo. Show all posts

Friday, August 9, 2013

Will Abe lead on the consumption tax?

On Friday, Prime Minister Abe Shinzō headed off (jp) to the mountains in Yamanashi prefecture for an eleven-day summer holiday. He leaves behind a growing debate in Tokyo about the wisdom of proceeding as planned with the consumption tax hike scheduled to be phased in from 2014-2015 (5% to 8% in April 2014, 8% to 10% in October 2015). Abe has said he will make his decision about the tax sometime over the next two months, leaving proponents and opponents of the hike to make their cases once again.

Arguably the supporters of the tax hike won several victories this week.

First, at the start of the week the IMF advised the Japanese government to stick to the plan as concluded in 2012, arguing that the tax hike will signal the government's commitment to fiscal restructuring and will therefore bolster investor confidence. The IMF has been saying that the consumption tax rate should rise to 15% for years now, so its advice for Japan is not new. But the fund's intervention gives proponents an important international backer as they make their case to the prime minister.

The next victory for proponents of the hike came on Thursday. Bank of Japan President Kuroda Haruhiko, speaking to the press after the BOJ policy board's regular meeting, voiced his support for raising the consumption tax and said (jp) that the BOJ's radical monetary policies and the planned hike were not incompatible. Like the IMF, Kuroda stressed the importance of reassuring investors that the Japanese government is serious about getting its financial house in order.

Finally, on Friday the Nikkei Shimbun ran a major article (jp; registration required) — basically an editorial — addressed to senior government officials who are "nervous" about the consumption tax increase that sought to reassure them that raising the consumption tax next year would not be like raising the consumption tax from 3% to 5% in 1997. The article opens by explaining that the 1997 hike came in the midst of a regional financial crisis and at a time when the balance sheets of Japanese banks and corporations were loaded with bad debts. Having established that 1997 was a particularly bad time to raise the consumption tax, Nikkei pivots to say that since banks and businesses have more "stamina" today, it's appropriate to take on the challenge of the national debt in order to reassure global financial markets, which, Nikkei reminds us, are roughly three times larger than they were in 1995. With that in mind, the article warns that at the first sign that the government is not serious about raising the tax, investors will short Japan in a heartbeat.

As arguments on behalf of austerity go, there is nothing earth shattering in the Nikkei article, in fact it contains pretty much the same arguments that Paul Krugman has critiqued for years, including in this 2010 column: the "confidence fairy" and the "bond vigilantes." But the arguments are less important than the reality that Japan's powers that be are lined up behind raising on the consumption tax on schedule in April 2014. The tax hike not only has the support of the BOJ president and Japan's leading business daily, but also the head of Keidanren (jp) its most powerful business lobby; Amari Akira, Abe's own minister for economic and fiscal policy; and leading members of the LDP, which has, after all, campaigned on raising the consumption tax for the last several elections. Of course, it almost goes without saying that the ministry of finance wants to see the tax hike proceed as scheduled.

The forces arrayed against the tax, at least at the elite level, are thinner. Hamada Kōichi and Honda Etsuro, Abe's leading economic advisers, have both voiced skepticism about the current tax hike plan, with Professor Honda's arguing (jp) that the tax should be phased in at 1% a year rather than in two phases. Saitō Tetsuo, the chair of LDP coalition partner Komeitō's taxation committee, has stressed the need to take economic conditions into consideration when deciding whether to go forward with the hike. Beyond elite circles, perhaps most significant fact is that the public is overwhelmingly opposed to the tax hike: Asahi's post-election opinion poll found (jp) 58% opposed and only 30% in favor.

Given that sustainable, robust growth is still far from assured — and that wages have yet to rise, suggesting that consumers would really feel the sting of the tax hike — the facts are probably on the side of the skeptics. The proponents still have to explain (1) why the confidence of global markets is so important when, as Michael Cucek reminds us, Japan is largely invulnerable to "bond vigilantes" and (2) why confidence would evaporate now as opposed to anytime over the past decade of swollen deficits. If anything, delaying the consumption tax hike should signal to financial markets that the Japanese government is serious about reviving Japan's economy.

But this week shows that the facts have an uphill battle against a good portion of the Japanese establishment (with the support of international actors like the IMF). After finally securing a plan in 2012 to raise the consumption tax, they are not about to let the Abe government back out of its commitment. With the final decision resting on Abe's shoulders, this issue is as good a chance as any for Abe to show that he can be the strong, decisive leader he claims to be.

Friday, August 2, 2013

The real problem with Asō's gaffe

After the uprising of the 17th of June
The Secretary of the Writers' Union
Had leaflets distributed in the Stalinallee
Stating that the people
Had forfeited the confidence of the government
And could win it back only
By redoubled efforts.
Would it not be easier
In that case for the government
To dissolve the people
And elect another?

Bertolt Brecht, "Die Lösung" (1953)
Deputy Prime Minister/Finance Minister Asō Tarō kicked off the second leg of the second Abe government with a fine contribution to the hall of fame of gaffes committed by Japanese politicians.

Speaking at a symposium hosted by the right-wing Japan Institute for National Fundamentals, Asō spoke about how the Abe government should approach constitution revision. He said:
Now if you say "let’s do it quietly," you need to look back at the Weimar Constitution, whose amendment went unnoticed. It was changed before most people realized it had happened. We need to learn from this. I have absolutely no intention of rejecting democracy. But I don’t want to see us make these decisions in the midst of an uproar. 
(That's from a translation by Peter Durfee; the full text of his remarks can be found here.)
The resulting international uproar — usually presented under headlines like "Japanese Finance Minister Taro Aso comes under fire for Nazi remarks" — has resulted in Asō's coming under pressure to resign from opposition parties, and under pressure from the prime minister (jp) to retract his remarks. He has retracted, but has said he will not resign.

However, in my reading of his remarks, Asō's interpretation of how the Weimar constitution was revised may have been the least offensive aspect of his speech. What's offensive about Asō's speech is the arrogant disdain for the messy reality of democracy, the lament of every would-be utopian in history eager to ram the square peg of humanity into their round hole of choice. Asō repeatedly bemoans the "boisterousness," "tumultuousness,"and "uproariousness" present in public discussion of constitution revision. He seems to say, Why can't the people see that we know what's best for them? Can't they see that the facts demand revision? I read this less as a blueprint for revision than as a whine about how it's all the fault of the public and the mass media for how little success Japan's revisionist right has had when it comes to building a consensus in favor of their vision of the constitution.

Why shouldn't the debate be boisterous? Why shouldn't there be uproarious and fierce opposition when the debate is about the document that serves as the nation's moral center — especially when the LDP's draft makes no secret of its plans to change the values enshrined in the constitution?  Why shouldn't Japanese defenders of the constitution feel just as strongly about defending a document — a document that, whatever its origins, has become an important pillar of postwar Japanese society — as the revisionists feel about changing it? Who are Abe, Asō, and company to decide whether a debate is being conducted appropriately or not?

At its best, liberal democracy is "boisterous" and "uproarious," because if the people have the freedom to speak their minds, there is bound to be a tumult. Politicians seeking order, politeness, and decorum can find some fine examples in Japan's immediate neighborhood.

In the final analysis, I don't think Asō was longing for an end to democracy or outlining a secret plan for constitutional revision. Rather, he has once again revealed a fundamental fact about his and Abe's worldview: they have no problem stating their love for democracy as an abstract idea, a value to be promoted in East Asia and a rhetorical cudgel with which to bludgeon China, but they have little love for democracy as it is actually practiced in Japan.

Sunday, July 21, 2013

Abe's underwhelming victory

Abe Shinzō's LDP-led coalition with Komeitō got its wish Sunday, winning enough seats to retake control of the House of Councillors for the government and ending the "twisted" Diet for at least the next three years. With five seats still undecided, the LDP and Kōmeitō have secured 134 seats, comfortably over the majority threshold of 122 seats.

But it is difficult to declare Sunday's results an strong mandate for Abe and his program.

First, the LDP fell short of winning an outright majority. The LDP is once again the largest party in the HOC, but it will still need to secure the votes of Kōmeitō to pass legislation in the upper chamber. It is unclear what threats Kōmeitō can wield to modify the government's behavior — I doubt whether it can credibly threaten to leave the coalition — but since they wield the deciding votes in the HOC, they will be in a position to influence the government's agenda, which will likely have consequences for nuclear energy and constitution revision. One could argue that Kōmeitō was the real winner on Sunday.

Second, the pro-revision parties fell short of a supermajority. The pro-constitution revision parties needed to win at least 162 seats to be in a position to pass constitutional amendments in the HOC. Given that the pro-revision parties don't even share the same vision for the constitution, the road to revision is no less steep today than it was before the HOC election. That doesn't mean Abe won't try to cobble together some kind of revisionist alliance in the HOC, but I think the pattern I outlined in May will hold:
At the very least, we're probably seeing the emergence of what will likely be a persistent pattern should Abe remain in power. Abe and his lieutenants will talk about the need to revise the constitution, Kōmeitō will express its unease about revision, what's left of the left wing will sound the alarm, public opinion polls will reveal skepticism about revision, LDP grandees will suggest backing down...and rinse and repeat.
It is difficult to view the HOC election as public endorsement for a shift to the right.

Instead, we should view the HOC election as a sign that the Japanese political system is not "stable" or healthy. There is an emerging narrative that because the Abe government looks durable, the Japanese political system has achieved some stability after years of turmoil and ineffectual governments.  Abe may well be in a position to last, although we won't really know until he actually has to make a controversial decision (about, say, TPP or nuclear power or the consumption tax). But the election returns suggest that these will be trying years for Japanese democracy. The DPJ has more or less imploded, and seemed to spend more time during the campaign fighting amongst itself than against the government. The Communists soaked up anti-Abe protest votes and won eight seats, including three district seats, but the ability to win protest votes does not necessarily make for an effective opposition party. As Michael Cucek noted before the election, none of the opposition parties has anything constructive to say about the problems facing Japan. Abenomics is winning public support at least in part because it's the only policy program on offer. Kōmeitō is basically left being the opposition-in-government. I think there are votes for a center-left program, but no party or leader has articulated one in simple, easily understood terms. Whether a coherent, effective large party can emerge from the DPJ's wreckage is one of the most important questions in Japanese politics in the years to come.

Finally, policy challenges remain. With control of both houses, Abe has no excuses. He cannot hide behind the "twisted Diet" any longer. He is going to have to deliver results and make decisions with the potential to trigger major public opposition. The media, of course, will be waiting to pounce at the first sign that the government is slipping — to say nothing of Abe's rivals within the LDP. The public is still opposed to nuclear restarts and is still opposed to raising the consumption tax next year. While the public as a whole supports Japanese participation in TPP, the LDP still includes an unwieldy mix of representatives from across the country, suggesting the possibility of a postal privatization-like confrontation between the urban and rural wings of the party.

In short, the HOC election was not nearly as transformative as it may seem. By failing to win an independent majority in the HOC, the LDP will continue to depend on Komeitō to pass legislation. But by winning a majority for the coalition, Abe will now be expected to use his political power to follow through on his pledge to revitalize Japan's economy — with the public, the media, and rivals within the LDP ready to turn on him should he falter.

Sunday, July 7, 2013

Will nuclear restarts derail Abe? (Probably not.)

Say what you will about the LDP, but the party has been fairly open about its preference for nuclear energy and restarting Japan's idled reactors as soon as possible.

The party may be about to get its wish.

On July 8th, four regional power companies will apply to the Nuclear Regulation Authority to begin compulsory inspections as a first step towards restarting their reactors. It will be months before the inspections will be concluded and plants reopened, but Monday appears to mark the beginning of the reintroduction of nuclear energy to Japan's energy mix in a significant way.

The NRA is central to the LDP's and Abe's soft-pedaling of the nuclear issue. Lest the Abe government be faced with this...

Source: Asahi Shimbun, Asia & Japan Watch, 30 June 2012

the LDP and the prime minister have repeatedly said that they will defer to the judgment of the authority when it comes to restarting reactors, including the pledge in the party's manifesto last year and again this year.

As long as the authority was not yet reviewing applications to restart reactors, deferring to the authority was an easy position to take. But now both the authority and the Abe government will be tested. For the NRA, it will be tested to show its independence from political decision makers, who have said they will respect the authority's decisions but have made no secret in wanting reactors put back online as soon as possible. For Abe, the pledge to defer to the NRA's judgment will be equally tested, especially if the authority rules against fast restarts for some reactors.

Perhaps the best outcome for both parties would be for some reactors to be restarted and others rejected for the time being, thereby allowing Abe to show his willingness to respect the NRA's decisions while still pocketing the political benefits of less dependence on imported energy. It might also defuse some of the political opposition — preventing demonstrations like those seen above, for example — by showing that the government really did defer to the regulators. It may also defuse some of the opposition from Komeito, the LDP's coalition partner. The latest Asahi polling, discussed here, shows that the public is still opposed to restarts by a considerable margin (29% in favor, 53% opposed), but the issue is a second-tier issue and it is by no means certain that Abe would face the kind of demonstrations his predecessors faced, especially if Abe can pass the buck for restarts to the NRA.

Meanwhile, by rejecting some applications for early restarts, the NRA could show its independence and demonstrate that it actually has some regulatory clout.

Mind you, it is beyond my expertise to say what the inspections actually will produce. (This NHK article [jp] has a decent rundown of the new regulations upon which inspections will be based.) But it does seem that, while the public is firmly opposed to restarts, there is a way for Abe to avoid taking a serious political blow from the nuclear question.

Pinpointing public support for Abenomics

With the upper house election campaign in full swing — Michael Cucek has the campaign numbers breakdown here — there is no shortage of public opinion polling to wade through. Because the outcome of the election is more or less a foregone conclusion, not much of it is very interesting.

However, it is still worth looking at if only to understand how the public is evaluating Abe's performance and what their priorities are as the campaign trucks fan out across the country.

I've been paying particular attention to several questions in Asahi's national tracking poll pertaining to public assessment of Abe's economic policies. In addition to tracking the headline approval rating, I've been looking at one question which asks respondents to assess whether they approve of his economic policies (previously whether they believe Abenomics holds promise for growth), and another which asks whether they believe Abe's policies are linked to increases in wages and employment.

In the latest Asahi poll (jp), conducted a week after the previous one, public support for Abe's economic policies improved slightly, rising to 55% approval from 51%, and, more importantly, disapproval fell from 31% to 23%.

Source: Asahi Shimbun
Abe also saw a slight shift in his favor when it comes to whether the public believes his policies are connected to improvements in wages and employment.

Source: Asahi Shimbun
Finally, this latest poll introduced a new question, asking respondents which policy they would like to see debated more during the upper house election campaign. The poll is consistent with those dating back years: the public is most interested in economic growth and social security, followed by issues like the consumption tax and energy, and finally TPP, foreign policy, and the constitution. 

Source: Asahi Shimbun, 7 July 2013
The fluctuations in support for Abenomics a few points one way or another probably don't mean much in the scheme of things, not least because last week's and this week's polls have had relatively small sample sizes compared to polls conducted earlier in the year. After getting responses from between 1500 and 2000 households for most of the year, the last two polls have had fewer than 1100 respondents (1039 last week and 1084 this week). By comparison, the June 11th poll that showed a twelve-point drop in support for Abe's economic policies had 1781 respondents. With approximately 51.8 million households in Japan, 1084 respondents gives us a margin of error of ± 3% at 95% confidence.

Thankfully, Yomiuri poll (jp) in late June found nearly identical results with more respondents (1821) when it asked whether respondents approved or disapproved of Abenomics: 54% approval, 31% disapproval.

Thus we can say with a reasonable amount of confidence that public support for Abenomics remains at just above 50%.

That, ultimately, is the most important number to watch. Because public support for the Abe cabinet rests so much on public support for its policies in the areas that matter most to Japanese citizens, i.e. the health of the economy, as long as the public supports Abenomics, they will support Abe. At the same time, if and when the public turns against Abenomics, Abe will be in trouble to the extent that growing unpopularity will create space for critics within his own party to undermine his program.

At which point Abe will be pressed to show just how much he believes in the slogan he has lifted from Margaret Thatcher (jp): There Is No Alternative.

Monday, June 24, 2013

The Japanese public's enduring anxiety about social security

Even as the Japanese people confronted slow growth and considered whether the longstanding institutions of Japanese capitalism would be able to guarantee prosperity in the future, they faced the prospect of an aging, shrinking population and worried about the stability of Japan's social security system. As baby boomers retire, Japanese society, like other developed societies, has become increasingly worried about whether the government would be able to meet its obligations to provide social insurance, pensions, welfare and poverty relief, and eldercare.


One has to wonder about the extent to which anxiety about Japan's social safety net has influenced household decisions about consumption, savings, and investment and their appetite for higher risk, higher yield assets during the "lost decades." The question is whether public anxiety about Japan's social safety net has depressed aggregate demand beyond the basic effects of too few Japanese chasing too many goods as argued by Edward Hugh. Arguably, the DPJ's program while in government (at least for the first year or two) was implicitly based on the notion that reducing insecurity about the safety net could yield macroeconomic benefits.

In this post, I will document the persistence of public fears about the social security system during the lost decades. Since at least the late 1990s, anxiety about the stability of the future of social security has regularly ranked at or near the top of the public's priorities in economic policy, which remains the case today. Any discussion of the impact of Abenomics on the economic behavior of Japanese households has to weigh Japanese attitudes about the social safety net. If Abe is unable to ease fears about the government's ability to provide for retirees, any gains to Japan's economic performance could prove short lived.

We can see these fears about the safety net as early as 1997. A March 1997 Asahi poll asked respondents whether they felt some anxiety about their future livelihoods. 69% said they said, versus 29% who said they did not. When those 69% were asked to explain what they were anxious about, the most common response was pensions and social security (30%). Only one other reply — "my personal health" — was in the double digits (11%). The same poll asked respondents to state the degree to which they felt confident in the future of public pensions systems. 42% expressed either great (5%) or some (37%) confidence, while 55% expressed either little (44%) or no (11%) confidence.


The next year an Asahi poll found that more respondents were most uneasy about pensions and social security (30%) than about Japan's economic outlook (28%), their incomes (20%), or their jobs (13%). 

Perhaps the clearest picture of public insecurity in the late 1990s can be found in an extensive July 1999 poll on questions related to Japan's aging society. The poll was based on face-to-face interviews with 2122 respondents nationwide, marginally more than Asahi's monthly telephone polls, which usually have between 1500 and 2000 respondents.

The survey paints a portrait of wide and growing anxiety among the Japanese public about life after retirement. Asked if there is anything in particular they feel uneasy about for their retirement, 28% of respondents said they were most uneasy about living expenses and other economic concerns, the most popular choice and an increase of six points over a 1994 poll on aging issues. Even more dramatic was the finding that 85% of respondents did not believe that contemporary Japan provided for a secure retirement. The survey found the public was concerned about the "fairness" of the social security system (23% thought it fair, 68% did not); was nearly evenly divided over who should bear the burden of higher medical costs as a result of aging (25% said to make the generations currently working pay more in premiums, 32% said the elderly should pay more in premiums and fees, and 28% said that all should pay more through a consumption tax hike); and believed that most attention should be paid to pensions as opposed to health insurance or nursing care insurance. The same poll found that when asked whether they expect the state pension system to provide for them, roughly two out of three respondents either greatly (33%) or to some extent (32%) said they counted on their state pensions. 

As Japan's stagnation deepened, the public focused more on economic policy than on the safety net, and public opinion polls reflected shifting priorities. Polls during the Koizumi years simply did not ask questions about welfare, social security, or pensions. It was almost as if through his frenetic activity in other policy areas Koizumi Junichirō made the Japanese public (and the Japanese media) forget about Japan's aging society and safety net anxieties.

However, when polls did ask the public to assess the Koizumi government's social security policies, the response was not favorable. For example, in an April 2004 poll concerning Koizumi's first three years in office, 67% of respondents said they did not approve of Koizumi's pension reforms. 

By fall 2004, anxiety about the social safety net had returned to the top of the public's concerns. Asked in September what they would like the recently reshuffled Koizumi cabinet to make its top priority, 52% said pensions and welfare, topping all other choices by a considerable margin, including jobs and growth (28%). By December, dissatisfaction with the Koizumi government's handling of pensions grew, with 76% disapproval (and only 13% approval).


Of course, postal privatization dominated public discourse for the bulk of 2005, but public concerns about the pension system did not vanish: a poll taken in November 2005, after Koizumi's landslide victory in September and another cabinet reshuffle, found that 56% wanted the government to make pensions and welfare its top priority, with jobs and growth policy in second place with only 17%.

Koizumi effectively bequeathed to his successors a public hungry for the government to fix the social safety net. Polling in advance of the 2006 LDP leadership election repeatedly showed that voters wanted the election to focus on social security. For example, in January 2006, 45% of respondents said the campaign should center on "how pensions and health care ought to be," followed by 28% of respondents who wanted it to center on fiscal reconstruction and taxation. In September, after Abe Shinzō became prime minister for the first time, 43% of respondents said Abe should make pensions and welfare reform his top priority, with growth and jobs in second place with 17%. (And only 2% wanted Abe to focus on revising the constitution.) Abe, of course, suffered a crippling blow with the emergence of the "vanishing pension records" scandal, in which it was discovered that due to carelessness on the part of the Social Insurance Agency the pensions records of up to 50 million people may have been missing data. The scandal served only to heighten preexisting public fears that the social security system was not in fact secure, and ensured that it would remain a critical issue for the government to address.

The global financial crisis changed the public's priorities — but not as much as one might expect. A poll published on September 12, 2008, three days before Lehman Brothers went bankrupt, found that 40% of respondents wanted the government to focus on the economy and government finances, while 37% wanted the government to make pensions and social security its top priority. Despite the latest downturn, reforming the social security system remained high on the public agenda, especially after the DPJ took power in 2009 and appointed Nagatsuma Akira, the parliamentarian who challenged Abe on the missing pensions scandal, minister of health, labor, and welfare. Under the Kan government, social security reform became tied up with the consumption tax issue, as Kan Naoto fought to tie consumption tax revenue to social security funding, which Noda Yoshihiko ultimately succeeded at doing in 2012. A February 2011 poll actually found public support for this version of the consumption tax increase: 53% agreed with a consumption tax increase in order to secure social security funding, with only 35% opposed. (The same poll found that if asked if they support a consumption tax increase with no tie to social security, 46% were in favor and 45% opposed.)


Noda obviously struggled to make his case to the Japanese people but it was not for a lack of concern on the part of the public. In late August 2012, after the tax increase had passed both houses of the Diet, an Asahi poll found when asked how confident they were in the social security system, 64% of respondents expressed not much (47%) or no (17%) confidence in the system, compared with 35% who had full (3%) or some (32%) confidence in the system. The same poll found the public evenly divided (43% in favor versus 43% opposed) over the idea of shifting resources from spending on the elderly to spending on child care and strongly opposed (60% opposed versus 31% in favor) to charging citizens over 70 more in fees for health care.

For the moment the social safety net is once again second to economic policy in the priorities of the Japanese public. But if the Japanese people have had a constant concern over the past fifteen-twenty years, that concern is the viability of Japan's social safety net. As Koizumi discovered, if and when the economy improves, concerns over social security are bound to grow — and as Abe learned during his first government, those fears can prove fatal to a government. It is not entirely clear what the Japanese public expects their government to do to strengthen the social safety net, since support for tax increases to bolster social spending has proven so fragile. There may ultimately be nothing the government can do to reduce anxiety about the strength of the social security system. In an aging society public anxiety about the soundness of the safety net — particularly in an age of high budget deficits — may simply be an enduring fact of politics. Abe may have bought himself a temporary reprieve, but sooner or later public attention will turn back to the social security question.

The next post and the last in this series will look at public opinion polling on attitudes towards saving and investment, an important indicator of 1) how much risk Japanese households will tolerate, 2) how eager Japanese households are to participate in new-style shareholder capitalism, 3) how much households are benefiting from the Abenomics boom, and 4) the degree to which Japanese depend on the social safety net for their retirement living expenses.

Friday, June 14, 2013

How long will the Japanese people support Abe (and Abenomics)?

The most remarkable contrast between Abe Shinzō's tumultuous first term as prime minister in 2006-2007 and his current term is the degree to which Abe has been able to rely on significant public support. By this time in his first government — approximately five-and-a-half months after his inauguration — Abe's disapproval rating had surpassed his approval rating and would remain that way en route to defeat in the upper house election in July and resignation in September.


This time around his support has remained buoyant: in the latest round of poll his approval rating is 67% in Yomiuri (jp), 62% in NHK (jp), and 59% in Asahi (jp). The reason for Abe's popularity is apparent. The Japanese public has embraced Abenomics.


As the data from Asahi's monthly polls shows, Abe's popularity overwhelmingly rests on the popularity of his policy program. The Japanese people did not suddenly fall in love with Abe or the LDP in December 2012, but rather responded with enthusiasm when presented with a government that appeared to be serious about overcoming Japan's prolonged economic stagnation. Arguably, Abe has also benefited from lowered expectations, thanks to the poor performance of his DPJ and LDP predecessors, who struggled both to articulate and to execute policies to revitalize and reform Japan's economy. Support for Abe and Abenomics seems to be based less on calculations about the virtues of the "three arrows" when it comes to improving economic conditions and making life better for Japanese households than a kind of naive optimism that the government is working. As Asahi's monthly poll has shown, respondents have wavered when it comes to their belief that Abenomics will result in higher wages and more hiring.


Simply put, the Japanese public seems willing to give Abe the benefit of the doubt.

It bears asking, however, how patient the Japanese people will be. Asahi's June poll contained some hints that the public is beginning to lose faith in Abe's program. When asked whether they believed that Abe's economic policies "hold promise for growth in the Japanese economy," only 51% of respondents said they did, which, while still a majority, is the lowest number since January, when the Japanese people were still figuring out what the Abe government planned to do. In the same poll, when asked whether they've personally felt economic recovery since the outset of the Abe cabinet, only 18% said they had, as opposed to 78% who said they had not. Obviously a sizable portion of the latter are still optimistic that Abenomics will result in recovery, but there does seem to be growing doubts about the efficacy of the Abe government's policies.


The next month may be particularly challenging for Abe. Abe and the LDP are kicking off campaigns for Tokyo assembly elections and next month's upper house elections in the wake of volatile market activity that has raised questions about the efficacy of Abe's policies. But more importantly, during the campaign the Japanese public will probably hear more criticism of Abenomics than during the first six months of the second Abe government. The DPJ may be unable to prevent the LDP from winning a majority in the upper house, but if they hammer Abenomics every day, across the country from now until the election they may sow more doubt among the Japanese people, which, if combined with more market volatility, could seriously undermine Abe's public support. Abe could win the election and still see his approval rating erode. For this reason, perhaps the LDP is right to be worried, as this Asahi article (jp) suggests some members are. Because as Abe's support erodes, the likelihood of intra-LDP turmoil and jockeying for position by potential rivals increases, which could force Abe to change course in the fall as he tries to get pieces of his growth strategy through the Diet.

Everything, in short, depends on retaining strong public support, which in turn depends on Abe's policies delivering tangible results. And if tangible results aren't possible, as some skeptics suggest? Then the Abe government may be shorter lived than seems possible now.

The US and the history wars in Asia

Jeffrey Bader, former senior director for Asia at the National Security Council earlier in the Obama administration, has drawn attention for remarks criticizing comments made by Abe Shinzō and other Japanese leaders about Japan's wartime past. As Kyodo reports:
Bader...also warned the U.S. government could be more "vocal" if Japan reviewed past statements in which the government formally apologized for wartime aggressions in other Asian countries.
Bader's statement provides an interesting contrast to more enthusiastic accounts of US-Japan cooperation under the second Abe administration.

On the one hand, the US-Japan alliance will not be fundamentally undermined by Abe and other senior LDP politicians' questioning past apologies for Japan's wartime behavior. US-Japan security cooperation is too important regionally and too institutionalized to be much affected by impolitic statements. The US military and the Japanese Self-Defense Forces will continue to train together no matter what Japanese politicians say.

On the other hand, the US-Japan alliance is not the only US relationship in East Asia and if other allies, say, South Korea, voice their disapproval about Japan's leaders directly to the US president, the US cannot be indifferent. (Japanese right wingers say the US cannot be indifferent because of the influence of Asian-American interest groups, but I don't think it's necessary to cite the nefarious influence of lobbying groups to explain why the US might have a problem with tension between its two major allies in Northeast Asia.)

So what can the US do about the "history wars" in East Asia? Is being more vocal the answer? Ideally, the first step to US involvement would be to establish just what kind of comments or behavior would draw reproach from senior US officials. Would Abe's remarks about whether Japan "invaded" its neighbors qualify? Or the US only step in when the Japanese government undermines official apologies? Would visits to Yasukuni by the prime minister or cabinet ministers draw rebuke? What about statements like Osaka Mayor Hashimoto Tōru's comments about comfort women? Would Hashimoto be criticized even though he is not a national official?

Second, would the US response be limited to rhetoric action, or would it be matched by symbolic gestures? Would the US administration withhold state dinners or invitations to Camp David?

However, the more one thinks about Bader's suggestion and its implications, the more it seems that the US is already fairly vocal about Japanese prevarication about history. In recent years there is no shortage of examples of legislators and administration officials criticizing the words and actions of Japanese leaders. As Dennis Halpin writes (pdf) in a note on President Park's address to a joint session of Congress last month, when an address by Koizumi Junichirō to a joint session was being mooted during Koizumi's valedictory trip to the US in 2006, the late Congressman Henry Hyde wrote to Speaker of the House Dennis Hastert, saying that to have Koizumi, a regular visitor to Yasukuni Shrine, speak in Congress would "an affront to the generation that remembers Pearl Harbor and dishonor the place where President Roosevelt made his 'Date of Infamy' speech." Of course, the House of Representatives also rebuked Japan in 2007 when it passed House Resolution 121, calling on Japan to "formally acknowledge, apologize, and accept historical responsibility in a clear and unequivocal manner" for the wartime "comfort women." The executive branch has done its part as well. For example, during Abe's visit to Washington earlier this year, Danny Russel, Bader's successor at the NSC, called for Japan to do more to encourage historical reconciliation.

A more interesting question, then, is what effect US intervention has had thus far on Japanese leaders. I think one can make the case that statements by US officials have at least helped blunt talk of revising or replacing the Kōno statement on the comfort women and the Murayama apology for the war. Perhaps it has also kept Abe from visiting Yasukuni while serving as prime minister. However, it is hard to imagine US intervention in the history wars achieving more than it already has. It is unlikely that US intervention will change what anyone thinks about history, and it may even result in more provocative statements by right-wing Japanese politicians and commentators outside government, the kind of Japanese conservatives who have found a political home in Hashimoto and Ishihara Shintarō's Japan Restoration Party. These conservatives, after all, already believe the US holds Japan in contempt — as Air Self-Defense Forces General-turned-talking-head Tamogami Toshio writes (jp) in his defense of Hashimoto — and so would perhaps even make a point of defying US criticism. To the extent that Japan's neighbors treat all provocations equally, more active US involvement in the history wars could exacerbate tensions.

Being "more vocal" may not, therefore, be without risks. There may not be much the US can do other than prevent Japanese leaders from changing the status quo in the history wars. Resolving the history issue may ultimately depend on the Japanese people themselves. As Stanford's Daniel Sneider argues in a new article in Asia-Pacific Review (discussed here), the revisionist narrative is by no means the dominant historical narrative in Japan. The only way for Japanese to change the incorrect image of Japan as a nation of revisionist warmongers is for Japanese speak up when their leaders try to rewrite history, as encouragingly happened after Hashimoto's remarks. To the extent that the US can encourage and praise Japanese behavior in pursuit of historical reconciliation, it might actually be able to do more good than if it were to step up its criticism of Japan's leaders. Of course, whether reconciliation happens will depend on the willingness of Japan's neighbors to acknowledge that most Japanese recognize the wrongs committed by their country and to come to see Japan's right wing as aberrant, not representative.

Tuesday, May 28, 2013

Is constitution revision actually possible?

Last week, the Sankei Shimbun reported that, in the face of mounting public opposition, the LDP would in fact not put revising Article 96 of the constitution at the heart of its upper house campaign strategy. (Naturally, the next day Sankei published an editorial arguing that the LDP should make revising Article 96 central to the campaign as a matter of course.)

But is the LDP — and, more importantly, is Prime Minister Abe — actually backing away from their determination to use the upper house election to gain a mandate for revising Article 96? More importantly, does it matter?

At the very least, we're probably seeing the emergence of what will likely be a persistent pattern should Abe remain in power. Abe and his lieutenants will talk about the need to revise the constitution, Komeito will express its unease about revision, what's left of the left wing will sound the alarm, public opinion polls will reveal skepticism about revision, LDP grandees will suggest backing down...and rinse and repeat.

Barring a dramatic external shock, it is difficult to see how the politics of constitution revision will change in favor of revision. The bid to put revising Article 96 before more substantive revisions has done nothing to defuse opposition to revision. It seems unlikely that Komeito will become more enthusiastic about revision. Depending on the now-toxic Japan Ishin no kai to pass amendments is a non-starter, not least because it is unlikely they will win anywhere close to enough seats to help the LDP. Defending the constitution may be one of the few areas in which the Japanese left is still be able to mobilize citizens. It will presumably take some event that reveals the constitution to be woefully inadequate for coping with the challenges Japan faces — one of the arguments used by revisionists — for these political obstacles to vanish.

As long as Abe doesn't pay any political costs for stumping for revision, there's no reason to think he'll back down entirely, even if from time to time constitution revision takes a back seat to other issues. But  no matter how much Abe talks about revision, for the foreseeable future I have a hard time seeing how it will ever get traction. There are just too many people either skeptical about or completely opposed to changing the postwar constitution. More importantly, Japan's conservatives are much better at preaching to (haranguing to?) the converted than winning new converts.

Friday, May 17, 2013

The power of positive thinking?

Prime Minister Abe Shinzō Abe spoke with Jonathan Tepperman, managing editor of Foreign Affairs this month in an interview published under the heading "Japan Is Back."

The interview is fairly comprehensive, discussing Abenomics and Japan's economic problems, history issues, territorial disputes, the constitution, and security policy. Tepperman was not shy about confronting Abe, especially when it comes to Japan's imperial past.

The interview provides another glimpse at how foreign policy narratives coalesce. Reflecting on his first term as prime minister and discussing what he is doing differently this time, Abe said, "I have...started to use social media networks like Facebook. Oftentimes, the legacy media only partially quote what politicians say. This has prevented the public from understanding my true intentions. So I am now sending messages through Facebook and other networks directly to the public."

In other words, Abe is sensitive to the need to control the narrative at home and abroad. The narrative that Abe is trying to establish is that no problem is so daunting that Japan cannot overcome it. While he does not  say that "Japan is back" in this interview, that was the title of the speech he gave at CSIS in Washington, DC in February. As in that speech, the challenge for Abe is to acknowledge that his country faces serious difficulties — how else could he justify his program? — but then to show that Japan is more than capable of overcoming them. As Abe says, "I know that the current situation is difficult, and the world economy will have ups and downs. But that is the mandate I was given, and we are elbowing our way through."

Of course, in propagating this narrative, Abe has help from the "legacy media" around the world. For example, the cover of The Economist this week features a soaring Abe — garbed in Superman's tights — flanked by fighter jets.

Abe is determined to project an air of inevitability about his policies. Of course, in monetary policy, projecting an air of certainty may signal the credibility of the Bank of Japan's commitment to a higher rate of inflation, so perhaps there's something to Abe's positive thinking. As The Economist writes in its briefing, "Promoters of Abenomics say that changing perceptions will create a virtuous circle. Bigger company profits will engender wage rises, which will boost consumption, which will lead to renewed business investment, which will lead to profits."

But one must be sensitive to the fact that this is all an exercise in narrative formation. Though Abe has promised to "elbow through," he has not in fact done so yet. As Michael Cucek shows, there are competing narratives even for the first quarter GDP figures that are being hailed as early indicators of the government's success. There are still blanks the government must fill in when it comes to its growth strategy. The demographic challenge continues to loom, and will not be elbowed through so easily, unless Abe is sitting on a plan for mass immigration. The point is not that there aren't encouraging signs or that Abe isn't in a favorable position to make progress, but rather that the "Japan is back" narrative requires minimizing or ignoring the challenges.

There is a bigger question of what exactly it means that Japan is "back." Will it be more assertive diplomatically or militarily? Will it spend more on its military? Will it remove the remaining restraints on its use of force at home and abroad? Abe gave some hints in his CSIS speech — "A rules-promoter, a commons' guardian, and an effective ally and partner to the U.S. and other democracies, MUST Japan be" — but it is still unclear what Abe's restored Japan would do differently, especially given that the Obama administration, "pivot" notwithstanding, has been exceedingly cautious in Asia. In other words, no matter how successful Abe's economic program, Japan will still be hemmed in by an ally that seems primarily interested in regional stability, by neighbors that distrust an assertive Japan, and not least by the Japanese public, which is not entirely keen on lifting all restraints on Japanese security policy.

These concerns, taken together with lingering questions about Japan's economy and whether Abenomics can produce sustainable growth, suggest caution is still in order.

Saturday, May 11, 2013

Don't declare victory for Abenomics yet

With the yen's falling to below ¥100/$1 for the first time since 2009 and the Nikkei’s posting five-year highs, analysts have begun declaring victory for the Abe administration’s campaign against deflation and slow growth. Paul Krugman, the intellectual godfather of Abenomics, has not quite begun his victory dance yet, but he is optimistic that under President Kuroda Haruhiko the Bank of Japan has credibly signaled that it will continue monetary expansion until it reaches its 2% inflation target.

But it is far too early to draw conclusions about the success of Abenomics — given that deflation continues — and there remain a number of unanswered questions surrounding the Abe government’s economic program.

Ultimately, the success of an economic program must be measured not just in terms of corporate balance sheets, but also in the economic wellbeing of average citizens. If wages remain stagnant or if Japan experiences a jobless recovery, can Abenomics be declared a success? What will Abenomics mean for the Japanese worker? As a New York Times article by Hiroko Tabuchi and Graham Bowley suggests, it remains to be seen whether monetary stimulus will translate into wage hikes or higher employment — though the government is trying to encourage corporations to hire more workers and raise wages. It may also depend on whether the government is able to reverse the rise of Japan’s non-regular workforce, the short-term contract workers who enjoy few benefits, little to no job security, and virtually no opportunities for advancement. Non-regular workers comprise between a third and a half of the labor force, and as the government acknowledges, the non-regular sector constitutes a tremendous waste of human capital.

However, without a plan to overhaul the Japanese labor market, the danger exists that exhortations to raise wages will result in corporations’ raising wages for regular workers but maintaining or cutting low wages for non-regular workers, thereby deepening the inequality that exists between regular and non-regular workers. The Abe government and the LDP are not blind to this problem — last month, for example, LDP Vice President Komura Masahiko said (jp) that more had to be done to improve the status of non-regular workers and provide equal pay for equal work — but thus far it is not clear how the government plans to resolve it. (For more discussion of the problems in Japan's labor market, see here.)

The same goes for gender balance in the labor force. Noah Smith (a onetime guest blogger here) has identified how underutilized women are in the Japanese labor force, and expressed his hopes that the Abe government will act to increase female participation in the workforce. Abe has, to his credit, said the right things about gender equality.In his 19 April speech at the Japanese National Press Club (jp), Abe spoke of gender equality as not a social policy issue, but as a central piece of his growth strategy. The reality is, however, that we just don’t know what he will be able to do to change the role of women in the economy. Pretty much the only specific proposal Abe mentioned in his speech was the proposal to increase the number of women in corporate management positions, but that proposal affects a fairly small number of women. Abe is not the first politician to pledge to do something about gender inequality — for the past decade Japan has had a cabinet-level minister of state for gender equality — but we still don’t know what Abe will do to succeed where previous governments have failed.

Reforming the labor market is part of the so-called “third arrow” of the Abe program, the Abe government’s growth strategy. Once again, Abe’s rhetoric is at least encouraging — talk about public-private partnerships to move Japan from inefficient to high-value-added sectors — but until the government’s detailed plans are released in June, it is difficult to say anything conclusive about whether the Abe government will succeed at transforming Japan’s economy. It is worth noting that the Abe government is not the Koizumi government redux: whereas Koizumi talked of moving from the public sector to the private sector, in his speech last month Abe stressed the role of government in promoting growth in new sectors, industrial policy for the new century, with all the risks that come with efforts by government to pick winners. 

Abenomics (and the latest round of quantitative easing in the US) has raised fears of currency wars breaking out between Japan and its competitors. The effects of the BOJ’s stimulus program are already being felt outside of Japan. South Korea’s central bank has already moved to cut rates in light of the ongoing decline of the yen against the won, as did Australia’s central bank earlier this week. European exporters — especially Germany’s — are feeling the pain from the yen’s decline against the euro. Of course, no government will admit that a currency war is afoot, but if other governments engage in competitive devaluation with Japan the benefits to Japanese exporters from a weaker yen will be muted (if they aren’t already muted). Though the G7 finance ministers' meeting in the UK this weekend did not necessarily single out Japan for criticism, the fact that the meeting was held does suggest that Japan's policies are under close scrutiny abroad. 

There are also lingering questions about Japan’s fiscal situation. With the BOJ stepping in to buy government bonds, the Japanese government will continue to be able to borrow without having to worry about rising interest rates. But the risks of Japan’s ever-growing debt remain — and if the BOJ has in fact succeeded at convincing market actors that it is committed to raise inflation, there is the risk that it will be unable to control inflation once it has met its target, hastening the day when interest payments will rise and break the government’s budget. The government is in a race against time. It needs to trigger sustainable long-term growth that can raise tax revenue before interest rates rise. The Abe government has indicated if economic conditions are still sluggish, it will delay the consumption tax increase passed under the Noda government, thereby postponing a useful means of closing the government’s annual deficit of 10% of GDP.

Finally, the question of Japan’s demographics looms over the debate about Abenomics. Edward Hugh offers a sobering account of how demographics may forestall the Abe government’s program. Hugh basically asks whether Japan has experienced a prolonged balance-sheet recession and is in a liquidity trap, as argued by Krugman, Richard Koo, and others, or whether Japan’s persistent demand shortfall is the result of a “shrinking population trap.” Hugh is skeptical that either fiscal or monetary policy will fix Japan’s economy and that the government’s monetary policy experiment risks triggering capital flight as elderly Japanese investors seek higher returns elsewhere. Hugh’s post is lengthy and I cannot do it justice with a short summary, but it should be taken into account when deciding whether Abenomics has succeeded.

The point is that it is impossible to know whether Abenomics has succeeded until we actually see the whole program put into action. Generating inflation is, as the Abe government says, just one arrow in a comprehensive plan to rejuvenate Japan’s economy. Stock market gains and a weaker yen may be helpful indicators but they should not be mistaken for signs for change in the real economy. Similarly, promising rhetoric about reform is encouraging, but after decades during which many Japanese politicians have talked a lot about reform but failed to follow through, it seems that a “wait-and-see” attitude is still appropriate. 

Abe probably has about as favorable a political environment as a Japanese prime minister could ask for — dysfunctional opposition parties, few challengers within the LDP, and high public approval ratings — suggesting that he may well be able to follow through on his ambitious agenda. That being said, if Abe cannot reverse Japan's economic woes even with all of these factors working in his favor, I have to wonder if anyone can.

Thursday, May 9, 2013

Abe's neo-statism

This week Prime Minister Abe Shinzō criticized right-wing demonstrations in Koreatowns in Tokyo and Osaka, stating, “The Japanese way of thinking is to behave politely and to be generous and modest at any time.” While it is, of course, good that Abe made a point of criticizing hate speech, it's important to recognize that Abe is pursuing a different program than some of the cruder conservative revisionists in his own party, the conservative media, or the right-wing demonstrators who terrorize the ears of Tokyoites with their sound trucks. The problem with the word "nationalist" is that it obscures more than it reveals.

In an astute article about Abe's program, the FT's David Pilling notes Abe's agenda can rightly be summarized using the Meiji slogan, Fukoku-kyohei (rich nation, strong army). What I wonder, though, is whether it is best to think of Abe as a nationalist or whether it is more appropriate to think of him as a statist, not unlike his Meiji forebears. The distinction is important. The right-wing demonstrators criticized by Abe are little more than chauvinistic ethnic nationalists, intent on showing the superiority of the Japanese people. Abe is interested in the survival of the Japanese nation in international competition, with the state as a kind of avatar of the Japanese people. His way of thinking is steeped in Hobbesian and social Darwinist conceptions of the state, in which the state and people exist in a sort of organic solidarity and in which the state is focused largely on protecting lives and property from enemies foreign and domestic. To compete with other nation-states, the state must be capable of organizing and drawing upon the country's resources and the people's energy in order to compete.

Accordingly, when Abe talks of breaking free of the postwar regime or creating a normal nation, it is with this idea in mind. Nationalism is a means to the end of strengthening the state. Encouraging national pride is useful to the extent that it makes Japanese citizens more amenable to constitution revision, more supportive of an assertive Japanese military, and more eager to stand up to provocation by China or North Korea, just as revitalizing Japan's economy is useful to the extent that it improves the state's fiscal position, swells its coffers, and bolsters national confidence.

The question is whether Abe's neo-statism poses risks to peace and security in East Asia. On the one hand, China arguably views the world along similarly social Darwinist lines, and one can therefore make the case that national survival for Japan depends on embracing a similar way of thinking, making Japan less vulnerable to bullying by China. However, the danger of Japan's embracing a social Darwinist conception of international competition is that it would make every problem between Japan and its neighbors harder to resolve, because every issue would become a question of status in the international hierarchy. When combined with fewer restraints on the use of force by Japan, the risk of outright war would surely increase.

There are still a number of hurdles Abe must overcome before he can remake Japan according to his neo-statist vision — and he must still convince the Japanese people of its wisdom, especially as far as constitution revision goes. But it is important to understand just what kind of nationalist Abe is, and to be aware that whatever short-term tactical concessions he makes, he has a long-term vision of where he wants to take his country.

Sunday, May 5, 2013

Following the leader

Michael Cucek catches a comment from LDP Secretary-General Ishiba Shigeru at a public appearance in Kagawa. 

Ishiba said, "The Liberal Democratic Party is a party for doing what?...First and foremost, it a party for the revision of the Constitution." 

Cucek raises some useful questions about what this statement means, but I wonder whether Ishiba wasn't just being extremely literal.

After all, revising the constitution is right there in the party's founding documents. In the party platform of 15 November 1955, the sixth and last (but arguably not least) proposal says that the party will "plan for independent revision of the current constitution and reexamine Occupation-era laws, changing them to conform with national conditions." The same plank says "in order to protect world peace, state independence, and popular freedom," the LDP will create a self-defense force and prepare for the removal of foreign troops stationed on Japanese soil (i.e., the US military). 

But to try to answer Cucek's questions, I don't know if the Westminsterization is really all that stealthy. If a prime minister knows what he wants to do, has the public behind him, and faces no real opposition from within his own party, one should not be surprised that even a politician with an independent base of support like Ishiba would have to follow the leader, right down to his rhetoric. 

There doesn't seem to be a whole lot standing in the way of Abe Shinzō's completing the work of his grandfather and the other fathers of the LDP.

Tuesday, September 22, 2009

Practical politics, symbolic conservatism, and the decline of the LDP

The LDP's presidential race is in full swing, and Tanigaki Sadakazu appears to be in command of the race against Kono Taro and Nishimura Yasutoshi. Polls of LDP Diet members suggest that Tanigaki enjoys the support of roughly a majority of the party's 199 Diet members; Yomiuri has Tanigaki with 102 votes, Nishimura with 30, with Kono with 28, with 39 members undecided. Tanigaki has secured the support of the party establishment, which, given the LDP's demographics after the general election, could well be the path to victory. Given these figures, it is little surprise that Kono is pinning his hopes on winning overwhelming in voting in the prefectural chapters, which will cast 300 votes in the election.

At the same time, the LDP is also trying to figure out what is to blame for the party's devastating defeat last month. One Sankei article notes that one group that studied the election found that the LDP's notorious web commercials — especially this one — were well viewed, but were poorly received by those who viewed them, prompting Sankei to ask whether the Internet ads are to blame. The survey was conducted online and had a small sample size, so the idea that the LDP somehow lost because of its Internet ads is absurd (although I'm willing to buy the argument that negative LDP ads combined with the DPJ's positive campaigning may have mattered on the margins). The point is there is no shortage of explanations for why the LDP lost this general election, and undoubtedly many of them have some validity.

One factor that I find worth exploring is the role played by the LDP's virtual abandonment of bread-and-butter issues — pensions especially — to the DPJ. The 2007 upper house election and the 2009 general election were contested over issues on which the DPJ's positions were overwhelmingly favored by the voting public, insofar as the elections can be said to have been concerned with policy. While voters may have had their doubts about various DPJ proposals, the DPJ managed to tell a convincing story of how LDP rule had faltered and why "regime change" was necessary. Central to this story is the LDP's yielding livelihood issues in the years since the end of the bubble economy.

In short, the LDP did not have to lose, at least in the manner in which it lost this year. A critical factor in explaining the LDP's collapse is, I believe, a shift in how the LDP presented itself to the public. Despite having been the party that presided over the economic miracle and guided Japan — with the bureaucracy, of course — to a position of global economic prowess while maintaining social equality, by 2007 the LDP had abandoned this legacy.

Perhaps it is unusual to speak of the LDP's having "abandoned" its legacy. After all, perhaps the LDP didn't abandon its legacy. Perhaps it was punished not for having bad intentions but simply for policy failures: the economy stagnated, LDP-led governments tried to stimulate the economy, failed, and in the process tied the government's hands with tight budgets, leading to austerity that were invariably felt in different forms throughout Japan and reinforced the image of a Japan that had become less equal and more harsh for many Japanese. (Perhaps the export-led boom during the earlier part of the decade was a poisoned chalice for the LDP, in that it kept urban areas buoyant, thereby reinforcing the image of a profound gap between center and periphery.)

But I would argue that it was not simply a matter of the LDP's having tried certain policies and failed. The idea I'm toying with considers how the LDP became a different party during the 1990s, culminating in the government of Abe Shinzo, which, given the support Abe had upon taking office and the manner in which he frittered it away (destroying himself in the process). From the early 1990s until 2007 the LDP shifted not just from center to right, but from pragmatism to idealism. It shifted from the realm of practical politics — which has as its fundamental concern the livelihoods of the Japanese people — into the realm of symbolic politics, Japan's cultural war.

Before I continue, I want to discuss this division between practical politics and symbolic politics. Foreign observers have long puzzled over how to think about ideological divisions in Japanese politics. It is hard to deny that ideological divisions between left and right were an important feature of postwar Japanese politics, especially in the early postwar decades. This division was rooted in the culture war that followed Japan's defeat in World War II. Not unlike Germany after World War I and the United States after Vietnam, Japanese intellectuals and politicians were polarized largely along lines related to the war. The idealistic left saw Imperial Japan and war as the great enemy and sought to prevent Japan's return to the dark valley. Because the US had "reversed course," because it had permitted the return of so many officials associated with Imperial Japan when it realized that Japan was needed as an ally during the cold war, and because in the eyes of the Japanese left US actions against the Soviet Union (with whom the left sympathized, to say the least) risked plunging Japan and the world into conflagration, opposition to the US-Japan alliance became a cultural question as much as it was a political question. Kishi Nobusuke expressed surprise at the opposition to his revised alliance treaty in 1960, which was, after all, a better deal for Japan than the 1951 treaty: but the forceful opposition that drove Kishi from power was responding less to the content of the treaty than the fact that Japan, under the leadership of the former Class A war criminal Kishi Nobusuke (whose ideas about the Japanese economy during the war amounted to Japanese-style national socialism), was in danger of returning to its wartime identity as a participant in power politics and active ally of the "imperialist" US. The treaty protests were, after all, preceded by successful left-wing demonstrations against the 1958 revision of the Police Execution of Duties Law, which the left feared signified a return to wartime repression.

At its founding, the LDP was a party ready to push back against the left in Japan's culture war. Recall that in its founding charter the LDP declared that one of the party's fundamental goals was the restoration of Japanese independence, which for Kishi and others meant in practice revision of the 1951 security treaty and revision of the 1947 constitution. It also meant an unabashed admiration for prewar and wartime Japanese society, in which citizens did their duty in service of the Emperor, based on a mystical bound between sovereign and people. As postwar political theorist Maruyama Masao wrote in his essay "Theory and Psychology of Ultra-Nationalism:"
Japanese nationalism...was never prepared to accept a merely formal basis of validity. The reason that the actions of the nation cannot be judged by any moral standard that supersedes the nation is not that the Emperor creates norms from scratch (like the sovereign in Hobbes's Leviathan) but that absolute values are embodied in the person of the Emperor himself, who is regarded as 'the eternal culmination of the True, the Good, and the Beautiful throughout all ages and in all places.'
This is an idea with staying power for the idealistic right: Abe, after all, spoke of the emperor as the loom that has weaved the tapestry of Japan (mentioned here), and the right obviously continues to attribute tremendous importance to Imperial family and its "unbroken line" of sovereigns.

The idealistic right was concerned not only with the position of the emperor in the postwar system: the right-wing position in the culture war addressed larger questions of Japanese nationhood and Japan's place in the world. The difference between left and right was not internationalism versus nationalism, but the left's neutralist, pacifist nationalism versus the right's great-power nationalism. The idealistic right effectively inherited Meiji-era Social Darwinism that saw the world as a dangerous place in which the "fittest" nations were those capable of besting others in conflict. That Japan was virtually occupied after 1951 — given the domestic role the initial alliance treaty accorded to US forces in Japan — and that Japan's ability to compete with other nations was constrained by the "pacifist" constitution drafted by the American occupiers were terrible affronts to the idealistic right, and in practical terms they prevented Japan from contributing fully to the struggle against communism (unyielding anti-communism being another inheritance from the prewar right, despite Kishi's flirtations with leftism while at Tokyo University — indeed, despite his being branded a leftist by his enemies when he was a senior official at the ministry of commerce and industry during the 1930s). The result was that security policy was as much a matter of symbolism for both the left and the right as it was a matter of practical policy concerning budgets, troop strength, procurement, and the like. The Self-Defense Forces, Article IX, and the US-Japan alliance are the prizes over which the idealistic left and right have fought until the present day, in addition to the Imperial family and the education system, the latter with particular resonance as the left sought to prevent the right from rebuilding the education system along cherished prewar principles.

Earlier I compared Japan's symbolic culture war with interwar Germany and post-Vietnam America. There appears to be something about losing wars that results in a continuation of the lost war by other means among domestic political actors as they struggle to rebuild after defeat. Part of rebuilding the shattered nation involves, of course, assigning blame for the defeat and taking steps to ensure that the disaster would not be repeated again. (Perhaps it is controversial for me to include America on this list, but I think when one looks at what American conservatives say about the U.S. defeat in Vietnam and about what happened on the home front during the war, indeed their propensity to blame the 1960s for much of what is wrong with the US today, I think post-Vietnam American politics may follow the same lines as the other examples.)

But the culture war was by no means the whole of Japanese politics. Indeed, the interesting story in the 1960 struggle over the US-Japan security treaty was how the LDP ultimately won the struggle. The LDP was by no means united in sharing Kishi's revisionist and idealistic vision for Japan. While the first principle in the LDP's policy platform in 1955 stressed "the people's morality" and "education reform" and the second stressed reforming the electoral system and the national administration (the politicians have been at this for a while), the third and fourth goals were "economic independence" and "creating a welfare state." There were plenty of LDP members in 1960 who could be called — to borrow the slogan from the DPJ — the seikatsu dai-ichi right, conservatives who stressed the importance of economic reconstruction and egalitarianism as the best weapon against communism. Yoshida Shigeru looms large over this school of thought and it was, of course, Yoshida's protege Ikeda Hayato who succeeded Kishi, promulgated his "income doubling" plan, and stressed a "low posture" in governing. The Yoshida school, and later Tanaka Kakuei and his followers were grounded in practical politics: symbolic politics and the culture war with the left continued to rage, but was pushed to the margins of the party. The Socialist Party, rather than adapt to an LDP that had shifted from symbolic to practical politics, continued to wage its quixotic battle against the idealistic wing of the LDP, which was the "anti-mainstream" from Kishi's ouster until the end of the cold war. As such, the party system that emerged from 1960 saw the bulk of the LDP monopolizing practical, livelihood politics, which enabled it to co-opt ideas from the opposition when challenged (environmental issues in the late 1960s, for example). While corruption scandals weakened the strength of the LDP as a whole, the mainstream, practical LDP remained in control of the party and developed a system that enabled it to cooperate with the JSP — behind the veil of the Kokutai system — and the centrist, urban-based small parties that emerged after 1960.

The problem, however, is that by marginalizing the idealistic right within the LDP, Japan's culture war was essentially frozen in place. The idealistic right never had to modify its views, and thus even today conservatives makes many of the same arguments that their antecedents made in the 1950s and 1960s. Hailing back to the LDP charter, Abe's first "accomplishment" was revising the occupation-era basic education law. More significantly, Abe saw constitution revision — grandfather Kishi's unfinished business — as his government's raison d'etre and the basis upon which the LDP would contest the 2007 upper house election. Even the changes in security policy were as much about symbolism as they were about enhancing Japan's defense capabilities. The defense agency was upgraded to a ministry without fixing the agency's structural problems. Building a Japanese-style national security council, a plan abandoned when Abe left office, seemed more like an effort to acquire the trappings of a twenty-first-century great power than a fundamental transformation of Japanese security policy making. Revising the restriction on the exercise of collective self-defense could have had practical implications but was left unrealized. Meanwhile the defense budget continued to shrink and the defense procurement process — exposed as entirely rotten by the Moriya scandal that blew open just as Abe left office — went unreformed, these being two critical goals that a practical conservative like Ishiba Shigeru desperately wants to reverse in order to enhance Japan's ability to defend itself.

(Ishiba is an interesting figure. He seems to have little patience with the symbolic agenda. A defense policy wonk, he wants to make policies that strengthen Japan's defense, not symbolic measures that accord with some vision of how Japan ought to be. Little wonder that Ishiba criticized Abe after the 2007 upper house election, and that he wound up as defense minister in the eminently practical cabinet of Fukuda Yasuo.)

What changed since the early 1990s is familiar enough. I have previously discussed the monograph by Richard Samuels (my mentor at MIT) and J. Patrick Boyd, my colleague, in which they tell the story of how the LDP's pragmatists and the pacifist left worked together to resist the idealist, revisionist right on the question of constitution revision. They argue that from the early 1990s, the LDP became a more revisionist party as the practical wing of the party was weakened as the result of reforms that weakened faction heads and other party organs and strengthened the party leadership. Their argument is essentially that the LDP's old, practical mainstream was reformed to the point of being marginalized within the party, which may be true, but I wonder whether the practical conservatives also suffered as a result of their having been the ones in charge of the party as the economy foundered and as the bureaucrats — their allies in power — became deeply unpopular following a series of scandals. Indeed, it is ironic that Hashimoto Ryutaro, the heir of the mainstream tradition, was the architect of reforms that contributed to the rise of the idealists.

How did the rise of the revisionists contribute to the LDP's defeat last month? Not surprisingly I see the Abe government as the crucial turning point. It was not necessarily Koizumi Junichiro who doomed the party. Had Koizumi passed power to a successor with greater ties with practical conservatism, a successor who would have sought to reconcile structural reform with the growing perception of inequality on the part of the public, the LDP might have been able to hold out for longer against Ozawa Ichiro's DPJ, which successfully seized the "practical" mantle abandoned by the LDP as it embraced the symbolic. Instead the rise of the revisionists made it possible for Abe, virtually a living fossil of the pre-Ikeda LDP, to succeed Koizumi despite having virtually no experience in governing. Abe became prime minister despite having won only five elections and having never held ministerial positions other than a few years as a deputy chief cabinet secretary and less than a year as the chief cabinet secretary during Koizumi's victory lap. Under the old LDP system, Abe would never have become prime minister when he did (certainly a commendable feature of the old system).

The result was that at precisely the moment that the inequality problem became a grave public concern and the public lost confidence in the pensions system, the LDP was led by a politician who, indifferent to economic policy and the livelihoods of the people he governed, did little more than repeat Koizumi's slogans, while devoting his attention to the planks of a fifty-year-old party agenda. It was also at roughly the same moment that control of the DPJ passed to Ozawa, who saw that as the LDP moved in the direction of symbolic politics voters who had reliably supported the LDP when it was controlled by the practical right were increasingly disenchanted with the party and open to the possibility of voting for the DPJ. Ozawa's DPJ effectively grabbed the mantle of the old LDP mainstream. Seikatsu dai-ichi, the DPJ's slogan in the 2007 upper house election, could have served well as the slogan of the LDP from Ikeda onwards. I do not think it was coincidental that when I visited Kagawa last month, the granddaughter of Ohira Masayoshi, one in the line of practical conservative prime ministers, was campaigning on behalf of a DPJ candidate.

The DPJ as a party, especially under Ozawa, has studiously avoided symbolic politics and stayed focus on improving the lives of the people. By contrast, the LDP's campaign last month was largely symbolic: warnings about the influence of Nikkyoso, the "radical" teachers' union, the DPJ's disrespect for the flag, the party's "leftism" and inability to defend Japan, and so forth. Aso fully embraced the culture war as he campaigned around the country and warned of the dangers of DPJ rule. Of course, the dangers voters were concerned about were dangers to their jobs and their pensions.

To return to power — or, at the very least, viability — the LDP needs to reorient itself to practical politics. Tanigaki, a heir of the old mainstream, may be able to take some steps in this direction, but the idealist conservatives remain powerful, not least because Abe, Aso, and others will continue to be active in debates over the party's future. Some party leaders will no doubt continue to advocate a return to Abe's agenda of "leaving behind the postwar system" (the system built by the LDP mainstream, incidentally). It may be that the idealists are outnumbered, and that should Tanigaki win the LDP might once again focus primarily on livelihood concerns and develop a sophisticated and detailed critique of the DPJ's agenda while offering its own proposals. If so, so much the better for Japan: two large parties debating how best to ensure economic security and opportunity for the Japanese people, with atavistic culture warriors confined to the margins of the political system.