Can the DPJ legislate a new relationship with the bureaucracy?

On Tuesday, the House of Representatives began debate on the Hatoyama cabinet's bill revising the National Civil Service Law, the first of three cabinet bills intended to introduce political leadership to be considered in the Diet (the others being bills establishing the national strategy bureau and increasing the number of sub-cabinet political appointees).

If passed, the revision will, among other things, introduce a Cabinet Personnel Bureau (CPB) attached to the Cabinet Secretariat. The cabinet will be able to control the promotion of senior civil servants — administrative vice ministers, division chiefs, and section chiefs — with the cabinet selecting senior bureaucrats from a list with an eye towards not just ability but also the willingness to perform, as suggested by Sengoku Yoshito, Hatoyama's administrative reform czar in an interview in Asahi's Globe section. The expectation seems to be that the government would move senior officials laterally, away from their "home" ministries, in the hope of overcoming compartmentalized administration. When asked whether appeals to expertise could render the revision a dead letter, Sengoku questioned whether the Kasumigaseki's level of expertise is as high as assumed, although when pressed he suggested that perhaps the Finance Ministry's budget bureau will enjoy a certain degree of insulation. Another reform included in the bill would enable the CPB to demote officials.

Looking over this plan — which shares certain features with plans for a basic law produced under by the LDP, and which has in fact been criticized by the LDP and YP leader Watanabe Yoshimi for being weaker than the Aso government's plan — it is unclear to me what exactly the government hopes to achieve. Sengoku stresses the importance of overcoming compartmentalization. This plan may be effective to this end, but I wonder whether it raises other problems in its place.

Under the Thatcher government, the British civil service faced a prime minister who intervened aggressively in civil service personnel administration, which had perverse consequences for the civil service. Traditionally, the job of British civil servants was to provide advice and options for ministers as they went about implementing the cabinet's program as outlined in the party's manifesto. Bureaucrats would push back against ministers, they would do their best to dissuade ministers from making poor choices, but ultimately they served political leaders as a matter of professional duty. Under Margaret Thatcher, bureaucrats became more circumspect about the advice they dispensed to political leaders as prospects for promotion became linked to sticking with the government's program, and were more inclined to tell ministers what they wanted to hear instead of offering frank advice. In other words, security in office for civil servants was linked to the quality of service that they provided political leaders. Colin Campbell and Graham Wilson consider the changes that occurred under the Thatcher government to have been so consequential as to have marked the "end of Whitehall."

Accordingly, it is unclear from this legislation how the government intends to ensure that the bureaucracy will provide quality guidance to the government when the bureaucrats will have incentives to please political leaders.

I understand why the Hatoyama government feels obligated to enshrine reform in law, as it gives the government's reform agenda a symbolic permanence that it otherwise lacks. And it it is understandable why in the near term the Hatoyama government wants to be able to control senior-level personnel appointments. It needs to sever whatever links remain between the bureaucracy and the ancien regime. Under LDP rule, after all, the LDP and the bureaucracy developed a symbiotic relationship, in which the party preserved the prerogatives of the bureaucracy while the bureaucracy served as a policymaking staff for the party and cooperated with LDP backbenchers' desires to direct national resources to particularistic ends. To build a new system that DPJ needs to be able to forestall sabotage, shirking, or foot dragging on the part of the bureaucracy.

But I would argue that the most effective reforms to the policymaking process have been those that have limited interaction between bureaucrats and backbenchers, and intra-party reforms that have sharply limited the ability of backbenchers to participate in policymaking. Without being able to play backbenchers off against the cabinet, bureaucrats have already had to accommodate DPJ rule to an extent that few expected.

As for the goal of building a politically neutral civil service that dutifully serves the government of the day, perhaps the only way to build such a civil service is regular changes in ruling party. The British civil service has been described as "politically promiscuous," willing to serve any government even when successive governments have contradictory aims.  If there is not regular alternation in power, the bureaucracy will wind up simply shifting its loyalties to the new long-term ruling party, bending to the interests of the ruling party instead of dispensing guidance with an eye towards national and public interests.

In short, the process of building a new policymaking system will require at least as much change in the minds of actors in the system as change in formal institutions, if not more. As the DPJ comes to see the bureaucracy not as a hostile remnant of the ancien regime but as the source of expert advice, as the bureaucrats come to recognize the legitimacy of a government in power on the basis of a public mandate for its electoral program and come to recognize that there is a realistic chance of a different party with a different program taking power, the system will change to something approximating top-down political leadership. The new system will not come about through bullying the bureaucracy — except perhaps in very rare instances — but through the bureaucracy's recognizing the role it has to play in the new system, and the DPJ's (and whatever ruling party succeeds it) recognizing that no advanced industrial democracy functions without an effective civil service.

A terrible idea from DPJ backbenchers, quickly nixed

On Wednesday Ubukata Yukio, the deputy secretary-general, Tanaka Makiko, Koizumi Junichiro's controversial foreign minister who joined the DPJ last year, and other DPJ Diet members proposed to Prime Minister Hatoyama Yukio and DPJ secretary-general Ozawa Ichiro that the party establish a new policy research arm to replace the policy research council that closed shop when the DPJ took power in September.

Once again showing that whatever the DPJ-led government's shortcomings, it is entirely serious about centralizing policymaking in the cabinet and neutering the ruling party, both Hatoyama and Ozawa were quick to reject the proposal.

That these backbenchers felt compelled to petition the government for some sort of policy role is a good sign that the Hatoyama government's efforts to change the policymaking process — at least as the ruling party is concerned — are working. Backbenchers, after all, have the most to lose from the shift to the Westminster model. Whereas under LDP rule a fourth-term Diet member like Ubukata could be aspiring to posts in the policy research council that would give him a stake in policymaking, both mid-career and first-term DPJ members have little to do but show up to vote for legislation and go home to their districts to campaign. Unlike LDP backbenchers, there are few channels for them even to try to intervene in order to direct pork-barrel spending to their districts. To a certain extent, their fates as politicians rest in the hands of a government over which they have little or no leverage.

And so it should remain. If the Hatoyama government is to fix any of the problems facing Japan, it will have to be able to formulate policy without having to worry about backbenchers working behind the cabinet's back to develop and advance their own policies. Creating a new policymaking outfit in the party would also give bureaucrats opposed to the government an outlet to leak information that could undermine the cabinet, playing divide and rule among the politicians. And given the Hatoyama cabinet's struggle to keep ministers on message, a DPJ policy shop could only muddle matters further.

Perhaps one day the DPJ might find it useful to create a party think tank that would keep backbenchers occupied and explore new ideas. But for now the new policymaking process is too fragile and restoring a policy role to the party will simply invite trouble.

The DPJ's quiet revolution

In a contribution to Foreign Policy's "Think Again" feature, Paul Scalise and Devin Stewart maintain that the DPJ victory will result in "the same old stagnation in Tokyo." While there are points worth considering in their piece — especially on foreign policy and the notion that the DPJ is "anti-capitalist" — on the whole Scalise and Stewart, far from offering new thinking about the DPJ, offer the same old cliches about the DPJ's policy priorities and its internal dynamics. [For the record, I know them both — indeed, Scalise and I have argued many of these points in person.]

First, they argue DPJ politicians are not revolutionary: "Like those of the long-reigning Liberal Democratic Party (LDP), they are political opportunists without any long-standing ideological position or dominant constituency. Their only common desire is to be elected." They repeat the standard claim that "many members of the DPJ leadership were at one point members of the LDP," implying that the presence of former LDP members in the DPJ means that the party couldn't possibly stand for change. (Because apparently the most important fact about Ozawa Ichiro and Hatoyama Yukio, among others, is that they began their careers in the LDP, not that they spent nearly the past two decades trying to destroy LDP rule and usher in a new style of politics.)

This argument also ignores the fact that the party's candidates were remarkably unified behind the DPJ's manifesto during the general election. Far from being "political opportunists," the bulk of the DPJ's newly elected members are true believers in the party's agenda, which can be simplified as "Seikatsu dai-ichi" (Livelihoods first, i.e. pensions reform, building a new safety net, etc.) and "Seiken kotai" (regime change, mainly changing the relationship between politicians and bureaucrats in Tokyo, decentralizing the government, etc.). The point is that the DPJ has a remarkably clear agenda, which enjoys the support of the party's Diet members. Indeed, as Michael Cucek, the no longer anonymous author of Shisaku, worried before the election, the problem may be that the party members are too loyal to the agenda and not opportunistic enough. The opinions of DPJ backbenchers, however, may not matter much one way or another (more on this momentarily). The politicians in the cabinet — the DPJ politicians who do matter — are not mere opportunists, but they are not naive idealists either. The standard caricature of the DPJ and its leaders is simply wrong.

And in any case, the DPJ does not need to be "revolutionary" to deliver meaningful change to how Japan is governed.

Second, they express dismay that the DPJ is not the party of economic reform. Perhaps this is the case, although they make the same mistake that they criticize the media for making: they treat "economic reform" as an "empty buzzword," as nowhere in this section do they bother to define what they mean by economic reform. Surely there is no single way for Japan to reform, beyond the broad idea that Japan ought to transition to a more balanced model of economic growth, as I recently discussed here. There is not a single path to a new Japanese model, and as with any major institutional change, it will entail bargaining and compromises among various social actors.

Scalise and Stewart expect a new economic system to emerge in the manner similar to Koizumi Junichiro's style of reform: "Were the DPJ to change this system, it would need to bolster party unity, appeal to progressive constituencies with a transformative economic plan, and then gin up grass-roots support." One, as I have already noted, the DPJ is as unified as it is going to get, and is certainly more unified than the LDP probably ever was when it was in government. And in the event that DPJ backbenchers disagree with government plans, administrative changes already implemented will make it difficult for them to register their disagreement (see the subsequent section for more on this). Second, I'm not quite clear what they mean by "progressive constituencies." Consumer groups? Activist groups? Foreign investors? Who exactly do they mean?

Finally, they anticipate a lack of reform due to the structure of the DPJ — and its "bickering," "fragmented," "hodgepodge" coalition government indebted "to many masters" — and not, as I argued the other day, the fact that transforming an economic system is challenging in the best of times, and even more challenging in light of the LDP's having left the new government with a gross debt/GDP ratio now in excess of 200% and the global economy's recovering from a historic crisis. The obstacles facing the new government are without question considerable, but far from being hindered by a divided, bickering party and government, Hatoyama and his senior ministers have taken a number of steps that should give the DPJ-led government a fighting chance of succeeding in changing the Japanese economy for the better. The government may well fail, but it won't fail because of irreconcilable divisions within the cabinet. Indeed, what Scalise and Stewart see as "heated internal bickering" (a code word for Kamei Shizuka) I see as a massive step forward: note that the bickering is internal not to the ruling party or between ruling party and cabinet as under the LDP, the debate is occurring within the cabinet, among cabinet ministers. Cabinet ministers are actually debating what the government's policy should be! They're not just signing off on some document handed to them by administrative vice ministers or the party general council! What they see as bickering I see as a feature, not a bug. No government in the world — no democratic government anyway — is characterized by perfect unanimity among its leaders. The question is how the system manages disagreements and whether it is capable of making decisions and following through on them. The LDP system failed in large part because disagreements crossed institutional lines, undermining the cabinet's ability to establish policy priorities and lead.

Which brings me to the biggest flaw in their argument: they completely misunderstand the nature of the changes proposed by the DPJ when it comes to the relationship between politicians and bureaucrats. In describing the system of LDP rule, they see bureaucratic dominance as the result of the failings of Diet members, not the result of the institutional weakness of the cabinet relative to the LDP's internal organs (most notably the policy research council) and the bureaucracy itself: "...Politicians lack the time, energy, staff, and expertise necessary to write bills."

Undoubtedly individual backbenchers have had few resources of their own — but again, they ignore the power LDP backbenchers were able to wield as members of the PRC, working in cooperation with bureaucrats against the cabinet. But the answer to making Japan's government more effective is not strengthening the power and expertise of individual backbenchers. Indeed, the answer lies is ensuring that backbenchers have fewer avenues to exercise influence while concentrating all policymaking power in the cabinet.

Which is precisely what the DPJ plans to do. Scalise and Stewart don't seem to appreciate the significance of what the Hatoyama government has done in just the first few weeks of power: "The ruling party has called for the creation of a few smaller cabinet-focused committees to replace a few older party-centric and ministry-centric committees. It has also restricted the media's access to the bureaucracy -- hardly signaling its commitment to a more democratic and transparent legislative process."

What they miss here is just how powerful an actor the "party-centric" committees — the LDP's PRC — was in the policymaking process and how having powerful policymaking institutions outside the cabinet prevented it from controlling the policymaking process. And the idea that replacing bureaucratic press conferences with press conferences by political appointees is somehow undemocratic is laughable, and is indeed intended to ensure that the government's policy message is conveyed to the public clearly by the officials responsible for drafting it.

Scalise and Stewart simply miss the idea that the DPJ is trying to implement a Westminster system in Japan — and they simply miss just how radical an idea this is when one considers it in contrast to the LDP's "un-Westminster" system of government, in which the ruling party and its organs, together with the bureaucracy, had extensive veto power over the cabinet. The DPJ is trying to create a cabinet-led system of government that will be able to attempt some of the reforms desired by Scalise and Stewart, reforms that LDP-led cabinets struggled to maneuver through a cumbersome policymaking progress laden with veto points. At the very least the DPJ is creating a system of government that will be capable of experimentation and government by trial and error, which, after two lost decades, may be the only way for Japan to get a new economic system.

So what do we know about the DPJ's system of government so far?

Quite a lot, actually, because in its first days in office the Hatoyama government stated precisely how it plans to govern.

First, the DPJ as a ruling party is weak and — unlike the LDP — has no formal role in the policymaking process. The DPJ's policy research council has closed up shop; policy coordination will be managed by a national strategy bureau attached by the cabinet and headed by Kan Naoto, deputy prime minister and one of the DPJ's most senior politicians. Ozawa, the new DPJ secretary-general, has been given tremendous power over the ruling party and its Diet majority, making him the essential figure for getting the cabinet's policies passed into law.

Indeed, Ozawa will perform a function essential to a Westminster system: his job will be to ensure that the cabinet has the confidence of the ruling party, through which it controls parliament. Ozawa is hard at work on ensuring that backbenchers follow his lead, and by extension the lead of the cabinet. Far from strengthening the power of backbenchers, which Scalise and Stewart for some reason see as essential to changing how the government works, the DPJ intends to reform the system so that the job of a DPJ backbencher is to receive instructions on how to vote from Ozawa, show up to vote at the right time, and take the necessary steps to get reelected and so preserve the government's majority. Unlike under LDP rule, when backbenchers were busy with endless party committee and subcommittee meetings, participation in which being essential for getting ahead in the party, the cabinet and the party leadership expect that DPJ backbenchers will be seen and not heard.

To make this point absolutely clear, the DPJ has informed its Diet members that legislation introduced by Diet members (as opposed to legislation introduced by the cabinet) will be banned "in principle," with exceptions made for legislation related to elections and "political activities." (Presumably the latter exceptions will enable Ozawa to move legislation related to liberalizing campaign activities, long one of his pet issues and the subject of his recent study trip to Britain.) Also while in Britain Ozawa studied the daily activities of parliamentarians — in other words, what backbenchers do with their time since they have little to do when it comes to policymaking.

Beyond these changes, perhaps the biggest oversight on the part of Scalise and Stewart is their failure to appreciate the radicalism of the DPJ's changes to the budgeting process. As I argued before the general election, the DPJ's idea of "regime change" cannot be understood without looking at its plans for the budgeting process. In their plans to transfer budgetary authority to the cabinet — which, after all, is given budgetary authority by the constitution — the DPJ is positioning itself to deliver a democratic revolution in Japan by enabling political leaders to determine how the public's money is spent, and to redirect funds in the direction of policy priorities desired by voters.

The Hatoyama government has already taken the first steps towards a new budgeting process. Just as it said it would, on Tuesday the cabinet approved a cabinet decision that canceled the Aso government's budgetary guidelines, instructed cabinet ministers to establish budget priorities from a "zero base" and to make substantial cuts to the extent possible, and stressed once again (as the DPJ did in its manifesto) that the government will be redoing the budget from scratch. It will not simply make incremental adjustments to last year's budget. At the same time, under the leadership of Furukawa Motohisa, deputy minister for the new national strategy office and the administrative renovation council, the Hatoyama government will devise a framework for next year's outlook for tax revenues and bond issues, a job in recent years done by the Council on Fiscal and Economic Policy (replaced by the NSO), but, as Asahi notes, "The finance ministry decided the specific size of the budget." The NSO will be taking the lead in all facets of the budgeting process. We will know more about the new budgeting process after 15 October, the new deadline for ministries to submit requests to the cabinet.

There are plenty of questions about how the NSO, the new budgetary process, and the new policymaking process more generally will work, but Scalise and Stewart miss several key points that suggest not only does the new government have radical ideas for the policymaking process, but also will likely succeed in making the government more top-down, more cabinet-centered, and more streamlined than any of its predecessors: (1) the Hatoyama government has clear ideas for how it wants to change the system of government (indeed clearer ideas here than in any other policy area), (2) relatedly, its members have spent years studying the LDP's failures, the failures of the Hosokawa government (in which several Hatoyama cabinet members participated, including Hatoyama himself), and of course the British system, (3) there is more public support on this issue than any other, as public opinion polls have shown overwhelming support for the DPJ's plans to redraw the relationship between politicians and bureaucrats, especially concerning budgeting, and (4) the bureaucracy is not nearly as opposed to the DPJ's plans as one might expect. Kan, for example, has been reaching out to reformist bureaucrats. The finance ministry, far from standing in the new government's way, accommodated the DPJ's request to hold off on budgeting for 2010 despite the ministry's desire to stick to the customary schedule. Spending ministries, the targets of the DPJ's desire to cut waste, have softened their once vocal opposition to the new government. They may yet attempt to derail the government through sabotage or foot-dragging, but there are enough reports out there of bureaucrats eager for political leadership to suggest that it is far too early to write off the DPJ's administrative reforms as doomed.

In short, the changes set in motion by the Hatoyama government will likely result in a stronger cabinet actually capable of leading Japan, and by leading I mean making difficult decisions instead of punting on every decision as the LDP did when in power. A new policymaking process is no guarantee of success, but the Hatoyama government is taking the right steps to give it a chance to change Japan for the better. It may not look like much of a revolution, but a quiet revolution is still a revolution.

The first day of the new era in Japanese politics

The DPJ wasted no time following the election of Hatoyama Yukio as prime minister Wednesday.

His cabinet lineup established, the DPJ-led government immediately set to work establishing a new relationship between the cabinet, DPJ backbenchers, and the bureaucracy.

Regarding the DPJ, its internal organizations, and its numerous backbenchers, the new government announced several measures to strip the DPJ of any policymaking role. On Wednesday morning Fujii Hirohisa, the new finance minister, reiterated an earlier pledge to abolish the party's tax commission and bolster the government's tax commission, reversing the situation that prevailed under the LDP. More significantly, the DPJ dissolved its policy research council completely. Contrary to earlier plans, Kan Naoto won't even carry the title of chair of the policy research council, because Ozawa Ichiro does not want cabinet members serving simultaneously in party posts. This single measure is a radical departure from LDP rule, under which the policy research council served as a shadow government, complete with committees and subcommittees mirroring the bureaus and offices of the bureaucracy. If bureaucrats wish to consult with politicians on policy, they'll have to go through cabinet ministers and the national strategy bureau.

The new government immediately established new regulations governing contact between bureaucrats and politicians not holding cabinet or sub-cabinet appointments. The regulations will require to bureaucrats to make the contents of all requests from Diet members known to their ministers — and bans, in principle, efforts by bureaucrats to influence Diet members. Abolishing the policy research council will close off an important avenue of influence under LDP governments. The government has also mandated that bureaucrats save records related to requests for subsidies, licenses, contracts, and the like from backbenchers and their secretaries.

Regarding the bureaucracy, the DPJ has made clear that it intends to constrain bureaucrats' activities. In particular, the DPJ plans to restrict media access to the bureaucracy, based on the idea that the cabinet is making policy and setting priorities and so its members should be responsible for explaining policies to the press, not the bureaucrats whose job is to execute the cabinet's policies. Discussing this proposal last week, Okada Katsuya naturally cited the British example: permanent secretaries in Whitehall do not give press conferences. Instead the government issued a new policy Wednesday. Political appointees in ministries will be responsible for communicating ministry policy to the media, and regular administrative vice ministerial press conferences are abolished. (To centralize explanations of the government's policies, the Hatoyama government ought to create a press secretary's office.) Naturally journalists have complained about this change.

The DPJ will also abolish the administrative vice ministers' council, which for 123 years has enabled bureaucrats to manage the work of the cabinet, as conservative newspapers did not fail to note in their reporting on its final meeting Monday. Bureaucrats will still meet amongst themselves, of course, but dissolving the council will strip them of a customary and powerful role in the policymaking process, hammering out disagreements across ministries before cabinet meetings.

The thinking underlying this framework can be found in a document released by the cabinet Wednesday. The document stresses that changing the balance of power between politicians and bureaucrats in favor of political leadership is essential to realizing "true democracy." This document is not a declaration of war on the bureaucracy as an institution. It is a constitutional document that aspires to restore constitutional government by ending the delegation of substantial powers from the cabinet to the bureaucracy. The second and third parts of the document contain most of the aforementioned regulations, but the first part explains the proper relationship between political leaders and bureaucrats, and the relationship of both with the public.

The role of politicians sent into ministries, the cabinet declared, is to command and supervise the work of officials on behalf of the public. Bureaucrats, meanwhile, are public servants — not a word regularly used to describe Japanese officialdom — and they are to implement the policies established by the public's representatives in government. They are to provide data to political leaders, present options for policies, and assist political leaders in the execution of their duties. The document stresses a division of labor between political leaders and officials: each should respect the other's responsibilities.

Ultimately these new regulations provide only a framework. It will take time for these principles to reshape the relationship in reality, time for bureaucrats to accept the leadership of politicians they may view as inferior, perhaps time even for politicians to accept that they are in fact the masters of the bureaucracy. Like any revolution, the DPJ's revolution in governance will entail a revolution in the mindsets of both politicians and bureaucrats.

But the Hatoyama government did not just outline a new framework for the relationship between politicians and bureaucrats on its first day in office. Its cabinet ministers hastened to set goals for the first weeks and months in office.

• Regarding the 2010 budget, Fujii stated that the government would decide upon a plan for the 2010 budgeting process by the beginning of October. The government will abandon the ceiling for budgetary requests established by the Aso government and start from scratch and hasten to find ways to save money in order to budget for programs promised by the DPJ during the campaign, such as monthly child allowances. In order to free up funds for next year's budget, the government plans to halt the Aso government's stimulus programs. The finance ministry informed the DPJ last week that it may be possible to recover nearly 6 trillion yen in funds that have yet to be distributed. Indeed, it turns out that more than half the budgeted funds have yet to be distributed. Tango Yasutake, the administrative vice minister of finance, indicated the ministry's support for cutting stimulus funds earlier this week, suggesting that as the Hatoyama government begins work it is already building a working relationship with the finance ministry.

• A critical player in drafting the new budget will be the national strategy bureau, the creation of which (or, its predecessor, the national strategy office, pending revision of the cabinet law) was one of the new government's first acts on Wednesday. Still no word, however, on who will be working under bureau chief Kan Naoto. Continuing on his theme of choice, Kan stressed that a cabinet budget committee will be created soon.

• Okada Katsuya, the new foreign minister, also made several key policy statements Wednesday. First, he instructed the ministry to investigate the circumstances surrounding the "secret" US-Japan agreement on the introduction of US nuclear weapons into Japan, with a goal of having the report ready by the end of November. He also stressed that he will take a flexible approach to the resolution of the Futenma issue.

• Relatedly, Kitazawa Toshimi, the new defense minister, said Wednesday that Japan will not be continuing its refueling mission in the Indian Ocean beyond the expiration of the enabling law in January.
  

Interestingly, as the Hatoyama government set to work, the LDP's Nakagawa Hidenao, who during the campaign said that preventing the DPJ from taking power was necessary to save Japan, wrote at his blog that the LDP ought to cooperate with the government as the new government works to shift power from the bureaucracy to the cabinet. He said that the LDP should in particular cooperate with the government to pass the legislation establishing the national strategy bureau. It seems that Nakagawa finally realizes that the DPJ is no less serious than Nakagawa and other LDP reformists about changing Japanese governance — indeed, arguably the DPJ's leaders are even more serious and have more comprehensive plans than anything LDP governments have offered in the way of administrative reform.

A new era in Japanese politics has truly begun.

The DPJ begins work on regime change

In a remarkable coincidence, the day after the DPJ's victory in the general election — and the day the DPJ began its transition in earnest — was the same day that ministries and agencies submitted their spending requests to the ministry of finance for the Fiscal 2010 general account budget.

The requests totaled roughly 92.13 trillion yen, a 3.58 trillion yen increase over the 2009 general account budget, making it the first over 90 trillion yen. Of the total, 52.67 trillion yen are general expenditures, with most of the remainder going to servicing Japan's national debt and regional subsidies.

Tango Yasutake, the finance ministry's administrative vice minister, stressed the ministry's desire to complete the budget within the calendar year, as is customary. The reason for Tango's emphasizing the ministry's desire is of course because the DPJ, still a few weeks from taking power, wants to halt the process immediately due to its desire to rearrange the budget completely, for the sake of introducing political leadership into the budgeting process and ensuring that programs from the DPJ's manifesto are included in a DPJ government's first budget as per the timeline included in the manifesto.

DPJ leader Hatoyama Yukio has stressed that the DPJ wants to change the budget completely, as the budget does not reflect its desires whatsoever. Apparently Kawamura Takeo, the outgoing chief cabinet secretary, did not get the message sent by the Japanese people on Sunday: Kawamura said Tuesday that because the requests include measures related to economic stimulus, the DPJ should give serious consideration to the requests as they stand. His colleagues also seemed to miss the point of Sunday's election. Ishiba Shigeru, the outgoing agriculture minister, and Kaneko Kazuyoshi, the outgoing transport minister, used the occasion of the post-election cabinet meeting Tuesday to criticize DPJ programs and demand that the DPJ leave programs untouched.

This is the first battle in the DPJ's fight to change how Japan is governed, and it should win: Asahi reports that the finance ministry is trying to exclude obligatory organizational expenses from the DPJ's desire to reshape the budget in its image. Presumably that leaves plenty of room for the DPJ to fix the budget as it desires. In this fight, the timing of the election may have been fortuitous. The bureaucracy is now facing the DPJ fresh from the high of its historic victory, with possibilities for the new ruling party that presumably won't exist once the DPJ moves into government and gets bogged down in governing.

But at the same time, the process would go smoother if the DPJ were to assemble its cabinet lineup sooner rather than later. Despite earlier indications that a victorious DPJ would name the appointees for senior cabinet posts within the first week after a general election — as indicated in the transition plan which according to Asahi is more associated with Okada Katsuya than Hatoyama — Hatoyama said Monday that he would not name a handful of senior appointees before naming the entire cabinet. The whole cabinet will be named after Hatoyama is elected prime minister. It also seems that Hatoyama may be wavering on his desire to appoint only elected officials to leading cabinet posts as he realizes how inexperienced his own party's members are. I strongly disagree with the decision to delay filling the most senior positions early. The transition would presumably go more smoothly with the government's core in place immediately, with the ministers-in-waiting getting their own teams in place and beginning to meet with senior bureaucrats in the ministries. The transition period is critical for the Hatoyama government's proposed national strategy office, which will have a major role to play despite not existing yet. After all, the NSO will be responsible for remaking the budget along lines desired by the DPJ — a point reinforced by Hatoyama's comment that the posts of NSO chief and the finance minister will be stressed jointly. To smooth the transition, the NSO in particular ought to be staffed as soon as possible.

Meanwhile, the press continues to report that Fujii Hirohisa will have a central role in the new government and that he will likely be joined by Kan, Okada, and Naoshima Masayuki, currently the DPJ's policy chief. Again, why wait if it is increasingly clear who will be occupying the leading posts? Filling these positions now would also take a bit of pressure off of Hatoyama — and would help move from abstract, campaign-style pronouncements as in Hatoyama's press conference Monday.

The bureaucracy itself is making its preparations for its new political masters. Bureaucrats have already delivered copies of budget requests to the offices of DPJ incumbents. For the first time, Yomiuri reports, DPJ members' offices are being visited by bureaucrats, in droves, whether or not the Diet members are present. Meishi are being left in mailboxes by bureau chiefs and other officials at levels never encountered by many DPJ members.

But the battle lines are also being drawn. As I argued in my earlier post on the importance of budgeting for the DPJ (previously linked to in this post), the DPJ's battle for budgetary authority will be waged more with spending ministries than with the finance ministry. Chief among them will be the ministry of land, infrastructure, transport and tourism (MLITT — haven't since this acronym, but why not?) and the ministry of agriculture, forestry, and fisheries (MAFF), the ministries with the most to lose from the DPJ's economy drive. Naturally MLITT's budget request was just about at the budgetary ceiling set by the CEFP. It appears that while MLITT has suggested that it might be open to revising its request, the ministry and the DPJ could clash over the construction of Yanba dam in Gunma prefecture and Kawabegawa Dam in Kumamoto — the DPJ called for the cancellation of both projects in its manifesto, meaning that the DPJ will fight that much harder to ensure that they are expunged from the budget. The DPJ's goal is cut 1.3 trillion yen in public works over four years (which, incidentally, shows how much Japan has already cut public works).

MAFF's request, meanwhile, was a 15% increase over last year's budget, an increase that includes a 19% increase in the ministry's public works spending.

MLITT, having shown conciliatory signs to the DPJ and having become accustomed to shrinking budgets, may find a way to accommodate itself to the new regime. Taniguchi Hiroaki, its administrative vice minister, requested a meeting with Hatoyama, a bit later than his colleagues in the leading ministries but still encouraging. Indeed, the ministry has announced that from 11 September it will freeze bidding on the Yanba dam, at least temporarily. The ministry still intends to argue for the dam, for which funds have already been dispersed to neighboring prefectures, but the DPJ probably has the upper hand.

The big fight will be with MAFF, which is truly threatened by the DPJ's income support plan and whose adminstrative vice minister has already traded words with the DPJ.

The DPJ could not have asked for a better start to its rule than to have bureaucrats dispirited and conscious of the fact that for now opposing the DPJ means opposing a public already ill-disposed to the bureaucracy, a public that whatever its doubts about the DPJ's manifesto is perhaps most sympathetic to the idea of political rule. It may be the case that neither side wants a fight for now, the DPJ because to wage open war on the bureaucracy would hinder its ability to get anything done, bureaucrats because for the moment a fight with the DPJ is a fight that they are sure to lose in the court of public opinion.

For more on the possibilities of genuine administrative reform, I recommend this essay by Karel van Wolferen, who is aware of the obstacles facing the DPJ without dismissing the possibility that the DPJ will succeed. I particularly like this sentence: "But my impression is that the individuals of the inner core of the party are deadly serious about what must be done to turn their country into what one of them, the most senior and most experienced Ozawa Ichiro, has in his writing called a 'normal country'."

Exactly so. The DPJ means what it said during the campaign, and is taking the first steps towards a new system of governance.

The budget is the key to regime change

In their final appeals to Japanese voters, Kan Naoto and other DPJ leaders laid particular stress on the budget.

Speaking in Tokyo on Saturday, Kan said, "True regime change is politicians who have received the trust of the people restoring the right to formulate budgets to the people." Okada Katsuya, the DPJ's secretary-general, delivered the same message in Gifu Saturday. "We will completely review and remake the budget," he said. "We will review from a zero base that severs existing obligations."

Perhaps it seems strange that on the eve of the general election that may deliver the DPJ into power for the first time, its leaders are speaking of the "right of formulating budgets" and "zero-based budgeting."

It shouldn't. After all, the power to determine how a nation's wealth is spent and distributed — inherent in the national budget — has been at the center of political conflicts for centuries since the rise of the modern state. Appropriately considering that Kan and other DPJ politicians are looking to create a proper Westminster system on Japan's shores, the battle over the budget was particularly central to Britain's political development, from the struggles of the seventeenth century, Britain's "century of revolution," to the battle over the "People's Budget" roughly a century ago, when the Asquith government fought over the House of Lords over a budget that included redistributory measures, especially pensions, and would be financed by tax increases on the wealthy.

When Kan speaks of the right to formulate budgets, he is speaking of something fundamental to democracy: that the people's representatives should have the power to decide how the public's money is spent and that their decisions should be transparent so that the people can decide whether they approve of how their representatives are using the public's wealth. The problem is not that politicians have been uninvolved in budgeting under LDP rule, but that their involvement was the product of collusion between elected representatives and bureaucrats who saw cooperation with certain politicians — the LDP's zoku giin (policy tribesmen) — making deals behind closed doors to benefit particular groups and constituents at the expense of the whole. The opacity of the budgeting process was compounded by the existence of special accounts in addition to the general budget, funds that were used with little or no public oversight. It was for this reason that when I spoke with one of the DPJ's rising stars, a retired finance ministry official, in January he stressed that the DPJ cannot be sure of how it will pay for all of its promises because it cannot be sure of how much money is sitting in special accounts the contents of which have not been made available to the DPJ, let alone the public at large.

Accordingly, while some doubt that anything will change with a DPJ victory, if the DPJ succeeds at making the budgeting process even more top-down and subject to political control than it became as a result of the Hashimoto reforms of the late 1990s (the extent to which these reforms transformed the budgeting process are open for debate), it will have truly changed Japan. Restoring the cabinet's constitutional prerogative to formulate the budget is, after all, the goal of the party's plans for a national strategy office. Administrative reform has arguably been one of the DPJ's core principles since the first DPJ was created in 1996 — the above statements and others reveal that for the DPJ administrative reform that does not include reform of the budgeting process is incomplete.

Changing the budgeting process, often construed as entailing a fight with the ministry of finance, may in fact entail more significant battles with the ministries responsible for spending the money rather than the ministry allocating it. Under LDP rule, spending ministries like the agriculture ministry, the former construction ministry, and the health, labor, and welfare ministry have been the primary administrative beneficiaries of opaque budgeting — it was not accidental that the most powerful policy tribes were connected to these policy areas. All of these ministries have suffered from budget cuts over the past decade, which will presumably make them even more resistant to changes proposed by the DPJ: it is their budgets that the DPJ would like to redirect in order to pay for programs directed at the public's main concerns.

Cutting these budgets will take a certain ruthlessness on the part of a DPJ government. Naturally the LDP will find ways to put a human face on budget cuts. Presumably manga artist Satonaka Machiko's appeal on behalf of the 11.7 billion yen "national media arts center" lampooned as Aso Taro's "Manga cafe" by the DPJ will not be the last such appeal if the DPJ wins Sunday. Masuzoe Yoichi, Aso's minister of health, labor, and welfare and potentially Aso's successor as LDP leader, warned that the DPJ's policy of rearranging the budget could jeopardize important programs in his ministry to combat swine flu and unemployment, which strikes me as fearmongering on Masuzoe's part, but it does suggest that after an electoral defeat the LDP will still find ways to challenge the DPJ on this question of remaking the budget.

But ultimately giving politicians in the cabinet more power over the budget is but a first step to moving Japan in a new direction. Having claimed budgetary authority, the government will then have to find a way to balance among the DPJ's three goals of fixing Japan's finances, building a proper social safety net, and finding a way to get Japanese households and companies channeling their cash holdings into profitable investment and consumption.

In most areas the DPJ may not signal a radical departure from the LDP — most areas except for the question of who should make Japan's budgets. And it is that difference which makes all the difference. If the DPJ implements its plans for a strengthened cabinet, it will make a radical departure from LDP rule, and clear the way for further policy changes.

The DPJ continues to reveal its plans for government

While the DPJ may have a public relations problem, the party has continued to show during the days leading up to the general election that it is focused on ensuring a smooth transition to power in the likely event that it wins, while at the same time taking the first steps to reorganizing the policymaking process to privilege the cabinet at the expense of the bureaucracy.

In particular, more details are emerging regarding the national strategy office that is at the center of the DPJ's plans for empowering the cabinet. The party has confirmed that not only will the director of the office be a member of the cabinet, but that the head of the DPJ's policy research council will serve concurrently at policy chief and head of the NSO. And Mainichi suggests that the post will be equivalent to a deputy prime minister. The goal, of course, is to forestall the creation of a policymaking process in which ruling party organs wield veto power over the cabinet's decisions — a central feature of LDP rule. How will a DPJ create the new office as it takes power, seeing as how it has no legal standing, and seeing as how the DPJ wants the NSO to play a leading rule in budgeting? It appears that the DPJ plans to create the office as an informal planning cell coming into existence concurrently with the Hatoyama cabinet, which will then submit legislation officially creating the NSO (and, it seems, dissolving the Council on Economic and Fiscal Policy, whose functions it will subsume). Jiji's report also suggests that the office will have thirty members drawn from the Diet, the private sector, and the bureaucracy.

Given the party's emphasis on increasing the role of the cabinet in budgeting, moving at least some distance in the direction of zero-based budgeting — recently stressed by Okada Katsuya in a campaign appearance in Tokyo — moving quickly on the NSO will be crucial to the early success of a DPJ government. I hope that they've already assembled a wish list for the NSO's thirty members and have put out feelers to those outside the party.

The DPJ has also confirmed that decisions regarding sub-cabinet appointees will be made by cabinet ministers themselves, instead of by party officials. (Recall that distributing sub-cabinet posts is one of the few remaining functions left to the LDP's factions.) The goal seems to be the creation of policy teams at each ministry, with the minister and sub-ministers working together to impose the cabinet's will. Incidentally, this policy signals at least two important changes. First, it suggests that the DPJ's changes to the policymaking process involve more than just strengthening the prime minister. By bolstering the positions of individual ministers, the cabinet as a whole will be stronger. Second, by giving ministers the power to select their political subordinates, it should introduce factors other than age and faction into the distribution of posts. After all, given that the DPJ has young former bureaucrats in its ranks, why should they be prevented from holding sub-cabinet posts due to their lack of seniority? Presumably this freedom to dispense with seniority is one advantage of the relative youth of DPJ candidates.

Another plan being floated by the DPJ is increasing the number of prime minister's secretaries to six, with one being a Diet member and the remaining five being bureaucrats. The party would prefer more than one political appointee, but due to the Diet law's limit on the number of Diet members who can serve concurrently in government, Hatoyama will depend on bureaucrats at his side until the law can be revised.

Finally, if the DPJ wins a decisive victory Sunday, its transition team will begin work on Monday.

Far from playing the naïve ingenue, the DPJ is clearly serious about governing and is doing all the right things to ensure a framework will be in place by the time the Diet meets to elect a new prime minister.

The DPJ prepares for its first steps towards a new style of government

The general election may be another four days away, but the DPJ's position in the polls seems secure and so the party is acting like a "responsible party" and putting plans in motion for its transition into government.

I have already written of the names mentioned for the leading positions in a Hatoyama cabinet — but naming politicians to the leading cabinet positions as early as next week is but one of the party's plans for the first days after an electoral victory.

In order to hasten the formation of a cabinet, the party has reportedly already begun vetting some 200 politicians who could be apppointed to the cabinet, the new national strategy office, and the new administrative reform and decentralization council whose task will be to identify areas where the government can cut waste from the budget. The goal is to have the cabinet lineup set before the new Diet is convened to choose a new prime minister. As for the vetting process itself, it seems that it is focused mostly on the political suitability of prospective appointees: namely, the state of their political finances and whether they have any past or present indiscretions that might embarrass the government (women, money troubles, etc.). I am a bit dubious about the process itself — as Sankei reports, the DPJ, lacking the government resources that have been available to the LDP when forming cabinets, is basically conducting open-source investigations using newspapers and weeklies, as well as talk in a candidate's hometown to gather information. But at least it's a start, and Japanese journalists are remarkably well informed. (I hope and presume that they're talking to journalists and not just reading articles.)

But beyond laying the groundwork for quickly staffing up a Hatoyama government, DPJ leaders are trying to set the tone for the party's first months in office. Kan Naoto's remarks on foreign policy — discussed here — are for better or worse part of this trend. I am more impressed with the party's initial moves regarding preparations for administrative reform.

Plans for the national strategy office are being finalized. The party plans to staff the office with ten Diet members, and gave them the power to oversee not only the budgeting process, but foreign policy and administrative personnel decisions. The Diet members will be joined by ten outside experts, and the plan is ultimately to amend the National Government Organization Law to legitimate the office.

As for the administrative reform council, its membership will include Diet members, outside experts, and representatives from the National Governors' Association and six local groups. The council will have a role in the budgeting process, mostly by looking for ways to economize so that the DPJ might be able to afford its manifesto.

The DPJ, moreover, is considering plans for reorganizing the government's tax commission, mainly by scrapping its party tax commission. The government's tax commission has long existed alongside the LDP's tax commission, with the latter being the more important of the two. The DPJ's plan is to make the finance minister the chair, the internal affairs minister the vice chair, and to fill the commission with parliamentary secretaries responsible for taxation from ministries and agencies. This reform follows the same principles of the DPJ's other administrative reform plans: put politicians in a position to oversee and instruct the work of bureaucrats.

The bureaucrats themselves continue to brace for the likely arrival of their new DPJ overlords. The first skirmish will be over the second FY2009 supplementary budget, portions of which the DPJ has made clear it wants removed. In a speech in Fukuoka Tuesday, Fujii Hirohisa, the likely next finance minister, repeated the party's call to remove spending related to Prime Minister Aso Taro's so-called "anime palace" (AKA the "state-managed manga kissa") and other public works spending from the supplementary budget and replace it with unemployment benefits and other spending directed to the immediate needs of Japanese citizens.

It is a worthwhile question whether the DPJ can actually follow through on its desire to introduce a policymaking process centered on politicians in the cabinet. Indeed, it is the central question facing a likely DPJ government. Journalist Shiraishi Hitoshi, writing in the monthly magazine Foresight, looks into the party's manifesto for clues as to whether the DPJ will be able to succeed in reforming Japanese governance. Not unlike LDP reformists like Nakagawa Hidenao, Shiraishi sees a number of points on which the DPJ appears to have compromised previously espoused principles and thus constitute warning signs of the DPJ's going soft on the bureaucracy. Most notably, he cites the absence of a proposal for radical decentralization (either the creation of a state system or the outright elimination of the prefectural level of governance) and the absence of the party's earlier call to demand resignations from top ministry officials, which he argues will undermine the impact of more political appointees and the proposed dissolution of the administrative vice ministers' conference. He is also concerned that the party will not be able to deliver on its proposed 20% cut in administrative personnel expenses and that the party will end up working hand-in-hand with the finance ministry.

I think Shiraishi makes some fair points, but on the whole I am less worried. I have no doubt about the DPJ's desire to accomplish consequential administrative reform once in power. But revolutions are not won by zealots; they are won by the realists capable of making tactical compromises with the old guard in order to outlast their enemies. The DPJ not only has to reform Japanese governance — it has to last long enough in power to do so. Nothing would undermine a DPJ government quicker than to declare open war on ministry officials, which would likely result in an endless stream of leaks, sabotage, and foot-dragging on the part of Kasumigaseki, a unified Kasumigaseki, which would in turn undermine the DPJ's ability to deliver on some of its promises in advance of the 2010 upper house election. And as for joining hands with the finance ministry, the finance ministry may prove to be the DPJ's best friend in Kasumigaseki during the early days. The DPJ has no greater enemy than ministries like the ministry of agriculture, forestry, and fisheries, whose work has been deeply integrated in the LDP machine. It is these ministries that are especially threatened by the DPJ's plans to cut waste, and it is the finance ministry that is keen to cut waste. I have previously expressed my support for the DPJ's "realistic" turn in administrative reform, because I think it signals a recognition on the part of the party's leaders that the fight for administrative reform will be a long one and that they are better off dividing and ruling the administration than facing a Kasumigaseki united against the DPJ.

Fujii characterized it thusly: "The LDP is currently beneath Kasumigaseki. We will place Kasumigaseki under the DPJ. It is imperative to have a system that uses Kasumigaseki." The DPJ cannot govern alone. It needs to be able to use the talent and diligence of the national administration in order to realize its plans, imperative to remaining in power, which is turn imperative to reforming the government over the long term. Administrative reform still will not be easy, but at least the DPJ appears to recognize that it is a goal to be pursued steadily and patiently.

The DPJ and the bureaucracy continue their dance

Sankei has a long and must-read article on the obstacles facing a DPJ government in implementing its plans for reforming the policymaking process.

The article highlights divisions within the DPJ over how to proceed in reforming Japan's administration, especially budget-making authority. The pragmatism visible in other aspects of the DPJ's program is also visible in the party's approach to administrative reform of late.

The pragmatic view is that of party senior counselor Fujii Hirohisa, a former LDP member who left the party in 1993, followed Ozawa Ichiro through from the Japan Renewal Party to the New Frontier Party to the Liberal Party to the DPJ. He served as finance minister in the short-lived Hata cabinet. And before running for the upper house in 1977 as an LDP candidate he served in ministry of finance for twenty-years, rising to the position of budget examiner in the budget bureau. Accordingly, perhaps we shouldn't be surprised that Fujii is opposed to suggestions that the DPJ might completely detach the budget bureau from the finance ministry and attach it to the cabinet (the party's 300-day transition plan refers to this idea).

Going as far as a 'national strategy office' is sufficient. We had better not fumble around by detaching the budget bureau from the finance ministry and creating a kind of budget office under the direct control of the prime minister. (Revising the laws) would take half a year, and in the meantime the government would break down.

There is a certain wisdom to Fujii's advice, at least as a DPJ government's first year in office goes. And it is worth listening to, for, as Sankei hints, Fujii could end up as finance minister despite not standing for reelection this year. Indeed, as a MOF OB (and Ozawa confidante) Fujii probably has the inside track on the finance portfolio.

Should the DPJ win this month, winning an absolute majority in the 2010 upper house election has to become its top priority. Any steps that interfere with the government's ability to move legislation that will enable the DPJ to stand before the voters in 2010 having made some progress in implementing its manifesto is detrimental to the goal of ensuring that a DPJ government survives. Whether or not a battle over the budget bureau would actually paralyze the government, it is a risk that the DPJ will not be willing to run.

Accordingly, it is entirely possible that the DPJ will soft pedal administrative reform during its first year. The DPJ would, of course, pass legislation creating a national strategy office (henceforth NSO) during this year's extraordinary Diet session, but the NSO, intended to replace the Council on Economic and Fiscal Policy (CEFP) is not the radical change that relocating the budget bureau would be. At the same time, the DPJ appears to be looking for ways to build relationships with senior bureaucrats, a change in tune from calls for "loyalty tests" for senior ministry officials. The Sankei article notes that in addition to the meeting with Tango Yasutake, the administrative vice-minister of finance, mentioned in this post, senior officials from the MOF, MOFA, METI, and an unnamed fourth ministry met with senior DPJ Diet members in late July to discuss this year's supplemental budget and next year's budget. The finance ministry has also been meeting surreptitiously with Party President Hatoyama Yukio and Secretary-General Okada Katsuya. The impression I get is that both the DPJ and senior bureaucrats are eager to ensure a minimal level of continuity should the DPJ take power later this month.

I see no problem with this, at least as a short-term strategic decision. The bureaucracy's position of strength was not built in a year, and it will not be dismantled in a year. In the meantime, the DPJ will need allies in the bureaucracy, especially in order to limit the bureaucracy's ability to undermine the party's other policy programs. I do hope that budget authority is eventually wrested from the bureaucracy's hands, but I recognize that successful revolutions take time and usually involve the slow process of changing customs, norms, and ideas in addition to changing institutional structures. I do think Nakagawa Hidenao — who has been writing of the DPJ's "abandoning the 'abandoning Kasumigaseki' line" — is deeply unrealistic when he writes of the DPJ's shift to an "appeasement line" on administrative reform. Appeasement, when stripped of its negative connotations, often amounts to recognizing one's limitations in implementing a certain policy approach. Appeasement can go too far, of course, but for a DPJ possibly on the verge of taking power to look for ways to ameliorate the bureaucracy's concerns and possibly co-opt certain senior officials is prudent politics.

Interestingly, Machimura Nobutaka, Nakagawa's fellow Machimura faction member, criticized the DPJ's administrative reform plans in a way diametrically opposed to Nakagawa Wednesday: he argued that "political leadership" in the form desired by the DPJ would be "iron fisted."

At this point in time Japan could probably use some "iron-fisted" government, after years of the LDP's weak hand. In looking for ways to cooperate with the bureaucracy to achieve its goals, the DPJ may be coating its iron fist in velvet, at least during the first phase of its government.

Anticipated reactions

The ministry of finance, its ears filled with the ringing of revolution (or at least administrative reform), appears to be engaging in a classic case of anticipated reaction to the prospect of a DPJ government or an LDP government that could take its promise of "cutting waste" seriously. Accordingly, it has instructed requesting ministries to identify wasteful funding in their budget requests due at month's end. The finance ministry is particularly focused on inefficient public works projects.

The finance ministry is clearly trying to concede some ground to a possible DPJ government in the hopes that doing so will forestall a more forceful attempt by the DPJ to seize budgetary authority, at least in the short term. The anticipated reaction may well fail. On NHK Sunday Naoshima Masayuki, the DPJ's policy chief, said that if the DPJ takes power it will completely review the budget requests for fiscal year 2010, although he also said that the party wants to complete the budget within the calendar year, which might be difficult given that the party does not know whether it would have its preferred organization for drafting the budget — the national strategy office attached to the prime minister's office — ready in time to oversee a review of budgetary requests. But the DPJ has made no secret of its desire to restore the cabinet's constitutionally granted power to draft the budget to the elected representatives serving in the cabinet. Hatoyama Yukio made the DPJ's intentions clear to Tango Yasutake, the newly appointed administrative vice minister of finance, in a discussion in July. Tango had some praise for the party's plan for a national strategy office, but overall his reaction was perhaps a bit muted. Tango may well prove amenable to the party's plans: his service as a secretary to former Prime Minister Koizumi Junichiro may make him more amenable to the idea of "political control."

But this is just the first phase in what could ultimately be the defining battle of a DPJ government should the party win this month. The DPJ will presumably not be satisfied with waste cut voluntarily by the ministries, but the finance ministry loses little by trying to anticipate the DPJ's goals now, and by doing may ensure that this year's budget process goes smoothly despite a possible change of government. But if the DPJ is serious about overhauling the budget-making process so that politicians are responsible not just for determining the overall shape of the budget, but in micro-budgeting, determining which programs belong in the budget and how much public money they deserve, there will be a major struggle between the DPJ and the finance ministry, provided a potential DPJ government survives more than one budget cycle.

The DPJ unveils its manifesto (part one)

At an event at the Hotel New Otani in Tokyo Monday evening the DPJ released its 2009 general election manifesto to the public.

Running to twenty-four pages, the manifesto is centered around five major areas: (1) cutting waste (essentially political and administrative reform); (2) child care and education; (3) pensions and health care; (4) regionalization; and (5) employment and the economy. After providing general outlines of the party's plans in each of these areas, it provides details about fifty-five specific proposals in these five areas, as well as in the areas of consumer and human rights, and foreign policy. While not all of these policy descriptions go into great detail — many are quite vague — the DPJ has provided a concrete plan for how it will go about governing should it win next month's general election. Its priorities are clear and reflect the public's priorities (at least the public's priorities as repeatedly expressed in public opinion polls). There are shortcomings: foreign policy, for example, is a particular weakness, despite the realism of recent remarks by the party's leaders.

Cutting waste: I am glad that the DPJ gave this section pride of place in the manifesto, because it is the most radical portion of their agenda. As far as I'm concerned, the various spending programs that have received much of the attention from the press and the LDP are bread and circuses compared with the party's plans for administrative reform. The title of "cutting waste" isn't mistaken, because the goal of changing how Japan is governed to shift responsibility for the nation's finances from unelected bureaucrats to elected officials serving in the cabinet (as written in Article 73 of the Japanese Constitution). Accordingly, as the heading in the "cutting waste" section proclaims, "Completely rearranging the country's 207 trillion yen general budget."

To do that, the DPJ proposes to ban the practice of amakudari completely, simultaneously reforming public and semi-public corporations and the special accounts that support them; cutting personnel costs by twenty percent (which will be done in part by moving some public services to local governments); making the government contracting process transparent; and reviewing how politicians and bureaucrats interact, which includes the party's proposal to appoint more than 100 ruling party members to cabinet and sub-cabinet posts and provisions for greater transparency in how politicians and bureaucrats interact (this proposal is a bit too vague for me). Also included in this section are proposals for political reform, including a plan to cut the number of proportional seats by 80, which would reduce the number of PR seats to 100 and the total number of lower house seats to 400. This plan would presumably be fiercely resisted by smaller parties in coalition with the DPJ. The DPJ also proposes to ban corporate contributions and fundraising party ticket purchases from companies with contracts with the national government and local governments over 100 million yen.

Finally, and most importantly, the DPJ alludes to making the budgeting process transparent. The manifesto does not include the proposal — included in the party's 300-day transition plan and discussed by Kan Naoto in his Chuo Koron essay (discussed here) — to move budgeting authority to the cabinet entirely, giving elected officials responsibility for collating requests and compiling a national budget. Without a shift of this sort, the DPJ will be hard-pressed to rearrange the general budget completely as it promises.

Complementing this plan for government is the party's plan for internal governance, which is not included in the manifesto but without which the DPJ will not be able to make much headway in wresting power from the bureaucracy. Briefly, having studied LDP rule, it is essential for a DPJ government to control the activities of its members and to disable the party's internal organs. DPJ backbenchers must not be able to undermine the cabinet's plans as outlined in this manifesto. Their responsibility, if not serving in an administrative position, will be to show up for votes and vote in the manner ordered by the government. Under Ozawa Ichiro's leadership the DPJ was criticized for being a "dictatorship:" given the anarchy that has characterized the internal politics of the LDP in recent years, a dose of intra-party dictatorship might not be such a bad thing, especially if the DPJ is going to have to manage complex coalition partnerships. The party has already taken steps in this direction, starting with the decision made a decade ago to replace the party general council with a shadow cabinet. A DPJ-led cabinet would also be strengthened by the weakness of the party's policy research council, which, thanks to the relative lack of information flowing from the bureaucracy until fairly recently, has been under-institutionalized and dependent on outside expertise.

The party's policymaking role would be further diminished by the party's plans for a "national strategy office" under the direct control of the prime minister. While it was not directly referenced in the manifesto, should the DPJ take power this office will be an important actor in coordinating the DPJ's plans for the transition from bureaucratic to political rule. The office will be responsible for compiling the budget and drafting foreign policy documents. Its staff will include as many civilians as bureaucrats and its head will have ministerial rank (and will likely be occupied by the head of the policy research council). Hatoyama Yukio has further stressed that the creation of the national strategy office would contribute to undermining the power of the administrative vice ministers' council, which Hatoyama wants to abolish outright. Hatoyama should probably listen to Kan — one of the few DPJ leaders with ministerial experience — who, while noting the pernicious influence of the council, acknowledged that it may be beyond the power of the government to abolish it, as it could very easily reemerge under a different name. In Chuo Koron, Kan suggested that it might be better to include it in the policy process by introducing political appointees into the meetings. Ultimately the DPJ may be better off developing the power of cabinet institutions instead of combating the administrative vice ministers directly. If a DPJ government could credibly establish a top-down policymaking process the administrative vice ministers' council may simply wither away.

I am not under the illusion that the DPJ will be able to write all of its administrative reform proposals into law. I have doubts about various proposals included in this section of the manifesto (will the DPJ really be able to send more than 100 political appointees into the ministries? what does the DPJ plan to do with the retiring bureaucrats cast into a labor market still unaccustomed to hiring workers mid-career?). But I do think that the DPJ is aware of the challenge it faces in implementing this portion of its agenda — and knows that building a Westminster system, in which politicians in the cabinet wield administrative power in full view of the public, is critical to making progress in tackling the other policy areas in the party's agenda.

(Part two here.)

The DPJ faces the bureaucracy

With the DPJ's prospects on the rise and the LDP mired in what may be terminal disarray, the DPJ is receiving greater scrutiny when it comes to how the party will govern should it take power.

That, after all, is what this election is about: if seiken kotai [regime change], the DPJ's longtime mantra is to have any meaning, the DPJ must be prepared to change how Japan is governed. A change of government must be more than a change of the name of the party wielding Japan's shambolic administrative machinery.

To this end, the DPJ's Kan Naoto opted for an observation tour in Britain. Kan was in Britain for six days, where he met with officials from government and opposition parties to discuss power transitions and relations between politicians and bureaucrats. (Although if the DPJ is going to look to Britain for lessons, can someone please send a box set of Yes Minister to Mr. Kan and company?)

It is revealing that Kan went to Britain because in effect the DPJ hopes to transform Japan's "Un-Westminster" system into a proper Westminster system, with power concentrated in the cabinet at the expense of the governing party and bureaucracy. The vaunted administrative reforms implemented under Prime Ministers Hashimoto and Koizumi served more to strengthen the Kantei as a pillar competing with the LDP and the bureaucracy in the policymaking process than to turn the cabinet and the prime minister's office into a proper Westminster-style executive. The DPJ's hope — and its primary mission — is to concentrate power in the cabinet, declawing its own policymaking organs and forcing the bureaucracy to bend to the will of the duly elected government. Because the DPJ's policymaking organs are underdeveloped compared to the LDP's Policy Research Council, policy zoku, and other mechanisms for LDP backbenchers to intervene in the policymaking process, to effect regime change a DPJ-led government will obviously be forced to confront the bureaucracy. (Although the DPJ has thought ahead about how to prevent its policymaking council from becoming a power base independent of the government: the DPJ plans to have its head serve concurrently as chief cabinet secretary. Naturally the need for coalition partners could complicate this effort considerably.)

The DPJ has plenty of ideas for confronting the bureaucracy, many of which are spelled out by Kan in detail in the July issue of Chūō Kōron. But the sum of these ideas is a scheme to destroy the customary practices that have given the bureaucracy its power, most notably the customs of allowing the bureaucracy to wield the power of personnel appointment delegated to the cabinet and respecting the decisions reached in the conference of administrative vice ministers. Perhaps it would be easier to change Japan's administration if the bureaucracy's powers were written into law. Changing customs can be more challenging, entailing a protracted war of words between the DPJ and the bureaucracy played out in the media. The bureaucracy's goal is akin to the LDP's goal: create a public image of the DPJ as an irresponsible party incapable of acting on behalf of the Japanese people. The media will be the primary arena for the battle between the bureaucracy and a DPJ-led government, but there will be other tools at the bureaucracy's disposal. Bureaucrats may be able to use back channel connections to former bureaucrats in the DPJ in an attempt to sow dissent within the DPJ. Bureaucrats could leak information to the LDP in opposition to undermine or embarrass the government. We should expect that the bureaucracy will do whatever necessary to defend its prerogatives.

The war has already started. Ichide Michio, administrative vice minister for agriculture, forestry, and fisheries, questioned the DPJ's plans for income support for agricultural households as "unrealistic" at a press conference, a clear case of political intervention by a supposedly politically neutral public official. Hatoyama Yukio responded to Ichide's remarks by suggesting that in Britain "he would be sacked." Sasayama Tatsuo shows that Ichide was responding to leading questions from reporters, a mitigating circumstance certainly, but this episode shows what we should expect from the media should the DPJ take power — and more importantly, in the months leading up to the general election.

Admittedly I should not be so quick to speak of the "media" and the "bureaucracy" as monolithic entities. Indeed, success or failure for the DPJ will depend on the extent to which the DPJ is able to sow dissent among bureaucrats, to find and support officials sympathetic to the party's plans. But the point remains that the central task for a DPJ-led government will be engineering a dramatic shift in how power is executed in the policymaking process, a shift conceived by Kan as from "bureaucratic cabinet/centralized government" to "parliamentary cabinet/decentralized government" (the centralization dimension referring to the relationship between the center and the periphery in Japan as a whole).

What the DPJ should not do is compare this task to the two previous great reforms, the Meiji-era reforms and the Occupation-era reforms. The DPJ is simply incapable of delivering reform on that scale, not because it is the DPJ but because it is a party in a functioning parliamentary system. Consider the circumstances during which the great reforms occurred. The first followed an internal, top-down revolution that enabled the new ruling elites to redraw Japanese institutions as they saw fit. The second set of reforms followed catastrophic defeat and was the product of an external, top-down revolution. In both cases there was a blank slate, or at least as blank a slate as possible in human affairs. Reform was largely extra-parliamentary — and as a result, opposition to reform was extra-parliamentary, isolated from power and easily repressed or ignored.

Needless to say, the DPJ will not enjoy the same freedom. It will face considerable legitimate opposition, within the Diet from an LDP that will likely find its voice in opposition and even from members of the coalition government that will likely emerge from the government (even if the DPJ wins a simple majority due to the need to keep its upper house partners involved). It will face opposition from prefectural governors, mayors, prefectural and local assembly members, NPOs, industry groups, and unions. Sooner or later it will face opposition from a considerable portion of the public. And while the bureaucracy may not be elected, its members are certainly participants in the political process. Accordingly, the less grandiose the DPJ is regarding what it hopes to achieve through administrative reform, the less vituperative the party is in its rhetoric regarding the bureaucracy, the more effective the DPJ will be should it take power.

I applaud Kan's efforts to move the DPJ away from harsh, anti-bureaucracy rhetoric that will make it more difficult to work with the bureaucracy. At a press conference last week Kan stressed that the DPJ is not against the bureaucracy, that it recognizes that it needs to make use of the experience and intelligence of Japan's bureaucrats. The DPJ, he said, stands for "post-bureaucratic politics, not anti-bureaucratic politics." Nakagawa Hidenao, Schmittian in his desire for political enemies, dubbed Kan's remarks as heretical to the cause of administrative reform, a sign that the DPJ does not have the stomach to tackle the challenge. But Nakagawa has it precisely wrong. The existence of a strong, entrenched bureaucracy is a fact of life for any Japanese government. Demonizing the bureaucracy accomplishes nothing. As a party with no experience in governing the DPJ will be especially dependent on the bureaucracy.

Does that mean that there is no hope for administrative reform? Hardly. In looking to unify cabinet and party, the DPJ has sought to learn from the LDP's mistakes: bureaucratic rule has been harmful precisely because the LDP did little to prevent collusion between backbenchers and bureaucrats, which prevented the government from speaking with a single voice and enabled backbenchers to misappropriate enormous sums of public funds. A DPJ victory would be a positive development for precisely this reason, as it would represent an opportunity to create a system in which elected representatives serving as prime minister and cabinet ministers could determine national priorities and direct the administrative machinery accordingly, confident that their work would not be undermined by backbenchers following their own agendas. The task, in short, is to establish a clear division of labor between politicians and bureaucrats, making politicians accountable for setting national priorities and drafting legislation, and making the bureaucracy responsible for implementing the public's will as embodied in legislation.

LDP rule has effectively erased this line. The challenge for a DPJ-led government will be to restore it.

How can Japan be saved?

With the sudden departure of Nakagawa Shoichi from twin posts of finance minister and state minister responsible for the financial services agency (FSA), Yosano Kaoru has been elevated from state minister for economic and fiscal policy and now holds all three positions simultaneously, making him, to borrow a term from American politics, the Aso government's economy czar.

It is most likely a temporary arrangement; the government has indicated that he will stay in place until the budget is enacted, but thereafter the posts will be divided, either with Yosano being bumped back down to his state minister's post or with Yosano's becoming a "permanent" (insofar as anything about the Aso government can be described as permanent) replacement for Nakagawa.

Nevertheless, until that happens, Yosano bears a heavy burden — it is not for nothing that Ozawa Ichiro wished his go partner good luck, not least because Ozawa and his party will do all they can to make his life more difficult.

While he has a fairly straightforward task for the first month of his tenure, it is worth considering Yosano's views and speculate as to what might have been. Arguably, if Aso was sensible and chose his ministers — or at the very least his finance minister — on the basis of merit, Yosano would have been a fine first choice for the post he now occupies. While Yosano was perhaps denied the post due to his long advocacy of a consumption tax increase as the means to set Japan's finances right (and to Aso's need to reward Nakagawa for his loyalty), he has been nothing if not pragmatic, as he stressed at his inaugural press conference Tuesday. He has also, unlike the prime minister, been unflinchingly realistic.

While Aso has done everything in his power to play down the severity of the crisis and the responsibility of LDP governments for its severity, while repeatedly making the fanciful promise to make Japan the first country out of recession even as its economy declines faster than other developed countries, Yosano has served as the bearer of bad news. His speech at the start of the current Diet session is a good illustration of his thinking. The underlying idea is that if the government is going to ask for the people's forbearance, it must be straight with them. It must be forthright about crisis and the broader structural changes underway in the global economy, and must have a clear vision about how Japan should change over the long term in response to the crisis and broader trends.

This is consistent with his approach to politics as outlined in his 2008 book Dodotaru seiji / 堂々たる政治, which can be translated as Open Politics, in the sense of straightforwardness. It is telling that Yosano says, in the closing pages of the book, that his favorite word is "decency" (he uses the English), arguing that decency is a "weapon sustaining Japan" as it struggles to adapt. Yosano's vision of politics is not unlike Barack Obama's, in that he wants to deescalate conflict within the political system — he is a uniter, not a divider. He is opposed to "market fundamentalism," although not, he notes, opening Japan's economy more to the global economy. He wants to ensure, however, that the weak are protected. He also does what few in Japanese politics seem willing to do today: he defends the bureaucracy, suggesting that the failings of some should not condemn the good work done by most. Yosano stresses that there needs to be a clearer division of labor between bureaucrats and politicians, with the latter taking clear responsibility for big decisions about the direction of the state. (I heard Furukawa Motohisa, a finance ministry bureaucrat-turned-DPJ member, make the same argument in Tokyo last month.) It does no good for governance to demonize the bureaucrats and shift the blame for Japan's problems on their shoulders. He takes a nuanced view to the common reformist theme of "cutting waste," suggesting that while there are some wasteful expenditures that can be easily cut, other expenditures require more careful consideration as they can have tremendous impact on the life of citizens in forgotten corners of Japan. Similarly, he does not dismiss Nakagawa Hidenao's "Rising Tide" school offhand, but rather suggests that it is unrealistic to expect the automatic reconstruction of Japan's finances that Nakagawa believes will result if Japan simply gets its economy growing fast enough. With Japan's sinking deeper into recession, Yosano may not see his desired consumption tax increase any time soon, but the recession suggests that it might be a long time before Japan sees the kind of growth needed for a rising tide to lift all boats.

Yosano's thinking is strongly reminiscent of the LDP's old mainstream, a view that could be called "politics as administration." In another era, he might have been a successful prime minister governing in the "low posture" style, abjuring ideology while solving national problems.

The question, however, is whether Yosano's politics are appropriate for an era of faltering institutions, mounting economic insecurity, and the need for drastic change.

More than the debate over economic policy, this is the major difference between Yosano and Nakagawa Hidenao. Nakagawa's political vision is rooted in conflict. Arguably he subscribes to Carl Schmitt's view of the political, in which the political sphere is separated from other spheres of life by its divisions of the world into friends and enemies. As Schmitt wrote, "The political is the most intense and extreme antagonism becomes that much more political the closer it approaches the most extreme point, that of the friend-enemy grouping." [NB: I am not citing the controversial Schmitt to discredit Nakagawa.

Reading Nakagawa's Kanryo kokka no hokai 官僚国家の崩壊 (The destruction of the bureaucratic state), which was published around the same time as Yosano's book, I got the impression of Nakagawa as a politician in search of monsters to destroy. His bete noire, introduced in the introduction, is what he calls the "stealth complex:" a network comprised of the universities, the bureaucracy, the Bank of Japan, the financial world, and the media that works to retard reform and protect their vested interests. (He explicitly cites Eisenhower's military-industrial complex as his model.) He explores the way in which bureaucrats undercut political rivals by leaking information, how they dominate the policymaking process as "Japan's biggest think tank," and how through government by informal networks they have hollowed out the policymaking process so that no one is accountable. Japan, he argues, is ruled by a void. And in order to transform Japan, this stealth complex must be destroyed and politicians given firm control of policymaking, to which end he more or less endorses the Watanabe Yoshimi-Takahashi Yoichi-Eda Kenji administrative reform agenda, based on the notion that in hard times, bureaucratic rule must give way to political rule (a theme with deep roots in Japanese politics). The remainder of the book contains Nakagawa's countless ideas for Japan: a kinder, gentler market capitalism in which the Japanese people help each other without the government's intervention, a decentralized government and a bureaucracy reined in and accountable to the people, and a full embrace of the IT and green technology revolutions to revitalize the economy.

But running through it all — and through his writing at his blog — is the need for someone to blame for Japan's problems; someone other than the LDP, that is. His politics clearly require an enemy against which to direct political efforts, much like Koizumi Junichiro's emphasis on the "opposition forces" within the LDP who stood in the way of reform.

In short, between Yosano and Nakagawa there are two very different approaches to politics, two very different ways of tackling the problems facing Japan. With the implosion of the conservatives, it may in fact be these two men who are left fighting over the wreakage of the LDP after the next general election. MTC wonders what exactly Nakagawa is planning (i.e., whether he intends to bolt the party at an opportune time), but it may be the case that he is prepared to fight it out within the ranks of the LDP, that he's convinced that Japan's system is a two-party system and since one party is unacceptable to him — if his writings about the DPJ are to be believed — he has no choice but to fight on to remake the LDP.

And while Yosano himself is an unlikely prime minister, his worldview could provide the right mix of concern for Japan's downtrodden and an emphasis on (as Ozawa says) change so that things can stay the same.

The question, however, is which approach to politics is most likely to get things done. That, after all, is what the public has been waiting for for years: a government that will move deliberately to tackle the problems that both Yosano and Nakagawa believe ail Japan. I think Koizumi's enduring popularity has less to do with the content of his policies than that for the first time the public saw a government in action. Perhaps at times it was only the appearance of action, but it was a significant enough departure that I think voters still appreciate the former prime minister, much to the chagrin of writers like Morita Minoru. Which suggests that Nakagawa may be right that a confrontational approach is the only way to break the establishment and set Japan on a new course. Yosano's "softly, softly" approach simply expects too much goodwill from all actors, probably more goodwill than is possible in the midst of economic collapse.

But at the same time Nakagawa is far too forgiving of the LDP: the bureaucracy is as powerful as it is because it has governed hand in hand with the help of an LDP unable to govern itself. And I'm not convinced that the LDP can reform itself to become the party Nakagawa envisions without a cataclysmic defeat that forces the party into opposition.

Ultimately the picture that emerges from both books, however, is that the range of policy ideas in Japanese politics today is fairly limited. There is a general consensus that some form of decentralization is necessary, with varying degrees of scope. There is a general consensus in a broad swath of the political class of the need to reform the bureaucracy drastically and forge a new relationship in which the bureaucracy is an instrument of the cabinet. There is a growing sense of the need to develop and draw upon the skills and expertise of Japanese outside the bureaucracy. There is an acknowledgment of the need to fix the government's finances, with the debate focusing on the extent to which trimming waste from the budget will solve the problem. (and it is unclear where exactly the DPJ falls in this debate, seeing as how they've done everything they can to avoid talking about a consumption tax increase).

(Of course, what's missing from this consensus is the most pressing problem of all: how to replace foreign demand for Japanese goods with domestic demand for Japanese and foreign goods as the basis for Japanese economic growth.)

Given that an agenda has more or less coalesced, the overriding question in Japanese politics then is who can get the government moving. After watching three consecutive LDP prime ministers crash and burn, the public seems unconvinced that LDP is up to the task, no matter how passionately Nakagawa fulminates against the bureaucracy and castigates the DPJ as an enemy of reform. Nakagawa's diagnosis may be right, to an extent, but his cure has been tried, and it has failed. The LDP is too dependent on the bureaucracy for policymaking and its members too free to manipulate policy and undermine the prime minister to make the policies both Nakagawa and Yosano see as necessary.

It is entirely possible that the DPJ, should it form a government, will be no more successful — Japan may languish for years to come. If it does, it won't be for lack of recognition of what's wrong with Japan but rather due to an inability to reshape the system of government wholesale.

Good luck, Mr. Yosano (and Mr. Nakagawa).