Japan faces political gridlock after drubbing of ruling party

 

CHAOS, REVOLT and policy gridlock – newspapers and pundits yesterday spelt out the painful implications of Japan’s weekend election, which has left Naoto Kan’s job in doubt just 33 days since he moved into the prime minister’s office.

Mr Kan’s Democrats (DPJ) have lost control of the upper house after voters punished the party for a series of missteps in what was essentially a referendum on its 10-month rule. It is surely one of the shortest honeymoons in Japanese parliamentary history.

Worse for Mr Kan, the result has brought the party’s conservative Liberal Democrat (LDP) rivals juddering back to life after they were tossed out of power and declared a political corpse in last year’s historic lower house poll.

The LDP took 51 of the 121 seats up for grabs – 13 more than it had before the election, while the Democrats won 44, losing 10. “I believe the first step toward our party’s rebirth has been made,” LPD ruler Sadakazu Tanigaki said after the results came in.

DPJ junior partner People’s New Party, meanwhile, has emerged empty-handed, forcing the government to begin scrambling for another coalition ally.

The government lost its other junior partner, the Social Democrats, in June after they resigned en masse in protest at a decision to allow a new US base to be built in the southern prefecture of Okinawa.

Sunday’s result is a disaster for a party that has promised radical economic and political reform. Although the upper house is far weaker than the lower chamber, it has the power to block all but the most important Bills. Mr Kan needs both houses onside if he is to achieve his pledges to transform government and pull the country out of a fiscal nosedive.

Just after taking office on June 8th, he warned that the country’s enormous national debt – nearly 200 per cent of gross domestic product – could throw the country’s roughly $5-trillion economy into a Greek-style crisis.

The warning was meant to concentrate minds: unlike Greece, Japan’s dept is held domestically. But many analysts believe the threat of implosion in the world’s second-largest economy is real enough, given its spluttering growth and the ballooning costs of propping up Japan’s greying society – over five million are set to retire this year and next.

Unfortunately, voters did not warm to Mr Kan’s proposed solution: a long-mooted hike in consumer tax from five to 10 per cent. Few believed his assurances that the tax would not punish the poor, a fact he acknowledged yesterday. “My lack of explanation about (the tax) was a big factor (in the disappointing outcome).”

With gridlock looming in the upper house, the prime minister must now go back to the electorate and persuade them to surrender more of their declining income. “In 10, 20, or 30 years from now, I hope the public will see this government as the defining factor that began rebuilding Japan’s economy,” he said at the weekend.

Mr Kan must also face down protests against the US base on Okinawa, the political graveyard of his predecessor Yukio Hatoyama, and deal with the inevitable fallout for Japan’s military alliance with the US.

He will have to avoid the inevitable political daggers within the DPJ ahead of a September leadership election, while keeping his eye on the Democrat’s key agenda: wrestling control from the bureaucrats who have run Japan for over half a century.

Not surprisingly, pundits are measuring the political coffin of Japan’s fifth leader since 2006, and wondering who will be sixth.