The opposition peers ahead

tauringhuang.

Jul 30th 2009 | TOKYO
From The Economist print edition

The DPJ lays out its credentials for governing

Reuters
WITH an election due on August 30th, an animated cartoon has proved a surprise internet hit in Japan. At a candlelit dinner, a smooth-talking suitor with wavy locks like the opposition leader’s leans over and whispers to his companion, “I can make you happier, why not switch to me,” promising her a worry-free life blessed by free child-care and a generous retirement. How will you pay for all this, she wonders? “Don’t worry,” he purrs. “I’ll sort out the details once we’re married.”

This is Japan’s first taste of attack advertising. The cartoon’s sponsor, the ruling Liberal Democratic Party (LDP), may be a shambles, empty of ideas and brought low by in-fighting, but its ruthless political instincts have not deserted it after half a century of nearly unbroken rule. It accuses the left-leaning Democratic Party of Japan (DPJ) of being both callow and extreme, fit neither to oversee Japan’s security alliance with the United States, nor to protect the nation’s rocky finances.

The charge of inexperience may not stick. Given the sleaze and incompetence of the mightily experienced LDP, which has produced four prime ministers in as many years, freshness has a certain appeal. The second charge, of extremism, though, may yet damage the DPJ. So on foreign policy, the opposition is tacking to the centre. In the past, its leader, Yukio Hatoyama, has questioned parts of the security alliance with America and the role of Japanese forces abroad. Two years ago, having won control of the upper house of the Diet (parliament), the DPJ claimed the scalp of a prime minister, Shinzo Abe, by attacking the Japanese navy’s refuelling mission in the Indian Ocean, there to support anti-terror operations in Afghanistan. The mission, it said, breached the country’s pacifist constitution. Now “continuity” is Mr Hatoyama’s watchword. To recall the mission “would be a very reckless idea.” The alliance, he now says, must not be rocked.

Yet the election will be won or lost on domestic matters. In its election manifesto, issued on July 27th, the party promises to address Japan’s deep-seated economic insecurities. It will introduce a child allowance, cut road tolls and taxes on small businesses, raise unemployment benefits, support farmers’ incomes and revamp a pension system that cannot keep up with an ageing population. More than anything, the pensions mess brought the LDP low (it lost 50m pensions records).

The opposition’s proposals amount to 3.5% of GDP and paying for them seems to depend on more than a sprinkle of fairy gold. More than ¥9 trillion ($95 billion), the party says, will be found in savings from public works and other wasteful spending. The party rules out raising Japan’s 5% consumption tax for at least four years, though that is key to turning round the dire public finances. Gross national debt is 180% of GDP and rising, as LDP stimulus packages—justified by the global slump—kick in.

Whether the DPJ’s sums add up at this stage, however, matters less than its ability to carry out its main campaign promise: wholesale “administrative reform”. This bland phrase amounts to a revolution. The party promises “rule by politicians not by bureaucrats”, something that did not happen during the LDP’s decades in office. Unlike in other democracies, power in Japan has rarely resided in the government of the day. Rather, influential bureaucrats have worked with “tribes” of politicians to protect the interests of road builders, construction companies, farmers and other lobbies. In addition, ministries control special funds of their own, so the cabinet’s hold over the national purse strings is weak. Policymaking bodies within the LDP itself have further undermined the authority of the prime minister. In the latest general election, in 2005, the then prime minister, Junichiro Koizumi, challenged the system by appealing directly to voters. He won by a landslide. But even before he resigned in 2006, the system was reasserting itself.

The DPJ’s plans are much more radical than Mr Koizumi’s. The cabinet will be responsible for the planning and execution of policy. Bureaucrats will be made accountable to their minister, and discipline enforced by putting more politicians into ministries. The budget-making process will be centralised, and items scrutinised line by line. The party’s secretary-general, Katsuya Okada, says severing all connections with the bureaucratic habits of the past will be a prerequisite for carrying out the DPJ’s other election promises.

That is probably correct but the question is whether so bold a reform is believable. The manifesto is central to the DPJ’s credibility. That, in itself, is a first for Japan. The manifesto proposes a four-year programme for sorting out state pensions and rationalising the budget. Akira Nagatsuma, the DPJ’s pensions supremo, says a copy of the programme will be posted in every government office, “a reminder to bureaucrats that this is the government’s contract with the people.” If the party pushes through its programmes, party members say, then it will ask voters in four years’ time to approve the rise in the consumption tax that will presumably be needed. Should a tax increase be necessary before then, Mr Okada says, the prime minister should resign and call a fresh election.

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Manifesto destiny
If the DPJ wins (and it is ahead in opinion polls, see chart), it can expect dogged resistance from the LDP and its bureaucratic allies. Even if it can defeat such campaigns—and it should get some help from modernising bureaucrats, who say they look forward to working under its proposed changes—two big uncertainties remain. One is that in addressing economic insecurities, the party appears concerned with redistribution at the expense of boosting long-run potential. Beyond a nod towards things like green technologies and nursing homes, the party appears to give little thought to increasing growth, allocating resources better or dealing with stubborn deflation.

The second uncertainty has to do with the role of the DPJ figure who towers over all his colleagues, Mr Hatoyama included: Ichiro Ozawa, once an LDP bigwig, then DPJ leader who was forced by a funding scandal to step down as party leader in the spring. Mr Ozawa is a bundle of contradictions. For nearly two decades he has worked to bring about a political upheaval in which LDP-led rule is replaced by a competitive two-party system. He may succeed at last. At the same time, Mr Ozawa, an electoral strategist of genius, learnt from his years in the LDP to play politics behind the scenes. In the Diet he comes across as dour. In private his quicksilver manner can charm colleagues or just as quickly destroy them. By temperament, Mr Ozawa would rather not sit in the cabinet, accountable to the prime minister. But that informal style of politics is just what the DPJ promises to break with. Should the DPJ win on August 30th, what Mr Hatoyama does with Mr Ozawa will be the first test of whether the party can bring Japan’s politics out of the shadows.