An Uncertain Year Ahead Following the Leadership Elections

Leadership elections for Japan’s two largest political parties took place in September 2012. While Prime Minister Noda Yoshihiko easily retained control of the governing Democratic Party of Japan, the contest was considerably more eventful for the opposition Liberal Democratic Party. The incumbent president, Tanigaki Sadakazu, withdrew from the competition, leaving a battle between five contenders: Abe Shinzō, Ishiba Shigeru, Ishihara Nobuteru, Hayashi Yoshimasa, and Machimura Nobutaka. No candidate received a majority of the votes in the first round, and a runoff contest was held to choose between Ishiba Shigeru and Abe Shinzō, the top two vote-getters in the opening round. The final result brought the mantle of leadership back to Abe Shinzō, who had served as prime minister in 2006–7.

The Problems with Abe

Abe was critical of the three-party agreement struck by the LDP, DPJ, and New Kōmeitō in June 2012 to pass the bill for the consumption tax hike and other measures. He appears to have a flexible mindset with regard to which parties the LDP might ally itself with if it wins a majority of lower house seats in the upcoming general election. It is said that he is not thinking of a grand coalition with the DPJ, but rather is searching for an alliance with the Japan Restoration Party, led by Osaka Mayor Hashimoto Tōru.

Abe believes that restoring Japan’s public finances can only be achieved by escaping from the deflationary trap that the nation has been in for so many years. This is the reason for his emphasis on an economic growth strategy and a sign that he will likely tread a different path from Tanigaki, his predecessor, who cooperated with the consumption tax hike put forward by Noda’s cabinet.

Abe is strongly nationalistic when it comes to foreign policy and constitutional issues. This has been especially evident during the recent territorial problems with South Korea and China, where his hawkish stance has been abundantly clear. Wariness of Abe on the Korean and Chinese sides would make an improvement in relations increasingly difficult. If he shows an excessively right-wing bent when dealing with reform to the Constitution, he will no longer be able to garner support from the majority of the Japanese people. There is a good possibility that a change of government will take place within the next year, placing Abe in the Kantei, or prime minister’s residence, once again. If that happens, Japan can expect a number of issues to crop up, especially on the foreign relations front.

The Outlook for This Fall and Beyond

Prime Minister Noda will reshuffle his cabinet at the start of October,(*1) but we cannot expect popular support for his administration to increase substantially. There has been heavy criticism of Noda’s ability to govern due to a succession of failures on both the domestic and foreign policy fronts, with the recent disputes over Takeshima and the Senkaku Islands at the forefront of people’s minds. It is generally expected that the DPJ will suffer a devastating defeat in any general election that happens soon. As far as Noda is concerned, the later it occurs the better. In any case, though, he must convene an extraordinary session of the Diet in October in order to deal with legislation to issue deficit-financing bonds, the source of half of the annual revenue that covers government spending.

In the DPJ, meanwhile the faction associated with former Secretary General Ozawa Ichirō has already left the party, and the prevailing view is that more members will bolt in the months to come. The result of this will be that the governing party will no longer hold a majority in the House of Representatives. If a parliamentary motion of no confidence against the cabinet is introduced, there is a strong probability that it will pass. We must not forget, however, that even if such a motion passes, it will not necessarily lead to a snap general election. An en-masse cabinet resignation is another option.

Noda will probably go down in history as the prime minister who put forward the consumption tax hike. If his successor can assemble a popular cabinet, it may be possible for the Democrats to limit the degree of their defeat in a general election. At the very least, once the new cabinet is in place, it is quite unlikely that we will see a Diet dissolution before the year ends—and given time, the DPJ’s support ratings may recover somewhat.

The real point of concern for both the DPJ and the LDP is the future movements of the Japan Restoration Party. If the three parties all field candidates and battle for the single-seat electoral districts, the two major parties will find it difficult to coordinate election strategy with the Restoration Party, allowing the newcomer to secure a meaningful number of Diet seats. If no party manages to secure a majority independently, alliances will be inevitable. This could touch off a complete reorganization of Japan’s political landscape. Predicting the course of Japanese politics over the next year is no easy task.