2012 Japan Post-Election Report: They Are Back! The Return of the LDP and What it Means for Japan and the World

by Joshua Tucker on December 20, 2012 · 2 comments

in Campaigns and elections,Comparative Politics,Election Reports

Continuing our series of election reports, the following post-election report is provided by Princeton University political scientist Christina Davis, the author of Why Adjudicate? Enforcing Trade Rules in the WTO (Princeton University Press, 2012).

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In a major defeat, the Democratic Party of Japan (DPJ) lost its position as ruling party in the election held December 16th. Prime Minister Yoshihiko Noda resigned as party president to take responsibility for the debacle that unseated 8 of 16 cabinet ministers including the Chief Cabinet Minister and left the party with only 57 seats in the 480 seat Lower House of parliament.  This reversal brought back into power the Liberal Democratic Party (LDP) that ruled Japan from 1955 to 2009 with only one brief interlude out of power in 1993-94. The LDP won 294 seats and together with its ally, the New Komeito party, will command a comfortable two-thirds majority in the Lower House.

Despite electoral victory, the LDP did not receive a strong mandate. In a post-election poll conducted by the Asahi Shimbun, respondents asked to explain the LDP victory cited “disappointment of the DPJ government” (81 percent) rather than “support for the LDP’s policies” (7 percent). Tokyo University Professor Emeritus Takashi Mikuriya attributed the election as a decision by voters to opt for a return to the stability of LDP rule after having their hopes for change with the DPJ disappointed. Robert Pekkanen of the University of Washington’s Jackson School of International Studies writes, “The LDP won because of a divided and weak opposition. In other words, the LDP lost the election—except compared to everyone else.”

Incumbency offered few advantages to the DPJ, which was dealt a bad hand across multiple dimensions when it took over from the LDP in 2009. The party is an amalgam of liberal and conservative politicians forming a loose coalition without ideological coherence. It came to office in 2009 during a global economic crisis, facing the challenge of a newly assertive Chinese neighbor, and was overwhelmed by the March 11, 2011 earthquake/tsunami/nuclear meltdown “triple crisis.” Unforgiving of these circumstances, voters punished the DPJ for lackluster economic performance, foreign policy setbacks, and the perception that the party was unable to provide unified leadership to face the tremendous challenges of recovery from the 2011 triple disaster. Even as the government pledged to move toward ending Japan’s reliance on nuclear power, the compromise decision to restart some nuclear power plants deprived the DPJ of a rallying issue to capture public resistance to nuclear energy that arose after the Fukushima plant meltdown.

Yet the election outcome cannot be attributed entirely to these issues. While Japan has struggled to adapt its economy to be innovative and flexible within global trends, the media in Japan and overseas are overly quick to malign current economic conditions. GDP growth in 2012 at 1.6 percent put Japan near the average for OECD countries and its 4.4 percent unemployment represented an improvement from 5.1 percent in 2010 and looks good relative to other countries. The last two quarters of the year showed negative growth to pull the economy into recession, but 2013 is expected to bring return of growth. Despite concerns about rising inequality, the country retains high living standards and quality public infrastructure. Public debt ballooned with the tremendous fiscal outlay for entitlement programs strained by an aging society, public works projects, and rebuilding in the Tohoku region damaged by the triple disaster.

In what could be seen as a profile in courage or political suicide, Prime Minister Noda made a deal with the LDP in August that in exchange for their support to pass an unpopular tax increase, he would agree to call for an early election. Raising the consumption tax from 5 percent to 10 percent in 2015 may help to rein in the budget deficit, but it splintered the DPJ, dampened the forecast for future economic growth, and was seen among voters as backtracking on electoral promises. Beyond the issue itself – after all, the LDP also supported the tax – the August deal raised questions about the leadership of the DPJ. Electoral defeat was equally severe for the DPJ politicians who supported the tax increase and the group led by Ichiro Ozawa who defected from the party in opposition to the tax increase.

As a last ditch strategy to gain traction on a policy issue prior to the election, Prime Minister Noda took a stand that Japan should join talks toward concluding a free trade agreement with the United States and ten other countries in the Trans-Pacific Partnership (TPP). This only further deepened internal splits within the party as members refused to agree to even make a commitment to join negotiations for the agreement. Farm groups wary of liberalization strongly opposed the agreement, which the Ministry of Agriculture had estimated would cause 4 trillion yen in agricultural production losses to the rural economy (although some counter the liberalization would bring much needed reform to the stagnant agricultural and food economy in Japan). Japan’s electoral system continues to be skewed to weight rural voters as much as twice as much in the allocation of seats per voter in comparison to urban districts. Ultimately the DPJ manifesto offered a watered down claim to explore entering the negotiations. The LDP took a negative position toward the agreement by stating it opposed liberalization that did not offer exceptions for sensitive industries, but it did so without directly opposing Japan’s eventual participation in the TPP. As with the consumption tax issue, the DPJ lost not on a substantive policy difference with the LDP, but through its appearance of inconsistency and weak leadership.

The nationalist policies of the LDP leader Shinzo Abe and the new entrant into national politics former Tokyo governor Shintaro Ishihara injected an unusual degree of attention to foreign policy in the electoral debate. The overall convergence of LDP and DPJ on the consumption tax and core economic policies accompanied by divergence on security policies may reflect strategies consistent with research by Matt Kearney and Megumi Naoi.   Electoral reforms in 1996 were intended to increase policy competition as Japan moved to single member districts and closed list proportional representation, but pork barrel politics remain prevalent. The DPJ’s ability to allocate pork barrel policies as the incumbent party made it hard for the LDP to differentiate itself on bread and butter issues, and it instead had to rely on nationalism to mobilize a new policy frame. Specifically, the LDP campaign platform advocates revision of the pacifist Article 9 of the Constitution to allow the Japanese military to participate in collective defense and elevate its status from “Self-Defense Forces” to “National Defense Forces”. Abe criticized the DPJ weakness in its confrontation with China over the disputed Senkaku/Diaoyu islands and joined hands with Ishihara in calls for strong defense of Japan’s rights.

The electoral outcome highlights the continued volatility in Japanese politics. With undecided voters as the largest group and general disaffection with all of the major political parties, the LDP will face a tough road to demonstrate a record of competence and build on this electoral victory for the upcoming upper house election in July 2013. Whether Abe is the leader to do this remains an open question, given that he resigned from the prime ministership in 2007 after a string of policy failures and reported stress-induced illness. Should the LDP falter, the octogenerian Ishihara and the youthful upstart Osaka mayor Toru Hashimoto head a new “Japan Restoration Party” ready to seize momentum as a populist party that had a strong showing in this first national election.

The tough talk on economic policy by Abe during the election focused on reducing the independence of the Japanese Central Bank as part of a concentrated effort to increase monetary easing and counter the strong yen that has hurt exports. On the spending side, Abe promised generous spending for public works as a campaign promise and aggressive fiscal stimulus policies can be expected as the LDP enjoys the benefit of returning to a position that it allows it to dole out pork as of old.  Although the early stock market reaction has been positive, a more comprehensive economic strategy will be necessary to turn around the economy while also reducing the deficit.

Going forward, it is probable that the LDP will deliver what Noda could not and bring Japan into the TPP negotiations.  Despite the party’s tepid stance toward the trade talks during the election, in order to deliver on its promise to revitalize the economy the party cannot only cater to rural interests in protection.  Major business groups and firms have come out to strongly advocate Japan’s participation. With Korean industry taking the advantage of privileged access to the United States and European markets from bilateral free trade agreements, Japanese exporters can present the government with the choice of joining the liberalization movement or forcing them to move more production overseas. The liberal Asahi Shimbun came out with editorial position in favor of Japan’s participation in the talks.  A November poll showed 41 percent of the public in support and 33 percent opposed. Of course, the irony will be that in the end it may be the United States and other participants rather than Japan that cannot deliver on the liberalization necessary to make the TPP a meaningful agreement. The greatest utility of the TPP is that its threat of exclusion for China could prompt China to take a more serious negotiating stance to promote breakthrough in the long-stalled Doha Round negotiations for a comprehensive multilateral trade agreement that would be more beneficial to all.

From the U.S. perspective, the return of its old partners in the LDP will be welcome. Abe’s first press conference emphasized that strengthening the U.S.-Japan alliance as his top priority. U.S. officials will hope that he will start with measures toward resolving the stalemate over the relocation of a U.S. military base in Okinawa and continued support for strategies to contain the threat from North Korean missiles and nuclear program.

China has viewed the election with alarm as sign of movement toward resurgent nationalism and anti-China sentiment in Japan. This fear is misplaced given that the electoral politics reflected rejection of DPJ more than endorsement of LDP. The specific LDP policies to defend Japan’s claims to the Senkaku islands, change the name of the military, or adopt legislation to make it easier to participate in UN peacekeeping do not represent a sharp break from the past. Most importantly, the priority to restore economic growth motivates Abe’s early comments that he will work to improve relations with China. While research suggests that the controversial visits to the Yasukuni shrine by previous LDP leaders such as Koizumi had no impact on Japan-China economic relations, ongoing tensions may harm specific sectors. Deep integration with China and other markets of East Asia has become the lynchpin of Japan’s economic prosperity, and the Abe administration is unlikely to jeopardize the mutually beneficial relationship. Chinese leaders are equally committed to economic growth and must recognize that efforts to coerce Japan through economic policies may backfire as did the embargo on rare earth mineral exports imposed in October 2010. The key will be to avoid misunderstandings and accidents through clear diplomacy on both sides to assure that posturing for domestic audiences does not aggravate relations.

The revision of the Constitution will prove to be a hard electoral promise to fulfill given the high threshold required to gain support (two-third vote in both houses of the Diet and majority in a public referendum).  Indeed, prior to changing substantive provisions in the constitution, the LDP will pursue an amendment to lower this hurdle to a simple majority in parliament and public referendum. While a useful political strategy for adding new dimension to electoral debate and forging coalition with Ishihara and the New Restoration Party, the new Abe administration will have to deliver gains on the economic front to win a majority in the upper house in the next election in July before it can seriously pursue this path.

 

 

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