Noda’s Policy Muddles

Politics Economy

On September 26 Prime Minister Noda Yoshihiko delivered an address to the United Nations General Assembly in which he called for use of the International Court of Justice for the settlement of territorial and maritime disputes. With the conflicts between Japan and China over the Senkaku Islands and between Japan and South Korea over Takeshima in mind, the prime minister declared that it is unacceptable for countries to attempt to realize their claims by unilateral use of force or threat, and he called for acceptance of the compulsory jurisdiction of the ICJ. He also affirmed Japan’s commitment to the principle that disputes must be settled in a peaceful manner based on international law.

As I noted in a column published in the Yomiuri Shimbun on September 23 and printed in English in the Daily Yomiuri on September 24, I do not think there was any need for the Japanese government to provoke China as it did with its recent cabinet decision to nationalize the Senkakus, thereby accentuating Japan’s sovereignty over these islands, which are already under our country’s effective control. As I saw it, such a move was bound to generate a major backlash from China, causing heightened tensions in the waters around the Senkakus and a major international campaign from China to publicize its own claim to these islands. Such developments have made it difficult for Japan to maintain its position that, regardless of what China and Taiwan may say, no territorial dispute exists. If Tokyo were to change this stance and acknowledge the existence of a dispute with Beijing over ownership of the Senkakus, it would lend consistency to Prime Minister Noda’s call for use of the ICJ to settle territorial and maritime disputes, which would apply to both the Senkakus and Takeshima.

Energy Policy Reduced to "Objet d'Art"

The government’s position on energy, meanwhile, is completely lacking in logical consistency.

On September 14 the Energy and Environment Council, headed by Minister of State for National Policy Furukawa Motohisa, issued a document titled “Innovative Strategy for Energy and the Environment,” including a commitment to mobilize all available policy resources to enable “zero operation” of nuclear power plants in the 2030s. The council also set forth three guiding principles concerning nuclear power plants: (1) to strictly apply the stipulated rules regarding the 40-year limit on such plants’ operation, (2) to restart the operation of idled plants once the Nuclear Regulatory Commission gives its safety assurance, and (3) not to plan the construction of new plants or additions to existing plants. Identifying the existing nuclear power facilities as an important source of electric power, the council expressly set forth a policy of reactivating idled plants.

Originally the government was slated to adopt the council’s document with a cabinet decision on September 19. But it ran into major opposition from various quarters, including industry, labor, local governments of jurisdictions where nuclear power plants are located, and the United States, with which Japan has an agreement on nuclear energy cooperation. Presumably as a result of this opposition, the government decided to make the council’s strategy document merely a reference material attached to a cabinet decision that set forth only a broad policy direction. This sort of last-minute switch is highly unusual.

The actual cabinet decision reads as follows: “The Government of Japan will implement future policies on energy and the environment, taking into account  ‘the Innovative Strategy on Energy and the Environment’ (the decision of the Energy and the Environment Council on September 14th, 2012), while having discussions in a responsible manner with related local governments, the international community, and others, and obtaining understanding of the Japanese public, by constantly reviewing and reexamining policies with flexibility.”

It is often said that politics is an art. This cabinet decision certainly qualifies as a prime example of political artwork, cleverly crafted for maximum ambiguity. In a television appearance after the decision was adopted, Prime Minister Noda declared: “Aiming for zero operation of nuclear power plants in the 2030s in consideration of calls from the public is an unwavering objective, and the cabinet has adopted a decision to do so. I hope you’ll understand that the overall policy and the future process have unmistakably been decided by the cabinet.” But the actual words of the cabinet decision are unclear even after repeated reading, and if “constantly reviewing and reexamining” is a key point, then it is reasonable to assume that the strategy document itself will be subject to future reconsideration and revision.

It thus comes as no surprise that the government is now backpedaling on the idea of finalizing its basic energy plan on the basis of the council’s strategy. Former Nippon Steel Corp. Chairman Mimura Akio, who chairs the Fundamental Issues Subcommittee of the government’s Advisory Committee for Natural Resources and Energy, has already called for a review of the strategy, saying it is riddled with contradictions and cannot serve as the basis for a policy decision.

The call for the mobilization of all available policy resources to enable zero operation of nuclear power plants in the 2030s, which was one of the planks of the Innovative Strategy for Energy and the Environment, had been contained in a recommendation submitted to the government by the ruling Democratic Party of Japan on September 6. But immediately after this, according to a report in the Yomiuri Shimbun on September 15, the government started looking for ways of avoiding a firm commitment on this point, and at an unofficial meeting of cabinet ministers on September 14 it was decided to add a phrase to the final strategy document stating that the government will “respond flexibly to whatever changes may occur.” In other words, the government left itself more wriggle room on this commitment. So while the DPJ sought to curry favor with the public with a “no nukes” call, the government softened this with the addition of an escape route in the form of the flexible-response clause so as to be able to formulate energy policy in a realistic manner. This resulted in the highly ambiguous cabinet decision adopted on September 19. The decision is thus a monumental work of art representing the contrast between the DPJ, which sought to finalize an energy policy decision of fundamental importance for the state and the economy with a view to the next general election, and the DPJ-controlled government, which worked to avoid being constrained by this policy.

Noda, Abe, and an Economy in Decline

At a special convention of the DPJ on September 21 Prime Minister Noda easily won another term as president of the ruling party, and he then asked House of Councillors member Koshiishi Azuma to stay on as party secretary general. Up to now Koshiishi has placed top priority on minimizing discord within the party, and he has advocated holding the next general election for the lower house (to be held sometime no later than August 2013) to coincide with the triennial election for the upper house next summer. Noda’s decision to reappoint him was thus taken as an indication that he had decided against dissolving the lower house and calling an election by the end of this year.

Then, on September 26, the Liberal Democratic Party, the biggest opposition party, held its presidential election. In the first round of voting Ishiba Shigeru, who until recently chaired the LDP’s Policy Affairs Research Council (and who previously served as defense minister and minister of agriculture), came in first, followed by former Prime Minister Abe Shinzō (2006–7), but Abe won in the runoff vote. It seems that Ishiba’s unpopularity with party elders like former Prime Minister Mori Yoshirō (2000–2001) and former Chief Cabinet Secretary Aoki Mikio led to Abe’s victory. Various public opinion polls suggest that the LDP, whose long hold on power ended in 2009, has a good chance of winning in the next general election and resuming its position as the top ruling party. In August, during talks with then LDP President Tanigaki Sadakazu aimed at securing passage of the government’s bill to hike the consumption tax through the LDP-dominated upper house, Prime Minister Noda promised to call a general election “soon,” and Abe can be expected to use every possible means to make the prime minister follow through on this pledge.

The mass media are currently focusing on the policy differences between Prime Minister Noda and the LDP’s Abe as his possible successor. Noda has set forth a zero-operation goal for nuclear power plants, but Abe asserts that even if reliance on these plants is reduced, aiming for a target of zero at this point in time is irresponsible. And while both men agree that the consumption tax should be hiked (according to the law enacted at Noda’s call in August, the current 5% rate is to be raised to 8% in 2014 and 10% in 2015), Abe says the hike should not be implemented as scheduled if the current state of deflation persists. Such differences are not insignificant. But I suggest that we not forget another serious consideration, namely, the sorry state of the Japanese economy.

In 2007, the year before the shock from the collapse of Lehman Brothers triggered a global economic slump, Japan’s nominal gross domestic product was ¥512.9 trillion, exports were ¥83.9 trillion, and imports were ¥73.1 trillion, leaving a trade surplus of ¥10.8 trillion; net income on foreign investments was ¥17.2 trillion, and gross national income was ¥530.1 trillion. Four years later, in 2011, nominal GDP had fallen to ¥468.4 trillion, exports were ¥66.5 trillion, and imports were ¥68.1 trillion, leaving a trade deficit of ¥2.6 trillion; net investment income was ¥14.7 trillion, and GNI was ¥483.1 trillion. In other words, over the course of this period, GDP declined by 8.7%, exports by 20.7%, imports by 6.8%, net income on foreign investments by 14.5%, and GNI by 8.7%. And the 2011 trade deficit, which was caused by increased energy imports in the wake of the Fukushima nuclear plant disaster, can be expected to persist. So the top strategic priority for Japan, regardless of who heads the administration, will be to find a way of halting this downward trend in the country’s economy. Anniversary and Launch of Arabic Edition

This October marks the first anniversary of the start of publication of And this month we are launching an Arabic-language edition, alongside our existing editions in Japanese, English, Chinese, French, and Spanish. Meanwhile, the total number of visits to our website is growing steadily, and the monthly figure is already substantially greater than the numbers of copies printed by the major opinion journals. As those familiar with Japan’s modern history realize, journals like Chūō Kōron and Kaizō played a major role in shaping public opinion in Japan during the Taishō (1912–26) and Shōwa era (1926–89). We now need to create forums that can play a similar role in our own time. Our aim is to make such a forum, and we request your support in this undertaking.

(Originally written in Japanese on October 1, 2012.)

Shiraishi Takashi Noda Yoshihiko politics Democratic Party of Japan Liberal Democratic Party Abe Shinzō energy policy economy DPJ LDP trade balance gross domestic product Takeshima territorial disputes Senkakus gross national income