The Stirrings of Political Realignment

Tensions Heightened by Ozawa’s Defection from DPJ

The faction led by Ozawa Ichirō has quit the Democratic Party of Japan in opposition the consumption tax hike proposed by the government of Prime Minister Noda Yoshihiko. The Ozawa faction set up their own party on July 11, 2012, named the People’s Life First Party. This was followed by further defections among DPJ Diet members, pushing the party into danger of collapse. Even though Ozawa personally lacks public support, his new party has policy coherence by sticking to the initial DPJ platform declared in the manifesto for the previous general election.

Prime Minister Noda has managed to uproot the opposition to a consumption tax hike led by Ozawa in the DPJ, but it came at the cost of a party split. The DPJ has tried to compensate for the loss of the Ozawa group by entering an alliance with the Liberal Democratic Party and New Kōmeitō—resulting in the three parties agreeing on a comprehensive reform of the taxation and social security systems. This agreement is, in a sense, a “grand coalition” between the three parties.

The cooperation between the three, however, does not extend beyond the consumption tax issue. The Noda administration has been unable to win support from the LDP and New Kōmeitō for the draft legislation needed to allow the government to issue the deficit-financing bonds to cover roughly half of the national budget, or for the draft bill to reform the election system. Prime Minister Noda is eager to extend the life of his administration as long as possible, while the LDP and New Kōmeitō are inclined to dissolve the Diet as soon as possible for a snap general election. Japanese politics is thus entering a period of increased tension.

High Hurdles to Forming a New Party

There are various legal restrictions on the creation of a new political party, however, as well as limits on the ability of individual Diet members to change political affiliation.

In Japan, a public subsidy totaling around ¥32 billion is paid to political parties. The amount received by each party depends on the number of Diet seats it has and the amount of votes it received in the most recent national election. In the midst of the ongoing recession that has made it harder to rely on contributions from individuals, corporations, and other groups, the political subsidy has become a large chunk of each political party’s revenue.  The executives of each party control its subsidy, and are also in charge of allotting positions to party members. This lends crucial significance to the issue of which party faction will occupy the key posts of party president and secretary general. Indeed, the backdrop to Ozawa quitting the DPJ was the fact he came out on the losing end of the power struggle over the executive posts. 

Forming a new political party requires having at least five Diet members, or obtaining 2% or more of the votes cast in the most recent national election. In the case that the 2% level is met, the new party must have at least one Diet member. It is no easy matter to meet those conditions. A politician who leaves one of the two main parties (LDP or DPJ) faces the strong possibility of losing the next election. This makes it very difficult to gather together five party defectors, and clearly accounts for why many of the DPJ members who opposed the consumption tax hike did not follow Ozawa in his departure from the party.

Diet members—particularly those elected to a proportional representation district—face another barrier to changing party affiliation. They cannot switch over to the same party they campaigned against in the election. Given this rule, the optimal way to increase the number of Diet members in a party is to form a completely new one.

On top of everything else, there are technical problems to confront when forming a new party. For instance, the calculation of each party’s political subsidy is based on the number of Diet members it has as of January 1, so late December is thought the ideal moment to create a new party. On this point, some have observed that Ozawa may have painted himself into a corner by forming his new party in July.

An Ozawa-Sparked Realignment Still Possible

Once a new national election is held, however, the result determines the situation for each party, including a new distribution of political subsidies. In other words, the political game is reset. This raises the strong possibility that the next general election will spur a political realignment. The strength of Ozawa Ichirō lies in his expertise in the election and subsidy systems, as well as his skill in accurately gauging voter trends in an election. Even though Ozawa personally lacks popularity, it would be a mistake to underestimate his talents.  

(Originally written in Japanese on July 22, 2012.)