Ambivalent Mandate for the Abe CabinetPolitics
On December 14, Japanese voters handed another sweeping victory to the coalition of the Liberal Democratic Party and Kōmeitō in a snap election called by Prime Minister Abe Shinzō. The LDP won 291 seats in the House of Representatives, down 4 from its pre-election strength, while the LDP’s junior partner, the Kōmeitō, secured 35 seats for a gain of 4, giving the ruling coalition another solid two-thirds majority in the powerful House of Representatives.
Japan’s biggest opposition party, the Democratic Party of Japan, was unable to bounce back from its devastating defeat in 2012. Although it came away with a gain of 11 over its pre-election strength, it still finds itself with just 73 seats in the 480-seat lower house. In a development emblematic of the party’s struggles, top DPJ leader Kaieda Banri failed to win reelection to the Diet.
The results were even more disappointing for Japan’s “third force,” which commanded so much attention in 2012. The Japan Innovation Party, which had snapped up 54 seats in its first general election two years earlier (under the name of the Japan Restoration Party), came away with just 41 this time around. The other new parties fared considerably worse, capturing only a handful of seats among them. By contrast, the Japanese Communist Party more than doubled its lower house strength, surging from 8 seats to 21.
Simply put, the outcome was a vote for the status quo, a collective decision to stick with Prime Minister Abe and his policies for the next several years. The electorate reiterated its harsh 2012 verdict on the DPJ. At the same time, it gave a clear thumbs-down to the proliferation of upstart parties.
In the following, I analyze the principal factors behind these results and examine the challenges facing the Abe cabinet and the opposition in the light of this analysis.(*1)
Winning by Default
During the December campaign, Prime Minister Abe consistently focused on his economic policies as the central election issue, and the coalition’s strong performance has allowed him to claim a strong mandate for “Abenomics,” as those policies are collectively known. Yet in a public opinion poll conducted by the economic daily Nihon Keizai Shimbun (Nikkei) shortly before the election, only 33% of respondents said they endorsed the prime minister’s economic policies, while 51% said they did not.(*2) How, then, do we explain the coalition’s second straight lower-house landslide?
Two factors are largely responsible for the outcome. One is the difficulty of assessing the efficacy of Abe’s policies at this stage in their implementation. Even more important, however, was the state of the fragmented opposition, which was ill prepared for a general election. With the opposition incapable of mounting an effective or credible challenge to the LDP, the ruling coalition won more or less by default. Let us examine both factors more closely.
The Promise of Abenomics
The second Abe cabinet (Abe was previously prime minister from 2006 to 2007) has channeled its efforts into two major policy goals. One is revitalizing and rebuilding the economy through an ambitious package of measures known collectively as Abenomics. The other is beefing up Japan’s security posture, an effort currently focused on opening the way to Japan’s participation in collective self-defense, previously considered legally impossible under the nation’s war-renouncing Constitution.
Abenomics is a three-pronged policy consisting of bold monetary policies to conquer deflation, flexible and targeted mobilization of fiscal resources to stimulate the economy, and structural reform, which has been presented as “growth strategy” to the Japanese voters. Abe unleashed the first of these “arrows” in April 2013 when he appointed Kuroda Haruhiko governor of the Bank of Japan. Under Kuroda, the BOJ launched a policy of “quantitative easing” designed to increase the money supply, stimulate lending, and conquer deflation. During Abe’s first year, this expansionary theme was echoed in the government’s fiscal policy, as indicated by the size of the fiscal 2012 supplemental budget and the fiscal 2013 budget.
Some critics continue to complain of a lack of progress in implementing structural reform, but this criticism is not entirely fair. Although the monetary “arrow” of Abenomics has received disproportionate attention, the cabinet has been steadily formulating a series of policies to carry out structural reform. It has announced its intention to lower the effective corporate tax rate. It is moving ahead gradually with policies aimed at the eventual deregulation of the electricity market. Agricultural reforms are making headway. Measures designed to boost the number of foreign tourists visiting Japan—including the expansion of international flights in and out of Tokyo’s Haneda Airport—are already having an impact. The government has also taken concrete steps to reform corporate governance, as by strengthening requirements for the appointment of outside directors under the Companies Act.
As the foregoing suggests, the Abe cabinet has made good on its 2012 campaign promise to implement comprehensive policies for economic revitalization. Whether those policies have succeeded in turning the economy around is another question. If the economy were firmly on the road to recovery, there would have been no need for Abe to delay by 18 months the consumption tax increase (to 10%) originally scheduled for October 2015.
Unclear Impact on the Real Economy
Abe’s economic policies have certainly had a positive impact on the stock market. The benchmark Nikkei average soared from around 10,000 in December 2012, when Abe took office, to above 17,000 on the eve of the recent election. But how have these policies played out in the real economy?
The most obvious measure of economic health is growth in gross domestic product. The economy expanded slowly in the first three quarters of 2013, with year-on-year growth of 1.5% (1Q), 0.7% (2Q), and 0.4% (3Q). Since then, however, performance has been spotty. GDP fell 0.4% in the fourth quarter of 2013, then grew by 1.4% in the first quarter of 2014 before falling back into negative territory in the second quarter (–1.7%) and third quarter (–0.5%).
One of the initial goals of Abenomics was to pull the Japanese economy out of the deflationary trap in which it has been mired. How well has the government succeeded in this respect? Here again, the evidence is mixed. The Japanese government’s consumer price index for all items excluding fresh food (published by the Statistics Bureau of the Ministry of Internal Affairs and Communications) has risen each month since the beginning of 2013, suggesting a shift to moderate inflation. However, the recently launched University of Tokyo Daily Price Index, which many consider a more accurate reflection of consumer prices, indicates an overall decline over the same period.
Another question is whether economic conditions are improving from the perspective of people’s livelihoods and living standards. Here, too, the answer seems to be yes and no. Overall, the unemployment rate has declined since Abe took office, dropping from 4.2% in January 2013 to 3.5% in October 2013. But real wages have declined each month since July 2013.
In a nutshell, it is difficult to say at this point whether Abenomics has been a success or a failure.
Defense Policy in the Abstract
Let us turn now to security policy. The second Abe cabinet has announced its intention to overhaul the legal framework governing Japan’s defense policies, and it has taken concrete steps in that direction. The prime minister’s Advisory Panel on Reconstruction of the Legal Basis for Security (first convened in 2007 under the short-lived first Abe cabinet) issued its report in May 2014, and two months later the Abe cabinet adopted a resolution based on those recommendations. The decision embraced a new interpretation of the Constitution with regard to the right of collective self-defense, as well as a more flexible stance on Japanese operations that could be seen as integral to the use of force by another country.
The next step for the Abe cabinet is to set about amending the relevant security legislation, and this it hopes to accomplish during the next ordinary Diet session, scheduled to convene in January 2015. But for most voters, the changes Abe envisions are abstract and difficult to visualize. In the absence of some overseas security crisis involving our ally the United States—something comparable to the Gulf War or the Iraq War—it is still unclear to the Japanese voters how the government’s new interpretation of the Constitution translates into concrete changes in the way the Self-Defense Forces operate.
Catching the DPJ Off Balance
Generally speaking, popular support for the policies of the government in power is one of the biggest factors in the outcome of general elections. In this case, however, the election was held too soon for voters to deliver a verdict on the success of the Abe’s cabinet’s key policies. With the jury still out on government policy, the capabilities and preparedness of the opposition parties became a critical factor. And in the recent election, the opposition was woefully unprepared to challenge the ruling coalition.
Let’s begin with the DPJ. The DPJ’s image was badly tarnished by the party’s failure to meet the challenges of government during its brief period in power, and in the two years since the party went down to an ignominious electoral defeat, the stigma has barely faded. To make matters worse, the DPJ was organizationally unprepared for a general election, having chosen only 134 candidates for 480 slots as of November, when the media first caught wind of a snap election.(*3) In the end, it fielded 198 candidates, far fewer than the 241 needed to seize a majority in the lower house.
Japan’s official campaign periods are short. The key to winning a general election lies not so much in the campaigning that politicians do after the House of Representatives is dissolved but in the groundwork the party leadership and membership lay by wooing and organizing supporters year in and year out. Having failed even to designate candidates for a large segment of the lower house seats in the two years since the previous election, the DPJ was in no position to make significant inroads.
Failure to Draw the Battle Lines
In addition to these problems, the DPJ’s campaign seemed to focus exclusively on criticism of the Abe government’s policies. In its heyday, the DPJ ran election campaigns headlined by policies like “structural reform” that drew a clear distinction between the DPJ and the LDP. This time it offered nothing more than “a shift away from Abenomics” and a vague promise to revive the middle class.
In its election manifesto, of course, the DPJ provided more specifics, including an economic growth strategy, but the inconsistencies were glaring. On the Trans-Pacific Partnership, for example, the DPJ, which rose to power as a reform-oriented urban party, staked out a hidebound protectionist position, vowing “to hold fast and never yield in such matters of national interest as exempting Japan’s five priority agricultural items [from elimination of tariffs], ensuring food security, and maintaining universal health insurance.” As a resource-poor nation, Japan should be actively pursuing the TPP so as to expand trade and revitalize the economy. With such archaic rhetoric as “hold fast and never yield,” it is small wonder the DPJ was unable to build support.
Meanwhile, the once-ballyhooed “third force” in Japanese politics continued its seemingly endless dance of splitting, merging, and regrouping. Your Party dissolved on the eve of the election after fracturing near the end of 2013. The Japan Restoration Party, which made a major splash in 2012, split into the Japan Innovation Party and the Party for Future Generations in July 2014, and by December the electorate seemed disenchanted with both.
Faced with so few attractive options, the majority of voters either gravitated to the LDP by process of elimination or stayed home—as evidenced by the 52.7% voter turnout, a record low for Japanese general elections since the end of World War II. Apart from the ruling coalition, only the Japanese Communist Party profited substantially from the situation.
Fading Hopes for the “Third Force”
What are the basic implications of the December election for the government and for the opposition?
Insofar as the strength of the ruling coalition remains essentially unchanged, the Abe cabinet can take the election results as a mandate to continue pursuing its basic policies. Yet even though the coalition won by a landslide, popular support for the Abe cabinet is soft. According to a Nikkei poll, public approval and disapproval of the Abe cabinet both stood at 42% on the eve of the election.(*4) Whether support for the prime minister solidifies or crumbles in the months ahead will hinge above all on the success of his economic revitalization policies. Abe, who pledged soon after the election to place top priority on the economy, seems well aware of this.
As noted previously, the government has not been dilatory about implementing structural reform. But there is still plenty of room for progress on measures that promise an immediate impact on growth, including the expansion of international flights at Haneda Airport to boost the number of foreign tourists visiting Japan. The government must continue pushing actively to implement these and other measures outlined in the “growth strategy” which it announced in June 2013 and June 2014. At the same time, it must do a better job conveying to the public the progress it has made if it hopes to secure its understanding and support for the cabinet’s economic policies over the long term.
With regard to the opposition, the DPJ, for all its missteps and handicaps, did manage to improve on its previous performance, winning 16 more seats than in 2012. By contrast, the Japan Innovation Party won 13 fewer seats than its predecessor the JRP secured in the last election.
One consequence of the December 2014 general election is that the trend toward fragmentation of the opposition appears finally to have passed its peak. Unlike in 2012, when the anti-LDP vote was split by a plethora of new parties, this time around anti-LDP voters gravitated toward the DPJ as the only opposition force capable of standing up to the ruling coalition. Hopes for the emergence of a viable “third force” appear to have receded.
Nonetheless, the DPJ has much to do if it hopes to mount effective resistance to the Abe cabinet. Here we will limit ourselves to a brief overview of these tasks, saving an in-depth discussion of the DPJ’s challenges for another occasion.
The biggest requirement for the DPJ is to formulate a package of economic policies that offers a compelling alternative to the Abe cabinet’s strategy. The DPJ must also confront ongoing problems surrounding its internal decision-making process, an issue that plagued the party’s leaders during the DPJ’s three years as the government party. The most urgent challenge in this respect is to clearly identify the party’s top policy-making organ. The party election scheduled for January 2015 will offer the DPJ an important opportunity to tackle these internal issues.
(Originally written in Japanese and published on December 18, 2014. Banner photo: Voters in the Shinjuku district of Tokyo arrive at the polls for the 47th House of Representatives election on December 14, 2014. © Jiji.)
(*1) ^ A development worth mentioning in passing is the defeat of the LDP’s candidates in all four of Okinawa’s single-seat districts. Okinawa voters’ wholesale rejection of the LDP reflects strong local opposition to the relocation of Marine Corps Air Station Futenma to Henoko, also in Okinawa, which could have serious implications for Japanese security policy going forward.
(*2) ^ Nikkei, November 24, 2014.
(*3) ^ Nikkei, November 12, 2014.
(*4) ^ Nikkei, December 12, 2014.