As Blaine Harden wrote in theWashington Post Thursday, Japanese citizens are not particularly enthusiastic about the government’s announced tax cuts, an attitude that might change when they start receiving payments, but then again, it might not. The Japanese public has been through this before, and rather than wait for the government to do the right thing, it seems that citizens are preparing to take care of themselves, whether by stuffing yen under the mattress, deferring big purchases, or doing a bit more shopping at the hundred yen shop. Little surprise that there is little taste for structural reform or any other kind of shock therapy.
Mainichi has released the results of its latest annual survey of livelihoods. Mainichi surveyed 3371 respondents in the Kanto and Kansai areas, and found that the level of insecurity among those surveyed is the highest since 1998. More importantly, support for the institutions of “Japanese-style” capitalism has grown: respondents who favored the protection of the seniority system of compensation rose six points to 22.3%, and belief in the value of meritocracy fell nearly nine points to 41.4%. Citizens seem less interested in Nakagawa Hidenao’s argument that Japan will be able to grow itself out of its problems than in being sure that they will have enough in their old age. They are not interested in promised handouts or, for that matter, talk of consumption tax increases to come. It seems that what they want is quite simple: some modicum of economic security and some acknowledgment on the part of the government that things have gone horribly astray, that the quality of life is withering. They will not be comforted by Mr. Aso’s pep talks concerning the “latent power” of Japan or the DPJ’s promises to put lifestyle first.
Mr. Aso may yet pull off an electoral victory next year — it is increasingly certain that the next general election will not be held before April 2009 — but a general election will not substantially alter the situation (even with a DPJ victory, although a DPJ victory would at least ensure that the same party controls both houses of the Diet for the next several years).
In case there was any lingering doubt, the Koizumi era is over.
Little wonder that Japanese are opening for an Obama of their own: the political system is broken and the economy is faltering. Neither the LDP’s nor the DPJ’s performance in the face of crisis has been particularly impressive. The DPJ’s greatest strength remains that it’s not the LDP, and even that assertion is increasingly questionable. Japan looks increasingly set to decline steadily, unable to take decisive steps to restore national dynamism. This is the bakumatsu, but with few signs of a restoration to come, despite Ozawa Ichiro’s determination to be the vehicle of that restoration.
Perhaps Japan should hold a lottery to pick a new ruling elite, choosing from among the eminently sensible housewives of Tokyo. I don’t see how they could be worse than the status quo.
Tobias,
Thanks for you post on the possible political effects of the current global recession for Japan. I agree with your assessment that the Japanese political elite has failed to come up with effective policy to end the long stagnation of the Japanese economy. Particularly, the last three Prime Ministers have been unable to address the problems facing Japan in the last few years. Hopefully the global recession will break the LDP’s hold on power and reinvigorate the political system. Although there does not appear to be a viable alternative to the LDP in the DJP, couldn’t a major election loss split the LDP? I think the most effective way to change the political system would be such a split in the LDP, separating the more conservative faction from the reformist factions. This would introduce a real competition of ideas into the Japanese political system. In order to reach a competitive system, the DJP may have to win several elections to induce change in the LDP’s staid party structure. The past 8 years with Koizumi’s reforms, a succession of three different Prime Ministers, and the current economic crisis all point to a likely crisis of legitimacy for the LDP. Do you see that as a likely outcome or do you think that Japanese politics will muddle along as usual?
While I found your article extremely engaging, I have one point of minor contention. You state that Taro Aso “leaves behind a country tottering on the brink of ruin.” Don’t you think that is a bit of an exaggeration? It is precisely because Japanese people have suffered relatively little from the last 20 years of varying degrees of political ineptness that the system continues the muddle along. In fact compared to the EURO zone and the U.S., Japan’s recession seems that it will be relatively minor. In fact, given Japan’s relatively healthy banking system it seems to possess a unique advantage in an international financial meltdown. As a recent article on Bloomberg.com stated, “Japan’s got a fairly straightforward problem: it’s experiencing an export-driven recession…it’s nasty, but not particularly complicated. The rest of the world has a financial system disaster on its hands.”What is your opinion on this line of thought? Thanks again, and I look forward to reading your future posts.
Cole