For Stability, Japan Needs Political Reform

NEW HAVEN: The Liberal Democratic Party’s landslide victory in Japan’s House of Councillors elections on July 21 was good news for the Japanese economy – the third largest in the world. Prime Minister Abe Shinzo’s Keynesian spending policies are exactly what’s needed to pull the country out of the prolonged economic malaise that has lasted, shockingly, for more than two decades since Japan’s asset bubble burst in1991. With solid majorities in both houses of parliament, Abe is in a strong position to get on with the task of economic rebuilding that could also benefit the world. But given the fundamental weakness of Japan’s fractured political system, the moment could turn out to be ephemeral.

A landslide win seems like a healthy development. After all, “tossing the bums out” is the essence of democratic politics – denied to Japan for decades before the 1994 electoral reforms broke the back of the LDP's hegemony. Prior to 1994, the LDP manipulated the old multi-member district system to lock in voter loyalty with protectionist policies and personal favors. Now the 480-member House of Representatives has 300 single member districts in which the party with the most appealing platform wins the most votes. 

In a historic pair of LDP-repudiating elections for the Upper House in 2007 and the Lower House in 2009, Japanese voters turned over the reins to center-left Democratic Party of Japan (DPJ), ending the LDP’s virtually unbroken control of postwar Japan. Now Abe is back, full of vim and vigor, with the wind at his back. Voters may have changed their minds once again to favor the LDP, but that does not mean Japan is destined to be a one-party state.

Many of Japan’s central bureaucrats are happy to have old masters back in the saddle. The LDP has for years had an enormous organizational advantage, and local politicians, who supply the pipeline for national candidates, will once again flock to the LDP on account of its control of the national legislature.

Still, Japanese voters have not swung as far to the right as it might seem. The electoral margin in this election was surprisingly thin – LDP won only 35 percent of the vote in the proportional representation portion of the ballot – on a turnout of 53 percent of eligible voters. In the Lower House elections of December 2012, the LDP clawed back a legislative majority with 43 percent of the single member district votes, 28 percent of the proportional representation votes, and an alliance with a smaller party, the Komeito. Upon resuming the prime minister post, Abe lost no time turning on the fiscal spigots, so-called Abenomics, which has improved the domestic mood and gained him star-status in world opinion. The DPJ had instead wrung its collective hands about the national debt which is twice the size of Japan’s GDP, a ratio of debt-to-GDP that is roughly double the American and higher than Greece’s. Lacking the necessary legislative majority in both chambers, the DPJ had tried but failed to work out long-term tax plans to cover the rising costs of services consumed by Japan’s aging population.

Unless voters are vigilant, however, what is good for Japan’s economy in the short run may be harmful in the long run. LDP’s solid majority puts Abe one step closer towards his goal of abolishing Article IX of the “peace constitution” that renounces the right to wage war. Against the backdrop of heightening tension with China over the Senkaku/Diaoyu islands, Abe has renewed the call for a revision of the constitution. For Japan’s neighbors who were victims of aggression in World War II, this would be unwelcome. Although the current constitution has not stopped Japan from building the fifth largest military in the world, Abe’s tough stand on China stokes fears among Japanese voters that they are a nation in decline. The rhetoric could atrophy into the worst kind of jingoism.

But global concern about resurgent nationalism or one-party rule in Japan misses a deeper concern. Japan still lacks clear electoral accountability. Although Japan’s electoral reforms of 1994 improved accountability by creating more incentives to form large, encompassing parties that could campaign on policy rather than on retail favors and popularity, the reforms did not go far enough. Of the 480-member House of Representatives, 180 are chosen from proportional representation lists which create many small parties purveying an array of confusing messages to voters. The House of Councillors is even worse, with a combination of proportional representation lists and the corruption-inducing multi-member district system that the Lower House eliminated in 1994.

Voters may like the intensity and focus of small parties – there are more than 10 in the Upper House alone – but they cannot be held accountable for national policies because they cannot themselves form a majority and may swing one way or another to become part of a governing coalition. Small parties have the luxury of picking a favorite issue, such as low taxes, while ignoring the costs of a shortfall in the government budget with which to provide services that voters also expect to enjoy. As long as proportional representation offers the possibility of winning seats in parliament with the support of relatively few voters, politicians have far less reason to join one of the two big parties that can provide competing visions of what is best for the whole nation.

In the election, Japan’s voters said “yes” to promises of economic growth and “no” to the DPJ’s failure to achieve it. The problem is that the promises are hollow and Japan lacks the political system that enables political parties to take responsible decisions. Abe’s popularity will remain high until the time comes to pay for deficit spending or until urban voters balk at subsidies for farmers or until farmers try to block free trade agreements that reduce the grocery bill for the average citizen. Any number of policy decisions will bring his demise, and Japanese voters will see with dismay that once again the Japanese parliament is too fragmented to make tough decisions.

Meanwhile, Japanese politicians will reach for cheap votes, promising something for nothing and stoking jingoistic fears of foreign policy encirclement.

The time has come for Japan to eliminate proportional representation from its ballots. A two-party system will foster political competition at the level of big ideas and wholesale policies rather than narrow, single-issue politics that trap legislatures in an endless blame game. It was once said, in the heady days of Japan’s “economic miracle,” that Japan had a first-rate economy and a third-rate political system. What has become clear over the decades is that a strong economy is not possible without fixing the politics. A responsible party system in Japan will not only make for a better Japan but also for happier neighbors and a safer world.