JIN-483 -- Aso takes the lead role in the greatest (comedy) show on Earth

J@pan Inc Newsletter
The 'JIN' J@pan Inc Newsletter
A weekly opinion piece on social, economic and political trends
in Japan.
Issue No. 483 Wednesday September 24, 2008, Tokyo

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So, much to the surprise of no-one, Taro Aso has become the nation's
latest prime minister and has elected a fittingly conservative cabinet.
Aso will face several challenges, not the least of which will be getting
the economy to pull a U-turn. As the country headed into recession, former
Prime Minister Yasuo Fukuda called for more stimulus packages – it
didn't seem to worry Fukuda that stimulus packages had left Japan with the
highest public debt among developed nations – it's now at about 150
percent of GDP. Neither was he really worried that the last stimulus
package was far too small to really do anything (or about the fact that
most people saw it as pork-barrel politics at its most obvious).

But that's all history now.

Before Aso tackles the economy, he will have to win a mandate
from the public – analysts expect him to call a general election as
soon as late October. In a move that is par for the course for the
comedy show that is Japanese politics, the LDP will hold an election
as soon as possible so that the newly elected PM doesn't have a chance
to become more unpopular than opposition leader Ichiro Ozawa. To lose
power would be a feat for Aso – the LDP has only been out of power for
10 months since 1955 – but, considering the dismal performance of the
ruling party, and Minshuto's successful win in the last upper house
elections, anything could be on the cards.

Aso has already begun a likeability offensive with geeks in Akihabara
sporting Taro masks, while attempting to sell assorted Taro
merchandise. The PM, a self-proclaimed manga fan, has already promised
to bring a bit of life into the nation's political scene. Koizumi may
have had a few Elvis songs up his sleeve but a Humphrey Bogart
impersonation? Has he ever danced at a summit wearing a samurai
costume? Well possibly, but Aso definitely has and no doubt there's
plenty more in store for the public.

So apart from beating the extremely unlikable Ozawa in a battle for
popularity, what else will the PM have to do to keep his political
head? For starters, he'll need a scandal-free cabinet. Easier said
than done. He seems to have learnt from the mistakes of Abe and
Fukuda, selecting a team of old hats who have hopefully had enough mud
thrown at them over the years to have little that can still stick to

Okay, so what else? Back to the economy for a second. Aso wants to
crank start the economy with some stimulation. He has been talking
about temporary flat income tax cuts, among a bunch of other tax cuts.
Also government spending and deregulation. Economists have said that
Japan will have to raise its 5 percent consumption tax in order to
cover welfare costs as they increase. This will be hard to get past
the public, though.

The pension mess still needs to be sorted out. It remains a thorn in
the side of the LDP and will not go away in a hurry. The ruling party
has no-one else to blame over the affair and its poor handling. All it
can do is clean it up as well as possible – and that won't be finished
by the next general election.

Foreign affairs is another area that pundits, at least at an
international level, are watching. Fukuda did manage to improve ties
with Japan's biggest trading partner, China. Although Aso has, at
times, been an outspoken nationalist, many believe that he will act

Also Japan's support of the US-led military operations in Afghanistan
will be important for relations with the United States. But regardless
of whether the LDP wins the next election, with the opposition holding
power in the Upper House it will continue to be difficult for
legislation to be passed so that the nation can supply fuel to
American ships in the Indian Ocean.

With all the chaos on Wall Street, and the resulting carnage in
Japan's markets, it was easy to lose track of the LDP election. The
public knew what the outcome would be anyway. But now the real show
will hit the road and the nation won't have to wait too long to see
the final act.

Ozawa was quoted in Time magazine as saying that the upcoming
elections will be Japan's "last chance" to change. I'm sure what he
really means is that: "If Minshuto can't win this election, we won't
have a hope in all eternity of ever, ever being elected into

"Japan's last chance to change" is probably snappier.

Michael Condon

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Written by: Michael Condon, Editor-in-Chief, Japan Inc Magazine
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