What Will the Shift in Power Mean for Japan?

“Extra! Extra! Government shift in power!” People swarmed around the train station, practically fighting for copies of the newspaper extra edition. The August 30 House of Representatives election marked the first shift of power in Japan in 16 years as the reins of government passed to the Minshuto (Democratic Party of Japan). It was another moment in which a people seeking “Change” chose to support a complete remodeling of their government.

During the forty-odd years that led up the last power shift, in 1993, Japan was able to achieve high economic growth based on so-called alignments of mutual economic interest, but with the economic downturn that followed the bursting of the bubble, people became frustrated with government corruption and ended up bringing a reform-based alliance of opposition parties to power. But that coalition government made up of eight different parties succumbed to internal dissension within a year. The LDP revived itself instantly with the next election, and continued on the path of “protect vested interests, reject change.”

When Koizumi came to power in 2001, he managed to force the conservative factions in the LDP into submission and hammer through reform measures. But no sooner did Koizumi step down in 2006 than the conservative factions that had been lying dormant resuscitate themselves and government for the vested interests began to raise its head again. However, the internal LDP power structure that had been dismantled by Koizumi never returned to its original position. LDP members were like sheep without a shepherd, and their position of political power just melted away. Instead Minshuto made its carefully thought-out bailout policies the key issue of the election. The LPD went down without a fight.

So what will this shift in power mean for Japan? Instead of making the overall economic pie bigger, Minshuto policy would redistribute larger slices of the pie to the vested interests of the organizations that are its main constituency, namely agricultural coops, medical associations, and labor unions, as well as to the economically disadvantaged population. These policies are ironically close to what the LDP did from 1955 through 1993. In that sense, although the media called Minshuto the “Revolution Party,” the reality is actually the opposite.

Aren’t the Japanese people a little too carried away right now with the idea of redistributing wealth? Even though the overall amount of wealth has declined? Is this the way to survive and thrive in a world where state capitalism is at the forefront? At least I would hope we are not choosing a path that will make all our people poorer, instead of joining in the global competition.


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