Sinzo Abe and the LDP win the election

17 Dec

I think that to a certain extent the results of the election here in Japan has more to do with the fickle nature of the Japanese public than any mandate for change. Its been a well documented carousel of prime ministers over the last half decade all of whom go into office seeking a coalition to establish their version of the national vision. Yet within a year of taking office the people sour on whatever slogan or policy had been used to garner their votes and simply vote to oust the former guy in favor of someone with a slightly different spin on things.

There is in fact a cultural obsession with something new. It is so pronounced that often the superior, older more established things are rebuilt so as to appear shiny and new.

The main difference as I see it is that Mr Noda was not only due for the yearly cycle bump out of office but that he was removed in favor of a repackaged candidate who summarily quit office the last time he held the position and perhaps more importantly for telling the truth about the national financial health. Mr Noda sent his message across the nation that a hike of the consumption tax was the best solution for the Japanese Governments spending programs. In order to keep the tap flowing everyone must now pay 10% consumption tax over the previous 5% rate.

Mr Abe on the other hand moved into power by promising a return to the free spending ways of the traditional LDP party. Many of these ancient lawmakers are in fact responsible for the broken financial situation that forced Mr Noda’s hand at the tax increase. Yet Abe-san went out and courted rural districts with pork barrel projects thus ensuring another few quarters of road expenditures. The way politics are apportioned in Japan is somewhat medieval with the rural folks having significantly more pull than the teeming masses of Japan’s urban mega cities. But this is a well known fact.

Japan’s pace of change is in many aspects glacial, but this election is a return to the past and thus a rejection of change in favor of the way things used to be done.

I make no secret that I preferred Mr Noda’s brand of politics because at least he was telling the truth. You could count on the former PM to tell it like it is or at least how he saw it. Mr Noda is truly a self made man, coming up through the system by hard work. Mr Abe on the other hand has again been given the mantle of leadership for being from the right family and having the right connections.

What can we expect ?

More of the old style pork barrel road projects, a return to the governments pro nuclear stance, more spending on unnecessary infrastructure and frankly the return of open graft and corruption with the old traditional and loyal LDP members being rewarded large contracts.

Not to sound overly critical but I think the nuclear position of Japan is in the process of changing. The public perception is that for the most part it is unsafe, yet the industry has greased many wheels and provides both jobs and ‘affordable’ power. Many younger urban people which is by and large one of the largest segments of the population are staunchly anti nuclear due to the criminal neglect, denials, obfuscation and outright lies from TEPCO (Tokyo Electric Power Company). They believe that it is not safe and the folly of neglect that is the Fukushima fiasco underlines their position. Every Friday thousands gather in front of the government building and openly chant “No Nukes!”. This is very un-japanese behavior and has become acceptable both morally and socially.

Essentially Abe represents a return to the past rather than a step forward. The young people I talk with almost universally dislike Mr Abe and they are quite unhappy about his re-election. Further I believe that he is distinctly unpopular among women, people under 40 and urban living older people. However here in Japan the boomers and 65+ silver group hold most of the power. The boomers need the jobs and the silvers don’t want the taxes so it was a perfect storm that resulted in Abe winning.

Perhaps the LDP will attempt to steamroll a national policy of turning the nuclear reactors back on again over local protest groups. We will see how effective they will be in their attempts to move a popular public position to the fringes. Despite what I think will be public outrage it is probably best for Japan to turn the nukes back on and return to the days of steady electric power not reliant upon gas and oil sources. However I feel that the harder the LDP pushes on nuclear policy the less likely urban, educated and younger people are going to like what they are hearing.

I also expect Mr Abe to seek a new working understanding with the Chinese government. There is too much business between the two countries for him not to at least attempt a rapprochement. As to his success in this endeavor all bets are off as the Chinese hold most of the cards in this game. Perhaps they want to smooth things over and are ready to make nice only time will tell.

Regardless of how things transpire, by this time next year if not sooner Mr Abe will be out of the job.

From watching him on TV I think he looks ill and his face discolored and unhealthy so I would put his stay in office at perhaps 6~9 months. He has cobbled together the conservatives and other rural groups in a coalition of government spending programs. His claims of creating inflation and reducing the exchange value of the yen are little more than slogans. When he was previously in charge he did little to nothing using the same tired policies that his party has been using for the past 2 decades without success.

My conclusion is that he will be a rather unremarkable leader who will exacerbate the current account, trade and budget troubles. The special interests hold the strings here so Abe will tow the party line and look to hold on as long as his health lasts. If things go well enough he can hope to call for another election by Summer 2013 or Winter at latest and hand the reins to the next in line.


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