The Japanese general election
Martin Fackler on a possible change of power in Japan when voters go to the polls in a few hours, if the Liberal Democratic Party is ousted after 54 years of nearly uninterrupted rule:
The possibility of such a transition, after more than a half-century of nearly unbroken rule by the Liberal Democrats, has gripped the nation’s attention. A poll released Monday by the national broadcaster NHK showed that 90 percent of voters intended to cast their ballot, far above the 68 percent turnout in the last lower house election four years ago. […]
The Democrats have been trying to seize the moment by tapping Japan’s simmering discontent. The party has tried to position itself as the choice for voters fed up with rising social inequalities, stagnating wages and other changes for which many blame economic globalization. It recently issued a manifesto pledging new spending of $177 billion a year. While economists have characterized the Democrats as slightly left of center, and the incumbents as slightly to the right, both parties are promising new social spending to win key blocs like farmers, who were alienated by the small-government reforms of former Prime Minister Junichiro Koizumi.
According to Fackler, neither major party has much to say regarding Japan’s deepening economic and demographic problems:
“This could be financial Armageddon,” said Naoki Iizuka, a senior economist at Mizuho Securities in Tokyo. “Foreign investors could see Japanese government bonds as worthless paper.”
Mr. Iizuka says Japan has at most five more years to get its fiscal house in order before facing the prospect of serious capital flight.
Japan must do this while confronting one of the world’s worst demographic problems. The low birthrate means that there will be fewer working-age taxpayers to support a growing numbers of retirees. In 2005, there were 3 working people per pensioner; that ratio will drop to 1.8 per pensioner by 2040, according to the Health Ministry.
Fackler’s account paints a DPJ victory as a possible means of breaking the grip of Japan’s entrenched interest groups, especially the elite bureaucratic level of the country’s civil service.