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Mainstream, Vol XLVII, No 42, October 3, 2009

Maturity of Democracy in Japan or Acid Test for Hatoyama?

Monday 5 October 2009, by Rajaram Panda

In what was a political earthquake, Japan’s Opposition party, the Democratic Party of Japan (DPJ), registered a stunning victory in the general elections held on August 30, 2009. The DPJ victory raised a significant shift in policy after more than half-a-century of almost unbroken conservative rule. In fact, much before the final counting of votes was over, it was being projected that the DPJ, a broadly progressive party whose ranks include Socialists as well as former Liberal Democratic Party (LDP) rebels, would secure more than 300 seats in a 480-seat House, almost triple the number it had in the outgoing House. As it finally transpired, the DPJ garnered 308 seats in the finally tally. With this, the Prime Minister and DPJ leader, Hatoyama Yukio, leads Japan’s first non-LDP administration since 1993, and only for the second time since 1955.1

Despite the epoch-making victory, there was a total lack of triumphalism, total absence of street celebration. Japanese people had voted for, in the words of Professor Jeff Kingston at Temple University, “change they did not believe and a leader they are not all that crazy about”.2 That the Japanese electorate chose Hatoyama was a calculated gamble. The exuberance of the bubbly 1980s seems to be the era of the old. Japanese people started introspecting and started re-looking at the role they accorded the state.

What were the factors contributing to the success of the DPJ and failure of the LDP? The people were angry and frustrated with the failure of the ruling coalition of the LDP and New Komeito to resuscitate the ailing economy and address the domestic issues of social security, health care, unemployment etc., and were looking for a change. This was reflected in their mandate for the DPJ.

The DPJ has made many lofty promises in its manifesto. The immediate issue of the new government would be to eliminate wasteful expenditure on public works, challenge elite bureaucrats’ policy stranglehold and invest heavily in social security in one of the world’s most elderly societies. In its manifesto, the DPJ proposed free high school education and 26,000 yen a month child allowance. The DPJ has offered direct support to farmers, poverty alleviation for struggling families, and better working protection. However, skeptics question Hatoyama’s failure to explain the source from which his party will raise money to cover this cost. They also question his ability to wrest power from the mandarins who have dictated Japan’s post-war economic policy.3 The public is skeptical about spending pledges from such a heavily indebted state. Whether Japan can afford more labour market regulation if it is to compete internationally needs debating. The LDP failed to reform the bureaucracy and it would be fascinating to watch the DPJ undertaking this project of institutional reform.

It seems that the election result has already heralded a fundamental shift in Japan’s conservative-dominated political culture. According to Gerald Curtis, an expert on Japan at Columbia University, the election resulted in “the end of the postwar political system in Japan”.4 He further observes: “It is the only time any party other than the LDP has won a majority in the Lower House of the Diet. It marks the end of one long era, and the beginning of another one about which there is a lot of uncertainty”.5 Japan is already saddled with a huge public debt and struggling to emerge from the deepest recession since the war.

There are critics who see Hatoyama’s economic policy as promises too many without substance. His 16.8 trillion yen investment programme is being interpreted as a “quasi-socialist approach” that would harm Japan’s public finances and blunt its competitiveness. Others see the DPJ’s economic policy as a fantasy Robin Hood scheme, aimed at appealing to as many as voters as possible. Nevertheless, the Hatoyama Government’s first priority would be to steer Japan towards sustained economic recovery.

The Japanese elite misread the aspirations of the people. The society had become fragmented and a hiatus had developed between the rich and the poor. The percentage of Japanese who regarded themselves as middle class had shrunk from 75 per cent before the bubble burst to about 40 per cent. A 2007 NHK poll found that 90 per cent of the Japanese believed inequalities were widening. Earlier, a limited number of foreign workers in Japan, either legally or illegally working as construction workers and engaged in the three Ds—dirty, dangerous and dungeon—types of job, were seen as the “working poor” by the Japanese. This lexicon had now entered into and amongst the Japanese who begun to see themselves in that category.

Nearly a third of the workers are now part-time or on short-term contracts. The life-time employment system that gave security to the Japanese workers is already eroded. There was large-scale retrenchment, salary was being slashed and the workers’ vulnerability increased. These contributed to breed frustration which was reflected in the mandate during the elections.

The people’s frustration heightened when in 2007 the LDP expressed scant remorse for the loss of 50 million pension records.6 This was an administrative oversight that shook the people’s confidence in the ability of the state to spell out what transpired in one of the biggest frauds in Japan’s history. The Japanese people were outraged when an LDP member suggested that homeless people taking up temporary residence in the fashionable Tokyo park were lazy. The Japanese people did not forget when a few years ago a Cabinet Minister called women as “baby-making machines”, a remark that helped the hapless women into the voting machines, this time favouring the DPJ.

Foreign Policy Issue and disquiet in Washington

If DPJ’s manifesto is to be believed in letter and spirit, and if Hatoyama pursues the election pledge to end Japan’s “subservience” to American foreign policy, including plans to halt a refuelling mission in support of US-led forces in Afghanistan, there is bound to be friction with Washington. In the manifesto, the DPJ promised to seek a more “equal partnership” with Washington and build closer ties with China and other Asian countries.

In a New York Times opinion article, Hatoyama articulated the new path that Japan would take under the DPJ rule.7 Taking a different position than the LDP, Hatoyama observed: “In Japan, opinion was divided on how far the trend toward globalisation should go. Some advocated the active embrace of globalism and leaving everything up to the dictates of the market. Others favoured a more reticent approach, believing that efforts should be made to expand the social safety net and protect our traditional economic activities. Since the administration of Prime Minister Junichiro Koizumi (2001-2006), the Liberal Democratic Party has stressed the former, while we in the Democratic Party of Japan have tended toward the latter position.”8 He saw in globalism a negative trend, which, according to his view, has damaged traditional economic activities and destroyed local communities. In short, Hatoyama called Japan’s ailing economy a victim of the US-led globalisation.

Hatoyama concedes that the US would “remain the world’s leading military and economic power for the next two or three decades” and therefore rules out a radical shift in bilateral ties. Therefore, he says “the Japan-US security pact will continue to be the cornerstone of Japanese diplomatic policy”.9 Nevertheless Hatoyama maintains that the failure of the Iraq war and the global financial crisis proved that “the era of US-led globalism is coming to an end and that we are moving towards an era of multipolarity”. This does not mean to suggest that the US’ global military and economic power will diminish in the short term as there is no another country capable of replacing the US as the dominant one, nor is there another currency that could replace the US dollar.

At the same time, Hatoyama sees China emerging as one of the world’s leading economic nations, while also continuing to expand its military power. Hatoyama also projected China’s economy to surpass that of Japan in the not-too-distant future. How does Japan position itself in this scenario in which the US is fighting to retain its position as the world’s dominant power and China seeking to become dominant in the realm of maintaining stability in the region? Restraining American political and economic excesses is one thing; wanting to reduce possible military threat from China while ensuring China’s expanding economy to develop in an orderly fashion is another. These are the two challenges for the Hatoyama Government. Fostering regional economic integration by engaging many economic actors and working towards the evolution of an East Asian Community seems to be the Hatoyama Government’s priority focus. The framework would be to build new structures for international cooperation, which will check excessive nationalism, while ensuring rule-based economic cooperation and security.

Hatoyama does acknowledge that the path towards achieving regional economic integration would be tumultuous and cannot be expected to be achieved in the short term. This is because countries in the region differ in size, development stage and political system. However, the success first by Japan, spilling over to other Asian and South- East Asian countries in the flying geese pattern of economic development and further encouraged by the joining of China in the growth pattern offer hope for the eventual evolution of an Asian Economic Community and a common regional currency. While the emergence of a single common Asian currency is unlikely to be achieved in at least a decades’ time, this will delay political integration even further. Underpinning currency integration would be the need for sculpting a permanent security framework.

If this is to be achieved, what would be the structure for the formation of a regional economic bloc? The good news is that the economies of the countries in the region are in sound footing. The economies are already interdependent within the region. ASEAN, Japan, China (including Hong Kong), South Korea and Taiwan already account for one quarter of the world’s gross domestic product. The next logical approach, one could expect, would be greater economic integration within an institutional framework and greater political integration.

Unfortunately, this is not the case. Besides cultural and historical conflicts that bedevil relations among countries in the region, there also exist clashing security interests that threaten to impede the development of cohesive and cooperative relationships among countries in the region. Increased militarisation by some of the Asian countries eats away precious resources that could have been used in the social sector. Then, there are territorial disputes between Japan and South Korea or Japan and China and territorial claims in South China Sea, particularly in the Spratly Islands, for control over resources, and these may derail any approach towards achieving greater economic and political integration. As there are no options to some of the issues being dealt with only bilaterally, there are always risks that things would get inflamed when emotion and nationalism intervene.

It transpires, therefore, that the road towards achieving greater economic and political integration is bumpy. Happily, Hatoyama is an optimist. According to him, Asia should draw some lesson from the experience of the European Union, how regional integration can defuse territorial disputes and apply some of the yardsticks to Asia. He quotes Count Coudenhove-Kalergi, founder of the first popular movement for a united Europe, who wrote Pan-Europa 85 years ago, in which he says: “All great historical ideas started as a utopian dream and ended with reality. Whether a particular idea remains as a utopian dream or becomes a reality depends on a number of people who believe in the ideal and their ability to act upon it.”10

However, despite tough posturing, after winning the elections with a massive mandate to rule, Hatoyama tended to mend fences with his country’s biggest ally and assured President Obama over a telephone call that the American alliance was the basis of the Japanese foreign policy. He was trying to quell worries that his slightly Left-of-the-Centre government would pull Japan away from the United States.

His New York Times article resulted in considerable disquiet in Washington. The US criticism of Hatoyama’s essay also hogged the frontline of leading Japanese newspapers. This clearly reflected the widely prevailed sentiment in Japan that Japan must stay close to the US, especially with a fast-rising China and nuclear-armed North Korea nearby. Though the DPJ wants to bring about minor changes to agreements covering the 50,000-strong American military presence in Okinawa, Hatoyama clarified that the DPJ has no intention to fundamentally alter the alliance. He also clarified that his essay was misunderstood and that it was not intended to be anti-US.11

Seen differently, it was premature for the US to react so negatively to an article by Hatoyama expressing his views on Japan’s possible foreign policy, even before he assumed office or even before he knew he was winning. Even though the DPJ said that it would re-examine the agreement to relocate the marine Corps airfield at Futenma to another site on the Japanese island of Okinawa, the DPJ has never said that it is not negotiable. If the DPJ says that the agreement is not negotiable after assuming office, that would make the DPJ more obstinate and things can drift for the worse.

Is Hatoyama envisioning a leadership role for Japan, what many might read as a Japanese plea for a new Co-Prosperity Sphere, which Hatoyama himself probably knows that Japan cannot achieve? Japan continues to suffer from the baggage of history and much whatsoever it does in terms of economic assistance, the stigma continues to remain. The Yasukuni Shrine continues to remain a symbol of Japanese aggression and successive visits to the shrine by Japanese Prime Ministers continue to remain an irritant in Japan’s relations with China and Korea.

Much of Junichiro Koizumi’s successes in his Asia policy were dissipated by his successive visits to the Yasukuni Shrine. The anti-Japanese demonstrations in Beijing in April 2005 are a case in point. For China and South Korea, the Yasukuni Shrine is more than a host to the remains of some of Japan’s worst war criminals—along with many other Japanese soldiers who died with honours. It is also seen as a museum and school for indoctrinating schoolchildren with a ‘we-will-win-next-time’ distortion of history. Successive visits by Hatoyama’s predecessors to the Shrine regularly offended billions of people and this has made Japan a moral pariah to many Asians. It is also unclear how Hatoyama’s advocacy of multilateralism and an Asian currency will win him friends.12

Role of the Communist Party (JCP)

Of all the political parties, the JCP is the only smaller party that retained the same number it had in the outgoing house—nine. For quite some time, the JCP has positioned itself as a safety valve for the political establishment by ventilating popular discontent earlier with the LDP and now the DPJ behind a system that is entrenched in a capitalistic set-up and no way challenges it. Though the party calls itself communist, its operational outreach is hardly advocating socialism.

Like the DPJ, the JCP calls for greater independence from the US. It wants the security treaty with the US be abrogated. It also wants the closure of American military bases on Japanese soil. The JCP would opt for a more aggressive foreign policy to assert Japan’s own economic and strategic interests.

There is a growing interest among Japanese people, especially among young people, in socialism. In the election just ended, JCP leader Kazuo Shii was one of six parties invited to participate in TV debates. A manga (comic) version of Marx’s masterpiece Das Capital became a best seller recently. Its party membership grew by 1000 per month since September 2007 and reached 415,000 by August 2009. Many of the new members are young people in their twenties and thirties. The party retained its nine seats it had earlier. Though Shii had expressed his willingness to work with the government if given an invitation, that possibility does not exist any more as the DPJ has accepted the support of the Social Democratic Party (SDP) and People’s New party (PNP) with seven and three seats respectively. However, the JCP has offered to function as a “constructive Opposition”.13

Even though the JCP has an old history (founded in 1922), it hardly had any decisive influence in Japan. After the American Occupation ended, the JCP played second fiddle to the reformist Japanese Socialist Party (JSP) until 1994 when the JSP joined the grand coalition with the LDP. In the Hatoyama Government, the JCP is expected to extend constructive cooperation on issues with which it has commonality with the DPJ.

Unemployment Issue

The critical record of the unemployment situation and deflation threaten Japan’s economic recovery and may be a reason for the DPJ’s short honeymoon, unless the DJP Government rises to the occasion to restore the confidence of the people.14 Statistics released on August 28, 2009 revealed that unemployment hit 5.7 per cent in July, the highest level since records began in 1960. The total number of jobless has jumped by 40.2 per cent from a year earlier.15

Sometimes Japanese statistics are fudged and the actual figure is much more than that revealed. Many full-time employees are kept on the company books as excess workers. According to Takahide Kiuche of Nomoura Securities, if all surplus labour were taken into account, unemployment would have been 12.2 per cent in June. A recent survey found that the number of non-regular workers fell by 470,000 from April to June 2009. Such is the grim situation confronting the Hatoyama Government.

The previous post-WWII record was 5.5 per cent, last seen in April 2003. According to a preliminary report released by the Ministry of Internal Affairs and Communication, the number of jobless people grew by the largest figure ever—1.03 million—from a year earlier to 3.59 million for the ninth straight month of increase. Of the total, 1.21 million had been laid off, up 650,000 from a year ago, the largest increase since comparable data became available in January 2003.16 In fact, Japan’s jobless rate has been rising every month since January 2009 when it was 4.1 per cent. Economists predict that jobless rate is unlikely to ease in the near future and they predict that the rate may climb to at least six per cent by the end of 2009.17

The unemployed are forced to rely on welfare benefits that are limited and temporary. The International Labour Organisation estimates that only 23 per cent of the unemployed in Japan receive benefits. Pensions, public education and health care have substantially been eroded. According to Professor Hugh Patrick of Columbia University in New York, the Japanese economy will put a lot of pressure on the DPJ, a party with factions that differ on policies, including deficit reduction. According to him, the coming nine to 10 months will be very exciting for Japan.18 In October 2009, the Hatoyama Government is likely to draw up a job-creation package and the most urgent priority for the new government is to see that the jobless rate does not climb further.

Labour experts and educators are seeking new strategies to improve the situation for young job-seekers. However, there are significant economic and structural barriers that stand in the way of those aspiring to a career outside the low-paying job sector. The old model of becoming a regular employee at a company upon graduation no longer exists.19

Economic Ills

Japan’s rise literally from rubble into an industrial powerhouse is one of the great economic success stories of the 20th century. The bursting of the bubble in the 1980s consigned Japan to a decade of economic slumber from which it is yet able to fully awake. The first great wave of globalisation was kind to Japan. The second wave seems to be dominated by China and likely to surpass Japan as the world’s second largest economy. Japan’s Lost Decade is a pain in the country’s economy whose assault has left a permanent scar.20 Twenty years after the publication of The Japan That Can Say No, a manifesto of self-assertion co-written by Sony Chairman Akio Morita, Japan seems reconciled to The Japan That Can Grow Slow.

Indeed, Japan confronts the worst economic crisis since the 1930s. The Taro Aso Government’s stimulus package only added to the country’s public debt, which stands at 170 per cent of the GDP, the highest in any industrialised country. The DPJ has promised not to raise taxes or increase the overall public spending and proposes to pay for new spending, estimated at $177 billion a year. The government hopes to raise this money by slashing the LDP’s pork-barrel projects and eliminating bureaucratic waste.

Apart from implementing spending on child care and tuition aid, cutting gasoline taxes and eliminating highway tolls, modifying the labour laws, the Hatoyama Government has promised 100,000 yen a month for job-seekers enrolled in training, a minimum wage boost (800 yen an hour or $ 8.5) and higher employment insurance. It may be hard to fulfil these pledges without worsening the country’s public debt. Though Hatoyama said on August 23 to Asahi TV that he would not let new bond sales for the next fiscal year exceed 2009 record of 44.1 trillion yen, the DPJ’s policy chief, Masayuki Naoshima, has gone on record in saying that higher bond sales may be unavoidable should there be a need for additional stimulus.21

The party has said it will pay for its promises by cutting what it terms wasteful spending, shrinking the public service, tapping money from special accounts managed by bureaucrats and abolishing some tax deductions. However, given the fact that tax revenue is falling and welfare costs are swelling as the population ages, the plan does not seem to be realistic and may hit a major road-block.

Addressing social security issue is another huge challenge for the Hatoyama Government. As the Japanese society continues to grey, the tax burden on the salary man continues to increase. No government measures to increase the birth-rate have proved successful. Japan’s population peaked in 2004 at about 127.8 million and is projected to fall to 89.9 million by 2055. The ratio of working-age for elderly Japanese fell from eight to one in 1975 to 3.3 to one in 2005 and may reach 1.3 to one in 2055.22

Japan will face acute difficulties in handling day-to-day activities such as maintaining the train, pay for social benefits etc. sundry jobs. Such a development will impact on the country’s immigration policies. The government will have to encourage immigration and a higher birth-rate, both of which have proved to be difficult in a society that is highly conservative. Japan’s closed mentality and strict immigration law can be seen from the fact that in the US, foreign-born workers make up 15 per cent of the work force as against Japan’s one per cent.

There are many Japanese who had migrated to countries such as Peru and Brazil in the early 20th century and there is a sizable population of Japanese origin in these two countries. In the 1990s, some of the descendants of these émigrés returned to Japan to replace retiring factory workers. With unemployment peaking at 5.7 per cent, Japan is offering to pay the airfare for those who wish to return home. Japan does not want to import new citizens but it does not want to manufacture them either. Occasional talks of a more liberal immigration law are never translated to concrete policy measures. As a result, while tje birth-rate continues to plummet, women and immigrants are continued to be seen as taking jobs from men. A national response to this huge challenge has not caught up yet and Japan continues to drift to chaos as a result.

Can the DPJ Deliver?

Despite tough posturing to change Japan to a better society by effective policy measures, it would remain unclear for a while how much of a difference the DPJ victory really heralds.

In the short run, it is unlikely that Hatoyama will dismantle the strength of the bureaucracy in the first year itself. On the other hand, he will need allies in the bureaucracy, especially in order to limit the bureaucracy’s ability to undermine the party’s other policy programmes.23 If Hatoyama’s government sticks to its pledge to break the bureaucracy’s stranglehold over policy-making, this will lead to a more “confrontational” and “top-down approach” to budgetary processes and formation. But as DPJ members are “incredibly inexperienced and incredibly incoherent”, the Hatoyama Government will still have to depend heavily on the bureaucracy.

There is also another side to this. It is not clear how the bureaucracy will respond if its role is scaled down. The bureaucrats possess data and information—a powerful resource—which they can use to cajole or, on the contrary, sabotage their boss. This is not to say that the Ministers would not assert. For instance, while as the Health Minister in 1996, the DPJ’s deputy leader, Naoto Kan, forced his Ministry to open up secret files on a scandal involving HIV-tainted blood from the 1980s. Also, several bureaucrats have developed some sense of resignation to the prospect of a longer-term DPJ Government.

The DPJ plans to restrict media access to the bureaucracy, based on the idea that the Cabinet is making policy and setting priorities and therefore the members should be responsible for explaining policies to the press, not the bureaucrats whose job is to execute the cabinet’s policies. Foreign Minister Okada Katsuya cites the British example by saying that permanent secretaries in Whitehall do not give press conferences.24 The government issued a new policy, according to which political appointees in Ministries will be responsible for communicating Ministry policy to the media, and regular administrative Vice-ministerial press conferences are abolished.25

The DPJ will abolish the administrative Vice-Ministers’ Council, which for 123 years has enabled bureaucrats to manage the work of the Cabinet.26 Bureaucrats will still meet amongst themselves, of course, but dissolving the Council will strip them of a customary and powerful role in the policy-making process, hammering disagreements across Ministries before Cabinet meetings.27 The government released a framework document on September 16, 200928 , which stressed that changing the balance of power between politicians and bureaucrats in favour of political leadership is essential in realising ‘true democracy’. This document is not a declaration of war on the bureaucracy as an institution but a constitutional document that aspires to restore constitutional government by ending the delegation of substantial powers from the Cabinet to the bureaucracy.29

The document defined the roles of the Ministers/politicians and bureaucrats: the role of the former is to command and supervise the work of officials on behalf of the public while the role of the latter—public servants—is to implement the policies established by the public’s representatives in government. Bureaucrats are to provide data to political leaders, present options for policies and assist political leaders in the execution of their duties. In other words, a division of labour was clearly spelt out. Though this was merely a framework for work function, it will take some time to reshape the relationship. While bureaucrats may hesitate to accept a role perceived to be inferior to the politicians, even politicians may also take some time to accept that they are in fact the masters of the bureaucracy. If the DPJ’s ascendancy to power is a revolution in governance, acceptance of the document will mean revolution in the mindset of both politicians and bureaucrats.30

In selectively releasing the names of his Cabinet, Hatoyama did not make friends in the media. When the list became public, it looked impressive. Kan Naoto became the Deputy Prime Minister and head of the National Strategy Bureau or its predecessor, the National Strategy Office. This portfolio plays a critical role in drafting the new Budget. A Cabinet Budget Committee will be created soon.31

Hatoyama needed a steady hand in the Finance Ministry. His choice of Finance Minister, the 77-year-old Hirohisa Fujii, may assure investors that the DPJ will restrain debt issuance. Fujii, a former Finance Ministry official who had retired from politics after a long career, was asked by Hatoyama to return to active politics. The choice of Fujii seemed to be obvious. Hatoyama needed experienced hands and Fujii had served in the post in the coalition government that ousted the LDP for 10 months in 1993-94. Tobias Harris, author of the ‘Observing Japan’ political blog and a former aide to ex-DPJ lawmaker Keiichiro Asao, writes: “His pragmatism may be the perfect approach to get the DPJ at least through to the 2010 Upper House election, and probably longer.”32 Fujii’s experience might make him best suited to work with the Ministry staff. The DPJ has committed to shift power from the bureaucracy to elected politicians, setting the stage for potential clashes with government officials. By persuading Fujii to enter the electoral fray, Hatoyama demonstrated that he was in need of qualified people around him in government.

Plans for the 2010 Budget will be worked out in the beginning of October 2009. Fujii plans to abandon the ceiling for budgetary requests established by the Aso Government and start from the scratch.33 He wants to find ways to save money in order to budget for programmes promised by the DPJ during the campaign, such as monthly child allowance. He was informed by his Ministry that it may be possible to recover nearly six trillion yen in funds that have yet to be distributed. As it transpired, more than half the budgeted funds had yet to be distributed.34

Hatoyama chose Okada Katsuya to be the new Foreign Minister. Okada too made several key policy statements. As a first, he instructed his Ministry to investigate the circumstances surrounding the ‘secret’ US-Japan agreement on the introduction of US nuclear weapons into Japan and expects the report to be ready by the end of November 2009.35 He also stressed that he will take a flexible approach to the resolution of the Futenma issue.36

Kitazawa Toshimi was chosen as the new Defence Minister. Kitazawa Toshimi announced that Japan will not be continuing its refuelling mission in the Indian Ocean beyond the expiration of the enabling law in January 2010. Kitazawa is one of the four Upper House members in the Cabinet. Kitazawa has long been close to former Prime Minister Hata Tsutomu, once Ozawa Ichiro’s co-conspirator in splitting from the LDP in 1993 and one of the participants in the creation of he new DPJ in 1998. He recently served as the chair of the Upper House Foreign and Defence Policy Committee.

Among other key ministerial positions, Hatoyama appointed Hirano Hirofumi as the Chief Cabinet Secretary, Haraguchi Kazuhiro as the Minister of Internal Affairs and Communications, China Keiko (Upper House member) as the Justice Minister, Kawabata Tatsuo as Minister of Education, Culture, Sports, Science and Technology, Nagatsuma Akira as Minister of Health, Labour, and Welfare, Akamatsu Hirotaka as the Minister of Agriculture, Forestry and Fisheries, Naoshima Masayuki as Minister of Economy, Trade and Industry, and Maehara Seiji as Minister of Land, Infrastructure, Transport and Tourism. Maehara will also hold portfolios for Disaster Relief, and Okinawa and Northern Territories Affairs, Giving him a voice in Foreign Policy discussions through the back door.

The Environment Ministry goes to Ozawa Sakihito, reflecting Hatoyama’s interest in emission controls. Nakai Hitoshi, who first joined the DPJ in 2003 in the merger with the Liberal Party, will serve as head of the Public safety Commission, and Ozawa critic Sengoku Yoshito will head the new Administrative Renovation Council. Fukushima Mizuho gets Consumer Affairs and the Aging Society problem, while PNP head Kamei Shizuka gets the Financial Services Agency and Postal issue.

The DPJ may need the two small parties beyond July 2010 and therefore the inclusion of both Kamei and Fukushima in the Cabinet seems to be a mature decision by Hatoyama.

By delegating authority to politicians who have either more policy expertise than himself or have independent standing within the DPJ, Hatoyama has constructed a team that is balanced and seems matured. Not all depended upon Hatoyama’s patronage. By carefully distributing portfolios amongst those who have expertise in their areas, Hatoyama did a tremendously commendable job in Cabinet formation.

Veteran LDP leader Nakagawa Hideonao said during the campaign that preventing the DPJ from taking power was necessary to save Japan. After the DPJ’s victory, he wrote that the LDP ought to cooperate with the Hatoyama Government as the new government works to shift power from the bureaucracy to the Cabinet.37 Nakagawa realised that the DPJ leaders are more serious than the LDP reformists about changing Japanese governance.

The policy response of the Hatoyama Government at least for the first year in office will be muted, lacking much bite. The DPJ will have to rely on the Social Democrats and other parties in the Upper House and therefore will be constrained by its coalition partners, just like the LDP was with New Komeito. The lack of unity on major policy issues, such as agriculture, might lead to conflict in the event of forceful legislative action. Though the LDP is decimated for the present, it might re-emerge stronger if the Hatoyama Government falters in governance. This intervening period will give space to the LDP to reform and reorganise, do some soul-searching by isolating the fault-lines and plugging them. Therefore, to accept total LDP meltdown as an established fact would be churlish and one could expect the emergence of a two-party system in the medium to long term.

Implications on India-Japan relations

Under Hatoyama’s dispensation, no major policy changes can be envisioned in India-Japan relations, either for the better or the worse, which means that the status quo would continue. The existing level of economic engagement can only be deepened as both countries have found convergence of their interests in economic, security and strategic realms. India is the only third country after the US and Australia with which Japan has defence agreement. The DPJ Government cannot afford to review in a major way Japan’s alliance relationship with the US, as the existing relationship has suited Japanese interests for over five decades. The Japanese public would not rejoice if the DPJ Government ever tries to review Japan’s ties with the US.

Though Japanese corporate groups are a bit concerned about the regional dynamics prevailing in the South Asian region, mature diplomacy will tell that these are temporary aberrations, not having any impact on the economic area. Surprising though it was that India did not figure anywhere in the DPJ election manifesto, Hatoyama’s Asia-centric foreign policy augurs well for the region.38 Though engaging China will surely be a priority, Japan will find India as a suitable strategic partner. Happily, in the Asian theatre, every country is a strategic partner with the other and any single country taking recourse to adventurism will have to weigh the costs that are going to be huge. Such recourse, if any, would be at its own peril. One could, therefore, expect the existing power equilibrium will only be strengthened. Hatoyama’s Asia policy will be directed from this perspective, it is hoped. In this framework, India-Japan relations can be expected to blossom in all directions: economic, political, strategic, cultural and defence.


1. Alex Martin, “Historic sea change at polls product of frustrated public”, The Japan Times, August 31, 2009,; “In landslide, DPJ wins over 300 seats”, August 31, 2009,

2. David Pilling, “A Wiser Japan Casts its vote without illusion”, September 2, 2009,,dwp_uuid= a1af05fa-f1a8...

3. Justin McCurry, “DPJ ends 54 years of almost unbroken conservative rule in Japan”, August 30, 2009,

4. Ibid.

5. Ibid.

6. Jason Miks, “Japan’s Elections: DPJ Promises Change, but Can it Deliver?”, (Accessed on September 7, 2009).

7. Yukio Hatoyama, “A New Path for Japan”, August 27, 2009,

8. Ibid.

9. Ibid.

10. Ibid. Hatoyama’s grandfather Hatoyama Ichiro and former Prime Minister of Japan, translated the book “The Totalitarian State Against Man” into Japanese.

11. For an objective critique of Hatoyama’s New York Times article, see Ryo Sahashi, “Hatoyama’s New Path and Washington’s Anxiety”, September 6, 2009,,pr... (Accessed on September 7, 2009).

12. Joshua Stanton, “Japan’s Unendurable New Prime Minister”,

13. Peter Symonds, “Japan’s elections: the Communist Party’s role”, August 28, 2009,

14. Keiko Ujikane, “Japan’s Unemployment May Shorten ‘Honeymoon’ for DPJ”, August 31, 2009, aa6L568rXgMs

15. Peter Symonds, “Japanese government faces landslide electoral defeat”, August 29, 2009,

16. “Japan’s jobless rate rises to record 5.7% in July”, show_article=1 (Accessed on August 31, 2009).

17. Ibid.

18. Keiko Ujikane, n. 10.

19. For the plight young job seekers are facing in the post-bubble Japan, see an interesting report in Asahi Shimbun. Chisato Yokota, Satoru Eguchi and Miki Moromugi, “Job fulfillment elusive for fretful youth”, August 29, 2009, (Accessed on August 31, 2009).

20. For some authoritative work on Japan’s Lost Decade, see Gary R. Saxonhouse and Robert Mitchell Stern, eds., Japan’s Lost Decade: Origins, Consequences and Prospects for Recovery (2004), Willey-Blackwell; Hiroshi Yoshikawa, Japan’s Lost Decade (2002) Translated by Charles H. Stewart, International House of Japan, Tokyo.

21. For a balanced assessment of DPJ’s likely policy, see Yoichi Funabashi, “Parties must compete on growth strategies”, August 12, 2009,

22. Daniel Gross, “Why Japan is not Rising?”, July 18, 2009,

23. Tobias Harris, “The DPJ and the bureaucracy continue their dance”, August 11, 2009, (Accessed on August 17, 2009).

24. Cited: http://mainichi,jp/select/seiji/seiokenkotai/news/200090912k0000m010100000c.html?inb=ra

25. Issued:

26. Conservative:; newspapers:

27. Tobias Harris, “The first day of the new era in Japanese politics”, September 18, 2008,

28. Released:

29. Tobias Harris, n.28.

30. Ibid.

31. stressed:

32. Tobias Harris, “Japan’s next finance minister?”, August 22, 2009, (Accessed on August 24, 2009)

33. will abandon:

34. More than half:

35. Instructed:

36. Stressed:

37. Nakagawa Hidenao, “Japan: strengths and weakness of Mr Hatoyama’s government”, http”//

38. Rajaram Panda, ”An Asia-centric foreign policy for Japan”, No. 2963, September 4, 2009,

Dr Rajaram Panda is a Senior Fellow at the Institute for Defence Studies and Analyses, New Delhi.

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