After the tsunami
Old habits die hard
The new prime minister takes a leaf out of the LDP’s book
Oct 22nd 2011 | TOKYO | from the print edition
He could have paid for the reconstruction TO A smoker from Europe or America, Japan is a puffer’s paradise. A pack of cigarettes in Tokyo, despite a hefty tax increase last year, still costs about half what it would in London or New York. Smoke billows out of bars. There is little social stigma. Yoshihiko Noda, the prime minister, is a two-pack-a-day man. The state, despite signing an international anti-smoking convention in 2004, still owns 50% of the world’s third-largest cigarette company, Japan Tobacco.
What is more, in Japan’s parliament smokers, and the elderly tobacco farmers who support their vices, are treated with the care and respect normally reserved for royalty. Why? Because on October 20th parliament opened for a special 51-day session in which Mr Noda will attempt to achieve the main priority of his seven-week-old administration: ratification of a 12 trillion yen ($156 billion) supplementary budget, mostly to pay for reconstruction of the Tohoku region shattered in March by the tsunami. In order to achieve that, Mr Noda, whose party has a majority in the lower house but not in the upper one, must – in his words—“listen humbly” to the opposition parties, especially the Liberal Democratic Party (LDP), which lost power after half a century in 2009. That, in turn, may mean surrendering to the special interests that support the LDP, such as 10,800 tobacco farmers—even though one in five of them is over 70 years old, and 4,100 of them say this may be their final year in the tobacco business.
As a result of all this, the rest of society will probably have to pay more income tax. Mr Noda’s ruling Democratic Party of Japan (DPJ) had recently proposed slapping another two yen tax on cigarettes and selling down the government’s stake in Japan Tobacco, which many people saw as a sensible way for a debt-strapped government to help pay the huge costs of post-tsunami reconstruction. But the plan is in danger of being thwarted by the LDP and its puffing pals.Mr Noda is also mending fences with the LDP’s old mates in the big-business lobby, Keidanren, and the bureaucracy. Since the DPJ came to power promising to dismantle the “iron triangle” of government, business and bureaucrats that helped keep the LDP in power for so long, businessmen and bureaucrats have behaved with increasingly shrill vexation at the way they have been treated, and at threats to decrease their influence.
Now, sensing a new dawn, Keidanren is clearly relieved, and attempting to shepherd Mr Noda’s government toward talks about joining the pro-American free-trade Trans-Pacific Partnership (TPP) by the time of the APEC summit in Honolulu on November 12th-13th.
As for the bureaucrats, Mr Noda has gladdened hearts within the finance ministry by pushing for higher taxes, overriding objections within his own party. Meanwhile, in the ministry of economy and trade, there is palpable relief that Mr Noda appears to have softened his predecessor’s hostile stance toward the nuclear industry after the Fukushima disaster that followed the tsunami in March.
All of which suggests that Mr Noda is slipping back into some of the old ways of the party he opposes, the LDP. As one political scientist laments: “When Mr Noda came to power, the significance of the change of government in 2009 came to an end.”
It’s not all Mr Noda’s fault though. At the root of many of Japan’s difficulties lies a convoluted political system. The country has what is known as a “twisted diet”, where no party has full control of either house of parliament, and opposition parties in the upper chamber can easily produce gridlock. The voting system for both houses gives disproportionate weight to rural interests, which further entrenches the status quo.
To assure the passage of laws, even self-evidently vital ones such as the reconstruction budget, Mr Noda has little choice but to seek support from the opposition, rather than confronting it, even if the LDP continues to move the goalposts. And so, even if bills are eventually passed, the “iron triangle” is reinforced, and any attempts to reform the system become harder. Or go up in smoke.
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