Koizumi Presses Bid to Reshape Politics ; Japan Votes Sunday in a Snap Election Called by the Prime Minister over His Economic Reforms

Article excerpt

Katsuya Okada, leader of Japan's main opposition party, is working the crowd. Outside Kitasenju Station in Tokyo, he heads to a bank of microphones to appeal to some of the 1 million commuters that pass by each day.

"The current government has been unable to reform the system - only the Democratic Party can carry out true reforms. We need a change of government!" he shouts.

But only about 300 people pay attention - underscoring the uphill battle Mr. Okada faces as he battles a Teflon-coated Junichiro Koizumi, now Japan's fourth-longest-serving leader since 1945.

Since his largely unexpected selection as president of the Liberal Democratic Party in 2001, Mr. Koizumi has dragged cautious LDP lawmakers into unfamiliar waters, urging fiscal restraint and smaller government. He has smashed the traditional mold of consensus politics and led from the top down. He's succeeded in halving the bad loans at major Japanese banks; nonperforming loans fell by nearly 60 percent to $164 billion in March. And he's pushed economic reforms, particularly the ambitious focus of this election: privatizing the postal savings system.

Now that flamboyant style may be paying off. Buoyed by dropping unemployment - the rate in July was 4.4 percent - and moderate economic growth, Koizumi may have boosted the likelihood that he'll keep his job, while setting the stage for future strong leaders by increasing the authority of his office.

"Koizumi wants to cull all the reform weaklings from the party, and people rate that kind of political backbone highly," says economist Tatsuhiko Yoshizaki at Sojitz Research Institute.

Even so, the attempted privatization of Japan's massive postal- savings system - the issue that prompted Koizumi to dissolve the Lower House and call a snap poll - is more than the LDP can swallow in its present form. The party's political power-base in the countryside has long benefited from policies that spread the wealth of Japanese cities to rural voters; Koizumi's reform program attacks such pork-barrel politics.

Indeed, the election has become something of a referendum on Koizumi's pursuit of neoliberal ideology, says Jiro Yamaguchi, a professor at Hokkaido University: "Privatization of the postal service is just a symbol of this change."

The problem is that there are reformers as well as conservatives on both sides of the chamber - and this may lead to some kind of political realignment after the election, with both the LDP and the opposition Democratic Party of Japan (DPJ) reconstituting along more clear cut proreform and antireform lines, says Mr. Yamaguchi.

If Koizumi wins a mandate, he will be in a strong position to introduce neoliberal policies in areas from health to pension reform to agriculture. LDP bigwigs are also urging him to stay beyond the scheduled end of his tenure in September 2006.

Analysts say victory for Koizumi would be yet another major blow to Japanese politics, which is heavily influenced by factions within the parties, and a further step toward a more Western, confrontational-style democracy.

"The power of the prime minister has grown ever since electoral reforms were passed in the mid-'90s, and this is a trend that will continue," says Jun Iio, an expert at the National Graduate Institute for Policy Studies (GRIPS) in Tokyo. …