Will PM's Reforms Save Japan? ; Junichiro Koizumi Hopes Yesterday's Proposals Will Rescue Japan's Ailing Economy - and His Job

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On the Tokyo talk circuits, he's being dismissed as a has-been.

In the countryside, languishing small businessmen call him a "god of poverty," says a top Japanese political analyst.

But Prime Minister Junichiro Koizumi, the unconventional politician who seized Japan's top office last April with a plan for reform and the personality to implement it, is not giving up so easily. Yesterday, the prime minister introduced an antideflation package that aims to stop dwindling stock and consumer price levels that threaten to dash hopes that Mr. Koizumi can rescue Japan's sinking economy. The package hints at injecting public funds into debt-laden banks.

Despite the report's release, however, Japanese political commentators remain more than skeptical that the prime minister, who won fame for his charismatic talk and perm-waved tresses, will be able to rescue his own premiership for more than just a few months.

"Koizumi is already a man of the past," says Minoru Morita, a senior political commentator and leading opinion-maker on Japanese interview shows.

Unable to make the sweeping changes he originally promised, Koizumi is beset by a spiraling banking system that's plagued by nonperforming loans. Critics say "structural reform" remains more of a catchphrase than a reality. To make matters worse, new scandals are shaking the public's faith in Koizumi's promise of clean government. His decision to dismiss popular but controversial foreign minister Makikio Tanaka - whose public appeal helped draw support for Koizumi during his rise to power - has cut his popularity ratings in half, with some polls giving him as little as 44 percent support.

The prime minister, once hailed as the best thing since take-out sushi, is now being treated like last season's hemlines - no longer all the rage and not long for this political world. Aides and party loyalists say that polls are not the be-all and end-all, and that Koizumi simply needs more time to make a difference. After all, as Koizumi himself pointed out last week during President George Bush's visit - one that gave the premier far less bounce than his administration had hoped - the reforms of Ronald Reagan and Britain's Margaret Thatcher took years to implement.

Those reforms also caused much social turmoil. And, some would argue, they broke down parts of the safety net which Japan might not be ready to give up.

"No matter how much cosmetics Koizumi may put on the face of poverty, it will not be able to affect the time span of the administration for more than just a few months," says Mr. Morita.

Politicians within his own ruling Liberal Democratic Party (LDP), not to mention leading opposition parties such as the Democratic Party of Japan, are already jockeying for Koizumi's seat. The expectation among most commentators here is that he will not be able to recover from the drop in ratings. Popular support was the key base of his mandate because he was never widely supported within his own conservative political party. …