Shake-Up in Japan
Two parties are better than one.

Tuesday, September 1, 2009

THERE CAN BE no democracy without political competition: For that reason alone, the landslide victory by the Democratic Party of Japan (DPJ) in Sunday's national election is cause for celebration.

The DPJ defeated the Liberal Democratic Party (LDP), which had ruled Japan with only 11 months of interruption since 1955. Japan under the LDP was hardly a dictatorship, but its political machine and its unelected allies in the bureaucracy had run out of ideas and energy. Japan's once-dynamic economy has been in stagnation pretty much since 1989. With its falling birthrate, even Japan's population of 125 million is not only aging but actually shrinking.

Can the Democratic Party of Japan, a mix of former LDP politicians, ex-socialists and civic activists, succeed where the LDP has failed? One irony of the party's reform message is that its behind-the-scenes leader is Ichiro Ozawa, a former LDP boss with a knack for power politics. Yet its proposed governance reforms, such as transferring budget authority from bureaucrats to elected officials, could make Japanese policymaking more transparent. Japan needs further restructuring of an economy that depends heavily on exports to support less-efficient sectors such as construction and agriculture. Greater reliance on domestic demand would help both hard-pressed Japanese families and the United States, insofar as such a policy might reduce Japan's trade surplus: The DPJ has several pro-consumption proposals, from lower highway tolls to increased support for couples with children. Alas, the party has been less clear about how it will pay for these goodies, no small omission given that the national debt is already almost twice Japan's gross domestic product. Unfortunately, too, the DPJ bought the votes of Japan's farmers with promises of money and protection.

The LDP stood for close U.S.-Japan relations, while Yukio Hatoyama, the inexperienced politician who leads the DPJ and will probably be Japan's next prime minister, has called for a more Asia-centered foreign policy, sometimes dressing this up with assaults on American "market fundamentalism" and other ills of globalization. There will no doubt be room for negotiation with the Obama administration, perhaps over such issues as the basing of U.S. Marines in Okinawa. But the threat of a nuclear North Korea makes Japan's neighborhood too dangerous, we think, for the government in Tokyo to seek a rupture with Washington or for the Obama administration to let one develop.

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