04 September 2015
OECD Week 2014: Forum 2014/High-Level Ministerial Council Meeting - Keynote address by Shinzo Abe, Prime Minister of Japan and Ministerial Council Meeting Chair

Japan's stunted democracy

With thousands of Japanese citizens in the streets protesting against Prime Minister Shinzo Abe, could Japan be on the verge of becoming a mature, full-fledged democracy asks John West.

In its long history as a nation, Japan had virtually never been a democracy, apart from a modest experience in the 1910s and 20s at the time of emperor Taisho (“Taisho democracy”). Authoritarian, fascist, feudal and/or military regimes were the norm.

After Japan surrendered in defeat at the end of World War 2 some 70 years ago, the US post-war occupation regime under General Douglas MacArthur instituted democracy in Japan. Unlike France, Korea and many other cases, the Japanese people did not fight for their democracy. This may be why Japan has been a virtual one-party state for much of the post-war period, with the rightwing Liberal Democratic Party (LDP) holding nominal power. Nevertheless, political power was substantially exercised by Japan's powerful bureaucracy, which managed the "iron triangle" of bureaucrats, business and politicians, that engineered Japan's miraculous recovery from the ashes of military defeat.

Today, we may marvel at Japan’s excellent infrastructure as testimony to the great efficiency of the iron triangle. But public investment in infrastructure also served other roles, like financing Japan's electoral system through kickbacks from construction companies to politicians, buying public support for LDP politicians, and corrupting bureaucrats. And Japan’s international corporate success stories like Toyota grew up behind walls of protection against international competition, which enhanced their support for the iron triangle system. While gerrymandering of rural political constituencies, and large financial support for Japan’s farmers, further bolstered support for the LDP.

The credibility of LDP-led government gradually eroded over the years, as a result of a series of outrageous corruption and other scandals, and its inability to respond effectively to the bursting of Japan's bubble economy in the early 1990s. The country which had rebuilt itself with the precision of an economic army, didn't know how to switch gears. It could not address the many new challenges it faced like dealing with financial crisis, population aging, and the rise of new Asian competitors like Korea, Taiwan and more recently China.

The iron triangle which benefited from many privileges through Japan's high-growth, catchup period would not let go, when the country needed to be opened up to international and domestic competition to foster a more innovation-driven economy. And when economic weakness set in during the 1990s, the “construction state”, which so successfully built up Japan’s infrastructure, just kept on building more. This may have helped keep the economy afloat. But it resulted in many wasteful projects, and contributed to the massive buildup in Japan’s public debt which today stands at almost 250% of GDP.

In short, when economic crisis struck in the 1990s, vested interests were no longer aligned with national interests, and they came to dominate nation interests. Abenomics, the reform program of Prime Minister Shinzo Abe, is a belated and half-baked version of what Japan should have done some 25 years ago.

LDP loses power

In 2009 the LDP was swept from power in a landslide electoral victory of the left-wing Democratic Party of Japan (DPJ) which won 64% of the parliamentary seats. This change of power raised many hopes that Japan had finally become a true democracy.

But the DPJ's tenure was a great disappointment. It was characterised by inexperience, incompetence, conflict with the bureaucracy which then undermined the government, and conflict/misunderstandings with the US concerning its military bases in Japan, which are still home to some 50,000 troops. The Japan/US Alliance remains critical to Japan’s security in light of the limitations imposed on Japan’s military activities by its pacifist Constitution.

Perhaps the greatest blunder of the DPJ government was the purchase of the Senkaku Islands from their private owner. As the sovereignty of these islands is still disputed with China, this act provoked a outsized reaction from the Chinese government, which continues to this day. China is always keen to seize upon any pretext to ramp up nationalistic fervour, which in practical terms usually means anti-Japanese sentiment. This ongoing dispute greatly undermines relations between Japan and China, and also between the US and China, as the US has been obliged to confirm that these islands are covered by the US/Japan Alliance.

The poor response to the March 2011 triple crisis of earthquake, tsunami and nuclear disaster was further evidence of the systemic weakness of Japan's system of governance. As the Fukushima Nuclear Accident Independent Investigation Commission concluded, the nuclear crisis was not a natural disaster, "... this was a disaster “Made in Japan”. Its fundamental causes are to be found in the ingrained conventions of Japanese culture: our reflexive obedience; our reluctance to question authority; our devotion to ‘sticking with the program’; our groupism; and our insularity.”

The inadequate regulation and supervision of TEPCO (Tokyo Electric Power Company), another major cause of the disaster, also highlighted the role of the nuclear iron triangle, where business and political interests were ganging up against citizens’ interests. TEPCO is for example a large donor to the LDP and other organisations. The nuclear regulatory agency both regulates and promotes nuclear energy, representing a profound conflict of interests. The agency also manifestly turns a blind eye to the reported close relations between TEPCO and the Japanese mafia, the yakuza, which helps provide TEPCO subcontractors with docile labor to do dangerous work in nuclear power plants.

The slow and ponderous governmental response to the disaster -- which continues to this day -- revealed a government machine with little agility. In a country which prides itself on its cohesive society, many thousands of people remain displaced.

LDP returns to power under Prime Minister Shinzo Abe

In the space of three years, the DPJ had three leaders, which meant that there was very little policy continuity and very little was achieved. And so it was that LDP was swept back into power in December 2012, under the leadership of Prime Minister Shinzo Abe. On this occasion, the DPJ won a mere 12% of the parliamentary seats. But this was not a real victory for the LDP. It was a rejection of the DPJ.

Prime Minister Abe vowed the revive the economy through his "Abenomics" program. The first two arrows of Abenomics, monetary expansion and fiscal stimulus, were quickly launched, as they had no opposing vested interests. Most regrettably, the third arrow of Abenomics is still in Mr Abe's quiver. Opening of Japan's market to foreign trade, investment and workers remains blocked by the same vested interests that have held the country back for over two decades. As one Japan expert recently said to me, "Japan Inc. is still alive and well".

The promise of democracy, raised by the 2009 DPJ victory, has faded in the distance. The DPJ was decimated in the 2012 election and is now a spent force. The LDP, and its junior coalition partner, the "Komeito" Party (a Buddhist party), now govern without any effective opposition. As in much of the postwar period, Japanese political competition mainly takes place behind closed doors between the different factions within the LDP, a similar situation to the one-party rule in Communist China. And for the moment, the hyperactive Mr Abe has been able to ward off opposition from rival faction leaders.

Shinzo Abe’s policy agenda

This means that, although Mr Abe’s principal mandate is to revive the economy through Abenomics, he has spent much more energy on other policy issues, for which there is little public support. Nuclear power stations, which had all been closed since the 2011 Fukushima nuclear disaster, are now being restarted, despite strong public opposition, to the delight of the nuclear industry. These power stations are mainly located in poorer communities, whose support can be bought off with government subsidies.

Abe has also pushed through a change in Japan's postwar pacifist security policy in the area of "collective self-defence", by reinterpreting Article 9 of the Constitution to the horror of most legal scholars. This would enable the Japanese military to come to the defence of allies, notably the US (this has been passed by parliament’s lower house, and will likely be passed by the upper house in the autumn of 2015). A large slab of public opinion considers Japan's postwar pacifism to be the essence of the country’s modern identity, and is thus strongly opposed. China and Korea, which both suffered greatly at the hands of the Japanese wartime military, disingenuously claim that Japan is remilitarising.

The Chinese and Korean reactions are substantially due to the reluctance of Mr Abe and his extreme right wing supporters to unambiguously apologize for Japan’s wartime invasions and violence, including the issue of Korean “comfort women”, the sex slaves forcibly recruited by the Japanese imperial army. Mr Abe’s speech in August 2015, on the occasion of the 70th anniversary of the Japanese wartime surrender, contained many constructive and positive elements, but stopped short of containing an unambiguous apology by Mr Abe himself.

Furthermore, in 2013, the first year of his current tenure, Mr Abe inflamed Chinese, Korean and even many Western nations by visiting the Yasukuni Shrine, which honors Japan’s war time criminals. While Abe has since refrained from visiting the shrine, some of his faction members still to do so, and he continues to send donations.

There are a number of things which are striking about Japanese governance under the leadership of Prime Minister Shinzo Abe. First, he is hellbent on focussing on security policy issues, rather than the economy which is in greater need of attention. And then he seems neither willing nor able to effectively explain his policies to his highly educated and well informed population. Rather, he seems intent on pushing through his policy changes by the most ruthless means possible.

This is regrettable. The policy changes in the area of collective self defense are very modest changes and are arguably very justifiable in light of the post-Cold War situation, the need to strengthen the Japan/US alliance, the unpredictability of North Korea, and the feistiness of China. Restarting some nuclear power stations, especially those located in areas which are not highly vulnerable to earthquakes, may also be justifiable in light of Japan’s almost total dependence on imported energy. If Mr Abe had made better efforts to explain his policies, he would have suffered much less of a backlash.

Japan’s stunted democracy

Today, Japan’s democracy is bedevilled by many factors -- some old and some more recent.

First, Japan has reverted to being a virtual one-party state dominated by the LDP and its leader, Shinzo Abe. Mr Abe may have lost much of his popularity due to his focus on security issues, and the undemocratic way that he has pushed his security agenda. And voter turnout in elections has declined dramatically, especially among the young, with only half of voters turning out in the last election, a postwar low.

But following the demise of the DPJ, there is no effective political opposition party. The DPJ contested less than half the seats at the last election, in 2014. Curiously, no opposition party has been to emerge as a rival to the LDP, despite the many public voices of opposition, such as in the protests organised in front of the Diet (national parliament), the Prime Minister's residence and in Kasumigaseki, the government ministry area of Tokyo. And for the moment at least, there is no serious rival to Abe’s rule within the LDP.

Second, Japan has never had a truly free and independent media, and this continues to be the case. The press clubs (“kisha clubs”) that each government ministry operates, foster unhealthily cosy relations between journalists and government officials, which inhibit critical reporting. The government is also issuing guidance to the media on appropriate reporting. The financial importance of corporate advertising by big business like TEPCO is another factor which compromises the media objectivity.

The national broadcaster, NHK, is now clearly under the government’s thumb, following Mr Abe’s appointment of cronies to senior management, notably Chairman Katsuto Momii. NHK journalists have quietly told me they are allowed to criticize the government. Some commentators have suggested that NHK behaves like a national broadcaster in communist China. And a controversial secrecy bill, that Mr Abe rushed through the parliament, greatly threatens the independence of the media and whistleblowers.

Third, “Japan Inc” (the iron triangle) is still very much alive and well, not only for the nuclear industry, where big companies are colluding with the government to reopen nuclear power stations. Japan’s annual hunts for whales, which outrage many countries, is also sustained by an iron triangle comprising the government’s Fisheries Agency, the Institute of Cetacean Research, and the Japan Fisheries Association which is a lobby group for the whole fishing industry which again benefits greatly from subsidies to undertake whaling.

Civil society organizations that undertake advocacy or protest activities are usually treated as social outcasts, even if they have become more active since the March 11 triple disaster. Citizen participation should be a foundation of democracy, but in Japan it is not the case. And while the bureaucracy now has less power than in the past, it is clearly a strong force on the side of the LDP, rather than being independent.

Fourth, Japan has become a “silver democracy”, where the voice of senior citizens in this aging society has an unhealthy and excessive influence over policy. Given the preponderance of old people in Japanese society, the financially unsustainable health and retirement benefits are virtually impossible for the government to touch.

Why Japan’s stunted democracy is a problem

Japan’s stunted democracy is very costly to the country in many ways. For one, the will of the people is inadequately reflected in government policy. And this matters greatly because the government is arguably not leading the country in the right direction on issues like aging populations, security policy, and relations with its Chinese and Korean neighbors. According to the OECD, only 23% of Japanese voters have confidence in the government, the fourth lowest among the 34 countries surveyed.

Second, the prolonged economic stagnation of the past 25 years, weak productivity and low per capita income, and enormous public debt of 250% of GDP, are all the product of the failure of government policy. And this policy failure is due to the excessive influence of established big business, which means that vested interests rather national interests dominate national policy making. Despite the success of a few companies like Softbank, Uniqlo and Muji, there is very little new entrepreneurial spirit and fresh dynamism in the economy.

In short, Japan needs a big dose of not only political democracy, but also economic democracy.

Only the Japanese people can solve this problem by becoming more politically active. But their society leaves them ill-equipped to do so for many reasons. For example, Japan’s deeply entrenched culture of social hierarchy means that there is insufficient questioning of authority. Its education system is based on rote learning and memorization, rather than critical thinking and analytical skills, leaving youth insufficiently capable of analyzing the world around them. Fervent patriotism and an exaggerated sense of cultural uniqueness inhibit the capacity of Japanese citizens to process criticism, and to draw lessons from the experiences of other countries.

And Japan’s conformist and conservative society is sustained by what Yoshio Sugimoto calls a system of “friendly authoritarianism”. “Japanese society has various forms of regimentation that are designed to standardize the thought patterns and attitudes of the Japanese and make them toe the line in everyday life … It is authoritarian to the extent that it encourages each member of society to internalize and share the value system which regards control and regimentation as natural, and to accept the instructions and orders of people in superordinate positions without questioning.”

What future for Japanese democracy?

Longtime Japan-watchers will tell you that Japan is capable of change, even if change only comes gradually. Thus, optimists might argue that public discontent with Mr Abe will eventually result in a credible opposition party taking shape in the same way that the DPJ did. But it is equally possible that Japan continue to muddle along. After all, we have been waiting for a real democracy for 70 years, but to no avail.

It is of course true that there is no perfect democracy, least of all in the United States. Everywhere, democracy is a process and struggle against anti-democratic forces. But Japan’s democracy is in complete tatters. Above all, it desperately needs a solid opposition that can represent the many voices of popular discontent, and stand up as a real competitor to Mr Abe and the LDP.
Tags: japan, japanese democracy, japanese politics, liberal democratic party of Japan, ldp, shinzo abe, democratic party of japan, dpj, abenomics, iron triangle

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