Sunday, May 19, 2024

Incomplete Deal over Political Reform in Japan

Promises to keep

By Takuya Nishimura, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
May 12, 2024. Special to Asia Policy Point

Facing public criticism over the slush fund scandal, the Liberal Democratic Party (LDP) and its coalition partner, Komeito, on May 9 reached a rough agreement on reforming regulations governing political funds.

Although they agreed on new rules for greater transparency, both parties failed to agree on specific measures that are essential for the restoration of public confidence in politics. The limited reforms are unlikely to encourage voters to hold a better view of Prime Minister Fumio Kishida’s leadership skills or to increase their support of him. Thus, it seems likely that the LDP and Komeito will continue their discussions to bridge the gaps.

The two parties basically agreed to hold each lawmaker more accountable for the management of political funds. A new rule would require a lawmaker to submit a “certification” of his political funds report. If an accounting manager failed to account for funds properly and was found guilty in a court, and meanwhile the certification was found incorrect, the lawmaker could lose his Diet membership.

LDP and Komeito also agreed to lower the threshold for disclosing the identities of purchasers of fundraising party tickets and the value of the tickets—but they did not agree on a new threshold. Currently, a political organization must report the name of any contributor who purchases tickets worth 200,000 yen or more.

A new, lower yen threshold for tickets is also in limbo. Komeito has argued for a 50,000 yen minimum, the same amount that triggers disclosure of donations to a political organization. The LDP has insisted on a threshold of 100,000 yen out of a concern that disclosure of the identities of purchasers will affect their businesses and in turn discourage ticket purchases.

“Policy activity fund” is another point left unresolved. Each party receives an appropriation from the government that the party places in its policy activity fund.    Each party then allocates funds to individual lawmakers. Lawmakers are supposed to spend the funds on election campaigns, but, by virtue of an exception in the Political Funds Control Act, a party is not required to report how the transferred funds are spent.  Both parties agreed that the expenditures should be made public.

The manner of disclosure, however, remains in dispute. Komeito has proposed that each party submit a list of specific expenditures and their purpose. The LDP will agree only to the disclosure of categories of expenditures and not specific amounts or their purpose. The LDP argues that its approach protects “freedom of political activity.”  But the fund is a government appropriation – that is, it is funded by taxpayers. A party can hardly be responsible to the taxpayers unless it makes details of the fund public.

There have been reports that some LDP leaders have transferred funds to an “unregistered political organization,” which is mostly free from disclosure regulations.  In response, the LDP-Komeito agreement includes a new rule for the disclosure of transfers annually of ¥10 million or more to these unregistered organizations.

The agreement does not address political donations by companies and organizations. Although Komeito is willing to discuss this issue, the LDP firmly opposes any reforms that would change current arrangements. The opposition parties, including the Japan Innovation Party (Nippon Ishin-no-kai), call for a complete prohibition on these donations.

The Constitutional Democratic Party (CDP) demands a ban on any fundraising parties and the termination of the policy activity fund. To these ends, the CDP, together with the Democratic Party for the People, is preparing a bill to amend the Political Funds Control Act. As debate in both Houses continues, the unwillingness of the LDP-Komeito coalition to engage in political reform is becoming obvious.

The failure of the LDP and Komeito to reach agreement on a full range of political reforms can only be attributed to Kishida’s lack of leadership.

Kishida needed an agreement with Komeito on thorough political reform, especially after the bitter defeat in three by-elections in April. After returning from trips to France and South America, Kishida urged LDP leaders to accelerate the discussion with Komeito. However, the negotiations resulted in consensus only on modest reforms. Afraid that negative public reaction will imperil their chances in the coming election, some LDP lawmakers criticized the agreement for failing to demonstrate a commitment to political reform.

For his part, Kishida expressed satisfaction. “The parties wrapped up the measures for not repeating the same scandal,” Kishida told reporters. This response made him look like he is driving a car on automatic cruise control.

Moreover, his credibility is in doubt. A monthly magazine, Bungei Shunju, included an interview with a former head of the Abe faction, Yoshiro Mori. In Diet debates earlier this year, Kishida said he had asked Mori about the kickback system in the Abe faction. In his interview, Mori said that Kishida had never asked him that question. Kishida insisted that he could not confirm Mori’s involvement in the scandal.

Kishida’s inability to explain the entire scandal is at the core of the public’s frustration. In the first trial of the lawmakers and accounting managers of the LDP for failure to report surplus payments, Jun-ichiro Matsumoto, the former accounting manager of the Abe faction, did not say how or why the LDP’s leaders continued to discuss the kickback system. It is thus not the court, but political leaders who are responsible for investigating how the secret fund was controlled.

Monday Asia Events May 20, 2024

, 10:30am (EDT), VIRTUAL. Sponsor: McKinsey Global Institute. Speakers: Olivia White, Senior Partner, Director, McKinsey Global Institute; Rodney Zemmel, Senior Partner, Global Leader, McKinsey Digital.

SOUTHERN ASIA’S SECURITY LANDSCAPE: VIEWS FROM RISING ANALYSTS. 5/23, 10:30-11:45am (EDT), VIRTUAL. Sponsor: Stimson. Speakers: Anuttama Banerji, Researcher at the National Maritime Foundation; Haleema Saadia, Lecturer at the National University of Modern Languages (NUML), Research Fellow at the ROADS Initiative; Dr. Muhammad Shareh Qazi, Assistant Professor at the Department of Political Science, University of the Punjab Lahore; Ladhu R. Choudhary, Assistant Professor (Senior Scale) of Political Science at the Department of Political Science, University of Rajasthan.

INDIA’S PATH TO PROSPERITY: BOOK TALK WITH RAGHURAM RAJAN ON ‘BREAKING THE MOLD’. 5/20, 10:30am-Noon (EDT), HYBRID. Sponsor: Brookings Institute. Speakers: Coauthor Raghuram Rajan, Katherine Dusak Miller Distinguished Service Professor of Finance, University of Chicago; Eswar Prasad, Senior Fellow, Global Economy and Development.

STRATEGIC SYNERGIES: INDIA-US TECHNOLOGY COOPERATION. 5/20, 11:00am-12:30pm (EDT), HYBRID. Sponsor: Hudson Institute. Speakers: Rudra Chaudhuri, Director, Carnegie India; Konark Bhandari, Fellow, Carnegie India; Daniel Markey, Senior Advisor, South Asia Programs, United States Institute of Peace; Vikram Singh, United States India Strategic Partnership Forum; Lisa Curtis, Senior Fellow, Center for New American Security.

SOUTH KOREA’S INDO-PACIFIC STRATEGY - A DIPLOMATIC LAME DUCK? 5/20, 6:00pm (JST), 5:00am (EDT), VIRTUAL. Sponsor: Yokosuka Council on Asia Pacific Studies (YCAPS). Speaker: Dr. Jeffrey Robertson, Associate Professor of Diplomatic Studies, Yonsei University, Non-Resident Fellow, Korea Economic Institute of America (KEI).

US POLICY ON IRAN: EXAMINING THE OPPORTUNITIES TO BUILD A NEW BIPARTISAN STRATEGY. 5/20, Noon-1:00pm (EDT), VIRTUAL. Sponsor: Middle East Institute. Speakers: Brian Katulis, Senior Fellow for US Foreign Policy, Middle East Institute; Goli Ameri, Vice Chair, Freedom House Board of Trustees; Alex Vatanka, Director of Iran Program, Middle East Institute.

UNRWA’S ROLE IN GAZA AND THE MIDDLE EAST. 5/20, Noon-1:30pm (EDT), HYBRID. Sponsor: Stimson. Speakers: William R. Deere, Director, Washington Office of the United Nations Relief and Works Agency for Palestine Refugees; Merissa Khurma, Director, Middle East Program, Wilson Center; Andrew Hyde, Director, Senior Fellow Multilateral Financial Diplomacy, Powering Peace, Stimson Center.

POWERING UP: LOCALLY-LED APPROACHES FOR ADVANCING WOMEN'S LEADERSHIP AND GENDER EQUALITY IN ASIA. 5/20, 1:30-2:30pm (EDT), IN PERSON ONLY. Sponsor: Asia Foundation. Speakers: Inthana Bouphasavanh, Director, Association of Development of Women and Legal Education, Laos; Udeni Thewarapperuma, Program Manager, Women’s Voice and Leadership, The Asia Foundation Sri Lanka; Rahpriyanto Alam Surya Putra, Director of Environmental Governance, The Asia Foundation Indonesia; Sumina Karki, Inclusive Governance Lead, The Asia Foundation Nepal.

CLIMATE CHANGE AND CRITICAL INFRASTRUCTURE ASSESSING THE RISKS AND IDENTIFYING MITIGATION STRATEGIES. 5/20, 2:30pm (EDT), VIRTUAL. Sponsor: Rand Corporation. Speakers: Andrew Lauland, Senior International Defense Researcher; Professor of Policy Analysis, Pardee RAND Graduate School; Michelle E. Miro, Information Scientist, Professor of Policy Analysis, Pardee RAND Graduate School; Susan A. Resetar, Senior Operations Researcher; Rahim Ali, Senior Technical Analyst.

TO RUN THE WORLD: THE KREMLIN'S COLD WAR BID FOR GLOBAL POWER. 5/20, 4:00-5:30pm (EDT), VIRTUAL. Sponsor: Wilson Center. Speakers: author Sergey Radchenko, Fellow, Wilson E. Schmidt Distinguished Professor, Johns Hopkins School of Advanced International Studies; Svetlana Savranskaya, Member, History and Public Policy Program Advisory Board, Director of Russia Programs, National Security Archive; William Taubman, Former Fellow; Bertrand Snell Professor of Political Science Emeritus, Amherst College.

OUTCOMES AND IMPLICATIONS OF THE 2024 SOLOMON ISLANDS ELECTION. 5/20, 4:00-5:00pm (EDT), VIRTUAL. Sponsor: CSIS. Speakers: Kathryn Paik, Senior Fellow, Australia Chair; Alan Tidwell, Professor of Practice and Director of the Center for Australian, New Zealand and Pacific Studies, Georgetown University; Anouk Ride, Research Fellow, Australian National University; Anna Powles, Senior Lecturer, Centre for Defense and Security Studies, University of New Zealand; Tarcisius Kabutaulaka, Associate Professor, Department of Pacific Islands Studies, University of Hawaiʻi at Mānoa.

Sunday, May 12, 2024

Monday Asia Events May 13, 2024

THE WAY AHEAD TO SECURE TAIWAN’S RESILIENCE. 5/13, 10:00-11:00am (EDT), IN PERSON ONLY. Sponsor: Wilson Center. Speakers: Alexander Tah-Ray Yui, Representative, Taipei Economic and Cultural Representative Office in the United State; Ambassador John D. Negroponte, Former Deputy Secretary of State; Elbridge Colby, Co-Founder, The Marathon Initiative and former Deputy Assistant Secretary of Defense for Strategy and Force Development; Carolyn Bartholomew, Former Chairman, US-China Economic and Security Review Commission; Robert Daly, Director, Kissinger Institute on China and the United States.

STRENGTHENING NATO'S EUROPEAN PILLAR. 5/13, 10:00-11:00am (EDT), VIRTUAL. Sponsor: CSIS. Speakers: Max Bergmann, Director of the CSIS Europe, Russia, and Eurasia Program and Stuart Center; Sophia Besch, Fellow in the Europe Program at the Carnegie Endowment for International Peace; Mathieu Droin, CSIS Visiting Fellow; Sean Monaghan, CSIS Visiting Fellow.

THE INSIDERS’ GAME: HOW ELITES MAKE WAR AND PEACE. 5/13, 10:30 - 11:30am (EDT), HYBRID. Sponsor: Brookings Institution. Speakers: E.J. Dionne Jr., W. Averell Harriman Chair, Senior Fellow, Governance Studies, Brookings; Michael E. O’Hanlon, Senior Fellow and Director of Research, Foreign Policy, Brookings; Elizabeth N. Saunders, Nonresident Senior Fellow, Foreign Policy, Brookings; Kori Schake, Senior Fellow and Director, Foreign and Defense Policy Studies, AEI.

CAN SOUTH KOREA SAVE UKRAINE? 5/13, 11:00-11:45am (EDT), VIRTUAL. Sponsor: Korea Chair, CSIS. Speakers:  Mark F. Cancian, Senior Adviser, International Security Program; Chris H. Park, Program Coordinator and Research Assistant, Arleigh A. Burke Chair in Strategy.

TRANSNATIONAL ORGANIZED CRIME IN SOUTHEAST ASIA. 5/13, 1:00-2:30pm (EDT), HYBRID. Sponsor: United States Institute of Peace. Speakers: Erin West, Deputy District Attorney, REACT Task Force, Office of the District Attorney, Santa Clara County; Jacob Sims, Visiting Expert, United States Institute of Peace; Jason Tower, Country Director, Burma, United States Institute of Peace.

STRENGTHENING THE MIDDLEGROUND OF THE DEFENSE-INDUSTRIAL LANDSCAPE. 5/13, 3:30-5:00pm (EDT), HYBRID. Sponsor: Atlantic Council. Speakers: The Hon. William J. Lynn III, Chairman and Chief Executive Officer, Leonardo DRS, Former United States Deputy Secretary of Defense, US Department of Defense; The Hon. Ellen Lord, Former Under Secretary of Defense for Acquisition and Sustainment, US Department of Defense, Former President and Chief Executive Officer, Textron Systems Corporation.

The Weak Yen Problem

No easy solution

By Takuya Nishimura
, Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
May 6, 2024. Special to Asia Policy Point

The yen-to-dollar exchange rate has moved in unusual ways over the past week. The foreign exchange market’s expectation that the gap between the low interest rate in Japan and the higher interest rate in the United States will not narrow soon has caused the yen to depreciate. Frustrated with this development, the Bank of Japan apparently has intervened at least twice in the FX market, once on April 29 and again on May 2, to increase the yen’s value against the US dollar. Yet so long as inflation persists in the US economy as it has done over the past few years, the weakness in the yen cannot be remedied, unless the BOJ plans to increase the inflation rate, which would complicate monetary policy.

The yen began its recent journey through the foreign exchange markets on April 26. At a press conference that day, the governor of the Bank of Japan, Kazuo Ueda, said that “Depreciation of yen has had no major influence on underlying inflation so far.” He insisted that monetary policy would not attempt to address foreign exchange rates. He also did not indicate when the Bank would start reducing its purchase of Japanese government bonds.

The market interpreted Ueda’s comments as a sign that the BOJ would not raise interest rates for the time being. That being so, the market believed that the wide interest rate gap between Japan and the U.S. would continue for some time. Money is generally supposed to flow to a currency with a higher interest rate. After the BOJ’s monetary policy meeting, at which the interest rate was left unchanged, the yen was sold, and the dollar was bought. At mid-day on April 29, the foreign exchange rate reached 160 yen against U.S. dollar for the first time since 1990.

A curious trend then began within the hour. The rate rose to 155 yen against dollar, dipped to 157 yen to the dollar, and then settled at 154 yen. These abrupt ups and downs invited speculation that the government of Japan had intervened in the foreign exchange market – unannounced. The Vice Minister of Finance for International Affairs, Masato Kanda, refused to comment. However, looking at the BOJ’s account balance, news organizations reported that the BOJ was likely to have intervened at the request of Ministry of Finance. The BOJ’s estimated current account balance dropped 7.56 trillion yen between April 29 and 30. When this balance drops, foreign exchange firms will experience offsetting increases. However, between April 29 and 30, the firms’ balances increased between 2.05 and 2.3 trillion yen.

The 5 trillion yen gap between the BOJ and the firms is thought to be the amount of the BOJ’s intervention on April 29. This amount approached the BOJ’s largest single-day intervention of 5.6 trillion yen in October 2022.

But the unusual moves in the foreign exchange market did not stop there. After the likely intervention on April 29, the yen still exhibited gradual weakness. Just after the Federal Open Market Committee of the U.S. Federal Reserve Board announced, on the afternoon of May 1 (U.S. Eastern Daylight Time) and the early morning of May 2 in Japan time, that it would leave the target range for the federal funds rate unchanged, the yen suddenly rose from 157 yen against dollar to 153 yen. The consensus view is that the BOJ had intervened again to the tune of 3 trillion yen.

The market was surprised at the second intervention because the yen seemed to be appreciating. The U.S. announcement of no change to the federal funds rate had stimulated purchases of yen. The market previously expected BOJ to intervene when the exchange rate reaches 160 yen to the dollar. The second possible intervention on May 2 occurred before the rate had reached that level, thus clouding expectations of when the BOJ would defend the yen. The exchange rate rose further to 151 yen to the dollar on May 3, after the U.S. jobs report showed a slowdown in hiring. The U.S. Labor Department announced an increase in payrolls of approximately 175,000, well below predictions of approximately 243,000.

The BOJ appears to have intervened in the foreign exchange market because the negative impact of the weak yen on the Japanese economy cannot be ignored. “If excessive fluctuation occurred by speculations, it poses negative impact on people’s life. We firmly deal with it,” said Kanda when asked about the first intervention on April 29.

A weak yen causes the prices of imported goods to rise and exerts downward pressure on real wages. Prime Minister Fumio Kishida has focused on returning the fruits of economic growth to the people, expecting that wages would rise faster than prices. He has also planned a tax cut for June. A depreciating yen may erode the effect of the economic policies of the Kishida administration, which is suffering from historically low approval ratings. Intervention in the foreign exchange market is unavoidable for the administration.

However, the effect of any intervention will be limited. The weak yen is the result not just of the interest rate gap between Japan and the U.S., but also of the relative strength of the two economies. Inflationary pressure is still strong in the United States. Wages are growing at a relatively high rate, encouraging consumption that leads to inflation. The Chair of the Fed, Jerome Powell, said in his press conference on May 1 that the members of the FOMC “do not expect it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2 percent.” Alternatively, the members “are also prepared to respond to an unexpected weakening in the labor market,” he said.

The Fed has shown no sign of another increase in the target rate, but U.S. wages are still increasing. The BOJ’s intervention in the foreign exchange market has no realistic chance of narrowing the interest rate gap with the United States.

Intervention is not a popular tool for adjusting foreign exchange in the international economy. U.S. Treasury Secretary Janet Yellen said that currency interventions should occur only in “very rare and exceptional circumstances,” when markets are disorderly with excessive volatility. Whether the interventions will help the Kishida administration to survive the aftermath of the slush fund scandal is uncertain.

Sunday, May 5, 2024

Monday Asia Events May 6, 2024

STRENGTHENING TRUST WITH INDIA: IMPLICATIONS OF THE 2008 US-INDIA CIVIL NUCLEAR AGREEMENT. 5/6, 9:30-10:45pm (EDT), VIRTUAL. Sponsor: Hoover Institution. Speakers: Condoleezza Rice, Tad and Dianne Taube Director, Thomas and Barbara Stephenson Senior Fellow, Public Policy, 66th US Secretary of State (2005-2009); David Mulford, Distinguished Visiting Fellow, US Ambassador to India (2004-2009); M. K. Narayanan, National Security Advisor of India (2005-2010); Nick Burns, US Ambassador to China, Under Secretary of State for Political Affairs (2005-2009); Eric Garcetti, US Ambassador to India.

WHAT LIES IN STORE FOR THE UN IN 2024. 5/6, 10:00-11:00am (EDT), IN PERSON ONLY. Sponsor: National Press Club. Speaker: Dennis Francis, President of the United Nations General Assembly. [Press Club members only, broadcast on C-Span and via the Press Club]

INSIDE CHINA’S NEW DIPLOMATIC PUSH. 5/6, 11:00am (EDT), VIRTUAL. Sponsor: Foreign Policy. Speakers: Evan Medeiros, Chair of Asian studies, Georgetown University; Ravi Agrawal, Editor in chief, Foreign Policy.

BEYOND THE SCIF: A CONVERSATION WITH REP. BRAD WENSTRUP (R-OH) ON AI AND BIOSECURITY. 5/6, 11:00am-12:15pm (EDT), HYBRID. Sponsor: American Enterprise Institute. Speakers: Dan Blumenthal, Senior Fellow, American Enterprise Institute; Anna Puglisi, Founder, Puglisi Ventures; Anthony Ruggiero, Adjunct Senior Fellow, Foundation for Defense of Democracies; Ken Staley, Senior Counselor, Palantir; Dov S. Zakheim, Commissioner, National Security Commission on Emerging Biotechnology. 

UNCERTAIN BOUNDARIES: NORTHEAST ASIA’S POSTWAR SETTLEMENT AND THE NORTHERN TERRITORIES. 5/6, Noon-1:00pm (EDT), HYBRID. Sponsor: Weatherhead Center for International Relations, Harvard University. Speaker: Sheila Smith, John E. Merow Senior Fellow for Asia-Pacific Studies, Council on Foreign Relations.

12 QUESTIONS FOR JONAS RÜEGG: JAPAN AND OCEANIC HISTORY. 5/6, Noon-1:30pm (EDT), VIRTUAL. Sponsor: Modern Japan History Association. Speaker: Jonas Rüegg, Senior Teaching and Research Assistant, University of Zurich, and Winner of the 2024 Modern Japan History Association Dissertation Prize.

THE CONSOLIDATION OF DIGITAL AUTHORITARIANISM AND LOOMING THREAT OF ARTIFICIAL INTELLIGENCE. 5/6, 1:30-3:00pm (EDT), VIRTUAL. Sponsor: Freedom House. Speakers: Svenja Hahn, Member of the European Parliament, Renew Europe Group; Julien Nocetti, Associate Fellow in the Russia / Eurasia and the Geopolitics of Technologies Centers, French Institute of International Relations (Ifri); Adrian Shahbaz, Vice President of Research and Analysis, Freedom House.

LAUNCH OF CHINESE HANDCUFFS: HOW CHINA HIJACKED THE ENVIRONMENTAL AGENDA. 5/6, 2:00-3:00pm (EDT), HYBRID. Sponsor: Heritage Foundation. Speakers: Landon Derentz, Senior Director, Richard L. Morningstar Chair for Global Energy Security, Atlantic Council; Diana Furchtgott-Roth, Director, Center for Energy, Climate, and Environment; Erin Walsh, Senior Research Fellow for International Affairs.

HANOI’S PROMISES: VIETNAM’S REALITY AND ACTIONS TO ADDRESS HUMAN RIGHTS VIOLATIONS. 5/6, 3:00-5:00pm (CET), IN PERSON ONLY. Sponsor: Freedom House. Speaker: Margaux Ewen, Director of the Political Prisoners Initiative.

MADE IN CHINA: WHEN US-CHINA INTERESTS CONVERGED TO TRANSFORM GLOBAL TRADE. 5/6, 4:00-5:30pm (EDT), VIRTUAL. Sponsor: History and Public Program and Kissinger Institute on China and the United States, Wilson Center. Speakers: author Elizabeth O’Brien Ingleson, Assistant Professor in the International History Department, London School of Economics and Political Science; Margaret M. Pearson, Dr. Horace E. and Wilma V. Harrison Distinguished Professor, and Distinguished Scholar, Teacher, Department of Government and Politics, University of Maryland, College Park. PURCHASE BOOK: 

JAPAN’S FOREIGN POLICY AND GLOBAL POSITIONING: CHOICES, CHALLENGES, AND RISKS. 5/6, 7:00-8:15pm (EDT); 5/7, 8:00-9:15am (JST), HYBRID. Sponsor Asia Society. Speaker: Gideon Rachman, Chief Foreign Affairs Commentator, The Financial Times.

9:00pm-1:00am (EDT), HYBRID. Sponsor: Center for Asia-Pacific Resilience and Innovation. Speakers: Michael Wills, Executive Vice President, National Bureau of Asian Research; Yul Sohn, President, East Asia Institute; Gulshan Sachdeva, Professor, Jawaharlal Nehru University; Syaru Shirley Lin, Chair, CAPRIWei Shyy, Former President, The Hong Kong University of Science and Technology; Bor-Sung Liang, Senior Director, Corporate Strategy & Strategic Technology, MediaTekJarret Su, Co-Head of Healthcare & Life Science, KPMG in Taiwan; Vita Chien, General Manager, AstraZeneca Taiwan; Sunjoy Joshi, Chairman, Observer Research Foundation; Grace Liu, Corporate Sustainability Officer, Acer; Nelson Chang, Chairman, Taiwan Cement; Shuhei Nomura, Associate Professor of Health Policy and Management, Keio University School of Medicine; Steven Pan, Chairman, Silks Hotel Group;
Kristoffer Berse, Dean, National College of Public Administration and Governance, University of the Philippines Diliman; Joe Huang, Director of Lean Planning for Volunteer Development, Buddhist Tzu Chi Charity Foundation.

Wednesday, May 1, 2024

Voters Strike a Blow Against the Kishida Administration

But not a knock out punch

By Takuya Nishimura,
Senior Fellow, Former Editorial Writer for The Hokkaido Shimbun
The views expressed by the author are his own and are not associated with The Hokkaido Shimbun
You can find his blog, J Update here.
April 29, 2024. Special to Asia Policy Point

On Sunday, April 28, voters firmly rejected the Kishida administration and the Liberal Democratic Party (LDP). In three by-elections of the House of Representatives, the LDP lost all three seats. The Constitutional Democratic Party (CDP) won all three races.

The results reflect public frustration with Kishida’s handling of the slush fund scandal and the LDP’s slow progress on political reform. The elections dealt a significant blow to Kishida’s efforts to preserve his administration.

By-elections are held twice a year, ordinarily in April and October, when a seat of any district of both Chambers of the Diet is vacant, either by resignation of a lawmaker, death or for other reasons.

One of the three by-elections, the election in the Shimane-1 district, followed the death of the former Speaker of the House of Representatives, Hiroyuki Hosoda. Hosoda was the head of the Seiwa-kai faction, also known as the Abe faction, which was at the epicenter of the slush fund scandal. Hosoda was also suspected of having close ties to the Family Federation for World Peace and Unification, the former Unification Church, and of having sexually harassed a female reporter.

In the one-on-one match-up in Shimane-1, Akiko Kamei of the CDP defeated Norimasa Nishikori of the LDP by a margin of 25,000 votes. It was almost the same as Hosoda’s winning margin in the last election in 2021. Swing voters who voted for Hosoda three years ago shifted to Kamei.

Kamei’s victory was the LDP’s first loss in this highly conservative district since the current election system was introduced in 1996. Although the Shimane branch of the LDP has been split since the gubernatorial election in 2019, the result of the by-election is widely interpreted as a protest by LDP supporters against Kishida’s indecisive handling of the slush fund scandal.

The second by-election, held in the Tokyo-15 district, filled a vacancy left by the resignation of the former LDP Representative, Mito Kakizawa. He stepped down after his arrest on suspicion of bribery in a mayoral election in Koto city, Tokyo. The LDP did not have a candidate on the ballot, and the election became a contest among nine candidates of the opposition parties.

Natsumi Sakai of the CDP won the race, with the support of the Japan Communist Party. Sakai’s victory showed that the CDP and the JCP can work together successfully in a race that does not include a LDP candidate. The Japan Innovation Party, or Nippon Ishin, took third in the race. A candidate supported by the popular governor of Tokyo, Yuriko Koike, came in fifth.

The third by-election was held in the district of Nagasaki-3 after the resignation of Yaichi Tanigawa. He had been indicted on charges of receiving over 40 million yen in kickbacks from the Abe faction. The LDP did not have a candidate in the race. The CDP’s Katsuhiko Yamada won the seat with 53,000 votes, twice the number of votes that Ishin’s candidate received.

The message of the results in Tokyo-15 and Nagasaki-3 is that voters who gave up on the LDP turned to the CDP, rather than to Ishin. Although the LDP did not field a candidate in two of the three districts, the LDP was seen as suffering defeats in three elections. “It was an extremely severe result. We hope to restore confidence through accumulating efforts for political reform and leading political agenda to solution,” said LDP Secretary General, Toshimitsu Motegi, on the night after the elections.

Defeat in Shimane was a particularly significant blow to the Kishida administration. Typically, the prime minister will join campaigns only for winnable districts in a general election. Kishida unusually campaigned in Shimane-1 twice. The LDP’s loss surely tarnished Kishida’s reputation.

The LDP tried to avoid outright voter rejection by not offering candidates in Tokyo-15 and Nagasaki-3. But the sweeping victory by the CDP and low voter turnout in those two districts showed considerable resentment of old-style LDP politics – the undisclosed use of political funds. The results in the two districts may signal a trend in other districts all over Japan. Indeed, they may mark the end of the era of LDP’s unilateral domination.

The results of the by-elections shocked LDP lawmakers. They will now be forced into close races in the next election. They will certainly oppose a snap election. An attempt by Kishida to call one in June would instigate a movement in the LDP to replace Kishida. Party members will look for a leader who can reduce the number of victims of an unpopular leader in next election.

So far, such a movement has not materialized. Leaders of the Abe faction had questioned Kishida’s leadership. But they have been inactive since they were subjected to severe penalties in the aftermath of the slush fund scandal.

Although Motegi or former Premier Yoshihide Suga have tried to rally some in LDP, there is not a movement for either. The most popular figure to replace Kishida, Shigeru Ishiba, has not decided to run for the presidential election. A strange silence has descended on the LDP. But it is likely that someone or something will ignite a movement against Kishida, as the party heads to the presidential election in the fall.

Even the CDP cannot be optimistic about the next general election. Their three victories were the result of LDP errors. A framework of electoral cooperation is essential if other parties are to replace an LDP administration. The Head of the CDP, Kenta Izumi, once told reporters that it would take five years for CDP to achieve a regime change. It is up to Izumi to build a viable strategy quickly to replace the LDP in the next general election.