Abe’s CSD Report and the Political Agenda

The Advisory Panel on the Reconstruction of the Legal Basis for Security (安全保障の法的基盤の再構築に関する懇談会; hereafter the “Panel” or kondankai) has delivered its report to Prime Minister Abe and the NSC. The main focus of the report relates to whether the Japanese government can and should allow itself to exercise the right to collective self-defense currently considered by the Japanese government to be a prohibited form of the use of force to settle an international dispute. I have outlined the general approach that might be used to reconfigure the current constitutional interpretation here.

The key thing to remember is that the kondankai’s recommendations do not carry any legal weight as they are essentially a private advisory body to the Prime Minister. Abe himself has said the report will point to the general policy direction that he intends to take, although the final decision on CSD and constitutional reinterpretation will be taken later. The report will serve, however, as a maximal point of reference for where Japan’s security policy and SDF activities might go in the near future.
For now, it seems Abe will use the report to assert that Japan cannot defend itself adequately or contribute to stabilizing the regional security environment without making certain changes to its security policy and current interpretations of Article 9. He will argue that such changes will be essential for Japan to continue to enjoy a stable regional environment, as this will help strengthen the US-Japan alliance and allow Japan to play a greater role in regional deterrence.
While indicating his support for many of the positions taken by the kondankai, the language used by Abe in the press conference after the report was released suggested that the changes proposed by the Panel were not a foregone conclusion. This was likely out of consideration for coalition partner Komeito. Abe also attempted to head off wide-ranging concerns among the public and many political elites about how far the changes would go by ruling out the proposal of the kondankai to allow unlimited Japanese participation in United Nations Security Council-sanctioned collective security actions undertaken by multinational forces seeking to restore international order. Abe also suggested that he would only pursue legislation to enable a partial or limited exercise of Japan’s collective self-defense rights. This is opposed to a reinterpretation that would allow the full embrace of the right to exercise collective self-defense, which could allow Japan to use collective self-defense rationales to justify military interventions such as those that took place in Vietnam and Afghanistan.
Even as he tries to present his reinterpretation plans in a moderate light, there are a few different “veto” points Abe will have to negotiate, however – both political and institutional – before this becomes full government policy.
Politically, Abe is to the right even for this rather right-leaning LDP. There are factions and groups within the LDP, including many in the House of Councillors, that are skeptical of the change, either on procedural and legal grounds (ie can political leaders really just “reinterpret” the constitution without Cabinet Legislative Bureau and/or Supreme Court direction?), or in terms of worries about public opinion and electoral backlash. Many less hawkish LDP members are closer to the Japanese public’s attitude in that they support the expansion of activities that the SDF can undertake, particularly in regards to regional security, but are reluctant for the SDF to be proactively engaged in combat overseas, particularly within another country’s sovereign territory.
This is very similar to attitudes within the New Komeito. In addition to a strong reluctance to see the SDF engage in overseas combat, the added complication with Komeito is that the party has symbolically been opposed to CSD since the party’s inception some 50 years ago. The Komeito’s core political support group, Souka Gakkai, is in particular against the change to this core identity for the party, and the organization has already made an official statement asserting that constitutional revision is required rather than reinterpretation. New Komeito MPs themselves are more pragmatic in the sense that they generally support the US-Japan alliance, and are not necessarily against all of the changes that Abe and the kondankai will propose. But the party really does not want to call whatever these changes will be “collective self-defense,” especially if it means they will run afoul of Souka Gakkai. Abe and his supporters, on the other hand, are highly invested in the historical and strategic symbolism around “collective self-defense,” so a lot of the tension between Abe and the Komeito will be focused as much on the language used in any collective cabinet decision, rather than simply being about what the SDF should be able to do.
Within this political context, two institutional checkpoints are important.
First, Abe is trying to rally Cabinet to sign-off as a whole on a new interpretation. This is harder than it might seem as every member of the cabinet needs to sign-off. Former Komeito leader Ota Akihiro is currently Minister of Transport in the Abe Cabinet. If Ota refuses to put his name to any Cabinet decision and Diet bills, Abe cannot proceed and would be basically forced to expel Ota (this would be similar to what happened between the DPJ and Fukushima Mizuho from the SDP over the Futenma relocation plan). That would obviously have significant implications for the coalition relationship which Abe currently relies upon for a majority in the House of Councillors. While they would be unlikely to oppose Abe directly, senior and influential cabinet ministers such as former LDP leader and Minister of Justice Tanigaki Sadakazu, and Foreign Minister Kishida Fumio, head of the less hawkish Kouchikai (宏池会) faction, are skeptical of Abe’s collective security agenda and may wield some influence inside cabinet.
Also, as much as he might want to, Abe can’t just turf out Komeito in favour of pro-CSD opposition parties with sufficient parliamentary strength to give the LDP a House of Councillors majority, even though this is a mathematical possibility. This is because Komeito essentially gives over their votes to the LDP at election time in Japan’s sometimes very close winner-take-all single member electoral districts, especially in urban areas. This is usually in exchange for the LDP not running LDP members in other seats, thereby allowing the Komeito to increase their seat total over and above what they would otherwise get through proportional representation. This relationship is essential for the maintenance of LDP rule, and LDP elders will be very reluctant to allow Abe to single out other parties in the opposition to replace the Komeito in order to  simply have the words “collective self-defense” emblazoned on the new policy. As it is, with the self-destruction of both Watanabe Yoshimi (Your Party) and Hashimoto Toru (Japan Restoration Party), the LDP now has no long-term prospects for collaboration, and in any respect, neither party can deliver votes in the disciplined and consistent way that the Komeito can. Komeito, itself, of course, will be very reluctant to break up the coalition for the same opportunistic reasons, and Komeito’s leader Yamaguchi Natsuo has already said that he has no intention of doing so. Abe and the LDP, however, would like a collective cabinet decision in the books before the end of the year as the US-Japan Revised Guidelines will be revised again.
Second, even if Abe manages to convince Komeito and Minister of Transport Ota to to sign off on collective self-defense and other proposals put forward by the kondankai, Abe still has to go to through parliament and attempt to make changes to anywhere between 10 and 18 laws, including the SDF Law, the UNPKO Law, the “Areas Around Japan” Law, and the Armed Attack Response Law. The two parties will undoubtedly have to make it through some pretty tough questions from the opposition. The opposition will also likely call in experts beyond those who sat on the Panel, and perhaps even former Cabinet Legislative Bureau officials, to contest the kondankai’s arguments. This might hold the legislative process up, especially if already skeptical public sentiment hardens against the proposed changes (with the electoral consequences that might have down the track). It isn’t impossible that some inside the LDP and Komeito get cold feet at some point, especially if the economy starts to stall, or the TPP or some other policy issue rises to trouble the current administration.
 In terms of the whole process of legislation surrounding the Panel’s recommendations, it could take up to 1 to 2 years more. The 1999 “Areas Around Japan” legislation took about two years to negotiate into legislation after the revised guidelines. Ishiba recently told a Washington audience something very similar could happen in this case. From Abe’s point of view, the longer he leaves things up for debate, though, the more politically tense things will become. This is because any controversy and delay will push the changes closer to elections, potentially leading to added caution within the ruling parties. This year is the sweet spot in the electoral cycle in terms of Abe probably not being penalized too much for unpopular policies. Currently, Abe is still in a politically strong position, and has arguably recovered a bit of lost ground since the Designated Secrets Bill and Yasukuni visit at the end of last year. His popularity does not seem to have been greatly harmed by the consumption tax increase last month, and he may be willing to spend political capital on this issue.
Komeito, on the other hand, wants to delay things as long as possible, as that will enhance its ability to extract concessions and compromises from the Abe government, and, they hope, help them avoid compromising on the more controversial elements related to the exercise of collective self-defense. In 2015, we have unified local elections in the spring, and then the LDP presidential elections later in the year. Then in 2016 we have both Lower and Upper House elections, unless current rumours prove true.
The controversy will be kept under wraps for a while longer yet, however. A meeting between the top executives of both the LDP and Komeito will take place on the 20th to discuss how to proceed on “gray zone” issues, relaxing some restrictions on SDF participation and the use of weapons to protect other countries’ militaries and citizens in UNPKOs and other joint operations, and perhaps legislation allowing the SDF to undertake operations to remove Japanese citizens from dangerous areas, as raised by the kondankai.  Discussions behind the scenes on the most controversial live issue of collective self-defense will also be started. What the Panel has to say about the exercise of collective self-defense, and its relation to the debate over its implementation, will be covered here as it becomes more salient over the next few months. For now, below is a brief discussion of the two broader issues of gray zone contingencies and the use of weapons in non-international conflict situations that the LDP and Komeito have already agreed to prioritize in order to essentially keep the political peace for the time being.
Gray Zone Contingencies 
Up until now the SDF has been highly restricted legally in regards to its ability to apply pressure through the threat of, or the use of weapons, even within Japan’s own territory, unless there is a direct and imminent “armed attack” on Japan underway and there is a government mobilization order (such as Defense Mobilization, Maritime Security Operations, or Public Security Operations Orders). There are no provisions that allow the SDF to immediately react to situations which may sit within the “gray zone” between peace and an “armed attack,” currently defined as an “organised and planned use of force against Japan.” The panel in particular has identified illegal and non-innocent submarine incursions into Japan’s territory, attacks on nuclear power facilities, as well as surreptitious paramilitary or guerrilla “invasion” of the remote islands (ie the Senkakus) for the purposes of exerting control over the islands, as three particular issues of concern. The argument is that such aggressive infringements, which could have implications for the security of Japan in addition to being infringements of domestic law, or could represent preludes to an organised armed attack, could best be handled through SDF deployment, rather than relying on the Japan Coast Guard and police through “law enforcement powers,” as has been the legal requirement up until now.
The political debate over better addressing such gray zone contingencies is generally uncontroversial. It was first mentioned in the 2010 NDPG released by the DPJ government as requiring addressing, and both the LDP and the Komeito appear to support adjustments to legislation.

The use of weapons in situations not considered the use of force

The kondankai identified two general situations, not considered to be the use of force in international law, within which the government has said it will consider relaxing restrictions on the use of weapons.

  1. 駆けつけ警護 (kaketsuke-keigo), removing obstructions to missions, protecting civilians

Currently the SDF is generally only allowed to use weapons in UNPKO missions to protect themselves and foreign civilian and military personnel under their direct supervision. 駆けつけ警護 (kaketsuke-keigo) missions, however, are emergency aid and protection operations that may involve the use of weapons to come to the aid of geographically distant unit under attack or personnel participating in the same UNPKO. Such personnel could include members of foreign militaries, members of NGOs or IOs or other cooperating civilians. The current constitutional interpretation regards such operations to possibly constitute a form of prohibited use of force overseas if the concerned personnel are being held or attacked by a quasi-national or state organization.

The Panel, however, argues that no other nation interprets the “use of weapons” within the context of the international standards set down for UNPKOs (which are generally post-conflict in nature) as being equivalent to the use of force, irrespective of whether the hostile party is a disorganized criminal group, a guerilla force, or a quasi-state organization. Furthermore, the panel argues that as UNPKOs are supposed to be carried out with impartiality, with the consent of the main parties to any conflict, and subsequent to a de facto ceasefire, any legal use of weapons within such missions to protect other civilian and military members of a UNPKO, or civilians in general in a sudden breakdown of peace, should not be considered the constitutionally prohibited “use of force to settle an international dispute.”

Based on similar logic, the panel also suggests that the SDF be allowed to, based on the rules of engagements and standards set down for UNPKOs, remove obstructions to UNPKO missions, and also to allow protection of civilians and the maintenance of security within the context of UNPKOs taking place in fragile states.

In addition to cooperation on gray zone contingencies, the Komeito appears in the last few days to have agreed to allow some relaxation of the use of weapons within UNPKOs might be justified since they believe public opinion is accepting of the use of weapons in such limited cases.

2. Protection and Rescue of Japanese Nationals Abroad

Citing the 2013 Algerian terrorist incident, the kondankai has also suggested the need to allow, within the limits prescribed by international law, for the SDF to come to the rescue and protect Japanese nationals abroad and, if necessary, use weapons to accomplish their missions beyond simple self-preservation. Until this incident the Japanese government had limited ability to dispatch the SDF to allow the protection of Japanese citizens abroad. The kondankai suggests that this is not sufficient and the SDF should be given greater powers. The panel argues that under international law the protection and rescue of nationals abroad is permitted if consent is given by the territorial state, therefore making them “efforts to supplement or substitute security activities of the territorial state.” They also argue that international norms, and previous statements by the Japanese government on these norms, allow the dispatch of military personnel to protect their nationals when another state does not have the will or capacity to protect them against severe attacks on foreign nationals, and could be considered the exercise of self-defense as the responsibility of the state.

The LDP and Komeito coalition will make these issues the top priority for collaboration in the new Diet session in the second half of 2014. It will be subsequent to this, likely in the autumn, that the debate over collective self-defense will heat up between the LDP and Komeito, although deliberations will start in the House of Councillors this month, as is the House of Councillors wont.

Japanese Elections: “Least-hated” rather than Popularity Contests

A lot of Japanese opinion polls tend to be of limited analytical value – either the questions are too general, too focused on “political” rather than policy issues, or are simply obscure and give no indication about priorities. However, the Asahi Shimbun has released (日) a poll a few days after the election that pretty much tells you everything you need to know about Sunday’s election and what the public was thinking.

It is certain that LDP President Abe Shinzo will become the prime minister. Do you have expectations of Abe?

    Have 51%

 Don’t have 42%

This is actually quite low. It probably relates to Abe having already been PM. It is probably going to get lower if he appoints former PM Aso to the foreign minister position as is being rumoured- Aso’s perceived incompetence is one that only rivals Hatoyama, and in any respect such an appointment will raise the spectre of “Tomodachi Naikaku 2.0″ as Aso served as Abe’s FM first time around.

Together the LDP and Komeito have a super-majority of 325. Is this a good thing?

 Good thing 35%

 Not good 43%

Well…that is unfortunate isn’t it people…

In the last election we have returned to an LDP-centred government. Is this a good thing?

    Good 57%

 Not good 16%

So people wanted to get rid of the DPJ, but only vaguely wanted the LDP in, and certainly didn’t want them to have too much power…

Do you think the reason that the LDP was able to do so well was because the public supported its policies or because of disappointment realting to DPJ’s time in government?

 LDP policies 7%

 DPJ disappointment 81%

Wow. We already knew this, but this is about as decisive a result as you will see from the Japanese electorate on any issue. So very, very damning for both the LDP and the DPJ.

In the election the DPJ lost many seats and fell back into opposition. Do you want the DPJ to rejuvenate as a rival party to the LDP?

 Yes 53%

 No 38%

This is more than I would have expected. Maybe the two party system shouldn’t be written off just yet?

The JRP increased its parliamentary presence from 11 seats to 54 seats. Do you think this was a good outcome?

Good 56%

Not good 22%

This really suggests that the JRP is leaving a lot of “points on the field” so to speak. Consistently about half of the public before the election wanted to see the JRP have more influence. But relatively few could bring themselves to vote for them. Clearly Ishihara is part of that, but Hashimoto himself really needs to focus on the key issues that make him fleetingly popular.

The election resulted in the lowest postwar voting turnout. Why do you think this is so?

 No issues of interest to me 6%

 No party or candidates I wanted to vote for 29%

 Even if I vote nothing is going to change 51%

    The timing was inconvenient 8%

My interpretation: 80% alienation, and only 14% laziness.

What policy issues were of the most concern to you in the election?

 Economy and employment 35%

 Consumption tax and social security 30%

 Constitutional revision, diplomacy and security 12%

 Nuclear and energy issues 17%

S0 82% concerned with domestic issues – only 12% at most were interested in the “rightward” agenda of the LDP and JRP. No wonder the public was disappointed. We got a bit of talk on the economy, but most of the debate was taken up by foreign policy issues [not an issue for me personally of course] and pointless bickering regarding whose uninspiring energy/nuclear plan was more or less realistic.

In recent elections there has been a trend of parties gaining and losing significant amounts of seats. Do you think such large reversals are a good thing?

 Yes 27%

 No 57%

Interestingly, LDP SecGen Ishiba Shigeru has come out and suggested that the government look at this very issue in the context of electoral reform. But then again, Ishiba is known to speak sense from time to time.

What Can Ishihara and Hashimoto do Together?

Two of the biggest egos in Japanese politics have found some room for compromise  (日) after weeks of dancing around the issue of working together. Ishihara Shintaro has recognized that Hashimoto Toru’s Nippon Ishin no Kai has the better political brand positioning and has decided to fold his party into Hashimoto’s for the upcoming election. However, Hashimoto has allowed Ishihara to take the lead (for now) and relegated himself to second position in the new collaboration’s set up. They have also managed to put behind them a few policy major differences and have announced a somewhat clear (relatively speaking) memorandum of agreement on what the party would actually initially focus on if it was in the position to affect the passage of legislation/policy-making in the next Diet.

What is notable is a failure to mention constitutional change. This is probably smart, as while no one will be confused regarding either man’s general orientation towards foreign affairs, issues of constitutional change, education and nationalism, and security policy, are things that the Japanese public has consistently indicated in polls are secondary to fixing the domestic political system, the economy, and other pressing social issues. The order of addressing these issues is important to the public, and it would seem that Abe and the conservative wing of the LDP are forgetting (日) this already.*

The document the two sides produced is reasonably short – a rough summary follows:

【1】 Breaking down the centralization of power

Establish a new tax collection system with increased local government responsibility for collection and deciding on its use- the consumption tax, to be increased to 11 percent, will dedicate five percent for fixed government financing and six percent for shared local government finances

【2】 Begin discussions around the doushuusei (a psuedo-federal) system for organizing regional governance

【3】 Initiate policies for the creation of an economy focused on successful small, medium and micro-business enterprise.

【4】 For funding the social security system, introduce appropriate insurance premiums, revise payment conditions, and remake the personal and asset taxation system.

【5】 Look towards participating in the TPP but in discussions ensure that the national interest is not harmed. [A well needed corrective, probably forced upon Hashimoto by Ishihara] In addition there is a need to introduce policies to enhance the competitiveness of the agricultural sector.

【6】 Establishment of a new energy distribution system

With regards to nuclear power, there needs to be (1)Construction of [new] rules regarding(a)safety standards(b)a new safety assurance system (c)processing of spent nuclear fuel(d)identification of responsibility; and(2)Liberalization of the energy sector [away from the regional monopoly system]

【7】 Regarding the Senkaku Islands dispute, push for China to go to the International Court of Justice to resolve the issue. If a case is brought against Japan by China, then Japan should respond in kind.

【8】 Ban party and Diet member donations from businesses and associations. Expand system for encouraging individual donations. As a transitional measure, have an upper limit for donations by businesses and associations

Afterword: The above list of objectives is a reasonably pragmatic, and frankly well needed, simplification of the various ideas floating around between the “third pole” parties. Perhaps Hashimoto in particular has realized that there were too many question marks over what he and his group would do with any power given to them by the citizens. It is also a response to recent criticism by both the LDP and DPJ who have suggested that deals made by the various small parties would be nothing more than “unholy alliances” (an ironic criticism to say the least). In any respect, the aggregated support rate for the various third pole parties (including Your Party and Tax Reducation Japan) still sits under ten percent depending on the opinion poll. A failure to improve on that figure, as well as to pool resources and field candidates in various SMD districts around the whole country, will not only curtail Ishihara and Hashimoto’s long-term ambitions by diluting their leverage, but given the electoral math,** would likely result in the LDP and Komeito coalition securing a majority on December 16th, thereby making the song and dance about the need for a “third pole” moot.

* The proposal is to remove the clause in the textbook certification process that requires consideration of the historic relationship with neighbouring countries. In fact they want to overhaul the whole system of textbook certification and design process, with its “masochistic tendencies,” as a way of making children appreciate ‘traditional Japanese culture’ and to regenerate the Japanese education system. Because that is obviously the main and most pressing problem with the Japanese education system…

** A subject for a post perhaps later next week if some useful opinion polls come out.

The DPJ Submits the Electoral Reform Bill (and Noda Adds a Twist)

The DPJ submitted (日) the electoral reform bill to the House of Representatives today. It is apparently the same as the bill that was rejected in the last Diet session. This is the one where the single member district seats are reduced from 300 to 295, with the reductions coming in the least populated prefectures. The PR seats are to be reduced from 180 to 140, with 35 of those seats being apportioned in a way favourable to the smaller parties.

However, Noda has stirred things up by saying (日) in Diet question time that a 2012 election (or as the reports mentioned, a dissolution of the Diet on the 16th – meaning Friday!) is a distinct possibility if the LDP and Komeito pass the electoral reform bill (edit/correction: and promises (日) to cooperate on passing a bill reducing the number of HoR seats and cuts Diet member expenses by 20 percent in the next Diet session).

This puts the pressure on Abe for the time being and maybe buys Noda a little more time on the TPP- does Abe want the PM’s job so much that he will give the DPJ a minor victory just before the election? A victory that could allow them to go into an election arguing that they passed a new tax but also cut the salaries of bureaucrats, and extracted a promise that will result in the reduction of discretionary spending of Diet members, and also cuts the number of HoR members in (symbolic) recognition of the burden placed on citizens.* Along with a commitment to the TPP this would appear to be the narrative Noda would want to promote.

He may succeed not only because of the LDP’s and Komeito’s eagerness to get back into government but also because they may all be collectively mindful of the impact “third-pole” parties, currently amassing their troops, may have if the election is put off too much longer. Indeed it would seem that the three main parties are anticipating some kind of post-election collaboration as the DPJ, LDP and Komeito have come to an agreement on the rules for passing the issuance of deficit covering bonds until 2015, for the ostensible purpose of avoiding subsequent governments being held “hostage” to the issue of government finances. This has essentially been an issue since 2007 when the ‘twisted Diet’ became a regular feature of Japanese politics.

Nevertheless, the next move would seem to be Abe’s on the electoral bill** – there are signs that the LDP may be open (日) – then followed perhaps by a decision on the TPP by Noda going in to the Cambodia East Asia Summit meeting.

*”身を切る改革”

Edit: It seems that while Jiji reported that the DPJ submitted an electoral reform bill with both the constitutional correction and PR reduction elements, it seems the focus is on whether the LDP and Komeito will “promise” to have discussions (and eventually pass a bill) over reducing the PR and overall number of seats in the House of Representatives during next year’s Diet session (as well as reducing by 20 percent Diet member expenses)- after an election. (ie deal with the constitutional issue now but allow Noda to say he extracted promises regarding reducing the financial burden of Japan’s HoR)

Further Edit: The Yomiuri suggests (日) that although the constitutional correction may be passed the election will be held under the current demarcation. It is less than clear whether this will satisfy the Supreme Court. Abe and Komeito leader Yamaguchi appear to be open to the idea of passing the correction now and promising to deal with the other aspects of electoral reform later according to post-debate announcements. So it seems likely that we will have an election on December 9th or December 16th.

Noda’s Next Step: the TPP?

Below is the more detailed and longer version of my piece on Japan and the TPP published over at the East Asia Forum.

Speaking of publishing elsewhere, I also am making regular contributions to the Shingetsu News Agency’s news site. SNA is a foreign independent news agency in Japan- one of the few, but well needed. They cover a lot of Japan stories on the ground too, which is becoming less common for international media agencies – see some of their videos here.

There is of course also Japan Security Watch and Asia Security Watch. Anyway, enough of the PR!

Why the TPP will not be Noda’s next big challenge

International expectations of Japanese Prime Minister Noda Yoshihiko’s administration seem to have increased greatly since his success in getting the consumption tax and related social security bills through the lower house late last month. Matthew P. Goodman a former White House coordinator for Asia-Pacific Economic Cooperation (APEC) and the East Asia Summit (EAS), writing for the CSIS, argues that[1] Noda needs “to make one last push over the next few months to secure Japan’s economic future—and his own legacy as one of the most effective Japanese leaders of the postwar era.” The Financial Times’ Mure Dickie[2] also writes that “the black-belt judo enthusiast should not be satisfied with a tax rise as his only legacy,” and along with Goodman suggests that Japanese commitment to joining TPP negotiations should be one of Noda’s main goals going forward.

Certainly Noda has been by the most effective of the (3) DPJ prime ministers. Unlike his predecessors Hatoyama Yukio and Kan Naoto, Noda has remained focused by taking on one policy challenge at a time, and has been calm, resolute and consistent in articulating his rationale for addressing said policy problem. He has avoided needlessly alienating supporters and potential allies, and most importantly, has focused pressure on his adversaries’ weaknesses and vulnerabilities in order to drag them into reluctantly supporting his policy program. While he stumbled in his first few months, he has managed to retain influence in articulating the narrative surrounding the “meaning” of his premiership, something that Hatoyama and Kan both lost early on in their tenures.

If one accepts the above evaluation of the Noda regime, then it would not be unreasonable to think that Noda may well have one or two more policy successes up his sleeve. Noda, and the DPJ, certainly need more than the single, unpopular success of raising the consumption tax to fight the next election on the basis of ‘effective leadership.’ Given that Noda identified joining the TPP as a priority late last year it is therefore natural to speculate that Noda may push forward with a bold Japanese bid to join the growing list of TPP nations in time for September’s APEC meeting in Vladivostok.

There are however many reasons why the TPP will not take a prominent place in Noda’s thinking over the next few months. Aside from the recent challenges surrounding the political management of his much reduced lower house majority, Noda will find pushing forward on the TPP much less attractive than he would have late last year. At the time, Noda found a proactive approach towards the TPP useful as it allowed Japan to temporarily take the focus off Futenma in the, at the time, troubled US-Japan relationship. It also seemed to stimulate Chinese interest in looking at pushing ahead with a trilateral trade agreement with Korea and Japan, giving Japan some diplomatic space for maneuver. This, Noda would have hoped, would have reduced the risk of foreign policy undermining his ability to push forward on domestic issues such as happened with his two immediate predecessors.

However much has changed since then making pushing forward on TPP even more unpalatable than it would normally be as a policy issue to burnish his credentials as a persistent, pragmatic and effective political executive. This time it is not Japan’s hesitancy to take on small but powerful political interest groups, but the US domestic situation that seems to be the biggest barrier to Japan’s entering TPP negotiations. In late May the United States gave a signal that it would start pressing Japan to reduce the nontariff barriers to car imports in talks over Japan’s participation in the TPP. [3] Then came news that the US required concessions in six areas related to automobiles before allowing Japan to join TPP negotiations. The necessary concessions would include relaxation of technological, ecological and safety standards, tax treatment for different engine displacements, and concessions on customer service and distribution. [4]

However Japanese industry reacted with incredulity to both the suggestion that Japan’s automobile market was a closed one and to the unreasonableness of what Goodman curiously describes as “token concessions.” Toyoda Akio, the head of Japan’s automobile industry association and president of Toyota Motor Corp., told the Japanese media that he was “greatly confused” by US requests. He declared that “Japan is an open market without any restrictions on imported vehicles and without any tariffs (on those imports),” and called for an “open dialogue based on facts.”[5] Toyoda also pointed out that Japanese car manufacturers were already having a hard enough time with the extremely strong yen and the weak dollar, something that should have seen US car manufacturers become much more competitive in the Japanese domestic market. The Japanese side argues that poor sales of US cars in Japan are the fault of US automakers and note that there are higher sales of foreign cars in Japan’s domestic market, just not American cars.

Looking at the Japanese media it appears that it has become conventional wisdom in Japan that accusations of Japanese protectionism and demands for unreasonable concessions are ironically part of a US auto industry strategy to maintain US tariffs, currently set at 2.5 percent on imported passenger cars and 25 percent for trucks.  Believing that the Japanese will not accede to these demands, the goal, it would appear to the Japanese, is no more than the exclusion of Japan from the TPP, or the US receiving an exemption for its auto industry – something that would only take place if Japan received a similar exemption for its own sensitive agricultural sector.

At about the same time as Toyoda’s remarks, METI Minister Edano met with U.S. Trade Representative Ron Kirk on the sidelines of an Asia-Pacific Economic Cooperation (APEC) meeting of trade ministers in Kazan, Russia.  The Asahi Shimbun reported that a Japanese source had said the talks had turned into a “game of chicken,” with both sides refusing to back down, despite the Edano-Kirk meeting lasting 20 minutes longer than the expected 45 minutes. [6]

On June 14, Yamaguchi Tsuyoshi, the Parliamentary Senior Vice-Minister for Foreign Affairs who accompanied Edano to the Kazan meeting, told a lower house agriculture committee that there was little hope for Japan being accepted into the TPP until after the US presidential election. [7] This is due to political sensitivities surrounding the US automobile industry’s influence in crucial swing states. Noda at the same time stated that he was not going to force a decision on joining the TPP by the then upcoming G20 meeting, [8] suggesting that a decision would be put off further. While some Japanese media outlets such as the Yomiuri lamented the possibility that Japan would be left behind when Mexico, and then Canada – both countries that declared their interest around the same time Noda did in November last year – announced that they would accept an invitation to join TPP negotiations during the mid-June G20 conference, [9] the Japanese government seemed to be unmoved. After a 19th June cabinet meeting Edano said in response to news of Mexico joining that “every country’s situation and conditions are different, and there is a need to continue to investigate and discuss with internal stakeholders.”[10]

The Japanese government’s suspicions were confirmed at the end of June. First US presidential candidate Mitt Romney, reacting to pressure from the three biggest automakers stated that he did not support Japanese participation in the TPP “at this time.”[11] Later US Senator Sherrod Brown of Ohio introduced legislation “aimed at preventing a new Pacific trade agreement from harming auto employment.”  Then 132 House of Representatives’ Democrats (about two-thirds of the caucus) also sent a letter demanding more transparency and better consideration of US stakeholders’ interests to USTR’s Ron Kirk. This coincided with an energized effort by US automakers to put pressure on Washington to not let Japan join talks on the TPP. For example Ford’s vice president of international government affairs Stephen Biegun declared that “It is just simply wrong the decision to put in that discussion a country which is demonstrably protected and closed to American exports.” [12]

While the Japanese auto industry rejected the claims by Ford in particular, arguing that Ford had “chosen to essentially withdraw from the Japanese market” and refused “to seriously compete there,” the fact remains that Japan is did not participate in the 13th round of TPP negotiations in San Diego taking place now, and is unlikely to participate in negotiations in the near future. Those calling for Japan’s immediate entry into the TPP in order to reinvigorate its economy, and for Noda to expend political capital on this goal, need to consider how disastrous it would be for Noda to pursue TPP accession under the current conditions and limitations.

There also needs to be more balanced discussion on what the real factors that are obstacles to Japan joining the TPP. One such factor is that it is not just the Japanese domestic political situation that is an obstacle to strengthening the multilateral trade order in the Asia-Pacific. Neither is it that the Japanese are still necessarily hostile to entering trade agreements with countries with sensitive sectors as seems to have been the case in the past. In the last three years the Japanese have made small but positive steps towards furthering discussions and negotiations to enter economic partnership agreements with nations such as China, Korea, Australia, the EU, and most recently, Canada, in addition to completing agreements with Switzerland, Peru, Vietnam and India. Politically, while the current group of national politicians is still undecided on the merits of free trade, supporters of administrative reform such as Hashimoto Toru are very much, in principle, in favour of increasing trade relations and Japan’s economic internationalization. Aside from MAFF and affiliated organizations, within Japanese officialdom there is increasing openness to liberalizing trade relations and indeed some see it as vital.

Nevertheless, the Japanese focus will remain in the medium-term on forging trade agreements with those nations where the benefits are most clear, and not with countries which insist on “protection” for not only industry interests in their own countries, but are also essentially demanding “protection” in the domestic markets of others, such as we are seeing in the US automaker’s case.


Noda Goes for the Lenient Approach

As expected Noda has chosen the pragmatic option and gone with probably the lightest possible treatment of the non-defectors who didn’t vote yes on the consumption tax bill.

Aside from the immediate expulsion of the 37 defectors from Monday, Hatoyama has been given (日) a six month suspension. 18 “no” votes were conveniently given a 2 month suspension, and 15 more were given various kinds of reprimand. This means the latter 33 will be able to vote in the September DPJ leadership election.

It also seems that Ozawa right-hand man Yamaoka Kenji was being far too presumptuous in submitting the notice of resignation of some lower house members from the party – 3 have now claimed they had not actually decided to do so and after all wanted to stay in the DPJ. One has also told the press (日) that he will remain an independent and for now and will not join the Ozawa party. There may be others who are considering this option. So at this point we have 36 lower house defectors likely to join “New Party Ozawa,” with 9 members from Kizuna almost guaranteed to join plus 3 more from Suzuki Muneo’s Shinto Daichi. The total now sits at 48 maximum lower house members for Ozawa’s party, which will give Noda and the DPJ a little more room should some stragglers join the Ozawa Shinto

Ozawa Leaves the DPJ: A Minor Victory for Noda

Or at least a more favourable development for Noda’s quest to extend his already somewhat unlikely administration’s longevity.

There were three numbers of primary importance that would have concerned Noda in regards to Ozawa’s expected resignation along with his most loyal members.

55

The number of House of Representatives members that would need to leave to reduce the DPJ-PNP coalition to a minority government. The implications of this would be that this coalition would not be able to defeat a no-confidence motion without support from outside parties, or would be able to pass the budget.

42

The number of House of Representatives members that would need to leave to give the new Ozawa party the right to put forward a no-confidence motion. The assumption here is that the 9 members of the Kizuna party of Ozawa-ites who had already left the party would join the new party.

So how many did House of Representatives members Ozawa manage to convince to leave the party?

40 (日)

This will enable Noda to breathe a little more easily. Not only can the Ozawa party not bring down the government but they cannot submit a no-confidence motion. The LDP could still of course bring such a motion, but its leaders will be mindful of  the passage of the LDP-DPJ-Komeito negotiated consumption tax/social security bills. The public may not appreciate the LDP both cooperating with and seeking to bring down the government at the same time, despite that being exactly what they have been trying to do, quietly. It would have been so much better if disgruntled members of the ruling party were the ones to bring such a motion. The Ozawa party will likely collect the necessary members at some point in the near future to enable it to submit such a motion, but it takes away the immediate risk.

19

The other number, which they were unlikely to get in any case, relates to the House of Councillors. This would have reduced the DPJ to being the second largest party in the House of Councillors, and led to the loss of the associated procedural privileges and control of the agenda. Ozawa managed to convince 12 House of Councillor members to leave.

There is however one other interesting number – 6 – that may be more consequential. The DPJ-PNP and Komeito will not be able to pass legislation on their own. This most likely will have consequences for the DPJ’s planned electoral reform mentioned previously, which is part of an attempt to drive the LDP and Komeito apart in terms of electoral cooperation. Furthermore, if a lower house election was to be held before July 2013 when half of the current House of Councillors members’ terms are up, then the DPJ and the Komeito, if they had such an option based on the results of such an election, would not have control of both houses of the Diet.  Any such government could potentially spend time spinning its wheels until the July 2013 upper house elections.

The other main reason for Noda to be not completely unhappy with this outcome is that he does not have to dirty his hands publicly doing what he may have been pressured into doing anyway – ‘dealing’ with ‘Ozawa’ once and for all. There was internal and external pressure for Noda to cast off Ozawa, and while Noda was none too happy himself with Ozawa’s defiance, a combative threat of expulsion for Ozawa specifically or long-term suspension of all those who went against the party could have led to a much larger exodus of party members that he would have wanted (as per the numbers above). A bitter and protracted “fight” over the appropriate level of punishment could have broken out, especially given the quite reasonable criticism that Noda administration had betrayed the DPJ’s original manifesto, and lost its electoral mandate in pushing forward with the consumption tax rise.

Now Noda can be strategically lenient towards those in his party who did vote no or abstain on the consumption tax bill without necessarily being seen to be taking a “weak” stance on party unity and discipline. He can also go to the LDP with a request to quieten down on DPJ internal issues now that Ozawa is “gone,” as the LDP has been demanding for some time. They will still make some noise – as they were an hour after the announcement (日) –  about needing to go to the public to “ask for the citizen’s trust,” but it is likely to be less enduring than it would have otherwise been given the exit of Ozawa. This removes one more issue for the opposition to use in regards to maneuvering around legislation and the timing of the next lower house election. This by no means means that Noda is safe until the September end of the parliamentary session, but it may give him some space to implement a political strategy for further extending the life of his cabinet.

Is this the End for Yoshihiko Noda?

57 against. 16 no shows or abstentions. This has made things somewhat more difficult for the Noda administration.

As explained the dilemma will now be that the application of strict penalties could lead to the DPJ losing its lower house majority and make it vulnerable to losing a no-confidence vote, while a soft application of penalties could be used by Noda’s political enemies in other parties against him in political posturing.

Ultimately Noda and the senior leadership should come down on the side of softer/delayed penalties. While the LDP in particular will try and herd Noda into undermining his own government by taking a hard line, it will be a dangerous game for the LDP to play out too publicly. If the LDP president Tanigaki plays games in the upper house around the tax/social security bills trying to force Noda to cut loose Ozawa and the 57, it may help him achieve his goal of forcing an early election but it will not do the LDP any favours in that election.   Tanigaki and the LDP voting against the tax bills on the basis of another party’s internal affairs will be too much for most to stomach – particularly because they themselves have argued the reforms are necessary for Japan’s fiscal future and have already voted in favour of them once. I suspect the DPJ will figure that out in due course and in the mean time will try to drag out the punishment process as long as possible.  I would expect the bills to pass the upper house in September as planned.

On the issue of a supplementary budget or other legislation however then it may be another matter. While Noda was able to successfully maneuver the LDP into voting for the tax bills without having  to give up his trump negotiating card, a negotiated election set for after the next LDP and DPJ party elections in September may well  be the pound of flesh extracted for any further cooperation on legislation. Komeito has expressed a preference for an election in the second half of this year as well.

If Noda can make it until August however without too much political damage then there may be another factor he could exploit – that of what could turn out to be desperate maneuvering for the role of LDP president. We may see all sorts of actors come out of the woodwork due to the, perhaps dubious, assumption that the next LDP president will be Japan’s next prime minister. In reality no one in the LDP wants to see Tanigaki succeed, and LDP hopefuls will want to be the ones to take credit for bringing down the DPJ government.

On the DPJ leader elections, under normal circumstances it is difficult to imagine the September DPJ election going against Noda unless he handles things badly in the next two months- the most likely candidates  have been prominently co-opted into either the consumption tax process (Maehara and Okada) or the restarting of Japan’s nuclear reactors (Edano or perhaps as an outside “election face,” Hosono). The one extenuating factor in this case is that the next DPJ election will allow DPJ party executives, regional politicians, and paid-up DPJ members to vote, which could be exploited by someone running a more populist campaign.

The other thing to watch for is the election reform bill. While the fuss over the tax bill was being played out the DPJ submitted to the relevant parliamentary committee its bill which it is hoping will eventually be backed by the Komeito. The DPJ has said that it is going to go ahead with a vote on the bill one way or another, so unless the Komeito party reacts strongly against it the LDP will also have another difficult choice to make – go against the bill but risk ‘splitting’ the LDP-Komeito relationship of convenience (some in the Komeito have come and said that the DPJ bill would lessen the incentives for the Komeito to cooperate with the LDP in the next election) or go along with a bill the party does not like. Noda may be able to use  this bill as leverage to fend off LDP demands on other bills.

Finally it seems that Hashimoto is on the move again – and his timing was good – perhaps too good. Just  a few days before the tax/social security bills passed the lower house Hashimoto came out all guns blazing against the betrayal of “manifesto politics.” He argued that, given the original DPJ pledge not to raise the consumption tax for at least four years, the DPJ was in passing the tax bill taking the concept of pragmatism far too far, and that actions such as the DPJ’s are the reason that Japanese do not have trust in the public. He makes a good case that will be hard to deny. Of course for Hashimoto the timing was good because the bills were a fait accompli. Hashimoto has in the past been reluctant to state his explicit view on the consumption tax rise, saying that a reorganization of the Japanese administrative structure would be required before making such a decision. He was over the last few days very careful in his words to not attack the consumption tax rise directly but rather the DPJ’s style of politics around it. The reality is that the DPJ seems to ahve done the dirty work for more populist parties campaigning on the basis of fiscal and administrative reform. That the DPJ has brought the LDP along with them is all the better. It is very unlikely that any party is going to roll back the consumption tax rise if it claims power. Even if such a party(s) was earnest in its attempt to cut spending and weed out waste in the political and bureaucratic system, there will still be a hole. This will help them reduce this somewhat and may make it easier for them to keep a hold on power. That may be the important long-term consequence of Noda’s success, even if in the short-term it has made things considerably more difficult for the DPJ and himself. 

The DPJ after Today’s Consumption Tax Vote

After an initial delay the legislation has been submitted and the roll call for the first of the various bills that fall under the  “social security and tax reform” designation pushed forward by the 3-party DPJ, LDP and Komeito (non-)coalition is expected to take place around 2.20pm Japan time today.

The situation seems to be coming into focus and there is good news and bad news for the Noda administration. As predicted Prime Minister Noda seems to have been quite successful in convincing the “middle-roaders” to bite the bullet and vote for the bill(s). He has not been so successful however in picking off those less resolute Ozawa/Hatoyama group members by convincing them to abstain or not turn up to the vote. The media strongly believes that 57 DPJ lower house parliamentarians have resolved to vote “against” the bill. If it was somewhere in the 40s then Noda could deal with these members however he wished. However any number above 50, and then 54 if we include the DPJ’s now quite subservient PNP coalition partner, would mean expulsion would likely lead to a no-confidence vote against Noda actually passing. Noda will thus be forced to either be lenient on even those that voted directly against the legislation, or be willing to take the risks of operating a minority government where LDP outrage on any issue – faux or otherwise – could lead to the end of Noda, or if a replacement cannot acquire the confidence of parliament, lead to a general election.

The LDP, citing Koizumi’s actions after the postal reform bill was rejected the first time in 2005, will be pushing the DPJ to expel the rebels from the party. Of course. The difference  is however that these rebels will not have actually prevented the legislation from actually passing and thus not as spectacular a public challenge to Noda’s leadership. There is leeway – especially as there is no DPJ precedent for dealing with this kind of situation – for Noda to treat the rebels somewhat more leniently. Indeed it will likely be very much in his interest to do so.

And the good news on this front for Noda is that it seems that only about 36 to 40 of the most hardcore Ozawa-ites have determined to leave the party after the vote and to set up a new party. With the Kizuna party, they would form a bloc of roughly 40 to 50 or so parliamentarians. While there might be up to 70 DPJ members who will not vote for the bill, not all wish to leave the party. Hatoyama, curious as always, has declared that he will vote directly against the bill – but he will not leave the party and does not wish to break the party apart. Under normal circumstances such a statement would seem to be putting the cart before the horse, however Hatoyama understands that DPJ executives will ultimately be forced to treat those like himself more leniently.

The question will therefore be how lenient – and how will those who wish to stay in the party react to that? One suggestion has been the suspension of party privileges for a designated period of time. However if the suspension is three months or more, then this will prevent such members from voting in the September DPJ presidential election. This may be unacceptable to some and they may end up leaving anyhow. There are some calls within the DPJ for the application of any penalties to be “delayed.” One option here may be only applying the penalty closer to election time, where essentially the DPJ would withdraw official party endorsement for that members reelection campaign. This would probably be the expectation of anyone submitting a “no” vote anyway, and at least in the interim they could enjoy the benefits of being in the government party while they consider their next move.

The DPJ party executives will be working the phones up to the last minute. They have constructed a document ranking DPJ members in terms of their resoluteness in terms of voting yes or no. Noda himself has been calling around. Will there be any last minute deals struck that may get the straight no votes down to around the low 50s? Another interesting thing to watch out for will be whether party discipline holds for the LDP as well. We may know around 5pm today.

…and then we will need to start thinking about the passage of the bill through the House of Councillors. It will pass – but there will be implications for defections and subsequent treatment in this as well – especially since one way or another the House of Councillors is locked until July 2013.

Update: Hatoyama has just now thrown (日) up another option that may justify lenience- he is only going to vote against the specific bill raising the consumption tax, not the full suite of bills. He and seven others may do this. Could this be a last minute Hatoyama classic which undermines the resolve of other members to vote against the prime minister (ie safety in numbers)? Or simply a distinction without a difference?