The DPJ’s Third TPP Attempt? (Edited)

President Putin was unable (日) to juggle his schedule and his aides had become concerned about his “condition.” A December meeting between Putin and Noda was suddenly put off until January at the earliest. Noda was apparently also concerned about how the Russia meeting was going to affect plans to deal with the domestic political situation.

Probably. It is also likely a sign that negotiations are not progressing as well as had been hoped.

Either way, an important date was cleared from Noda’s December schedule, begging some questions regarding his strategy around calling an election.

Wasting no time, it was also revealed that Noda was now considering calling an election after all. Of course this is after having cowed the opposition into doing what they were always going to do anyway – agree to pass the budget financing bills – and got the bleating about the need to call an election stopped for one day (日). It seems that Noda has decided that the time is right to consider (after caving (日) in on the bill that would superficially fix the lower house vote disparity) dissolving the lower house in late November/December (election then likely to actually take place in January).

There has been talk in the last week of the DPJ actually already engaging in preparation/constructing an “environment” friendly for calling an election. The DPJ is going around the country over the next week to talk (日) to the public about what they have actually achieved in the last three years. Articles appeared in newspapers calling for “fresh ideas” as an implicit form of apology for the DPJ not having lived up to the manifesto and reform expectations. The party has identified that it needs to run in the election as the centrist party option and sole remaining bulwark against the “conservative” forces of Abe’s LDP, Ishihara and Hashimoto. And Noda has now dangled (日) in front of the media the idea that the nation will officially enter TPP negotiations, seemingly more plausible now that Obama has been reelected (meaning he can discuss sensitive issues regarding Japan and the TPP without worrying about the impact on key battleground states like Ohio, Michigan, etc).

The strategy, according to media reports (日), is for Noda to commit Japan to enter the TPP, and then soon after that call an election.

Let’s be sure of a couple of things.

First, Japan announcing that it will enter negotiations may not result in much progress actually being made. Whether Obama can realistically hold back US auto industry demands for “prior concessions,” which makes it close to impossible for Japan to enter the TPP, is less than clear and will require leadership/bravery on his part. In fact one source (日) suggests that the US has no intention on going back on the requirement for “prior concessions” due to the importance the Obama administration has placed on saving the auto industry in his policies and then in his campaign rhetoric against Romney. Japan will also still need to get the agreement of all of the other nations involved before actually entering negotiations. Also, now with Canada involved, which has its own protectionist interests in the agricultural sector, gaining this permission to enter negotiations is going to get somewhat harder. Obama will also have to think carefully about how discussions about Japan joining the TPP will affect any attempt to gain “fast-track” authorization for the TPP negotiations from Congress, which is a subject than cannot be put off for too long – although the slow progress, and apparently deadlocked negotiations, may provide some breathing room in terms of urgency.

Second, it may ultimately not save Noda. The LDP will likely still gain the highest number of seats in the next election. But such a strategy could have an interesting impact upon the way an election, and its immediate aftermath, unfolds, that could benefit some in the DPJ.

First, depending on the order of events, it may well enhance Noda’s ability to construct a truly “centrist” party in terms of both narrative and personnel management. Either the remaining anti-TPP advocates (日) in the DPJ will have to leave before an election will be held, or vote along with the LDP on a no-confidence motion regarding the TPP (if announced before the end of the current Diet session on November 30), which will result in the same outcome.  One less problem (日) for Noda, and he can reward those reformist, pro-TPP loyalists, with a more likely chance of being reelected.  It could even be a “less is more” outcome as a DPJ unencumbered by worrying about alienating certain interests may perversely be more electable.

If these anti-TPP DPJ members (along with – or initiated by – Ozawa’s separatists) specifically sponsor a no-confidence motion for the purposes of assailing Noda on the TPP, then the LDP will have to be careful to manage the atmospherics around this. The LDP will have to condemn Noda for making such an important, but “illegitimate” decision without consultation just before an election he had already promised to call “soon.” But the LDP will also have to articulate their own view on the TPP for electoral consumption. If Noda calls an election without even waiting for the no-confidence motion (or calls it after November 30), thereby turning the election into one about the TPP, which Abe himself is against, this to be sure will not gain the DPJ anything close to a majority, and will probably not save Noda…but it could still play well enough in public to give the DPJ a chance to gain more than they would likely right at this moment, based on this new, more coherent and “centrist” branding. With the consumption tax and the entering of TPP negotiations under his belt Noda may well be able to pick up a few votes due to an emphasis on “decisive politics” ( or “politics that can decide” if you like), no matter how unpopular the policies may be (also if Noda holds strong and calls the election “when he wants to”, this will only enhance this narrative).

As noted it will force Abe et al to make a decisive statement themselves. If they also come out in favor of the TPP then they jeopardize their ability to retake the rural seats that the DPJ managed to divert  from the LDP in 2009 and will almost certainly lose as they did in the 2010 House of Councillors election. Abe will also be mindful of under-performing in an election given that he was not even his party’s no.1 choice in the first place.  I would put my money on an anti-TPP line prevailing especially given Abe’s preexisting proclivities. If they do come out against the TPP  they will have to make a decision on just what they will do with Noda’s TPP “present” if they get back into government.

Perhaps along with the nuclear power issue, this may be the DPJ’s equivalent of the Futenma ‘leadership opportunity’ which the LDP lovingly left the DPJ to deal with along with their conflicted coalition partners in 2009. If Abe and the LDP still gain the largest number of seats in a TPP-centered election (with the LDP on one side and the DPJ on the other), and has to forge a working relationship with the likes of Hashimoto, Watanabe, and Ishihara (who all have various opinions on the TPP), then this could be a ticking time bomb that could destroy an Abe administration. Even if somehow Abe manages to avoid this and his minority government manages to preserve a likely anti-TPP line, then (as Noda has already committed Japan to negotiations) this will require Abe, one of the DC establishment’s favorite sons, to burn a few bridges. Either the Abe administration will have to drag its feet on the TPP with the long-term intention of failing, or it will have to decisively pull out of negotiations. Either option will likely greatly complicate Abe’s management of its relationship with the US, and will also likely hurt him greatly at home where there is an even split in regards to whether Japan should join TPP negotiations or not. Abe may just as quickly lose the Keidanren’s endorsement that was picked up after his election to LDP presidency. * And voters may quickly remember why they turfed out the LDP in the first place.

While the situation will have become more complex for “PM Abe” et al,** the DPJ will potentially for the first time become a coherent opposition, possibly behind a new, likely younger, leader. In theory. If this all transpires before next year’s House of Councillors election then the DPJ may well manage a mini-comeback.***

This could all be another trial balloon/political diversion for the LDP and Noda’s opponents, which could force themselves in compromising themselves. One hopes not – this is a strategy that is becoming more obvious and less effective over time and is actually now hurting the DPJ more than anyone else. To be sure the TPP “nuclear” option is also still only being “investigated” as an approach to resolving the current political deadlock – many in the DPJ still want to hang around and play a part in drafting the next budget.

But it could also be a good sign that Noda has realized there is very little to gain by loitering and being timid at this point in time, and is grasping the situation by the horns. It will also be very obvious to Noda that the “third pole parties” are precisely at this point unclear about how to deal with each other (日) and forge the common front essential for any reasonable electoral success and after election influence. Waiting too much longer may give them the time they need (and seemingly, want (日)) to iron out the differences.

We may know more about this on Wednesday, November 14, when Abe and Noda go head to head (日) in parliament. Noda, now having the LDP’s explicit support in passing the budget related bills, and implicit support on the other requirements (日)  for a lower house dissolution he had previously articulated (the fixing of the constitutional vote disparity and the establishment of a national commission on social security), will struggle to avoid being more specific on the issue of when a lower house election will be held.

* The Keidanren has essentially said (日) that this month’s East Asia Summit in Cambodia may well be a “last chance” for a meaningful TPP announcement for Japan.

** Remembering the LDP will be almost more certainly anti-TPP after the election than it will be even before it irrespective of Abe’s own views.

*** There is always the (very hopeful) possibility that the LDP will be so compromised and mismanage the situation so badly that an effective double election will be held anyway in late 2013 and that the “new” DPJ and some collection of third pole forces will be in a position to align themselves on issues of reform and have control of the lower house.


Japan and Australia to take Perhaps the Final Big Step in the Relationship?

A very interesting development out of New York this morning (日). Japan and Australia, on the heels of the recent two-plus-two dialogue in Sydney where Japan’s foreign and defense ministers had to rush home admist the controversy over the Senkaku Islands with China, have agreed to further deepening of the strategic partnership, and have also committed themselves to making a breakthrough on the Economic Partnership Agreement which has been under negotiation for 5 years.

This would be a significant step for the bilateral relationship. Australia and Japan already have a ministerial “two-plus-two dialogue.” In fact Australia is the only nation other than the US to have such an arrangement with Japan. Japan’s two-plus-two dialogues with Vietnam and India are at the sub-ministerial level. Australia and Japan in the last few years have signed a Acquisitions and Cross-servicing Agreement (ACSA) and also an intelligence-sharing agreement. They have recently begun conducting bilateral military exercises together with the Nichi-gou Trident exercises in June this year. Japan’s SDF is also, after US Forces Japan, the most familiar with the Australian defense forces as the two countries have deepened military-level relations starting with the Cambodia UNPKO, and have comprehensively engaged with each other in regional peacekeeping, humanitarian and disaster relief,  and human security fields. Of course, the Australians were also the ones to protect the Japanese SDF in Iraq.
So, other than a formal alliance, which is unlikely due to Japan’s restrictions on the exercise of collective self-defense, and also the fact that alliances are no longer the weapon of choice for security partnerships, there was only a few areas left where the two countries can usefully collaborate in more depth than they do now. One such area is in the maritime domain, particularly around Anti-Submarine warfare (ASW). When the two countries held their first bilateral exercises recently they engaged in ASW exercises, something they have also done so with the US in trilateral exercises. Furthermore, there has been interesting discussion in the Australian press about the Japanese working with the Australians, perhaps in a joint partnership, to outfit the Royal Australian Navy with 12 submarines similar to the highly regarded Japanese diesel-electric mid-sized Soryuu submarine. We will see where that goes.

[Going, it is. One day after writing this Japan and Australia announce that they are seriously considering working together on finding a replacement for the troubled Collins-class submarines].

Two other areas are in regards to the economic partnership, and collaboration on the UN, including UN Security Council reform. Australia is currently competing for a non-permanent seat on the next installment of the UN Security Council, and Japan is sure to support this. Australia has after all supported Japan’s ascension to the UNSC as a permanent member after UNSC reform (if it ever takes place) since the early 1990s. In terms of the economic partnership, while it has been deepening over time without an EPA, particulary as Japan has invested much more in the Australian mineral resource economy recently (in part a response to Chinese investment in Australia), negotiations on a Free Trade Agreement lagged for some time. However, in the last year or so it would seem that the DPJ, perhaps using the TPP as a bait and switch approach to distract the anti-FTA elements at home, begun a new push for an EPA* with Australia. Certainly it seemed that the Japanese govenrment was more engaged than it had been in previous years, with the exception of a bit of activity when negotiations were first entered into in 2007. Of note in terms of this particular announcement, is that the last time an Economic Partnership Agreement was explicitly connected to the deepening of the strategic partnership in this way was when former Prime Minister Abe in 2007 basically told his own bureaucracy that an EPA with India would be agreed to and that it was to be done soon. And indeed it was soon settled and is now in force. It is within this context that we can perhaps understand the latest commitment, and it would not surprise me if we see an EPA between Australia and Japan, irrespective of what happens on the TPP, within the next two years.

* Japan doesn’t do “FTAs” as they see them as too narrow. They tend to go for wider “economic partnership agreements,” which put less emphasis on increasing the percentage of trade items where tariffs will not be applied (to be called an FTA this usually needs to be somewhere in the mid-90s (%)), in favour of economic engagement and agreements in areas wider than tariff liberalization.

Maehara goes to Washington

If PM Noda’s negligence in turning up to September’s APEC without omiyage of Japan’s TPP commitment wasn’t enough to convince the US that Japan does not see the TPP as its economic salvation, then perhaps Maehara Seiji’s Washington comments may do. In a meeting with Senate Finance Committee Chairman Max Baucus, Maehara communicated (日) that Japan would not consider the US request for prior concessions before joining negotiations, saying that negotiations would be conducted, well, after negotiations had started. So nothing will happen on the TPP front until 2013 when we know who is in the White House.

Of course, the Asahi interprets this as the pro-American, pro-TPP Maehara communicating intra-party hesistancy about joining the TPP. If it was simply this, I believe he may have chosen different words. An alternative explanation could be that Maehara can see like anyone else that the idea of one-sided prior concessions is fundamentally unfair and asinine. Especially when the requested concessions themselves are fundamentally unfair and asinine.

What about future prospects for the TPP? The TPP’s main supporter is now Hashimoto Toru, who places the TPP, perhaps quixotically, at the centre of his policy drive for opening Japan up to international competition. His strategy is that Japan should pursue a more vigorous free trade agenda at the same time as reforming, perhaps through some tough choices, the agricultural and other uncompetitive sectors in Japan. This seems reasonable, although I think he perhaps is unaware of the geopolitical factors behind Japan’s FTA/EPA policy. Essentially anyone who signs on to cooperation with Hashimoto’s JRA will have to embrace Hashimoto’s TPP policy. The seven established Diet members who switched to Hashimoto’s party have done this, although one of them had to allegedly bite his tongue, which may be a sign of things to come.

The interesting question becomes one of electoral math. If Japan is to join the TPP, then what combination of parties could make this happen? The LDP is likely to become more anti-TPP as it takes back a lot of the rural seats it lost in the 2009 House of Representatives election. This is what happened in the 2010 House of Councillors election, where the LDP didn’t do particular well in the cities but came storming back outside of them. I suspect this might happen again. So an LDP-Komeito-JRA collaboration is probably not going to bring Japan into the TPP, nor would an LDP-DPJ grand coalition. Ironically enough, the DPJ may be more inclined after the election as it will probably be “unburdened” of its rural-orientated members. A DPJ-JRA collaboration may be the best bet for the TPP, if the numbers are there. That said, the longer Japan is left out/stays out, the harder it will be to justify entering at a later stage, given it will have little influence over how the deal is to be shaped. While Obama could ignore the autoindustry after reelection to a second term, it is the Senate that is going to be the hardsell for Japan joining, irrespective of what happens in the US House of Representatives. Another issue is that as the President’s “fast track” negotiating authority (or Trade Promotion Authority) expired in 2007 and the TPP, unlike KORUS, will require renewal of this authority before it can be considered (or else the Senate could theoretically filibuster or even make amendments to the multiple-nation negotiated pact). This article from February suggests that even in 2002 the process for negotiating the renewal of fast track authority took 18 months, and it has already been rejected by the Senate once under Obama’s watch. If Japan is still being considered as a TPP partner to negotiations such legislation may take even longer to pass when Obama pushes for it again in 2013. Even if it is quickly done, the Senate will likely demand that it is given authority over admitting new partners to the TPP negotiating process, which would probably mean Japan will not be included as voting against Japan joining woud not jeopardize the whole agreement. The administration could wait until later to give Japan time to commit before pushing forward on the fast track authority. However the administration will not want to wait too long. As the TPP negotiations get closer to its conclusion (if that is, the direction it is going – we wouldn’t know), the more current participants will want assurance that the painstakingly negotiated agreement is not going to be torn to pieces with all sorts of amendments on the Senate and HoR floor. Tricky.

Maehara’s statement to Senator Baucus today may well be where things end with the TPP and Japan for some time.

Maehara has also failed to bring the omiyage of public understanding regarding the MV-22 Osprey deployment. In fact Maehara requested (日) that conditions be attached to the deployment to Okinawa which would prevent the Osprey from transitioning from vertical takeoff and landing mode (VTOL) and short takeoff and landing mode (STOL) unless it was out to sea or within the cofines of the base. Maehara has, to the surprise of some, being quite outspoken on the Osprey deployment and safety issue over the last few months, perhaps hurting his stock in Washington. That said, I have it on good authority that Maehara was not however universally liked by the DC security establishment.

In any respect, this might be the solution. I have never understood why “pilot error” in previous MV-22 crash incidents, as opposed to the identification of a technical design fault, was supposed to assuage the Japanese people of their concerns – if the difficulty is in the transition as some have argued, then is this not a design fault? Certainly not a technicality given that humans will also be flying the Osprey over Okinawa. Nevertheless, this solution, while making the Osprey marginally more costly to operate, could be argued to be equivalent in safety terms to operating the helicopters the US already uses out of its Japanese bases. That is the logical implication in any respect.

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.

Japan’s Regional Security Environment and Possibilities for Conflict

The next 5 months could be one of high drama and tension in East Asia geopolitics due to various leadership transitions and elections. In South Korea we have already seen election year sensitivities coming to have real life policy consequences with the last-minute cancellation of the ACSA/GSOMIA military accords between Japan and the ROK. With the presidential election due to be held in December 2012 this might just be the first in a series of tensions between Japan and South Korea, or even between the ROK and the US. North Korean leaders are also the masters of milking the US presidential season for concessions by simultaneously escalating tensions and negotiating for their deescalation.

The US presidential and congressional elections take place in November this year, which will constrain President Barack Obama on issues such as North Korea, Iran, and the TPP, and will likely push him to take tougher positions on China-related issues such as human rights, currency manipulation and adherence to WTO rules. China will also undergo a leadership change around November this year, and although the top two positions of CCP General Secretary (and eventually PRC president) and Party Secretary (and eventually Premier) of the State Council appear to be relatively safe for Xi Jinping and Le Keqiang, the composition of the Politburo Standing Committee could well change depending on internal CCP politics around internal and external events. It is important to bear in mind that the slowdown in the Chinese economy that is currently taking place could make this a more sensitive time than normal for the PRC. This sensitivity could be exacerbated by Sino-American relations. Every president since Nixon has essentially found it useful to take a tougher line on China in their first term. Some have speculated this is because of the lack of a working relationship and distrust between Chinese leaders and a new US administration, and the general demands of reelection politics. Human rights, trade, and Taiwan/North Korea issues generally tend to pop up as critical issues around US election time and the administration in power cannot be seen to be taking a soft line towards China. Of course this is simply not just about the US. When the PRC undergoes its sensitive 10-yearly leadership transition analysts have pointed out that actors other than the core CCP leadership tend to have their influence augmented and reflected more in PRC foreign policy and diplomacy. The PLA and the SOE sector of the economy for example tend to have greater influence during this period. With these two pivotal events for Sino-American relations taking place in exactly the same month tensions are sure to rise, and the possibility for diplomatic conflict or worse cannot be ruled out. Recent tensions over the South China Sea may well have set the tone for the next 5 months or more.

Then there is Japan. While Japan’s House of Representatives election does not have to be held until the middle of next year there has been some talk about a November date, after the ruling DPJ and the opposition LDP’s internal party elections. Given the various inter- and intra-party interests this seems quite plausible, although far from determined. From the foreign policy view this could add to diplomatic tensions in East Asia. For Noda Yoshihiko the main goal before then will be for him to suck as much oxygen out of his opponents’ likely election platforms by either appealing to his opponents to work together on these platforms in the interim, or taking them on as his own.

Indeed there are signs of such a strategy being implemented. Noda is continuing to support the Osaka-mayor backed development of legislation to turn the Osaka region into a Metropolitan administrative district similar to Tokyo. While Noda is unlikely to decisively agree to Japan’s joining TPP negotiations, he will continue to fly the TPP flag – another policy interest of Mayor Hashimoto Toru and his reformist One Osaka (Ishin no Kai) party. Both the One Osaka party and the LDP have identified in their policy statements a desire to change Japan’s disposition towards defense and collective self-defense in particular – the LDP through the dubious mechanism of “constitutional reinterpretation” and Hashimoto through a constitutional amendment to Article 9. Noda has in the last week identified discussion on the interpretation of collective self-defense as something he wants to push forward in the current parliamentary session, particularly as it pertains to defense of US ships on the high seas and Japan’s use of its BMD system to  defend the US from ballistic missile attack. Finally, Noda has also pushed forward on the previously identified proposal of ‘nationalizing’ the Senkaku Islands, where the government takes over ownership from the current private owner. This is clearly focused on taking a little wind out of Tokyo Governor Ishihara Shintaro’s sails – something that Ishihara furiously alluded to in public. It is also a reasonably popular policy which will do no harm to Noda assuming he acts in a more decisive way than Kan Naoto’s administration did when faced with Chinese pressure over the islands.

The Noda administration’s other objective will be to relieve itself of as much pressure as possible from external sources as well. US-Japan relations could become a source of tension due to a number of issues. First there is the ongoing issue over the Futenma Replacement Facility. Second there is the continuing controversy and diplomatic friction over the deployment of the unpopular Ospreys to both Okinawa and Japan’s mainland. Third, there is the TPP, where arguments for Japan to enter negotiations have become weaker giving recent US demands. Noda is in an impossible situation in regards to all of these issues, given how politically vulnerable he now is in terms of both the upper and lower house numbers (as any subsequent prime minister will be without a solid majority in the Diet). In the short-term the best that Noda can do is state that he is committed to pushing forward with the policies, and hope that US election politics mercifully distracts Washington DC.

Noda’s plan to discuss collective self-defense may also have an external facing dimension. Given Noda’s political acumen, it would not be a surprise to find out that he is using such discussions as a hedge against Chinese escalation of the Senkaku Islands dispute that is likely to come about should Noda’s “nationalization” plan come to fruition in the next few months. While the CCP can be unpredictable in terms of how they react to certain sensitive diplomatic issues, the party leadership, and likely the PLA, will be united in not wanting to see Japan take on a more proactive military stance. The CCP at least still takes a realist approach to its foreign policy thinking, and the one thing they will not want to see, now that the strategic “distraction” of Taiwan has been somewhat dampened in the interim, is Japan rising to become a full strategic competitor in the East Asia region. A change in Japan’s collective self-defense doctrine would portend such a development for the Chinese leadership. The Chinese will be all the more wary given Japan’s recent activities in strengthening relations with its ASEAN partners. Not wanting to give the Japanese government a good excuse to go forward with changes in Japan’s security doctrine, the CCP may well tone down its ‘outrage’ over the nationalization of the Senkakus, assuming that the more hardline policies such as the stationing of the SDF of the islands, as proposed by Ishihara Shintaro, are not entertained. If more hard-line ‘nationalist’ elements in the CCP, or in the PLA in particular, take advantage of the more permissive pre-leadership transition political environment and move to escalate the issue then Noda possibly figures that he can make some political capital out of that as well, depending on the nature of the escalation.

The above is perhaps a somewhat cynical reading of the current geopolitical environment and internal politics of various regional actors. There are promising developments such as the potential (日) restarting of trade talks between Japan and the ROK, and Japan’s likely participation in three-way talks on a NE Asia trade bloc with China and the ROK. There may even be some coming together over North Korea and a restart of the six-party talks given China’s increasing displeasure with the DPRK. These will all have great long-term significance if they come to fruition. However in the short-term one should expect tension to be the norm rather than the exception. This coming together of domestic politics and external developments in putting pressure on various governments, which will need to be mediated through sensitive East Asian publics, means that avoidance of such tensions will likely require skillful behind-the-scenes diplomacy until at least early 2013.

Hashism v Gomanism

“I ask you to judge me by the enemies I have made.”
― Franklin D. Roosevelt

Making sense of Hashimoto is becoming harder and harder as time goes on. On the one hand with his recent obsessions regarding tattooed Osaka city council workers he has started to make himself look like the dictatorial hypocrite that some claimed that he was, or at least fulfilled the expectation that he would be far too full of himself to walk back an obviously badly conceived policy.

It also made him look less like the politically astute operator many believed him to be. It is one thing for your opponents to use what you have done against you to paint you as something you may not be – but walking into a narrative trap (“fascist,” or “intemperate” or whatever) clearly laid out before you seemingly without hesitation is pretty boneheaded.

On the other hand the “defeat” that Hashimoto suffered at the hands of the DPJ government over the Oi nuclear reactor restart reflected upon Hashimoto in a different way: Hashimoto admitted his defeat in this war of the wills and even went as far as to “withdraw” the declaration of war on the DPJ government he had put forward earlier on in the debate about the restart of the reactor, arguing that he was indeed intemperate in making such an announcement – it should only be used as a once in a lifetime resort. I suppose this implies that he is going to break it out again if need be.

What to make of this? Is this a new “flexible” side of Hashimoto coming out? Are his advisors having an impact by counseling him over the types of battles he chooses? Did he realize that the DPJ was trying to drive him into a corner in order to take the wrath of a hot and bothered Osaka during the peak of a summer of brownouts? Or that he had been called on insincere populism? Time will tell I guess. Whatever the correct interpretation it was a rough last couple of weeks for the Osaka Mayor.

But if we are to judge one by their enemies, then the hatred of Hashimoto that fills the infamous cultural fascist, revisionist pseudo-historian, and Sino-Korean provocateur-supreme Kobayashi Yoshinori  (plenty more adjectives could apply) suggests that Hashimoto should rest a little easy. Let us list the ways that Kobayashi hates (日) Hashimoto so, according to the Shuukan Bunshun:

Kobayashi first starts off with the claim that in his 20 years of ‘commentating’ or ‘debating’ issues of apparent national importance (sarcasm should be noted) that he has never seen anyone as infantile as Hashimoto Toru.

He calls him a “fraudulent” patriot.

He is particularly concerned about his lack of reverence for the Japanese emperor. He criticizes him for his wanting Osaka to be considered a 都 (tou). This is not for any administrative or political reason –  Kobayashi argues that such a designation should only be reserved for the city in which the emperor resides, and to expect otherwise is churlish.  

He does have Hashimoto up about his over-eagerness in pursuing teachers who do not stand for the Japanese national anthem and pay appropriate respect for the flag.

Here however his critique is not motivated by some profound  respect for democracy. Nope again,  its about the emperor, particularly the current one who is one record as having said it would be nice if people showed patriotism without being coerced.

He is against the TPP, which is something that Hashimoto has said Japan needs to consider if it wants to internationalize its economy. For Kobayashi the problem is essentially that the TPP would destroy the unique rice-producing nation that was a gift from the gods, and now ruled by an unbroken line of divine emperors. Add in some stuff about an economy being dependent on foreign consumption being bad and potentially turning Japan into Korea.

Kobayashi then makes some vague but more coherent points about neoliberal economic policies undermining the Japanese economy and driving societal inequality through promoting the survival of the fittest. He cites the current global financial crisis as proof of that.

[Essentially he is critical of Hashimoto’s fondness for some of the Koizumi administration’s policies, although to be fair to Hashimoto there are some areas where is actually pro-public investment so may differ from the Koizumi crowd in some crucial ways. Hashimoto, after all, has been rather reluctant to be too closely associated with Watanabe Yoshimi’s Your Party.]

Kobayashi hates Hashimoto’s populism in regards to anti-nuclear movements around the country. He thinks Hashimoto taking on academics and criticizing bureaucrats who criticize Hashimoto is nothing more than a child’s quarrel. He hates how he dismisses people like Kobayashi as precocious brats. And he thinks this kind of behaviour is putting a wall between politicians and the citizenry.

It is true that Hashimoto is somewhat immature in his dismissiveness of people who criticize him, and while good for entertainment probably does not endear him to people he may have to work with in the future. Nevertheless critical debate like this is for Kobayashi the antithesis of democracy (if directed against him anyway). The final paragraph is worth reproducing in full:

Experts and mass media journalists who praise Hashimoto, who is on par with childish dictators like Kim Jong-Eun, and his determination to break through entrenched interests by embracing a decisive politics (or more accurately, a politics that can make decisions), are all idiots. We may as well just give up on democracy and yell “banzai,” “comrade,” and “Hashimoto-shogun” (ie  military dictator) just like they do in North Korea!

Serious stuff as you can see.

The TPP and Japan’s Geopolitical Environment

Previously I have lamented that the discussion over the TPP in Japan was focused on slightly bizarre and narrow conceptions of the debate revolving around what the TPP will or will not do for the Japanese economy. In short, it seems unlikely to me that failing to join the TPP will either destroy Japanese agriculture, or save the Japanese economy and kick it magically into action, depending on which view you take. Simply put, the health of the Japanese agricultural sector, and Japan’s food security/self-sufficiency is already stagnant under the current system (and some argue that the current system has created such a mess). On the other hand joining the TPP is not going to make or break the ‘internationalization’ of Japan’s economy. This point deserves more attention.

Western companies may well lament the lack of access, as any self-interested actor would do, but in all cases things are not what they seem about the ‘closed’ Japanese economy. In addition to the US farm lobby coming out against the ‘closed’ Japanese agricultural sector (it’s true but it is more a case of the pot being introduced to the kettle), the US automobile industry also feigned an interest in the principles of free trade when it opposed Japanese entry into the TPP on the basis of the Japanese automobile sector being anti-competitive. Of course, the problem with that, as the Japanese car manufacturers indignantly pointed out, is that Japan does not have any tariffs on vehicle imports. And if you are worried about those nefarious non-tariff barriers to trade that one just knows the deceptive Japanese must be upholding, you would need to explain the strong and rising popularity of European cars in Japan, especially relative to the fate of the “Toyota” Cavalier.

On the broader level, natural disasters have actually demonstrated that the Japanese economy is not all that insular. The 3/11 disaster, which snuffed out a producer and intermediate-goods led comeback (where Japan is still the most crucial player, cf. consumer goods) created problems in global supply chains. The Thai floods also brought into sharp relief the fact that Japan has been very gradually to be sure, and some may argue very deliberately, been broadening its economy. The Japanese-led expansion of production networks in Asia, and now the mini-shopping spree Japanese companies are going on in the West due to the almost irrationally strong yen, is a much more consequential dynamic in the short to medium term than what are most likely to be efficiency adjustments that the TPP would likely bring.

That said, I believe it is hard to make any more specific judgement upon the TPP than what I have outlined without the Japanese government actually getting involved in the negotiations.

However since I wrote my original post over a month ago on the broader meaning of the TPP within Japan’s diplomatic world view (a more polished version appeared at the East Asia Forum here), there has been a gradual move of the discourse in Japan towards discussing these broader, more strategic issues. And in the last month the geopolitical environment has started to see some interesting developments as well, which will put Japan’s ultimate choice about joining the TPP in a longer-term context.

First there was the accusations from LDP President Tanigaki and Ishihara Nobuteru that a foreign policy that seeks to exclude China in some way from was inappropriate, or literally (ja) “tone-deaf.” This may sound somewhat opportunistic coming from the LDP, but on the other hand Tanigaki in particular is on reasonable ground here as he has always been less antagonistic toward China within the LDP. Koizumi Shinjiro then took a shot at his own party for putting their heads in the sand on the issue, which in itself is not unreasonable as a criticism, but then went on and suggested that the US should be the axis of both Japan’s economic and security policies. He accused (ja) the leadership of the LDP of pursuing a “Hatoyama-like” policy of East Asia regional integration. These kinds of discussions have been echoing throughout Nagata-cho and Kasumigaseki for the last month or so, and the discussions are certainly not confined to the LDP. Which is good.

While Koizumi the younger often has many insightful, sharp and witty things to say, I think he has misunderstood why the name “Hatoyama” has become a foreign policy epithet in Japan at least. And it demonstrates that the US remains the Koizumis’ Achilles’ heal in terms of foreign policy thinking.

The problem with Hatoyama’s thinking was that he suggested that in the short to medium term a clear choice needed to be made about aligning Japan comprehensively with one or the other sphere of influence in its broader foreign policy. While others quickly exaggerated his intensions, Hatoyama did come close to pushing the idea that Japan should align itself with East Asia more, both in economic and security and diplomatic terms, and away from the US.

If Koizumi’s statement was describing the overall debate about the TPP then I would have to agree – some of the “either/or thinking” is a bit reminiscent of Hatoyama’s binary rhetoric, imagined or otherwise.

But Hatoyama didn’t advocate a Japanese foreign policy that made Asia the major economic diplomatic focus, and the US/West as the security focus, which is probably where Tanigaki, and a fair amount of others in Japan, sit right now. As mentioned above, the Hatoyama policy supposedly looked to Asia as the comprehensive focus Japan (economically, culturally, diplomatically, militarily etc)- which is actually very close in logic to Koizumi’s own statement that the US should be the axis for Japan’s economic and diplomatic/security policy!

Another pervasive mistake, implicitly contained within Koizumi’s statement, is assuming that economically Japan can’t have its cake and eat it too. A problem with some of the more passive, multilateral conceptions of Japan’s security policy is that it can be difficult to play various sides of the coin coherently. And security policy requires coherence for it to be effective and for partnerships and responsibilities in times of conflict to be expressly understood. But in the economic, intercultural and diplomatic fields, a Janus-like foreign policy seems seems perfectly reasonable if you can get away with it- and often actually preferable.

In reality an economically integrated East Asia probably complements Japan’s security, including its security relationship with the US, better than an economically narrow ‘littoral-Pacific’ orientation, as suggested by the TPP. A number of reasonable people see stronger East Asian integration as something that would empower the US-Japan alliance in its accepted role of keeping stability in East Asia, and not undermine it. There is another school of thought that suggests, coming from the other direction, that Japan can only pursue a strong relationship with Asia on the back of a comprehensive partnership with the West and the US in particular. This is probably what Koizumi Jr. was really aiming for in his statement. However, this conception ignores the diplomatic sensibilities, and frankly the post-colonial antagonisms that still remain in East Asia, and also diminishes Japan’s own diplomatic capabilities, strengths and distinct advantages it has in Asia compared to Western countries (notwithstanding the obvious weaknesses as well). Despite protestations to the contrary there is no pressing reason for Japan, and other nations in East Asia, to align themselves strongly with the US on all dimensions of foreign policy, including the security and economic dimensions. If the price of having the US in the region while being able to pursue closer economic relations in East Asia, is more burden-sharing in the military dimension to offset US demands, then I am sure Japan and other East Asian nations would take that choice if it came to that.

The good news is that while the Noda administration has made a somewhat untidy political entry into discussions about negotiations on joining the TPP, Japan is moving ahead reasonably quickly with the “plus 3” negotiations (China, Japan, Korea) within the context of discussions on the TPP. At a trilateral summit in Bali the three countries agreed to push (ja) on to starting negotiations next year after a collaborative study group finishes its investigation on the key issues for getting agreement. Overall Japan-China relations seem to be going well and there is talk of strengthening the relationship by going deeper than just looking at a ‘mutually reassuring strategic relationship’ (戦略的互恵関係). Discussion on resource sharing in the East China Sea between the two countries has also restarted. Caution and skepticism is always the appropriate default for understanding Japan-China diplomatic relations, as so strongly emphasised by 2010’s events, however China-Japan relations did get off on the right foot after Noda’s inauguration (en), with both sides deserving credit. It may well be that the TPP, Japan’s interest in it, and Obama’s recent strategic victories in East Asia, may force the Chinese to play softer ball with Japan in the mean time. Developments working in Japan’s strategic favour in the short-term are Myanmar’s rather unexpected about-turn, the Darwin Marines announcement, the TPP and Japan’s interest in this, Japan’s overtures to ASEAN, and the Philippines, Vietnam, and Indonesia in particular, India working closer with everyone but China, potential US military cooperation with Indonesia, and the boost all of this has given to intra-ASEAN relations. Possibly equally important is that on their own any one of these might have made the security environment quite tense, but the sudden and cascading nature of all of these developments seem to have created considerable diplomatic space for Japan to pursue its varied interests. It almost seems of late that Japan has had some diplomatic ‘presence’ which has not been a pervasive description of Japan’s foreign policy for some time. It is not often that a Japanese PM can talk all at the same time of ‘restraining’ China, involving Japan in multilateral negotiations over the South China Sea, while pushing forward on deepening relations between with China with little noise emanating from that direction (ja).

It is in this context the TPP becomes meaningful if talked about and pursued in the right way in the diplomatic context (that is to say, avoid conceptions like Nagashima’s or Koizumi’s). It may well be a way of allowing Japan to participate in what could be a valuable economic development, but it may also give Japan, when pursued in tandem with the potentially more lucrative “plus 3” deal, a bit more leverage in managing its security environment without fear of retribution from one party or another. Specifically, the TPP seems to have allowed Japan to avoid incurring US wrath on Futenma and/or on pursuing East Asia-centric economic regionalism. Irrespective of how the TPP turns out it provides whatever government is in power in Japan some short-term security – after all, one of the number one priorities for any Japanese Prime Minister in the current domestic political environment is to avoid the US, willfully or otherwise, bringing down a government due to said government’s foreign policy credentials being undermined by superficial appearances of strategic discord between the allies (see Hatoyama, Yukio). And while it seems that China might in the short-term be cowed by the strategic blunder that was 2010 and what now appears to have transpired from that, Japan not putting the boot in in the short-term may well be a significant diplomatic enabler later on down the track. Obviously global financial tensions and concerns about China’s own economic stability right now need to be given due consideration.

The Japanese interest in TPP has also seemingly given a bit of a spur to ASEAN plus 6 EPA negotiations, particularly as ASEAN, accustomed to being in the driving seat of regionalism, now faces a renewed “plus 3 threat” as well as the TPP challenge to its prized “multilateral” leadership.

Japan in the various arrangements - Asahi Shimbun 18 November 2011

However, the existing TPP group of 9’s “defensive” decision at APEC to forge ahead without Japan, Canada and Mexico, has made Japan’s accension much less attractive for Noda or the Japanese government in terms of what can be concretely gained from the TPP. The main attraction, perhaps more than the economic benefits, for Japan, was the ability to influence the making of norms and trade rules in what some see to be a pathfinder trade agreement to a broader Asia-Pacific one. The idea here seems to be that now with Japan potentially on board the TPP becomes worth its while, especially for the US. However by excluding Japan from the initial stages they can push the Japanese to accept whatever type of agreement is forged between the group of 9, without giving Japan the chance to raise objections or gain for itself exceptions, except in the drawing up of schedules phase. This is too clever by a long way however. The TPP is not necessarily that valuable to Japan economically, or that crucial to its ‘internationalization,’ that they would necessarily play along with any seriousness. Excluding Japan in this way just makes it all the more easier for Japan to play along for the next year or so and then say no when something not particularly tasty for the Japanese palate is put on the table.

This all assumes of course that things will go as smoothly as the plus 9 countries expect in terms of even negotiations with those countries, which, as belaboured previously, is an assumption one should not bet on. Nevertheless, Japan should enjoy, and perhaps just maybe even aggressively seek to take advantage of, the diplomatic opportunities on offer right now.

The latter of course, requires some domestic stability and consensus, and Noda’s diminishing political prospects as he tackles the thankless job of trying to unite the DPJ around a fiscal plan (including tax rises) for the near future, will be of concern.

Edit: Micheal T. Cucek has an uncanny habit of providing very useful and succinct summaries of my posts. This latest one  is so helpful it is worth providing it here as the effective conclusion to this post:

The key takeaway is that the TPP does not detract from Japan’s options as to strategic alignment but adds to them, forcing other actors within the East Asian drama to be cognizant of Japan’s more varied ecosystem of strategic choice.

And then there were 12

At risk of sounding like a broken record one of the under-appreciated aspects of the TPP is the fact it is a multilateral negotiation that sits somewhere between the seemingly hopeless WTO negotiations and the more familiar bilateral negotiation. That is, not a Japan-US bilateral despite domestic Japanese rhetoric suggesting otherwise. This insight is of great strategic importance both for the negotiators who will go into battle, but it should also be of great importance for the domestic debate, wishful as that might be.

In this sense today’s news (ja) that Canada and Mexico want to join the TPP should be viewed positively by the Noda administration. We now have 12 potential members: Singapore, New Zealand, Chile, and Brunei (the P4 ie the actual TPP), but also as the interested parties we have Vietnam, Peru, United States, Australia, Canada, Mexico, and Malaysia. Not only does it raise the stakes of missing out for Japan, if the Noda government and its allies on this issue had more influence over the TPP narrative, it also brings on potential “allies” in the negotiation. Canada certainly is not going to compromise too much on its public medical system, and Canada also has a number of minor agricultural protectionist issues of its own. Mexico may be one of the “cheap produce” threats agriculturally speaking, but someone in Japan needs to aggressively attack the almost absurd idea that the price elasticity of Japanese produce is anything but extraordinarily inelastic, ESPECIALLY rice. In fact this could almost be argued by a creative negotiator as a non-tariff barrier to trade, along with the Japanese language.

This has two potential and interrelated strategic consequences. First if the domestic situation really does become too difficult the added complexity will likely slow down the negotiating process, giving breathing room to the Noda government, and time to mollify key stakeholders. This in turn will give the Japanese government more time to present a convincing strategy to reform the agricultural sector which is in its current incarnation a threat to itself and Japan’s long-term food security.

Secondly, should certain changes really be a bridge too far then Japan does have allies to lean on to make only the minimal necessary changes. This will be particularly important for negotiations over pharmaceutical procurement within Japan and others’ medical systems.

The general dilution of US “influence” should be of great rhetorical advantage in the domestic debate over the TPP for its proponents. I’m skeptical that the US influence would be all that bad if countries negotiated with a firm and clear understanding of their national interests in mind. But there is in Japan a sense that Japan’s bureaucrats will somehow relent under sustained US pressure in any negotiations, in addition to looking out for their own in domestic turf battles. However the enemy this time isn’t other Japanese but overseas interests.

In any respect I believe this worry, while not unreasonable given public disillusionment with the bureaucracy in Japan, confuses two quite different strands of the US-Japan diplomatic relationship, if we must really simplify the TPP down to this dynamic. On security issues and the alliance the MOFA may well from time to time be willing to relent on issues of national importance for the sake of diplomatic cordiality, ie Futenma. However those with long memories will remember that Japanese trade negotiators are a completely different breed – tactically aware and extraordinarily familiar with the details. As we all know Japan bureaucratic institutional memory is strong – sometimes to Japan’s detriment – but in this case the pool of knowledge from the 80s still remains and successors have been cultivated.

Nevertheless, bringing more countries into the TPP should be viewed positively, not negatively in terms of the political messages that can be leveraged from such developments. And ultimately if Japan does have to make an diplomatically undignified withdrawal as some are worrying (insincerely I believe), then it is all the more likely it will not be alone.

Ad-hoc reflections on the meaning of the TPP

The one thing I’ve noticed since arriving in Japan and having reflected on the TV coverage of the TPP discussions and debate, is quite how earnest, and I would argue, over-earnest the debate really is in Japan, notwithstanding the potential future impact on an over-represented voting bloc in Japan.

The fact of the matter is, no one really knows what the TPP is going to be and (from the point of view of the Japanese at least it would seem) its main sponsor, the US itself, may well be the biggest spanner in the works of any eventual TPP deal that even half way meets the expectations originally articulated in regards to this “high quality” trade and investment agreement.

The one thing we have to remember is that while the US is committed to a certain kind of a liberal trade order, it has a pretty chequered history in regards to its commitment to the liberal political and trade order in general. There are a number of nations involved (including the one from which this author comes) that are extremely sceptical about any deal eventually negotiated by any American administration, and given that the 60 vote necessity in the Senate now almost appears semi-constitutional, these nations will be even more sceptical going forward.

The additional problem that some countries will have is that they will in trying to meet US requirements potentially risk aggravating some of their own key political constituencies while possibly getting nothing much in return. In New Zealand for example any proposed changes to the government procurement systems in health, and IP laws (which will only advantage US companies – something which came up pretty quickly in the debate in NZ) which the US is pushing for through the TPP, will be looked upon quite suspiciously. In fact the very popular government in New Zealand was not willing to risk even a little bit of political capital on this and ruled out any fundamental changes to the Pharmac model due to TPP negotiations, without a single bit of discussion. If a popular government is unlikely to give the US what it wants, it is going to be a considerably harder road for other nations – including Australia and Japan, whose domestic political situations are much more precarious.

There is also some suspicion arising among some fellow TPP travellers in regards to the US’ primary motives toward accession to the TPP. The original P4 countries (which involved New Zealand and hence why a pesky little non-important country genuinely committed to free trade like NZ cannot be brushed away in the discussions) that are at the “core” of the TPP, and not a few of the 5 negotiating to join are somewhat concerned about just how eager the US became toward the TPP in 2010 in particular. In fact top Australian and New Zealand political figures concerned at some of the external rhetoric floating around the TPP in Washington have had to communicate to key figures supporting the TPP  in no uncertain terms that the moment they (NZ and Australia – and likely Malaysia and Singapore wouldn’t be far behind in echoing the sentiment) smell a China containment policy, they are gone from the negotiations.

After all Australia had to sign a FTA with the US which did not go anywhere near as far in liberalizing the US agricultural market as hoped by the Australians, and due to the same range of interests and stakeholders a NZ-US FTA has not been a realistic consideration. Perhaps these comments are unfair and that the Obama administration in particular is more genuine. But in terms of US commitment to trade liberalization when it doesn’t suit them – well I guess many of these nations will believe it when they see it.

That is not to say that the TPP is a dead duck or negotiations are of  no value. In the short-term it could do good things in terms of clarifying rules of origins, procedures for trade remedies, and may even be a useful mitigating dynamic pushing back against tendencies towards protectionism that some are predicting will arise in the next year or two. However on the trade front – the most important front for most of the nations involved – this is likely to take a very long time and it is unlikely any deal – at least one as high in quality as initially desired – will be wrapped up in the space of a few years (unless some kind of security or economic jolt makes it more diplomatically and politically feasible).

What does this mean for Japan? Well first of all Peter Ennis gives a run down on the current inter-personal and diplomatic dynamics between Tokyo and Washington that I have no additional insights to add to. Essentially he argues that Tokyo and Washington, surprise surprise, might well be on different pages in regards to the symbolic and diplomatic dimensions of Japan’s agreeing to start negotiations.

However from my point of view it seems the Noda government’s signalling about the meaning of the TPP is somewhat curious overall. In one, simplistic sense, Japan has little to lose from joining negotiations as it is unlikely to be the only one with baggage coming into the negotiations. It is just more up front and earnest about them. The time scales here are in the order that Japanese agriculture and the government would have ample time to respond to any changes. After all, in the Australia-US FTA the US implementation of the limited amount of agricultural liberalization was somewhat tardy. These sort of dynamics do not appear to have been communicated very well in the Japanese media. In a sense, Kan’s concept of a “third opening” was somewhat of an over-exaggeration to the degree that Kan seemed to be focused solely on the TPP which took on more symbolism than it perhaps deserved.  The TPP could  be very big. But there is a long way to go. I thus found it quite interesting watching one Japanese TV program where it remarked how the production of certain agricultural goods had in the space of 25 years (or so) reduced a number of times over since liberalization. An economy can change quite a lot in 25 years and for the most part, it probably should. I don’t doubt that trade liberalization had something to do with these reductions but little mention was made of the redistribution of capital and labour resources that likely happened in the interim period.

Secondly, there is the question of whether the TPP as important as some of the other developments in global finance and trade. It may or may not have escaped the attention of some that a certain neighbourly competitor (South Korea) has already signed an FTA with Europe, and bilateral agreements with the US and Australia appear to be just around the corner. For the record, South Korea is only somewhat interested in the TPP.

Or perhaps all of the talk around the TPP, as Ennis in more polite terms suggests, a good way to placate the US diplomatically in order to relieve pressure over the Futenma issue? It may also be a valuable way to draw domestic fire away from Japan’s other more interesting trade projects, namely the already signed agreement with India, continued and redoubled efforts with the EU and Australia, and the start of China and South Korea trade discussions.

Japan also fundamentally likely shares concerns about the TPP turning into not just an economic hedge against China but also a full on “anti-Chinese” project. In this sense, the US should be secure enough in its relationship with Japan, and understanding enough of Japan’s own national interests, and recognise that the pursuit of simultaneous trade agreements with key Asian neighbours is actually a very good idea for Japan in terms of how it effects its long-term ability to manage diplomatic, economic and security tensions in East Asia.

Why Japan Still Matters

Given limitations on my own time right now, I would like to offer in lieu of a serious post of my own this excellent piece by Peter Ennis writing over at the Brookings institute.

As usual there is the typical excess of  balance, thoughtfulness, and common sense blended with insider knowledge. In addition, Ennis sums up in a nice quote a theme my own research will likely reflect upon in terms of generation change and foreign policy:

It’s ironic, but in this age of globalization and rapid social change, it may be Japan’s deepening and widening democracy and civil society, more than Japan’s vaunted economic miracle, that proves most valuable as a model to Asia’s developing nations.

While it is not uncommon for alliance managers to argue for the need to maintain a broader view of the alliance in addition to its military and economic dimensions, the insight  nicely points to why it would be a disaster if a more “forceful” resolution to the Futenma issue was pursued, for both the long-term legitimacy of the alliance itself as well as for Japan’s own interests.  With former National Security Adviser James Jones’ recent comments and Senators Webb, McCain and Levin’s call for a re-examination of basing plans in East Asia, including Futenma,  it does seem however that we are witnessing an opening in the discourse on not only Futenma but potentially on the sustainability of the US global and regional presence, and Japan’s orientation towards this presence. Which means, interesting times ahead for students of Japan’s foreign and security policy.