Japanese Reforms Rejected in Major Blow to Hosokawa

Prime Minister Morihiro Hosokawa suffered a devastating blow to his grasp on power Friday as 21 of his own coalition supporters rebelled to help defeat four political reform bills in the upper house of Parliament.

The bills, representing the core of Hosokawa’s promises for change on which he rode to power last August, lost by a vote of 130-118.

It was the first time since 1951 that any government-submitted bill had been rejected by a vote in Parliament.

The prime minister had indicated early in his tenure that he would resign if the reform package failed, but Friday he said he will fight on. He declined to elaborate on what he would do to fulfill his promise of last August to “assume responsibility” if reforms were not enacted by the end of the current Parliament session next Saturday.

In an unscheduled news conference, Hosokawa declared that he will “exert my full efforts” to win passage of the bills by then.

“I am not sure, but I think there is room for compromise,” he said.

Although both sides pledged to try again, prospects for success were dim. Parliament has already spent five years debating reform amid widespread corruption.

The reforms would have tightened controls on political funds and replaced multi-seat election districts with a combination of single-member constituencies and a proportional representation system.

Such changes would have amounted to the biggest overhaul of Japan’s political system since the American occupation after World War II.

The defeat undermines Hosokawa’s leadership on the eve of a crucial meeting with President Clinton in Washington Feb. 10-12. U.S. officials have been complaining that the prime minister has allowed bureaucrats to resist efforts to hammer out a framework for improved economic relations.

Hosokawa and Clinton are supposed to approve such an agreement at the February meeting, which the Japanese leader is still scheduled to attend. But it is now unclear what Hosokawa’s circumstances will be at that time.

Hosokawa is expected to ask Parliament now to establish a 20-member joint committee from both the upper and lower houses to come up with compromise reform bills.

The committee would have to approve any revised bills by a two-thirds majority, but the new bills could be passed by a simple majority in both houses--with Liberal Democrat support.

The bills were passed by the lower house Nov. 18, but if no action is taken by next Saturday, the government will have to start from scratch to seek reforms later.

Hosokawa could then be forced to resign or call a general election, political commentators predicted. Either move would threaten the summit with Clinton.

To spur preparations for the Washington meeting, Treasury Secretary Lloyd Bentsen will make an initially unscheduled stop here later today and Sunday to meet Hosokawa and Finance Minister Hirohisa Fujii.

Hosokawa’s Friday setback threatens to further delay government measures to cope with Japan’s continuing recession. A supplementary budget for fiscal 1993, which ends March 31, and the budget for fiscal 1994 have been pushed aside for more than a month by the tussle over political reform.

The intra-coalition rebellion also brought to the surface a deep split within Hosokawa’s “rainbow coalition” of seven parties in the lower house and eight in the upper house.

Seventeen Socialists voted against the bills, and three others boycotted the showdown, exposing the danger of a split in the coalition’s largest party.

One coalition member from the Democratic Socialist Party also defected.

A Liberal Democrat rebellion by five members who voted for the reforms fell far short of compensating for the coalition desertions.

Both sides in Parliament on Friday called for a final reform push.

“We won’t give up. We will continue to seek reforms,” Chief Cabinet Secretary Masayoshi Takemura said.

Yohei Kono, president of the Liberal Democrats, which lost its 38-year hold on power last summer, agreed.

“To restore people’s trust in politics, something must be done,” he said.

Yuichi Ichikawa, secretary general of the Buddhist-backed Komei (Clean Government) Party, which is a key member of the Hosokawa coalition, said his group would be willing to support--without revision--even the reform bills that the Liberal Democrats had proposed.

A leader of the Democratic Socialist Party, another coalition partner, said his group will support reforms “close to the Liberal Democrat proposals.”

The former ruling party, however, is deeply split over whether any reforms should be implemented.

Twice since a 1988-89 influence-buying scandal tainted every major Liberal Democrat leader, the party sabotaged reform efforts by two of its own prime ministers before losing power in July.

In addition, the Liberal Democrats’ current proposals are widely believed to be aimed at bringing the conservative party back to power.

As such, acceptance of them could threaten to drive the entire Socialist Party out of the coalition and bring about Hosokawa’s downfall.