Hosokawa--Still Standing : Japanese prime minister emerges from a brutal political battle

Prime Minister Morihiro Hosokawa is still on course in his campaign to lead Japan into a new political era. His victory in securing significant political reform signals a changing Japan that may at long last put consumer interests ahead of Japan Inc. Should that shift occur, Tokyo will find it a popular and pragmatic move, and not just in Japan.

After more than five years of seemingly endless debate over political reform, Parliament finally passed a mild reform package last Saturday. It is short of the sweeping initiative Hosokawa sought at first, but it overhauls Japan’s electoral system and puts some limits on political donations.

Hosokawa’s reformist efforts extend well beyond these changes. His coalition government virtually has upended the traditional style of Japanese politics, back-room dealings and party alliances. Voters are being listened to, and the public prosecutor’s office is aggressively rooting out corruption.

Having achieved his first priority, political reform, Hosokawa now turns to economic problems at home and to stalemated U.S.-Japan trade talks. This week he is expected to unveil a long-delayed package of tax cuts and government spending, a major effort to stimulate the ailing economy.

Will reformist Hosokawa make any difference in U.S.-Japan trade negotiations? In public, he has taken a less than conciliatory tone on the basic points of disagreement. But during his few months in office Japan has agreed to open its rice market to imports and to increase foreign access to public work projects. Both will benefit U.S. businesses. The next step is to push Japan’s bureaucrats to reduce the $50-billion trade imbalance with the United States.

Still, when Hosokawa arrives for his Feb. 11 meeting with President Clinton he must be bearing more than the traditional “gifts” of a tax cut and vague trade promises. That was pro forma for old Japan. His new Japan must deliver substantive commitments on trade.