NEWS ANALYSIS : Party’s Almost Over for Japan’s Former Rulers

It looked for a while as if the Liberal Democratic Party, whose 38-year grasp on political power here was broken last summer, might be staging a comeback: Its opponents--the ruling eight-party coalition--were sabotaging political reforms and forcing Prime Minister Morihiro Hosokawa to compromise with LDP demands that turned a new election system to their favor.

One quarrel after another erupted within the coalition. One announcement after another that Hosokawa made was soon rescinded.

Finally, the mass media that had built Hosokawa’s popularity ratings to record highs suddenly began questioning the inability of the telegenic, aristocratic former governor to explain a $950,000 loan he received from a gangster-linked parcel delivery firm 14 years ago.

Seizing the opportunity, the LDP asserted that the loan was, in fact, an illegal political donation; the party launched a boycott of parliamentary deliberations on the budget, already delayed by political reform, to demand answers.

“No matter what mistakes he (Hosokawa) made, the public still liked him,” one LDP member complained. “We concluded that if we couldn’t get rid of him, we wouldn’t have a chance to regain power in the next election.”

On April 8, the LDP got its wish: Hosokawa announced that he would resign to break the budget logjam and accept moral responsibility for still undisclosed financial dealings that he said might involve violations of law.

Now, however, Hosokawa’s badly split coalition stands but one step away from naming a new prime minister. And the Liberal Democrats have seized defeat from the jaws of victory.

While the old rulers might yet patch together an LDP-led coalition with expectations of going back to “business as usual,” the party’s chances to regain control by itself appear more remote than ever. Divisions within its ranks have become at least as serious as those within the ruling coalition.

On Tuesday, the LDP avoided what, according to political commentator Minoru Morita, would have been “a fatal blow” as former Foreign Minister Michio Watanabe completed a humiliating about-face by announcing that he would neither leave the LDP nor form a new party to join the coalition, as he had declared he would a day earlier.

But his threatened rebellion exposed Watanabe, leader of the party’s third-largest faction, as a turncoat-in-waiting. It also revealed that the thirst for power was gravitating away from the LDP.

Even without Watanabe, 12 lawmakers bolted the LDP in the 12 days of furor since Hosokawa resigned, shaving its holdings in the lower house to 207, or 49 shy of a majority.

As a result, the ruling coalition’s de facto choice for its next leader, Foreign Minister Tsutomu Hata, may win election for prime minister in the lower house by a wider margin than the seven-vote majority Hosokawa got last Aug. 6.

So serious were the threats of more defections that the LDP appeared to be in the process of dissolution.

“The important thing is to make sure you get out before you find yourself the last leader left in the LDP,” one senior party leader said--only half-jokingly. (The last leader would assume the burden of the party’s debts and the problem of disposing of its large staff--in effect, take charge of bankruptcy.)

Still blessed with an ample supply of candidates, the LDP--unlike any of the coalition parties by themselves--is expected to find no trouble running candidates in all of the 300 single-seat districts in the next election, which is expected next year.

But continuing defections would seriously reduce the number of LDP winners, just as defections last summer did in the July election that deprived the party of its majority.

The LDP was also unable to use the turmoil it sparked to build a new image. Although emotionally divided, the coalition is still seen by the public as the vehicle for change; the LDP is seen as a party of money politics and back-room deals.

Despite driving out Hosokawa, LDP President Yohei Kono made no attempt to form an LDP-led coalition--this even though help from any one of three opposition parties would have done the trick. Nor did he offer any new vision for what an LDP coalition could do to solve a host of problems Japan faces, including its worst post-World War II recession.

Both pro- and anti-reform party leaders criticized Kono for deficient leadership. In response, he promised--without specifying when--to name new party executives and reform decision-making to dilute the influence of elders and bosses of factions.

A Yomiuri newspaper poll released Wednesday showed 37% of voters picked Hata as their No. 1 preference for the next prime minister; a mere 4% named Kono.

Most dangerous to the LDP’s future is a growing conviction among Japan’s power-oriented interest groups that the LDP will not again be “the administration party.” In the past, nationwide relationships--extending down to the ward and county level--had lured voters in search of favors to the party.

Education Minister Ryoko Akamatsu said the coalition had ended the power of LDP lobbyist-experts to influence the bureaucracy.

Koji Kakizawa, a former parliamentary vice foreign minister, was reported to have walked out of the party because he wants to run for governor of Tokyo and is sure that no LDP member can win that post. And one formerly influential LDP urban lawmaker was reported to be despondent because, since last summer, he has found himself with nothing to do. Small shopkeepers who had come to him for help with taxes or favors they needed from the bureaucracy have stopped visiting.