Japan’s Socialists Facing Survival Test in July 23 Election : Politics: The sagging party, a partner in the ruling coalition, hopes to keep enough seats to be a viable force.

Under gray, rainy skies that seemed to match the economic and social gloom enveloping his government, Prime Minister Tomiichi Murayama launched a campaign Thursday for Japan’s upper house election in which the very fate of his Socialist Party is at stake.

With Socialist losses in the July 23 balloting a foregone conclusion, attention here has focused on whether the former No. 1 opposition party can hang on to enough seats to remain a viable political force.

Further sapping of the party’s power could lead to calls for Murayama’s resignation or induce him to resign on his own, although the coalition of Socialists, Liberal Democrats and New Party Harbinger is expected to easily win a majority. The three parties together control 158, or 63%, of the seats in the House of Councillors, or upper house, which must approve all legislation except the budget and treaties. Half of the chamber’s 252 seats are at stake.

Under umbrellas held by special police outside a commuter railway terminal, Murayama urged voters to support the Socialists and their coalition partners in recognition that the coalition of left and right has stayed together and held the reins of government for a year--far longer than expected on June 29, 1994, when he became the first Socialist to head the government since 1947.

“Recently, voters are saying that ‘Grandpa is doing surprisingly well!’ ” the 71-year-old prime minister said. But he said nothing about the country’s economic stagnation or the poison gas attacks that have destroyed confidence in public safety.

Six years ago, when those upper house members now up for reelection were elected, Socialists won 46 seats. This time the party is fielding only 40 candidates and Murayama has said he would be happy if as many as 22 are elected.

Support for the Socialists has plummeted to as low as 6% as voters became disillusioned by the Socialists’ inability to come up with effective policies and the party’s willingness to help restore the Liberal Democrats to power after they lost their hold in 1993. Conflicting figures of support--ranging from 25% to 39%--were reported for Murayama’s Cabinet.

Chief Cabinet Secretary Kozo Igarashi has said that Murayama will stay in office at least through the election--expected next year--for the lower house, which elects the prime minister.

Confidence in the government’s ability to manage the economy has all but disappeared, as the performance of the slumping Tokyo Stock Exchange is showing. Only recently has the government admitted that bad loans held by banks, estimated at no less than $475 billion, are dragging down the economy. The coalition parties promised to take action--but not until the fall. Similarly, enactment of a major supplementary budget also has been postponed.

Later statistics are expected to show the economy plunged in the April-June quarter after three years of virtually no growth.

The economic gloom here has grown so deep that ordinarily conservative scholars are expressing alarm. “Fifty years after the end of World War II, Japan’s social, economic and political structures suffer from fatigue. They are no longer functioning properly,” Reizo Utagawa, a research fellow at the Institute for International Policy Studies, wrote.

“There is growing cynicism that the series of political changes since the summer of 1993 have been only sound and fury. . . . The drive for political reform has lost steam,” wrote Koichi Kishimoto, a political science teacher at Reitaku University.

“We believe the Murayama Cabinet should go,” the Nihon Keizai Shimbun declared in an editorial. “It is unable to deal with grave problems, such as social unease, economic uncertainty and diplomatic crises.”