Ex-Premier Lands Back on Path to Power

Less than three years ago, Ryutaro Hashimoto--renowned for his slicked-back hair and hard-line fiscal reforms--resigned as Japan’s prime minister after his party’s humiliating defeat in a parliamentary election. Several members of his own party said then that they resented his autocratic ways and poor listening skills.

Well, Hashimoto’s back.

Today, he became the odds-on favorite to replace unpopular and gaffe-prone Prime Minister Yoshiro Mori. But Hashimoto’s possible return to Japan’s top post may say more about the failings of the ruling Liberal Democratic Party than the rise of his political star.

Hashimoto was one of four members of parliament who registered by this morning’s deadline to run April 24 for LDP president, a post that virtually assures the winner the office of prime minister. Hashimoto’s candidacy was endorsed Wednesday by the party’s largest faction.

The only candidate given an outside chance of beating Hashimoto is three-time contender Junichiro Koizumi, a well-spoken former health minister in Hashimoto’s Cabinet who vows to privatize the country’s massive postal savings system and restructure the economy.

Koizumi has a chance, said Tomoaki Iwai, a political science professor at Nihon University here, because Hashimoto is widely unpopular with LDP members in the local branches. While each member of parliament has a vote in the poll, prefectural party chapters get three votes each.

That Hashimoto, who instituted an unpopular 5% consumption tax that many critics contend was a key factor in driving the country into recession, could make such a comeback so quickly is largely due to back-room maneuvering and a lack of other candidates.

The others who registered are Shizuka Kamei, the LDP’s policy chief and leader of a small faction, and Taro Aso, state minister for financial services and the grandson of former Prime Minister Shigeru Yoshida.

Support for the party, which has ruled postwar Japan for all but a brief hiatus, has fallen in recent times, particularly in Mori’s yearlong tenure. The prime minister’s popularity in polls dropped to a single-digit nadir after he continued his golf game in February despite hearing that a U.S. submarine had sunk a Japanese fishing vessel, leaving nine Japanese dead. Mori told his Cabinet last week that he would resign for the sake of the party.

The lack of popular leadership, coupled with a weak economy and record-high unemployment, could presage another drubbing for the LDP in July elections for the upper house of parliament, particularly if Hashimoto is at the helm, several Tokyo voters said Wednesday.

“If Hashimoto comes back, then time goes backward,” said Katsuyuki Kawai, a 50-year-old office worker.

Added Tokyo banker Kenji Takahashi, 52: “Hashimoto? What can he do now? He was a loser. . . . The LDP will be completely defeated in July. In this era, party politics is completely over.”

Hashimoto, 63, served as prime minister from 1996 to 1998. He spearheaded the country’s “big bang” financial deregulation and a realignment of ministries and agencies designed to streamline government operations and reduce reliance on bureaucrats. But the 5% consumption tax and other structural reforms were widely unpopular.

On Wednesday, Hashimoto apologized for his structural reforms, pledged to focus on getting the economy back on track and vowed to essentially toe the party line.

In contrast, Koizumi, 59, vowed to shake things up. He resigned from his faction, which supported Mori, and vowed to bring an end to the splintering of the party’s groups.

“The policies of the Liberal Democratic Party are facing a critical moment of either being totally abandoned by the people or regaining the trust of the people,” he said.

Koizumi vowed to speed the write-off of bad debts that saddle many corporate balance sheets and to introduce fiscal reforms. He suggested that Japan could endure more job losses if it instituted retraining programs and adequate unemployment compensation.

“I believe the Japanese can adapt to change,” Koizumi told reporters Wednesday. “The only problem is Japanese have lost hope and confidence in their ability. As long as we can show that the government is prepared, I am sure Japan will rise again.”