Vote in Japan Gives Boost to Reform Hope

The Japanese government secured a clear victory in elections Sunday, bolstering Prime Minister Junichiro Koizumi’s ambitions to upend the status quo and attack this nation’s deeply rooted economic, political and social problems.

“We did better than I expected,” a weary, unshaven Koizumi said in a television interview a few hours after the polls closed. “Now my role is to implement reform.”

Strong support among unaffiliated voters and city dwellers allowed the three-party governing coalition led by Koizumi’s Liberal Democratic Party to claim 78 of the contested seats in parliament’s upper house, compared with the 63 it needed to maintain its majority. While this amounted to only a one-seat gain, the outcome was still impressive given the drubbing many members of the coalition earlier expected.

The government also was helped by a divided opposition, which failed to gain traction after Koizumi co-opted many of its arguments. Most of the dozens of former athletes, rock stars, singers and other celebrities who ran against the LDP, including pro wrestler Satoru “Tiger Mask” Sayama, lost.

Sunday’s balloting provided the first national litmus test for Koizumi’s administration since he was named prime minister in April. The populist leader wasn’t running for any of the 121 seats up for grabs in the 247-member upper house, but his enormous popularity and mantra-like calls for reform dominated the campaign.

The fact that his coattails so obviously affected the LDP’s once-dismal prospects should bolster his position, at least for the time being.

With the election over, however, the real battle begins. Since his unexpected rise to power, Koizumi--a former Cabinet minister and longtime LDP stalwart--has been studiously vague about just how he plans to tackle the country’s many problems. High on that list are a deteriorating economy, troubling deflation, deep-rooted political corruption and growing social ills.

While avoiding specifics may be good campaign strategy, critics and ordinary Japanese alike are eager for evidence of substance behind the “Koizumi Kool” phenomenon, and they want more details about how he intends to lead the nation’s 126 million people out of their decade of darkness. Koizumi enjoys close to 70% popularity, unprecedented for a post-World War II prime minister.

The markets also are growing increasingly volatile and impatient as the world’s second-largest economy continues a muddled downward slide. Last week, the benchmark Nikkei stock average hit a 16-year low, sparking loud calls for action.

“Koizumi is like a doctor about to operate who hasn’t told us what he’s going to do,” said Shigenori Okazaki, a political analyst with UBS Warburg. “The patient is entitled to know what part of the body he’s going to cut off.”

Koizumi vowed shortly after the polls closed to unveil specifics soon, but a move in almost any direction is likely to quickly run into problems. Spend more government money, and Japan’s enormous debt level worsens. Don’t spend, and the economy faces collapse.

Enact meaningful bank reform, and companies go broke and unemployment soars, threatening the government with dissolution. Avoid these tough steps, and the entire financial system could implode, leading ultimately to many of the same results.

“Everyone knows Japan could go bankrupt, but no one seems to know what to do,” said Kenji Izuka, a company worker standing outside a polling station Sunday on the outskirts of Tokyo.

Even if Koizumi finds the courage to court change and attack vested interests, he faces enormous resistance. Within his own party, his threats to disrupt well-greased pork-barrel channels and change the way revenues are distributed put the jobs of powerful conservative politicians and their constituents at risk.

While the old boys have been quiet during the past few months because they needed Koizumi’s popularity to win votes, the long knives will quickly reappear in advance of a crucial LDP election in September to determine the party president--and, by extension, the prime minister. In theory, the party could dump Koizumi despite his strong popular mandate.

Among voters at large, meanwhile, the call for reform sounds good as long as it affects someone else. Once reform measures start biting, however, things could quickly change.

Koizumi has warned about the social and economic dislocation costs ahead, and so far the Japanese have rallied behind him. But it’s not clear how much stomach they have for protracted pain, given that many still enjoy a comfortable lifestyle, well-paying jobs and ample savings to fall back on.

“Japanese feel layoffs are for someone else to worry about,” said Ryu Kiyomiya, a political analyst. “If it’s their own misfortune, however, it’s a different story.”

Koizumi’s other option--namely, to avoid the fight and forget his campaign promises--would subject him to dismissal as yet another flash in the pan who betrayed people’s hopes.

An additional problem is that it’s not entirely clear what people voted for Sunday. From the southern tip of Okinawa to northern Hokkaido during the 17-day run-up to the elections, Koizumi campaigned in behalf of local LDP candidates. Often, however, these pols were pushing for public works projects even as the prime minister attacked such spending as wasteful.

“The political situation is so complicated,” said Kenji Fukuda, the 65-year-old owner of an auto repair service in Tokyo. “Support for Koizumi isn’t necessarily support for the LDP.”

Koizumi has two major advantages in his battle against his political opponents. One is the admittedly fickle adoration of average Japanese. His appearances have drawn huge crowds, his political posters sell like hit records, and young women are even flocking to buy Koizumi cell-phone straps. Opponents will be wary of challenging this phenomenon too openly.

The charismatic, quirky leader played to the masses throughout the campaign, a notable change in a country that has traditionally relied on political machines and top-down pressure to deliver votes. One television commercial showed him trying to push a giant boulder alone, only to be joined by a crowd of ordinary Japanese.

The prime minister’s other edge is his ability to call a general election of parliament’s powerful lower house, thereby subjecting members of the old guard to direct voter scrutiny and the risk of being flushed from the dark corners where they thrive. But such a move also threatens to split the LDP, which has ruled Japan for half a century, and set off a long-awaited realignment of national politics.

While some critics argue that a split represents the best hope for Japan’s future, this country has tended toward gradualism, accommodation and compromise. Koizumi, after all, is himself a third-generation LDP politician, a longtime party supporter and conservative on many defense and nationalism issues.

In fairness, the old guard also is under growing pressure.

“In the past few months, the old guard has realized a lot has changed,” said Haruo Shimada, a professor of economics at Keio University.

Ultimately, if he hopes to get much done, Koizumi may need to elicit the backing of his coalition partners for a less extreme, but ultimately more publicly acceptable, policy course.

“Essentially, Koizumi has to compromise and the conservatives have to compromise,” said political analyst Okazaki.

Another challenge Koizumi faces, analysts say, is channeling his energy on what most agree matters most: fixing the economy. The prime minister has become more and more distracted in recent weeks by spats between his Cabinet members, a fight with South Korea and China over textbooks and whether to visit the controversial Yasukuni Shrine honoring Japan’s war dead.

Pocketbook issues are not only high on voters’ lists of concerns. In political terms, a further deterioration of the economy would give LDP conservatives a strong basis to undermine Koizumi by arguing that so-called structural reform should be shelved and stimulus spending revved up.

Koizumi will have to show his hand within the next few weeks. By early next month, he must deliver a budget blueprint, giving some clue about how aggressive he will be in slashing government debt.

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Rie Sasaki and Makiko Inoue of The Times’ Tokyo Bureau contributed to this report.