Japan: Voters sanction the austerity policies of Prime Minister Kan !

One of the most lucid and independent commentator Dr. Minoru Morita predicted on June 22nd a "Big Loss for the DPJ in the Upper House Vote elections". Quotes: "The Kan Cabinet and the Democratic Party of Japan escaped parliamentary deliberations. Though they could have convened the budget committees of both houses, the cabinet and the party quashed any hopes for deliberation and fled. They pulled a fast one. Parliamentary deliberations are for the people. It's an important way that a democracy gives voters the material they need to decide their votes. It's criminal for Kan and the DPJ to eliminate debate just as we enter a crucial time (...) We have to leave behind the politicians who choose to act immorally. There's no reason for the Diet to exist if we allow lawmakers and politics that don't show esteem for the institution. I want the power of the people to get behind the Diet, the most esteemed institution of our government. To do this, we must punish those who run from it."

http://minorumorita.blogspot.com/

Focus on a political tragedy

Tanigaki's victory (R) seen as a responsive symbol of the younger generation of Liberal-Democrats while Kan (L) seen as incapable to fix Japan without the "Shadow Shogun" Ozawa Ichiro?

It took less than 4 months to crush two prime ministers, one resigned, Hatoyama Yukio after a feud within the left side of the DPJ, the other, Kan Naoto, is a lame politician without a majority after Sunday's Parliament election.

DPJ defeat at the Upper House election throws Japan national politics into chaos for the time being as the DPJ will have to decide what to do with the defeated leader Naoto Kan, some push for Kan's resignation to take responsibility and look for a stable new coalition partners while others call for the return at the helm of the "Shadow Shogun" Ozawa Ichiro who was hastily sided out by Kan's team, a team regarded as irresponsible vis a vis Japan's opinion deep sense of abandon and despair.

Quotes of Monday's Japanese dailies and commentators

"If there is one lesson that this upper house campaign has taught us, it is a lesson that we all should have already learned: there is no stopping Ozawa Ichiro... Ozawa's behavior during the campaign could signal a new role for Ozawa as an internal critic, concerned less with vying for control of the party than with keeping the party on what he sees as the right path. It seems to me that the Kan government could live with Ozawa's moving into this role." writes Japan watcher - blogger Tobias Harris.

Tokyo stocks opened slightly lower Monday as selling took the upper hand on anxiety over possible political instability after Japan's ruling coalition suffered a major setback in Sunday's upper house election.

Defeat was severe and DPJ punished after Japan's ruling coalition not only failed to gain an overall majority in the House of Councillors but also to win more seats than its main rival, the Liberal Democratic Party.

Mizuho Fukushima, head of the Social Democratic Party, retained her Upper House seat even though her party left the coalition after Fukushima was dismissed from the Cabinet of Yukio Hatoyama for opposing the government position on relocating the U.S. Marine Corps Air Station Futenma in Okinawa Prefecture.

And now?

“Kan will be in a defensive crouch

trying to ward off Ozawa attacks.”

Dr. Gerald Curtis, Columbia University

Ozawa Ichiro. Profession? Political shadow shogun

With the ruling coalition falling to a minority in the Upper House, Kan will have to seek out new coalition partners to obtain a working majority. It remains to be seen whether any party would be willing to join a DPJ that has been effectively rejected by voters. Yoshimi Watanabe, the leader of Your Party, repeatedly said during the Upper House campaign that his party would never join hands with the DPJ. New Komeito head Natsuo Yamaguchi also maintained a confrontational stance toward the DPJ throughout the campaign. Asahi daily.

"The DPJ is growing arrogant now, so I wanted to punish it," a 40-year-old man of Gifu who voted for Your Party. "I'm disappointed at its handling of the issue of relocating U.S. Air Station Futenma (within Okinawa Prefecture)," said a 22-year-old man living in Shibuya Ward, Tokyo. "This is not about Okinawa or about civil servants, it is about helping Japanese to reinvent their life in the XXIst century," said a mid-aged Japanese office employee in Osaka.

About half of voters in three big cities who supported the ruling Democratic Party of Japan (DPJ) in the House of Representatives election last summer voted for other parties in the July 11 House of Councillors race, according to a Mainichi daily survey. However, the LDP's outstanding performance was aided largely by voters' criticism of Prime Minister Naoto Kan's inconsistent remarks on a consumption tax hike. A failure by the party to show clear prospects for winning the unified local elections next year and the next House of Representatives election is likely to spark calls for the party leadership to step down.

After Kan took the reins from his unpopular predecessor, Prime Minister Yukio Hatoyama, the DPJ benefited from a big boost to its approval rating. Kan then began speaking out in favor of raising the 5% consumption tax to 10%, calling for cross-partisan discussions on restoring Japan's fiscal health. But opposition parties resisted such calls and criticized Kan. Nikkei financial daily.

The setback for the DPJ may increase political uncertainty and should lead Japan to a necessary consensus and revitalization with the aid of the public and private sector in Japan as "it struggles to climb out of a prolonged economic slump and trim its massive public debt, while facing a host of other challenges as a result of drastic changes in the country's social structure, ranging from an aging population to weakening community bonds."

"It was not a good strategy to vituperate the civil servants while chastising consumers with an increase of the consumption tax and offering simultaneously tax reductions to the private corporations" said a Japanese scholar in a Tokyo seminar prior to the elections.

The DPJ now faces the challenge of finding new allies to secure a majority to pass bills smoothly through the Diet. It is almost certain that Kan's grip on the government will loosen and rifts will deepen within the ruling party ahead of its leadership election in September. Kyodo news agency.

The outcome also will induce problems for Kan within his own party, the DPJ. With a party presidential election scheduled for September, DPJ lawmakers who are thinking about their own political futures will request for a new party president to lead them into the next Lower House election, which must be held within three years.

Some will likely blame Kan's comment about the consumption tax rate for the party's loss. His resignation is asked. Upper House elections are often a barometer of whether a prime minister can build a stable government. Many past leaders, including Ryutaro Hashimoto in 1998 and Shinzo Abe in 2007, stepped down following crushing defeats, while Junichiro Koizumi got a landslide victory in the 2001 election and stayed in power for five years through 2006. End of quotes.

Consequences of Kan's defeat on foreign relations?

"The Japanese government that emerges from this vote will be notably weaker, less able to push through important legislation, with a leadership facing challenges from within and outside the DPJ. Key international issues now loom on the immediate horizon, from finalizing negotiations on the base dispute with the U.S. to coping with a rising China, not to mention responding to signs of new slowdown in the global economy," said Daniel Sneider, of Stanford University.

Michael Green, Japan Chair, Center for Strategic and International Studies: "The result of Japan’s Upper House election may condemn Japan to another year or more of weak and uncertain coalition government, or worse — a “twisted Diet” in which the opposition controls the Upper House and blocks legislation until the ruling government collapses."

From blogs.wsj.com

Sources: Asahi, Mainichi, Yomiuri, Morita's, Tobias Harris's blog, wsj blog, illustration Kazuya-Akimoto, Reporter's notes.