JAPANESE POLITICSIN 2020: THE 8TH YEAR OF THE

ABE ADMINISTRATION

Foreign Press Center Japan Briefing2020/01/08

Harukata TakenakaNational Graduate Institute for

Policy Studies, Tokyo

2

INTRODUCTION1. Lower House

自民/LDP, 285

公明/Komei, 29

立憲民主・国民民主/CDP・DPFP, 120

共産/JCP, 12

維新/Ishin, 11 希望/PH, 2 無所属/Ind, 6

自民/LDP 公明/Komei 立憲民主・国民民主/CDP・DPFP 共産/JCP 維新/Ishin 希望/PH 無所属/Ind

3

自民/LDP, 113

公明/Komei, 28

立憲民主・国民民主/CDP・DPFP, 61

維新/Ishin, 16

共産/JCP, 13

沖縄の風/Okinawa, 2

れいわ新撰組

/Reiwa, 2

碧水会/Hekisui, 2みんなの党/Your Party, 2

無所属/Ind, 6

自民/LDP 公明/Komei 維新/Ishin

共産/JCP 沖縄の風/Okinawa

立憲民主・国民民主/CDP・DPFP

れいわ新撰組/Reiwa 碧水会/Hekisui

みんなの党/Your Party 無所属/Ind

2. Upper House

40

10

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60

70

Dec

-12

Feb-

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n-14

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-17

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pr-1

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n-18

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-18

Feb-

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pr-1

9Ju

n-19

Aug

-19

Oct

-19

Dec

-19

Approve Disapprove

3. Approval Rate

4. Longest serving prime minister = 2916 days→ 8th year.

5

Agendas for 2020Jan-March. Budget Deliberation (102.6 Trillion)April. Japan-China summit meeting.Apr- July. Social Security ReformJuly. Tokyo Governor’s ElectionJuly-Aug. Tokyo OlympicAug-Sep. Tokyo ParalympicFall. Extraordinary Diet Session: Social Security

ReformNov. US Presidential Election.

2021:Sep. PM Abe’s term expires as LDP presidentOct. Term of Lower House expires 6

I. TRANSFORMATION OF THE JAPANESE POLITICALSYSTEM AND PRIME MINISTER’S POWER

1. Shift from 55 system to a “new” system in 2000s2. 55 System (1955-1993)

1) Formation of LDP and Social Democratic Party in 1955.2) Prime Minister with weak political clout.3) LDP government as a coalition government of between 1955 and 1993.

4) SNTV= One electoral district electing 3 to 5 politicians.a) Several LDP candidates from the same district.b) For LDP candidates party label has almost no value.c) Easy to get elected as an independent candidate.d) Provides room for factions -> Dominance of factions

within the LDP7

3. 55 System (1955-1993) as a Consensus Model

Consensus Model 1955 system

Executive power Coalition cabinet = power sharing

LDP cabinets = coalition cabinets of factions

Executive-legislative relationship

Balance of power Independent Diet

Party System Multi-party system Multi-party system

Electoral System PR SNTV

Bicameralism Strong Strong

8

4. Shift toward a Westminster Model1) Prime Minister with more political clout2) Closer to a single party cabinet = No more coalition cabinet of LDP factions.

3) Electoral system FPTP + PR → closer to FPTP.4) Party system conducive to two party system.

Westminster Model Current system

Executive power Single party cabinet = concentration of power

Single party cabinet= Concentration of power

Executive-legislative relationship

Cabinet dominance Independent Diet

Party System Two-party system Now fluid

Electoral System FPTP FPTP+PR (more seats allocated to FPTP)

Bicameralism Weak Strong

9

5. Sources of change1) Electoral reform of 1994

a) Increased importance of party endorsement (1)More difficult to get elected as independent(2)One candidate in one constituency

b) Concentration of political funds to parties 2) Administrative reform of 2001

More legal authority to the PM for policy formulation

10

II. PRIME MINISTER'S POWER UNDER THESECOND ABE ADMINISTRATION (2012-

1. Further Increase in Prime Ministerial Power

1) PM power in the party2) PM power in the government

11

2. PM power increase in the party1) Norm of “Elected 6 times, then you are aminister” broken!

a) In the past most LDP back benchers who havegot elected 6 times could expect to be appointedministers -> Almost 100%

b) Under the Abe administration this figure hasgone down to around 70%.

12

13

0

10

20

30

40

50

60

70

80

90

100

0

20

40

60

80

100

120

2nd M

ori

2nd M

ori Res

1st K

oizum

i

1st K

oizum

i Res

2nd K

oizum

i

2nd K

oizum

i Res

3rd K

oizumi

3rd K

oizumi R

es

1st A

be

1st A

be Res

Fukuda

Fukuda R

es Aso

2nd A

be

2nd A

be Res

3rd Abe

3rd Abe 1

st Res

3rd Abe 2

nd Res

3rd Abe 3

rd Res

4th Abe

４th A

be 1s

t Res

%

Ration of Politicians with Ministerial ExperienceMore than Six ministerial experience

2) Long Serving Ministersa) No reshuffling between 2012.12 and 14.9b) Big Three (2012.12-2017.8)・Deputy Prime/Finance Minister Aso Taro・Chief Cabinet Secretary Suga Yoshihide・Foreign Minister Kishida Fumio

c) Average term of these three ministers from 2000-12.・Finance (356 days)・Chief Cabinet Secretary (427 days),・Foreign (356 days) 14

3) Any implications for PM power?Prime minister can now resist pressure frombackbenchers for promotion.

4) Where does this power come from? PM'sleverage over endorsement

15

3. PM power increase in the cabinet and enhanced role ofthe Cabinet Secretariat1) Cabinet Secretariat

a) Originally set up to deal with routine workb) Gradually enhanced responsibilities overcoordination of policies involving various ministries.c) 2001 reform increased its authority to support primeminister’s policy formulation

2) Important policies prepared by the cabinet secretariata) Key economic policies and intl. economic negotiationsb) Security related bills of 2015 to enhance role of SDFin international military confrontations.

16

170

500

1000

1500

2000

2500

3000

3500

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

3) Number of Officers in the Cabinet SecretariatOfficial quotas Concurrent officials Total

18

0

5

10

15

20

25

30

35

40

45

2nd M

ori Res

1st K

oizum

1st K

oizum

i Res

2nd K

oizum

i

2nd K

oizum

i Res

3rd K

oizumi

1st A

be

Fukuda

Aso

Hatoya

maKan

Kan 2nd R

es

Noda 1

st Res

Noda 2

nd Res

2nd A

be

2nd A

be Res

3rd Abe

３rd

Abe 1s

t Res

３rd

Abe 2n

d Res

３rd

Abe 3r

d Res

4thAbe

4) Special Policy Units in the Cabinet Secretariat

190

2

4

6

8

10

12

14

16

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

5) Number of Bills Submitted by the CabinetSecretariat

4. Further Institutional Reforms Increasing PM power1) Introduction of National Security Council (2013. 12)and Security Bureau in the Cabinet Secretariat(2014.1)-> Enhances prime minister’s power over security policy.2) Creation of Cabinet Bureau of Personnel Affairs(2014.4)a) Increased the prime minister's power on

appointment of high ranking officials in theministries.

b) Before the reform the PM had power of veto.After the reform the PM now can have more

substantive power as the ministers have to make pre-appointment consultations with the PM. 20

III. AGENDAS 2020: LONG TERM TRENDS

1. 1st period: Dec 2012 〜 Sep 2015= Era of Abenomics1) Monetary easing2) “Growth Strategy” or “Structural Reforms”

2. 2nd period: Sept 2015 〜 Sep 2019= Era of social and labor policies1) Workstyle reform: serious regulations on over working

hours2) “Make Education Free”

a) Pre school education and day care servicesb) Make tuitions for universities free for low income

households.3. 3rd period: Sep 2019 〜

= Era of ”Social Security Reform for All Generations” 21

IV. AGENDAS 2020: TOWARD AN AGE OF “YOULIVE UNTIL 100 YEARS OLD”

1. Underlying factors1) Life expectancy simply getting longer.a) Male: 81 years b) Female: 87 years2) Reduction of working age population.

2. Abe Cabinet aims at increasing the number ofpopulation among those who are older than 65 years old.

1) In 2020 regular Diet session, it will introduce anew legislation to encourage companies to hiresenior people who are older than 65 years old.

2) Also in 2020 regular Diet session, it will amendCivil Service Law to extend retirement age of civilservants from 60 years old to 65 years old.(Only17% of firms set retirement age at 65 years old) 22

3. Health care insurance reform1) Ask those above 75 years old to pay more formedical services

2) From 10% of costs to 20% of costs.

23

V. AGENDAS 2020：CONSTITUTIONALAMENDMENT

1. 164 seats needed to propose amendment in HOC.2. Seats allocation・ LDP 113・ Komei 28・ Ishin 16・ Independents 3 （By Nikkei)→ 160: 4 seats needed.

3. Work on NDP?

24

4. Development before the current Abe administration.1) LDP committed to amending constitution since itsformation in 1955.

2) LDP had been referring to constitutionalamendment since 2000 general elections.

3) April 2012. LDP proposes draft for ConstitutionalAmendment

5. Abe administration1) PM Abe has been eager to amend constitution.2) LDP made a commitment to amend constitution in

14 general election and 16 HOC election3) May 2017, PM Abe proposes to amend Article 9 and

to refer to the SDF in the constitution.25

6. In the Oct 2017 election, LDP proposes to amendconstitution in the following areas

1) Specific reference to the SDF2) Free and enrichment of education3) Responses to emergency situation4) Elimination of “merged district” in the HOC

election.

26

7. LDP Presidential Election Sep 2018.1) Before the election PM Abe claims that he will havethe LDP submit a formal proposal of amendment tothe Diet.

2) After the election, PM Abe says that he will havethe LDP explain general ideas about possibleamendments.

3) In the extraordinary Diet session in 2018, the LDPdid not make any explanations.

8. HOC election 2019: “Amend Constitution soon”

27

VI. AGENDAS 2020: EXTERNAL RELATIONS

1. Middle East!!!・ Japan has dispatched a frigate to the Arabic Sea

2. Free and Open Indo-Pacific Vision1) India 2) Australia 3) ASEAN 4) Middle East

3. Sino-Japan Relation4. North Korea5. South Korea

28

VII. AGENDAS 2020: POLITICS

1. Cherry Blossom Party Quagmire1) PM invited too many supporters2) He might have entertained them (possible

violations of electoral regulation law as well aspolitical funds regulation law)

2. Integrated Resort Scandals5 LDP politicians suspected of receiving

briberies or illegal financial contributions.

29

3. General Election of the Lower House1) After regular Diet session before Olympics2) After Olympics

4. Tokyo governor’s election (July 5, 2020)1) Stable support for Governor Koike2) NHK opinion polls (July 2019)

a) Highly evaluate the current administration(ooini): 7%b) More or less (aru teido): 52%

5. US presidential election (Nov. 2020)If President trump gets re-elected, then ……..

30

VIII. WHO SUCCEEDS ABE?1. Suga Yoshihide: Chief Cabinet Secretary (1948.12.6. 71)

2. Kishida Fumio: Chairman of Policy and Research Council (1957.7.29. 62)

3. Koizumi Shinjiro: Minister of the Environment (1981.4.14. 38)

31

APPENDIX. REVIEW OF PAST POLICIES①: THREE ARROWS

1. The First Arrow: Bold Monetary Policy1) March 2013. Appointment of Governor Kuroda2) April 2013. Quantitative and Qualitative Monetary Easing3) October 2014. Additional Easing4) August 2016. QQME with negative interest rate5) September 2016, QQME with operations on Long term and Short term interest rate

2. The Second Arrow: Flexible Fiscal Policy1) Real FY 2013 Budget:¥105.7 trillion (FY2012 Sup Budget (¥13.1 trillion) +FY2013 Budget (¥92.6 trillion))2) Real FY 2014 Budget:¥100.3 trillion 3) Real FY 2015 Budget:¥99.4 trillion4) Real FY 2016 Budget:¥100 trillion5) Real FY 2017 Budget:¥101 trillion6) Real FY 2018 Budget:¥100.3 trillion7) Real FY 2019 Budget:¥104.1 trillion8) Real FY 2020 Budget:¥105.7 trillion

3. The Third Arrow: Structural Reform (Growth Strategy) 32

33460,000.0

470,000.0

480,000.0

490,000.0

500,000.0

510,000.0

520,000.0

530,000.0

540,000.0

550,000.0

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Billion

Nominal GDP

34

2.7 3.1

1.1

-1.1

-0.3

2.8

0.4 0.1

1.5

2.2 1.7

1.4 1.7

-1.1

-5.4

4.2

-0.1

1.5 2.0

0.4

1.4 1.0

1.7

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

％

GDP Growth Rate

35-2

-1

0

1

2

3

4

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

%

CPI

360.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Revenue

37

9.4 7.1 6.6 7.3 6.7

9.5

16.1 16.5

21.2 21.7

18.4

34.0

37.5

33.0 30.0

35.0 35.4 35.5

31.3

27.5 25.4

33.2

52.0

42.3 42.8

47.5

40.9 38.4

35.0 38.0

33.6 33.7

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

Trill

ion

JGB

38

16.3

11.6 10.1 9.2 9.5

13.5

21.5

17.9

24.2 25.2 23.5

40.3 42.1

36.9 35.4

41.8 42.9 41.8

36.6 33.7

31.0

39.2

51.5

44.4 42.5

48.9

40.8 39.0

35.5

39.0

34.2 34.5

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

％

Ratio of Bonds in the Budget

390

100

200

300

400

500

600

700

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

¥10,

000

Average Household Income

REVIEW OF PAST POLICIES②: THE THIRD ARROW

1. TPP111) Chronologya) June 2017 negotiations begin.b) Nov. 2017 countries agree on “core” part.c) Jan. 2018 negotiations gets concluded.d)June. 2018 Japan passes TPP related legislations.e) Dec. 2018 TPP comes in to effect.

2) Substancesa) Tariff reduction

(1) tariff on beef and other agricultural products reduced.(2) tariff on auto and auto parts reduced.

b) Speedy custom clearancesc) Expansion of e-commerce (third country server permitted)

40

2. Japan EU Economic Partnership Agreement1) Chronologya) April 2013 negotiations begin.b) July. 2017 Japan EU reach agreement in principle. c) Dec. 2017 negotiations get concluded.d) Aug. 2018 Japan and EU sign the agreement.e) Dec. 2018 Japan and EU ratify the agreement.f) Feb. 2019 the EPA will come into effect.

2) Substances: Tariff reductiona) tariff on all manufactured goods eliminated.b) tariff on agricultural products reduced (beef,

wine)41

3. Tax Reforms1) FY 2014. Reduction of Effective Corporate Tax Rate from 38.01% to 35.62) FY 2015. 32.11% 3) FY 2016. 29.77%

4. Electric Service Liberalizations1) FY 2016. Liberalization of retail market.2) FY 2020. Complete liberalization -> separation of generating companies and transmission companies

42

5. Agricultural Reforms to increase competitiveness1) FY 2014 Introduction of Farmland Management Organization 2) FY 2015 Reduction of Central Union of Agricultural Co-operatives over regional agricultural co-operatives.3) FY 2016 (LDP proposal) JA (National Association of Agricultural Cooperatives) Reform (the target year of implementation not specified)a) No more selling of farm machineries and fertilizers to farmers

b) More selling of agricultural products purchased from farmers instead of selling as “agents” of farmers.

3) FY 2018 Repeal of forced reduction of rice production.43

6. Corporate Governance Reforms1) FY 2015 Defacto mandatory introduction of external directors.2) FY 2014 Introduction of Japanese stewardship code3) FY 2015 Introduction of Japanese governance code (At least 2 external directors strongly recommended)4) FY 2016 Guideline on Corporate Governancea) Disclosure for the status of advisors and councilors b) Ex CEO’s expected to act as external directors

5) FY 2017 Revised stewardship code・Institutional investors expected to disclose their voting records on individual agendas

44

6) FY 2017 TSE Revises requirements for corporate governance report→ Enlisted companies have disclose status offormer presidents who serve as advisors or councilors7) FY 2019 amendment of corporate law and mandatory introduction of external directors for listed companies.

45

7. Inviting more foreign visitors1) FY 2013 10.3 million, FY 14 13.4 million, FY 15 19.7 million, FY16 24.0 million, FY17 28.6million

2) FY 2014 Expansion of Haneda Intl Airport Capacity (0.45 million landing and takeoffs)3) FY 2014 Expansion of Narita Intl Airport Capacity (0.3 million landing and takeoffs)4) FY 2016 Daytime Flights from Haneda Airport to the US5) FY 2020 Further Expansion of Haneda Intl Flight Slots by 40000/year (100/day) 5) FY 2020 (Target) 40.0 million visitors

. 46

470

5000000

10000000

15000000

20000000

25000000

30000000

35000000

1996

C.Y.

1997

C.Y.

1998

C.Y.

1999

C.Y.

2000

C.Y.

2001

C.Y.

2002

C.Y.

2003

C.Y.

2004

C.Y.

2005

C.Y.

2006

C.Y.

2007

C.Y.

2008

C.Y.

2009

C.Y.

2010

C.Y.

2011

C.Y.

2012

C.Y.

2013

C.Y.

2014

C.Y.

2015

C.Y.

2016

C.Y.

2017

C.Y.

Number of Foreign Visitors

48-40,000

-30,000

-20,000

-10,000

0

10,000

20,000

30,000

1996

C.Y.

1997

C.Y.

1998

C.Y.

1999

C.Y.

2000

C.Y.

2001

C.Y.

2002

C.Y.

2003

C.Y.

2004

C.Y.

2005

C.Y.

2006

C.Y.

2007

C.Y.

2008

C.Y.

2009

C.Y.

2010

C.Y.

2011

C.Y.

2012

C.Y.

2013

C.Y.

2014

C.Y.

2015

C.Y.

2016

C.Y.

2017

C.Y.

Travel Balance

REVIEW OF PAST POLICIES③: LEGISLATION OFSECURITY RELATED BILLS IN SEP. 2015.1. Dramatic shift from Japanese security policy

1)1980s: Japan concentrates on self defense.2) Now:a) Partial exercise of the right of collective self-defense.b) Combat support for US and other forces

(1) When a situation arises threatening Japanese security.

(2) When there is a UN resolution calling for foreign countries to respond to deal with actions jeoporatizinginternational peace.c) More active role in UN PKO. 49

Before AfterExercise of the right of collective self defense

Impossible Possible under some conditions: “attack against a foreign country that is in a close relationship with Japan

Combat support for US and other forces 1)

1) Situations in Areas Surrounding Japan that will have an important effect on Japanese security2) Combat support very restricted

1) Situations in Areas Surrounding Japan that will have an important effect on Japanese security2) Combat support less restricted.

Combat support for US and other forces 2)

1) New legislation necessary.2) Combat support very restricted.

1) Possible with a relevant UN resolution and Diet authorization.2) Combat support less restricted.

PKO Impossible to guard other troops or private citizens.

Possible to guard other troops or private citizens. 50