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Japan’s new cabinet: Back to the future | The Economist

Japan’s new cabinet

Back to the future

Shinzo Abe’s appointment of a scarily right-wing cabinet bodes ill for the region

[Jan 5th 2013 | TOKYO | from the print edition]

ON DECEMBER 26th the new prime minister of Japan, Shinzo Abe, unveiled his cabinet. Mr Abe, an arch-nationalist, promises to focus on turning round an economy enduring its third recession in five years. He says he has learnt from his disastrous first term as prime minister, in 2006-07, when economic policymaking was distracted by needless spats over wartime guilt, and by a gaff-prone cabinet.

The question is whether Mr Abe (pictured, centre) can keep the government on-message. In picking his 19-member cabinet he has given reason to doubt that, in the long run, he even wants to.

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Consider the following. Fourteen in the cabinet belong to the League for Going to Worship Together at Yasukuni, a controversial Tokyo shrine that honours leaders executed for war crimes. Thirteen support Nihon Kaigi, a nationalist think-tank that advocates a return to “traditional values” and rejects Japan’s “apology diplomacy” for its wartime misdeeds. Nine belong to a parliamentary association that wants the teaching of history in schools to give a better gloss to Japan’s militarist era. They deny most of Japan’s wartime atrocities.

The line-up includes Hakubun Shimomura, the new education minister, who wants to rescind not just the landmark 1995 “Murayama statement”, expressing remorse to Asia for Japan’s atrocities, but even annul the verdicts of the war-crimes trials in Tokyo in 1946-48.

Mr Abe has made no secret of his wish to revise three of the country’s basic modern charters: the American-imposed constitution of 1946, committing Japan to pacifism; the education law, which Mr Abe thinks undervalues patriotism; and the security treaty with the United States, under which Japan plays a junior role. To describe the new government as “conservative” hardly captures its true character. This is a cabinet of radical nationalists.

But what do the voters want?

Mr Abe knows that few ordinary Japanese share his appetite for a root-and-branch makeover of the nation’s post-war architecture. He therefore has good reasons to focus on the economy in the coming months. His Liberal Democratic Party (LDP) and its junior partner, New Komeito, triumphed in December’s general election, winning two-thirds of the seats of the lower house of the Diet, Japan’s parliament. Elections take place in July for the upper house, now controlled by the opposition, led by the Democratic Party of Japan (DPJ). Though voters have shown themselves nothing if not volatile, solid economic management could win Mr Abe the upper house, too. He would then have the strongest governing mandate in years.

For the moment Mr Abe is trying hard to kick-start the economy. He is pressing the Bank of Japan to introduce a 2% inflation target as a way to jolt Japan out of its long deflationary funk. And he has instructed the new finance minister, Taro Aso, to come up with a new fiscal stimulus, regardless of set borrowing limits. Mr Aso, a former prime minister himself, may be one of the few politicians with the clout to overcome the bureaucrats at the Ministry of Finance, who will be appalled by any extravagance?the national debt already stands at over 200% of GDP. Mr Abe denies that this is a return to the big-spending days of past LDP governments, which were addicted to construction and public works. But he has yet to show how new spending will be any better than the old sort. The risk is that, at some point, new borrowing will spark a sudden, sharp rise in the interest rates the government has to pay on its debt.

So far, investors are giving Mr Abe the benefit of the doubt, partly because his bashing of the central bank has helped drive down the value of the yen. The stockmarket is now higher than when the earthquake and tsunami struck on March 11th 2011. Investors expect that the LDP, the party supported by power utilities and manufacturers of nuclear equipment, will face down anti-nuclear protesters and switch the country’s idle reactors back on.

Abroad, Mr Abe shows signs of wanting to tread carefully, at least until the upper-house elections. A former defence minister, Fukushiro Nukaga, is due to visit Seoul on January 4th to meet South Korea’s president-elect, Park Geun-hye (see article)?a welcome attempt to mend ties frayed by disputes over islands known as Dokdo in Korea and Takeshima in Japan.

Mr Abe has also promised to strengthen security ties with America that were not always smooth under DPJ rule. They would, he said on taking office, be “the first step in turning Japan’s foreign and security policy around”. Inevitably, China bristled. The China Daily, an official newspaper, warned that using the alliance to apply pressure to China will “only aggravate” tensions in the East China Sea over disputed islands known to the Japanese as the Senkakus and to the Chinese as the Diaoyus. Mr Abe has offered no peace-pipe to the Chinese government, only stiff promises to defend Japanese territory. These follow the scrambling of eight fighter jets to intercept a Chinese surveillance aeroplane that flew over the Senkakus last month, the first Chinese incursion into Japanese-controlled airspace since records began in 1958.

Mr Abe must hold his nerve on China, but rein in his own nationalist instincts, and keep the ghosts of the past locked safely in the LDP’s cellar. Such restraint would always have been difficult; Mr Abe’s new cabinet makes it almost impossible.

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