Tanigaki's Reelection: Deader Than Elvis

PLEASE WAIT LOADING ,,,,,,,,, Elvis Presley, of course.

Liberal Democratic Party president Tanigaki Sadakazu drifted further down in his Kurztian course yesterday.

In what should have been a mere formality, he called upon Koga Makoto, leader of the Kochikai (Koga Faction). A formality because Tanigaki is himself a member of the Kochikai, having merged his own faction, also called the Kochikai, with Koga's in May of 2008, first in order to order to reunite the sundered original Kochikai, which split into two competing groups in 2001 and second and more importantly, to gain leverage through numbers in intra-LDP fights for position and spoils.

Now as the champion of the rebuilt Koseikai, albeit arising out of the far smaller of the two shards of the original faction, Tanigaki should, out of the bonds of loyalty that bind LDP members to one another even when their bonding makes zero sense in terms of ideology or general election strategy, have received Koga's support.

Tanigaki did not get it. (E)

Koga has been a known opponent of the Tanigaki doctrine of taking a confrontational stance toward the Democratic Party of Japan's every proposal in a bid to force a House of Representatives election. He encouraged cooperation, being a major back room facilitator of the DPJ-LDP-New Komeito agreement to pass the bills reforming the social welfare and pension systems, including the raising of the consumption tax.

The LDP's voting on August 29 in support of the seven party censure motion, which condemned the three party agreement, infuriated Koga. He could not, would not support Tanigaki's continued reign as party president. (J)

Without the support of his faction behind him in the party election, Tanigaki has essentially zero chance of rounding up the even the 20 signatures necessary for applying to be a candidate. No one wants to be associated with a politician who has been cast off by his faction leader.

Unwilling as ever to comprehend that some things are just impossible, Tanigaki has yet to call it a day.

By the way, unlike Tanigaki's reelection chances, the other Elvis is quite alive...and laughing at himself.

Tanigaki Sadakazu In The Heart Of His Darkness

PLEASE WAIT LOADING ,,,,,,,,,

Willard: They told me that you had gone totally insane, and that your methods were unsound.

Kurtz: Are my methods unsound?

Willard: I don't see any method at all, sir.

- Apocalypse Now (1979)

There are number of ways one can betray oneself. One can violate one's stated principles. One can behave in a manner that defies simple logic. One can act in a way that leads one's friends to abandon you.

In general, it is best to avoid all of the above.

However, there are times that we flawed creatures really, really, really want something so badly we are willing to betray ourselves. In these cases is still best to limit oneself to one of the above forms of self-injury on any given day.

Yesterday, the Liberal Democratic Party and their leader Tanigaki Sadakazu threw that concept into the fire.

Immediately after the Democratic Party of Japan's ramming of the bond issuance bill and the electoral reform bill through a just short of half-empty House of Representatives, the LDP and the New Komeito submitted to the House of Councillors a childish and nearly parodic motion of censure to that House's president.

The two parties wanted to have a vote on their motion the next day.

Unfortunately for the two parties, they had not conferred with the other opposition parties in the House of Councillors, whose votes they needed for the LDP-New Komeito motion to pass. When negotiators from the two parties went to meet their peers in the other opposition parties, they were aghast to find out that the other parties wanted the LDP and the New Komeito to vote for their censure motion, which had been sitting on ice in the House of Councillors since August 7.

Since the August 7 bill of censure contained a condemnation of the DPJ-LDP-New Komeito Three Party Agreement on the passage of the social welfare and pension bills -- and singled out for condemnation the consumption tax bill, which the LDP and New Komeito had both voted for, the tax rise indeed being a campaign promise of the LDP -- voting for such a censure motion would seem out of the question.

However, to everyone's surprise but those who know how deep the rot inside the LDP extends, the LDP leadership said:

"OK, if you are adamant about this, we are cool with voting for your motion."

Which immediately led to the New Komeito asking for time for "an adjustment" (chosei) of the atttack on the prime minister.

I would have loved to have been at that strategy meeting...

New Komeito Member (slowly, as if in distress): "OK, let me see if I have this straight.

You want us to vote in favor of a censure motion condemning the Three Party Agreement, an agreement to which we were two of the three Parties...and which also condemns the legislation agreed upon in that agreement, that we, together with a wounded DPJ, dutifully voted in favor of in the House of Councillors...legislation which, may I remind you, was not in the DPJ's manifesto, but in the LDP's manifesto.

Please tell me that this is not the plan."

LDP Member (grinning): "That's the plan!"

At which point the New Komeito delegation probaly told -- or should have told -- their peers in their longtime alliance partner:

"We twisted the arms of our local party organizations to forge this alliance. We took a huge blow to our reputation as the party of peace by voting with you on the dispatch of Maritime Self Defense Forces ships to the Indian Ocean. We hung with you when you tried to turn back the clock to the pre-war era under Abe Shinzo. We got wiped out in the 2009 House of Representatives election because of our association with you. Our district vote switching in that election saved your party from utter annihilation.

We have been through hell and high water with you.

But this, this insane.

Sorry, but you're on your own now."

I have said it before -- when the religious party in a secular-religious party coalition is the voice of logic, moderation, patience and the dirtying ones' hands in the service of a greater good -- then you are suffering from a serious breakdown in the natural order.

Undeterred by their friends having abandoned them, the LDP yesterday linked arms with the remaining opposition parties in the House of Councillors, including the People's First Party headed by the LDP's arch-foe and designated punching bag Ozawa Ichiro, to pass the August 7 motion of censure, the New Komeito's members walking out of the chamber before the vote.

The motion passed, 129 votes to 91.

Ostensibly, the passage of the motion of censure means the current Diet session is over. The House of Representatives can continue to carry out its business. The House of Councillors, according to tradition if not law or rule, goes on immediate hiatus. The tradition of ceasing all business after a motion of censure is a reason why under normal conditions, the House of Councillors has indulged in this non-binding nonsense on what had been previously determined to be the last day of the Diet session.

We live, however, in abnormal times. The inability of one man, Tanigaki Sadakazu, to accept that he has never had what it takes to be LDP president, much less Prime Minister of Japan -- and the inability of the LDP presidential hopefuls in the top leadership, with their vested interest in maintaining the status of the office of the president even as it was being dragged down by an incompetent -- have left the LDP sans sense, sans morality, sans anything.

OK, Morons. Now What?

PLEASE WAIT LOADING ,,,,,,,,,

Yamaguchi Kunio Natsuo (L) and Tanigaki Sadakazu (R) are Leader and President of the New Komeito and the LDP, respectively.

As can be expected in these lamest of times, the Liberal Democratic Party and the New Komeito, having failed to halt the passage of the bond isuance and electoral reform bills in the House of Representatives, submitted at a velocity somewhat faster than the speed of thought a censure motion to the President of the House of Councillors.

So what happens now?

All business in the House of Councillors comes to a halt, the motion taking precedence. The membership gathers in the plenary chamber. The parties submitting the motion explain their reasons for submitting the motion. The chamber votes.

Should the measure pass, nothing of consequence happens, as a censure motion has no legal effect. The prime minister, however, will be persona non grata in the House, stripped of the dignity of his office.

The presumed result is that the House of Councillors will cease to conduct any of its business, despite the Diet's still being in session -- the continued acceptance of high salaries for no work being extremely popular with the taxpayers. (J)

I am looking forward to the LDP's and the New Komeito's speeches. New levels of casuistry will be necessary to prevent folks from laughing.

The prime minister's faults:

- "He convinced us to vote for a rise in the consumption tax, which was our own policy."

- "He has increased Japan's international prestige by keeping his cool at a time when Japan is beset with challenges to its territories and territorial claims."

- "He disposed of non-Japanese activists landing on the Senkakus in exactly the same way Koizumi Jun'ichiro did."

- "He has led his party into passing a bill that provides the legal basis for the government to pay its bills."

- "He has led his party into passing an electoral reform bill that a) resolves the issue of the unconstitutionality of the districts due to over- and under-representation, b) cuts the cost of government by eliminating 40 seats of the House of Representatives and 3) increases the chances of the smaller parties to win seats."

A damning list, to be sure.

The live broadcast from the House of Councillors chamber is scheduled to begin at 10:00 a.m., accessible at http://www.webtv.sangiin.go.jp/webtv/index.php.

Photo image credit: Kyodo News

Why Noda Chose The Consumption Tax Or How Rick And The SSJ Meet Dracula's Daughter

PLEASE WAIT LOADING ,,,,,,,,, There are two major list-serves on contemporary Japan, the NBR Japan Forum and the SSJ-Forum. Many of the same individuals contribute to both, with the NBR Japan Forum being heavier on economics and security and the SSJ-Forum, unsurprisingly, being more often on society, culture and politics. Of the two, the SSJ-Forum is generally the more useful, as a large number of the posts are events schedules, calls for papers or book release announcements. Also the SSJ-Forum does not tend to get clogged up with long-winded debates over issues relevant to the participants but irrelevant to contemporary Japan (Rod Armstrong and Mike Smitka, I am not talking about you. Keep up the good fight!).

However...

On August 4, Richard Katz of the Oriental Economist newsletter posted a question to the SSJ-Forum:

I'm curious to know how rational choice theorists would explain PM Noda's single-minded devotion to pushing the unpopular consumption tax hike.

My understanding of rational choice theory is that it borrows its methodology from economics in which actors try maximize their utility in the narrow sphere of the
marketplace, and utility is defined by some fairly well-specified objective function, e.g. firms try to maximize profits, consumers try to maximize materal (sic) living standards and so will buy a $300 TV rather than a $400 one if the two are perceived to be identical. In the case of rational choice theory about politicians, as I understand it, the objective function is usually said to be to gain power by getting elected and re-elected, rising in the ranks of their party and office, and being part of a ruling party. Ideology, principles, beliefs are all laid by the wayside.

How can any of this explain Noda's actions? As a result of the tax hike and his mishandling of the nuclear restart issue, the Democratic Party of Japan is headed for a calamitous defeat. Most surveys (as well as my own personal conversations with DPJ and LDP Diet members) suggests the DPJ would win about 100 seats if the election were held now whereas the LDP would win 200. One first-term DPJ Diet member from western Japan, a genuine reformer, bitterly told me he may need to switch to Hashimoto's party if he wants to survive the next election. Needless to day, Noda will no longer be head of the DPJ in the aftermath of such an electoral disaster (assuming he remains PM in the run-up to it). Whether these numbers turn out to be right or not, depends on the Hashimoto party and other factors, but I don't know of anyone who believes the DPJ will win.

[snip]

So, how does rational choice explain Noda's willingness to sacrifice his own career and his party's fortunes in order to "do the right thing" as he saw it?

If one says that "doing the right thing" is now part of the objective function, then rational choice theory is basically left with saying: "he did it because he wanted to do it." That, to me, hardly seems like a contribution to either explanation or prediction.

BTW, this is not a rhetorical question on my part. I have little doubt that rational choice theorists do have an explanation for Noda's actions; I just can't
figure out what it would be. I'm hoping that its advocates on the list can help me out.

The question has prompted a number of luminaries in the field -- Aurelia George Mulgan, Thomas Berger, Ellis Kraus, Okumura Jun -- to post partial answers to Katz's question. These having been popping into my mail box at the rate of about one every 18 hours.

All of which makes me feel like Dracula's daughter -- at least as she is portrayed by Lily Tomlin in her one-person sketch, "Lud and Marie Meet Dracula's Daughter" of, oh, way too long ago.

Have a listen.

OK, now that you are back -- here is problem with the question -- which is the problem with the discussion.

When asking about how a given theory explains how a certain choice is made, it is helpful if the choice actually existed. To whit, asking, "I'm curious to know how rational choice theorists would explain why men prefer apples with blue and white Kusama Yayoi-style polka dots on them?" would be worthwhile if there were apples with blue and white Kusama Yayoi-style polka dots on them.

[An aside, but it always fascinates me that 99% of the articles promoting one of Kusama's exhibitions or analyzing her work manage to avoid mentioning that she is clinically insane. She lives, voluntarily, in an assisted living community as she is well aware that she is bonkers.

Her insanity informs her art, I think. Keeping her mental condition under wraps is a real disservice.]

Now in the case of Noda's choice, Katz has, in his written work for the Oriental Economist and his two public presentations in Japan, one at the Foreign Correspondent's Club of Japan and the other at Temple University Japan, taken at face value Prime Minister Noda's claim or insinuation that he had three major projects to undertake in the near future to bolster Japan's economic health:

1) begin formal, unequivocal discussion on joining the Trans Pacific Partnership

2) restarting Japan's nuclear power plants as soon as possible

3) raising the consumption tax in order to stabilize the funding of the nation's welfare and pension systems

For a Japan optimist like Katz, who sees Japan's output gap and suppressed domestic spending as criminal and reversible, the prime minister's decision to pursue option #3 at the expense of options #1 and #2 is perverse. The Japanese government's current borrowing costs are among the lowest on earth. The currency is one of the world's strongest. There is no crisis in confidence in Japan's ability to finance its debts. Furthermore the previous raising of the consumption tax in 1997 contributed to a crushing of domestic GDP growth, helping trigger the financial meltdown of 1998 and in the end reducing overall tax receipts (I think the little matter of the Asian Currency Crisis of 1997 had a little more to do with the 1998 crisis than the consumption tax rise -- but my memory is perhaps faulty).

Why pursue an end that will likely damage rather than strengthen the economy?

As Katz's question indicates, he also cannot see the political value of pursuing a rise in the consumption tax. Every single past instance of the tax either being imposed, raised or even talked about (2010) has led to the ruling party getting hammered in the next election.

However, if you look carefully at the three major policy programs listed above, it is clear that only the third, the consumption tax, was real. The first and second options, however economically sound, were political red herrings or lead balloons (choose your metaphor).

Any analysis of the "choice" a DPJ prime minister makes or may make must consider paramount the control the Liberal Democratic Party has over the passage of legislation through the House of Councillors. If the LDP does not like a policy, it has no chance of being implemented.

Looking at the TPP, one can immediately see that no matter what the government or the Nihon Keizai Shimbun may be saying, it is dead on arrival. The liberalization of the agricultural sector makes the TPP anathema in the rural districts, which are as ever overrepresented in the current Diet. Voting for the TPP would kill the reelection prospects of a DPJ representative in a rural seat. As for the LDP, which wants to regain the rural seats it lost to the DPJ in 2009, the TPP is also poison, though the LDP leadership, in pandering to the business lobby that also abandoned the LDP in 2009, keeps the TPP among its verbal bag of tricks.

So pursuing the TPP was a hopeless endeavor, especially after it turned out that the gatekeeper to Japan's joining the discussion was the U.S. Congress, particularly the U.S. Representatives and Senators from the state of Michigan and other U.S. auto producing states. There is only one thing negotiators of this blessed land want to show the legislators from the states dependent on America's bailed-out auto industry, and that is their naked backsides.

Restarting the nuclear power plants was also political poison. The country is in the grips of a deep and irrational fear of nuclear power and the nuclear power industry. Any politician speaking up for the restarting of nuclear power would be suspected of being in the pocket of the nuclear village.

Noda rational expectation was that Japan's industrial and commercial interests understood that this was their fight, not his. It was up to Japan's economic actors to make the case to the public that dangerous and unpredictable as it may be, the nuclear power plants had to be restarted, lest the country suffer economic damage or even catastrophic blackouts.

This industry pointedly failed to do. Perhaps it was unaccustomed to doing heavy political lifting by itself, having always relied on the bureaucrats of the Ministry of Economics, Trade and Industry to do their dirty work for them. Perhaps the elites in both the bureaucracy and industry, unaware that the political ground had shifted underneath their feet, thought that they could cow the populace into silence with just the hint that an interruption in the reactors restarts could hurt output and thus employment and remuneration.

Whatever the reason, industry failed to convince anyone that the country was on the brink of disaster. It took a personal intervention by the prime minister, at the last minute, and a chancy game of chicken with political maverick Hashimoto Toru, to persevere in a struggle to just get the Oi #3 and #4 reactors back on line before this summer, which has turned out to be a scorcher.

That prime minister Noda paid deeply for this intervention was made clear yesterday when he had to invite into the Prime Minister's Residence representatives of the crowds of anti-nuclear protesters who have been making his Friday evenings deafening affairs. In pointed contrast, representatives of the Japan Chamber of Commerce also paid a visit to the Residence yesterday to limply present the prime minister with a unwelcome written request that the government do more for the security of power supply.

As for the consumption tax, here was a policy program that had a chance in hell of succeeding, specifically because it was not a DPJ program but an LDP one. On the face of it, the LDP could not vote down one of its own campaign promises, when given the chance.

It is indicative of the intellectual and ethical rot in the LDP that the party nearly succeeded in convincing itself to negate the implementation of its own campaign program, even after the DPJ blew itself into to pieces in an act of self-sacrifice in order to accommodate the LDP.

So the answer to the question initially proposed is simple: Noda chose the consumption tax option because it was real. Governments have to do something, even seemingly stupid stuff, lest they be accused, and rightly so, of doing nothing.

"Rationality" had nothing to do with it.

Now, I will go listen to Ms. Tomlin one more time. I need the laughs.

Six New Fredos

PLEASE WAIT LOADING ,,,,,,,,,

Fredo, you're nothing to me now. You're not a brother, you're not a friend. I don't want to know you or what you do.

- Michael Corleone, The Godfather, Part II (1974)

On Friday, six Democratic Party of Japan members of the House of Councillors voted against the ittai kaikaku reform bills, including the bill raising the consumption tax. These six defectors are new, not a part of the 12 DPJ members who left the party to join Ozawa Ichiro's People's Life First Party (33 days since its founding and still no party website) or the 3 who left to form the Green Wind caucus.

The six are:

Tokunaga Eri (Hokkaido district seat, elected in 2010)
Mito Masashi (Kanagawa district seat, elected in 2007)
Uematsu Emiko (Kagawa district seat, elected 2007)
Okubo Yukishige (Nagasaki district seat, elected 2007)
Arita Yoshibu (proportional list seat, elected 2010)
Tashiro Kaoru (proportional list seat, elected 2010)

Mito, Uematsu and Okubo face reelection next year,. The other members are in for the long haul. Like House of Representatives member Kawauchi Hiroshi, all six really belong inside the LF. However, they are far more useful to Ozawa as fifth columnists inside the DPJ. Through them he can still influence DPJ policies, even though he himself is no longer inside the DPJ.

The six cannot be expelled or even severely reprimanded. After the defections to the LF and the Green Wind in July, the DPJ is left with 85 members in its House caucus, only one member more than the Liberal Democratic Party. Were the six traitors of Friday to leave the DPJ, the party would fall to the #2 rank in the House, losing the majority of committee chairmanships and most likely the position of President of the House.

Ozawa knows the DPJ's loss of control of the House's chairmanships would eliminate his ability to influence politics. It should surprise no one that he has his acolytes remain inside the DPJ House of Councillors caucus.

Speaking of disobedience, the LDP has decided upon the punishments to be meted out to the seven of its members of its House of Representatives delegation who defied orders to abstain from voting on the no confidence motion against the Noda Cabinet. The seven will receive reprimands, the second strongest of the eight levels of punishment the party can mete out to its members. (J)

This slap on the wrist is surprising, as one of the sinners, Nakagawa Hidenao, was served with a six-month suspension of all party privileges for having abstained from the June House of Representatives vote on the consumption tax.

The leadership had solid reasons to be lenient. The participation of Shiozaki Yasuhisa in the mini-mutiny was a transparent threat of a greater hard-right rebellion against Machimura faction leader Machimura Nobutaka for his milquetoast leadership and his support of LDP president Tanigaki Sadakazu. A severe punishment could also push Koizumi Shinjiro to run in the next election as an independent, an outcome the LDP is desperate to avoid. Koizumi the Younger (Koizumi IV) is, as Okumura Jun has put it, the LDP’s Chosen One, the prophesied future leader of the party.

It would furthermore be the height of hypocrisy for the LDP to punish the seven for voting for a no confidence motion only a day after Tanigaki and the LDP leadership abandoned plans to submit their own no confidence motion.

So the six DPJ House of Councillors and the seven LDP House of Representatives members, traitors to the party line each and every one, are virtually untouchable.

The weak responses by both the party leaderships presages further breakdowns in party discipline. An inability to get a straight answer from the LDP will endanger Prime Minister Noda’s plan to squeeze the LDP into voting for the bill authorizing the issuance of new bonds. The LDP leadership is eager for a quick deal on a redistricting bill – a necessity as the dissolution of the House and the calling for new elections would plunge the country into an irrevocable extra-constitutional state. However, if the LDP cannot guarantee party unity on the bond bill, it is of little use to the DPJ as a negotiating partner.

Of course, what can be said of the LDP applies equally, if not more so, to the DPJ. True to the nature of its former leader Ozawa, who recruited the majority of the DPJ’s serving Diet members, party members seem to have only the weakest of understandings of the fundamental importance of loyalty to the party. Disagreements over policy have thus led to a splintering of the party, not along the ideological lines the pundits predicted three years ago, but on the degree of loyalty to Ozawa the person.

Later - This post has been edited for clarity.

He Did It

PLEASE WAIT LOADING ,,,,,,,,, That is the takeaway for this weekend.

Decades ago this blessed land's bureaucrats and the research arm of the Liberal Democratic Party established that government finances faced a demographic wall, where the European-style social welfare benefits and United States-levels of taxation would collide with a wave of retirees, necessitating either:

1) mass privatization of government functions

2) reversals in the promises made to the citizens

3) higher taxation

4) potentially hyper-inflationary levels of government indebtedness, or

5) a combination of the above.

The solution the bureaucrats and the LDP proposed was a consumption tax, with an initial target rate of 10%.

It has taken thirty years to walk the walk from realization to realization. At least three prime ministers have had their heads handed to them over the tax, first for the imposition of a nominal 3% tax, then for each step of the march up to 10%.

However, on Friday, with every political instinct and a slug of economic analysis pulling in the opposite direction, Prime Minister Noda Yoshihiko managed to drag an opposition-controlled House of Councillors over the goal line.

The political costs have been enormous. Noda will most likely be rewarded, as he should be, with reelection as party president in September. However, he will preside over a much diminished Democratic Party of Japan, over 60 members of which have decamped in one way or another over the consumption tax. The Cabinet's and the DPJ's opinion polling numbers are in the cellar, with an election looming.

One can hate the raising of the consumption tax...and a lot of folks do, for reasons both intellectually sound and transparently selfish.

However, one cannot, no, one must not deny the bravery and tenacity of the prime minister, who sacrificed political blood and capital his party could not spare. When all the sirens are singing sweet songs about how cheaply the government can borrow money, Noda and his wounded party have sent a signal to the holders of Japan's bonds that the government of this blessed land will make good upon its debts through a willingness to both inflict pain and accept annihilation.

Rushing Forward With No Confidence

PLEASE WAIT LOADING ,,,,,,,,, On Sunday, I put forth the proposition that Koizumi Shinjiro's visit to Liberal Democratic Party headquarters accelerated LDP moves toward submitting either a no-confidence motion against the Cabinet or a censure motion against prime minister Noda Yoshihiko. Koizumi, walking very much in his father's footsteps and also reflecting his long stint in Washington, has become the face of the free market/low tax wing of the LDP, especially since The Big Man, Nakagawa Hidenao, has been put on ice.

In pushing a plant to threaten the PM with a no-confidence motion or censure, Koizumi was also the representative of the members of the LDP who had resigned themselves to the June 15 three-way LDP, the New Komeito and Democratic Party of Japan agreement to vote for consumption tax bill in both Houses of the Diet. Not a few in the LDP were sure the consumption tax issue would lead to the breakup of the DPJ.

The controversy over the raising of the consumption tax did indeed lead to a breakup, with Ozawa Ichiro leading his followers out of the DPJ. However, to the disappointment of those who thought the breakup would result in the DPJ-led coalition losing its majority in the House of Representatives, Ozawa led out of the DPJ only about half of the legislators purportedly under his influence -- well short of the number of rebels needed to transform the DPJ-led coalition into a minority government.

When Koizumi and his six youthful fellow LDP members bullrushed the office of the LDP party president, however, they were pushing on an open door. LDP president Tanigaki Sadakazu has known that in order for him to win reelection in the party presidential election in September, he had to have something to show for his first term.

He had to foment a crisis, and in this month.

The dispute over the date of the House of Councillors vote on the consumption tax was too small potatoes for this purpose, at first glance. The LDP proposed to have the vote on the 10th; the DPJ and Prime Minister, wanting delay action in the Diet so that they might cut deals on legislation with Tanigaki's successor, proposed a vote on the 20th.

The DPJ offer was only an initial bargaining position, though. The party's negotiators, in talks with LDP and New Komeito representatives, indicated the August 10th date was acceptable. (J)

Taken aback, the LDP violated all normal negotiating procedures and proposed a vote on the 8th -- a counter proposal to which the DPJ, while indulging in the requisite amount of whining at the LDP's duplicity, agreed to yesterday. (J)

Of course, in the meantime, in the face of the DPJ's violent accommodation to every one of the LDP's wishes, the LDP presented a further demand -- that Prime Minister Noda make a public commitment (kakuyaku) to dissolve the Diet after the House of Councillors vote on the consumption tax legislation. Otherwise the LDP would submit either a no-confidence motion or a censure motion or both.

The Prime Minister, who if anything is calm and controlled in his responses, told the LDP yesterday that the dissolution of the Diet was his problem, the timing of which was up to him and nobody else (J). A seemingly now hysterical LDP leadership responded by vowing to go through with its threatened submission of a no-confidence motion or a censure motion today, and to renege on the June 15 agreement. (J)

It is a rare thing when the representatives of a small religious party have to pay a visit to the headquarters of a large secular party in order to tell the secular party "Calm down or else." Nevertheless, that is what leaders of the LDP's longtime ally the New Komeito, their faces grim, had to do last night (J). Presumably they explained to their LDP counterparts that if an election were held, the LDP-New Komeito alliance would lack a majority in either House of the Diet -- and that no third party would cut any deals on passage of legislation with an LDP that has a history of backing out of major, signed agreements.

So all by indications, Tanigaki has triggered the political crisis he needed. Unfortunately, it seems to be leading to his own private Waterloo, rather than the overthrow of the Noda government he has desired.


Later - This post has been edited for clarity.

Tanigaki's Appeal To The International Finance Community

PLEASE WAIT LOADING ,,,,,,,,, As noted earlier this morning, Liberal Democratic Party President Tanigaki Sadakazu was interviewed by the Wall Street Journal Asia (E). He was also interviewed by Bloomberg (E), leaving Reuters no doubt wondering, "What are we, chopped liver? Not raw, of course." (E)

In both articles, Tanigaki makes essentially the same points:

- If Prime Minister Noda Yoshihiko, in an attempt to prevent further defections from the Democratic Party of Japan's House of Representatives or House of Councillors delegations, proposes modifications of the bill doubling the consumption tax in FY 2015, then the deal in between the DPJ and the LDP-New Komeito alliance is off.

- Tanigaki is ready to submit a no-confidence motion against the government in August.

What could be compelling the president of the LDP to talk to foreign financial information wire services? Was he just going the rounds, talking to anyone who could schedule an interview with him?

Seemingly not. A cursory look at the domestic press shows him offering no interviews to a domestic news entity, just a press availability open to everyone on the 20th.

So what is the deal here?

The first point Tanigaki raises is trivial: a deal's a deal. The PM is not stupid -- he knows that if he tries to renegotiate the package on the passage of the pension and social welfare bills through the House of Councillors, the LDP and the New Komeito will cry betrayal, and order their senators to vote against the bills, killing the reforms.

The second point raised is non-trivial -- and gives an indication why Tanigaki chose to spend his time with Bloomberg and ASW-A rather than any major domestic news outlet.

Tanigaki faces a huge battle to retain his position, should he choose to present himself as a candidate in the LDP's presidential election in late September. He has taken the party absolutely nowhere in three years in office. The party's public support numbers are below those the party had after its trouncing at the polls in August 2009 -- though, to be fair, the LDP does rather better when the question asked is: "What party will you be voting for in the proportional seat vote for the House of Representatives?"

Ambitious colleagues in the party know that Tanigaki's election to the presidency was not due to any outstanding qualities he possessed, but merely because out of the princes of the factions, it was Tanigaki's turn on the throne (I am indebted to Okumura Jun for this insight).

The domestic news media is aware of the tenuous hold Tanigaki has upon the party rank-and-file. They know that if he cannot engineer a political crisis before the end of the current Diet session on September 8, he will go down in history as only the second LDP president to not become Prime Minister.

What the domestic news media also knows is that Tanigaki has virtually no ability to precipitate a political crisis of the magnitude capable of toppling the Noda Cabinet. He cannot bring down the government in this session over the bond issuance bill: the government has enough money to last until October, or beyond, with a little fiddling. As for a successful no-confidence motion, Tanigaki would have to round up everyone not in the governing coaltion -- every member of every party and every independent -- plus 17 of the DPJ's own members, to vote with the LDP (the numbers work out differently, of course, if there are abstentions). This means the Communists voting with the LDP, something that might happen, oh, immediately prior to a giant meteor hitting earth, extinguishing all life on the planet. It means the LDP joining hands with Ozawa Ichiro's People's Life First Party (LF).

The LDP has a strong wish to return to the position of the party of government and strict internal discipline. But grab Ozawa's hand, after all the many times he has scalded the LDP? The very thought sets the brain to boiling.

So it would make sense to talk, not to the national media, which would ask all sorts of embarrassing questions like:

- "How are you going to get the Communists into bed with you?"

and

- "What if you entice the requisite number of number of traitors to vote with you and your allies against the government? Then what do you do? The electoral districts are still unconstitutional, so a Diet dissolution and elections are illegal. What kind of coalition are you going to put together to solve that problem, after you have blown the DPJ apart?"

Better to talk to the international financial press, to sow confusion in the international markets and foreign institutions, first in the hopes of sparking questions about the stability of the Noda government, and second, through the Japanese media's peculiar obsession with the way Japan is portrayed in the non-Japanese media, a rebound of the story in the domestic press.

Because after a serious bout of political deafness over the U.S. Marines' introduction of the despised MV-22 Osprey aircraft into this blessed land (J), one which made it look as if the intransigence of the U.S. Marines was going to drive a second DPJ prime minister out of office, the PM has righted himself and is demanding safety assurances and interim flight paths guaranteed to drive the U.S. Marines nuts. This is perhaps not the "Return to Sender" message the public wants the PM to send to the United States. However, it represents a significant step in the government at least appearing to reclaim sovereignty over the nation's airspace, which Noda for a moment seemed to be giving away.

Tanigaki needs Noda to misread another issue, or have a member of the Cabinet get caught in a compromising position, to evade the axe in September.

Without Noda's or the Cabinet's help, Tanigaki is doomed. He will talk up a storm but he has no wind at his back.

It Had To Happen Sometime

PLEASE WAIT LOADING ,,,,,,,,, It was a typo just begging to happen.

So it happened.

Congratulations Wall Street Journal Asia, you win the coveted LGM (Little Green Men) Award.

Japan Opposition Leader Says Tax Deal Not Set
July 23, 2012

By ALEXANDER MARTIN And TOKO SEKIGUCHI - TOKYO

Barely a month after Japanese Prime Minister Yoshihiko Noda negotiated an agreement with the main opposition parties to pass a controversial sales tax increase, the head of the opposition said he is preparing to push Mr. Yoda out of power and may ditch the tax deal...

(Link)

I met him in a swamp down in Dagobah
Where it bubbles all the time like a giant carbonated soda
S-O-D-A, soda

I saw the little runt sitting there on a log
I asked him his name and in a raspy voice he said "Yoda"
Y-O-D-A, Yoda
Yo-yo-yo-yo Yoda...

- Weird Al Yankovic, "Yoda" (1985)

Later - The folks at the WSJ-A have since scrubbed the typo. Ah, but I have the screen capture:

Japan's Depleted Politics

PLEASE WAIT LOADING ,,,,,,,,, This Sunday's morning talk show lineup provided a stark demonstration of the depleted state of this blessed land's politics. Following a week of significant action -- the defection of four more members of the ruling Democratic Party of Japan and the consequent formation of two new parliamentary caucuses in the Diet and even more more in the local assemblies (J - Yamanashi and J - Tochigi); the public humiliation of Ambassador to China Niwa Uichiro, the first non-bureaucrat to hold the post, over his matter-of fact assessment that a purchase of three of the Senkaku Islands by the Tokyo Metropolitan Government would likely lead to great frictions in between Japan and China (E - When will the Government of Japan get around to issuing the "It's OK talk to anyone -- ANYONE -- just not the Financial Times" directive?); the first serious hiccup in the seemingly unstoppable march of Osaka City mayor Hashimoto Toru (for those keeping score: July 21 = 0 tweets) -- the best that Nichiyo Toron, the national broadcaster NHK's flagship political debate program could come up with was a debate in between Jojima Koriki and Kishida Fumio, the Diet Affairs chairmen of the DPJ and the Liberal Democratic Party, respectively. For 22 minutes, rather than the customary hour. And with Kishida not even in the Tokyo studio but piped in from outside.

This is nearly unprecedented. Nichiyo Toron almost always has at least the policy chiefs of all the major and mini-parties of the Diet on display, if not the party secretary-generals. True, the result looks ludicrous, with the representative of the ruling DPJ and the representative of its coalition appendage the People New Party on one side facing off against six (now, with Ozawa Ichiro's new Livelihood Party, it would be seven) representatives of the main opposition parties on the other, requiring the moderator to carry out a delicate dance of traffic control in between the criticisms of the opposition and the assertions of the ruling coalition and in between the positions of the significant parties and the sad bleatings of the insignificant.

The abbreviated face-off covered only a tiny range of issues. Both men offered their party's positions on:

1) the progress of the main reform social welfare and pension bills (ittai kaikaku hoan), including the bill raising consumption tax to 10%, through the House of Councillors

2) the schedule for the holding of House of Representative elections, once the ittai kaikaku bills pass the House of Councillors, as the written agreement in between the DPJ, LDP and the New Komeito requires

3) the likelihood of the LDP cooperating with the DPJ in passing the all-important bond issuance bill necessary to implement the DPJ-drafted budget, before the money runs out of money in October (E)

4) the competing bills of the DPJ and LDP on reforming the districts and size of House of Representatives, in order that an election might be constitutional

5) the stability and legitimacy of the DPJ-led government, in light of the recent waves of defections from the DPJ

These five subjects are all linked together as in a chain: the solving of one leads to and depends upon the solving of others. As the sparse attendance at Nichiyo Toron debate indicates, these are issues the DPJ and the LDP have to work out between themselves, as no combination of either party with any of the other parties in the Diet can approve any of the necessary legislation.

The greatest hurdle is an agreement on the reform of the House of Representatives. At present, 97 districts have populations greater than 2 times the population of the smallest district, meaning that over half the votes in those 97 districts are essentially thrown away. Despite a history of deference to the executive and legislative branches, the Supreme Court has thrown down a challenge, declaring any disparity greater than 1.99 to 1 unconstitutional, putting some meat on Article 14 of the Constitution, which guarantees citizens equality under the law.

The LDP bill, known as the +0/-5 Solution, is a clever response to the Supreme Court's challenge. Rather than giving the voters in the 97 grossly underrepresented districts a greater say in the running of their government, the bill would simply abolish the five smallest districts. The disparity of between the 97 largest districts and the smallest district would then fall below the 1.99 limit.

The attraction of this bill for the LDP is obvious. It preserves almost intact the inequalities that perpetuated LDP rule for 50 years. The urban and suburban, revenue-producing districts are denigrated, while the largely rural districts, with their government contract- and regulation-protected economies, are elevated.

The competing DPJ bill has as its core the +0/-5 Solution, which is contrary to the interests of the DPJ's natural constituency, the abused urban and suburban electorate. Tacked on to the +0/-5 core, however, are a pair of amendments that at once entice and repel the New Komeito, the LDP's alliance partner.

The DPJ bill is thus not a bill at all. It is a red herring, a lie told in order to keep the LDP and the New Komeito engaged, under the illusion that a weakened DPJ is ready to cut a deal on redistricting. In return the LDP and the New Komeito, out of their present eagerness to hold an election, are expected to offer concessions on pending bills, such as the all-important bond issuance bill.

However, all the gamesmanship cannot disguise a basic reality: the DPJ and the LDP no longer have the luxury of playing ruling party versus opposition. With the recent defections of 16 House of Councillors members, the DPJ no longer has the option of teaming up with the New Komeito to pass bills through both Houses of the Diet. Only a DPJ-LDP consensus can guarantee a bill's passage.

Furthermore, as Okumura Jun has noted, barring the intrusion of a Hashimoto Toru-led national political party -- which, due to this week's revelations and Hashimoto's sudden loss of his voice, suddenly has become far less of a threat to the status quo -- there is no plausible set of election results altering the necessity of DPJ-LDP cohabitation. An election, if held today, would not prove or solve anything.

Furthermore, the LDP membership does not really want to have an election, not now. Party president Tanigaki Sadakazu has proven a disappointment, unable, since his election in 2009, to improve his party's standing with the electorate, despite the DPJ's many stumbles and bumbles. Tanigaki's term ends in September; several of his more aggressive and thoughtful colleagues are poised to replace him. Eager to force an election before his term runs out, Tanigaki advocates implacable confrontation with the DPJ. His intra-party rivals, unwilling to undermine the authority of the party presidency that they themselves covet, echo his intransigence, though with a distinct lack of enthusiasm.

Hence the current poverty of Japanese politics. While a multitude of decisions await, the direction of the country is hostage to the passage of a handful of bills. Furthermore, a faith that party identity is honed through conflict with the other side, a legacy of the LDP's long reign in power, holds the two major parties back from inescapable collaboration.

The Nakatsugawa Mystery Solved, Or Ozawaism Without Ozawa

PLEASE WAIT LOADING ,,,,,,,,, Well, that was fast.

In my post of yesterday, I was puzzled what Nakatsugawa Hirosato, a Tokyo Bloc proportional seat representative of the Democratic Party of Japan could be doing quitting the party to serve as an independent.

It turns out the answer depended on what one believes "independent" means.

If by independent one thinks "serving in the Diet without attachment to any party" then Nakatsugawa's resignation yesterday made no sense.

If, however, by independent one means "a label to paste upon oneself until the party one hopes to join organizes itself" then a proportional seat member throwing himself off the DPJ party list before the party got around to throwing him off itself makes complete sense.

As it turns out, Nakatsugawa seems to be the missing piece in the plans of Kiuchi Takatane, the first man out the door in the buildup to the passage of the consumption tax bill. Kiuchi, the Tokyo District #9 seatholder and a former Merrill Lynch partner, is The Big Money behind a new parliamentary caucus in the House of Representatives, just as Tanioka Kuniko is The Big Money behind the new Green Wind (Midori no kaze) caucus in the House of Councillors.

Kiuchi, it turns out, is further along in the process of building a party around himself than Tanioka. Nakatsugawa, if and when his resignation from the DPJ is accepted, would become the fifth member of the Kiuchi's new caucus, currently slated to be called "the Association of Reform Independents" (Kaikaku mushozokukai) (J). With five members the caucus could be converted into a formal party, eligible for public campaign funding and other goodies.

The caucus, which is to be launched today without Nakatsugawa's participation, is composed of Kiuchi, a North Kanto proportional seat holder, a South Kanto proportional seat holder (Nakatsugawa, if and when he joins, would complete a Kanto Plain trifecta) and Sato Yuko, a Nagoya District seat holder and former political secretary to current Nagoya City mayor and major loon Kawamura Takashi.

So on successive days the DPJ has seen defections tied to monied former members, both of whom were recruited by Ozawa Ichiro, each establishing proto-parties linked to neither the DPJ, the LDP nor Ozawa Ichiro's Livelihood Party.

It is impossible to tell how far either Kiuchi's or Tanioka's caucuses can go. Neither Tanioka's liberal (don't tax but spend) or Kiuchi's neo-liberal (don't tax and don't spend, indeed, cut) ideologies electrify the electorate. Tanioka is an irrepressible talker, so will have no problem in promoting Green Wind and keeping it in the public eye. Kiuchi's communication skills are so far unknown. Kiuchi's focus so far on the Kanto Plain area, where Watanabe Yoshimi's Your Party has its base (and indeed, featuring a political philosophy which is nearly indistinguishable from Watanabe's), and Tanioka's only having women in her caucus are hurdles both incipient leaders will have to overcome before either caucus can become a significant new forces in politics, both which in their essences seem to be competing flavors of Ozawaism-without-Ozawa.

--------------------------------------------------
* In my post yesterday about the Green Wind, I did not acknowledge the association of Green Wind with Die Grünen and other Green parties in Europe. While the association is there, particularly in Green Wind's anti-nuclear stance, the connection of green with wind in a caucus of the House of Councillors is the stronger precedent. The House of Councillors has had the Furyokukai ("Wind-Green-Association") and then the Shinfuryokukai ("New-Wind-Green-Association"). The latter association formed a joint caucus with the DPJ only to be absorbed into it, leaving only the name of the caucus -- The Democratic Party Of Japan and New Wind Green Association Caucus -- as a reminder of the Shinfuryokai's existence.

Not A Keeper, For Anybody, But Still A Loss

PLEASE WAIT LOADING ,,,,,,,,, Nakatsugawa Hirosato, a third term Democratic Party of Japan member from the House of Representatives, Tokyo Bloc, has just turned in his resignation papers to Acting President Tarutoko Shinji. He was one of the 19 Representatives who voted against the bill raising the consumption tax to 10% who nevertheless elected to remain inside the DPJ. He is the second of that group to since change his mind and submit a letter of resignation.

Unlike his predecessor Kato Gaku, Nakatsugawa is a proportional seat member. Also unlike Kato, Nakatsugawa is choosing to serve out the rest of his term as an independent. (J)

Which makes little sense, career-wise. True, by voting against the Cabinet, Nakatsukawa guaranteed that the party leadership will not be putting his name on the party list the next time a House of Representatives election is held. Unless he is planning on retiring from politics all together, he has to find either a party to take him (Which is not very likely, for if there were a party in need of him, he would not be coming out as an independent, would he?) or a district where he can run, with campaign funding coming from Amaterasu-knows-where.

His reasons for leaving the DPJ are equally peculiar. He attributes his decision to the passage of the consumption tax bill (Which happened, what, 24 days ago?) and the prime minister's not firing Japan's Ambassador to China Niwa Uichiro for Niwa's having tut-tutted about Ishihara Shintaro's plan to have the Tokyo Metropolitan District buy three of the Senkaku Islands.

This indicates that Nakatsugawa maybe thinks he has a future in the TMD's or a Tokyo municipality's right wing politics, after his term as a Representative ends.

With Nakatsugawa's resignation, the number of Diet members who have resigned from the DPJ since the consumption tax vote now stands at 55 -- 39 from the House of Representatives and 16 from the House of Councillors.

One Point Of Light To Look For In The Murk

PLEASE WAIT LOADING ,,,,,,,,, Today is likely to be rough day in Japanese politics.

Ozawa Ichiro is going to unveil his new political party, provisionally named "The People's Livelihood Comes First" Party (Michael Penn has provided a very convenient shorthand: "The Livelihood Party"). At this writing, the Livelihood Party will burst onto the scene with 49 Diet members: 37 from the House of Representatives and 12 from the House of Councillors (J).

All in all, 51 members of the DPJ have left the fold since July 2. The most recent defector is Yonenaga Harunobu, a Hatoyama Group member, who turned in his resignation papers on July 6. As Yonenaga is a House of Councillors member, his leaving the party over the consumption tax bill prior to the vote on that bill represents an embarrassing loss of face for the Democratic Party of Japan. However, Yonenaga, a district seat holder from Yamanashi, has chosen to serve, at least for now, as an independent, lessening the impact of his departure.

It will surprise no one if Yonenaga shows up at the meeting this evening introducing the establishment of the Livelihood Party. Almost certain to be in attendance will be fellow DPJ defector turned independent, Zukeran Chobin, as he made clear on his blog yesterday he will be caucusing with the Livelihood Party. (J)

It will also surprise no one if the entire membership of the Kizuna shows up at the meeting, with Kizuna leader Uchiyama Akira announcing his party's merger with the Livelihood Party. With Ozawa now out of the DPJ, Kizuna's raison d'être has evaporated.

With Kizuna's nine members and the cooperation of Zukeran and the three former DPJ members in Shinto Daichi, Ozawa will have 50 sure votes in the House of Representatives, one short of the 51 he needs to table a no-confidence motion against the Noda Cabinet.

Which makes moves of one sure guest at the unveiling unfortunately significant.

Former DPJ party leader Hatoyama Yukio has, through his behavior in the last week, transformed himself from DPJ-co-founder-yet-Ozawa-puppet into a DINO - a Democrat In Name Only. On June 26 he voted against the consumption tax bill, for which he was smacked on July 3 with a six-month suspension of party privileges. He complained about this punishment, with some party members suggesting that slapping a 6 month penalty on Hatoyama while hitting other opponents to the bill with two months suspensions was disproportionate. In a gesture that Hatoyama should have accepted graciously, the party central secretariat reduced his suspension to only three months on July 9.

Ever able to miss seize an opportunity to miss an opportunity*, Hatoyama, already in the hottest of water for boasting that he and his followers held the casting votes should there be a move to depose the Noda Cabinet through a no confidence motion (J), piled it on yesterday, saying not that he did not see why he deserved to be disciplined but -- and I am not making this up:

"There is an extremely insulting phrase making its way around. The phrase is 'the LDP's Noda Faction'."

Typically gutless in its presentation -- "It's not what I am saying, mind you. It's what I have heard, that's all" -- Hatoyama's insult is grounds for the imposition of a full year's suspension.

Except, of course, doing anything to Hatoyama right now will provide a pretext for him and perhaps a smattering of his followers to leave the DPJ, magnifying the impact of today's unveiling of the Ozawa party.

As it is, the leadership will likely sit tight-lipped, seeing whether or not Hatoyama has the wherewithal to actually quit the DPJ. He will be a prominent guest at the unveiling today -- but unless he actually shows up at Secretary-General Koshi'ishi Azuma's office with resignation papers in hand, he is just tossing out his usual b------t, using Harry Frankfurt's definition for the kinds of noises Hatoyama makes.

The one person whose attendance will really matter, if it happens, will be Fukuda Eriko. I have highlighted her before. However, rather than just being an Ozawa Girl, she has been the brains and conscience of the anti-consumption tax movement. She considered not voting on the bill, for she saw the fight over the consumption tax shifting from being a struggle over policy (seiji) to struggle over power (seikyoku), with the only beneficiary being the opposition Liberal Democratic Party. In a last minute change of heart she voted against the bill, thinking "I may not be reelected. But unless I commit myself now to the cause, I will regret it the rest of my life." (J)

Fukuda received the same two month suspension as the other DPJ members other than Hatoyama who voted against the consumption tax bill. She had, however, voted with the government on the establishment of a national commission to debate the minimum pension and other social welfare programs, while voting down the unneeded bill on the merger of the nation's kindergartens and day care centers - making her one of only two DPJ members to vote this conscientious way.

Though only 31 years old, an Ozawa pick and a first-termer, Fukuda is one rebel to whom the DPJ and Prime Minister Noda must pay attention and, if they are smart, total respect.

If Fukuda shows up at tonight's unveiling, the indication will be that the DPJ is in serious, serious trouble.

-----------------------------------------------
* A borrowing of Abba Eban's famous exasperated characterization of his Arab counterparts.

Giving The LDP Some Credit, Sort Of

PLEASE WAIT LOADING ,,,,,,,,, I have an incurable habit of dumping on the Liberal Democratic Party,

My latest bad joke at the LDP's expense?

"You know, there's an old saying:

Fool me once, shame on you

Fool me twice...I'm LDP!"

even as it has fallen out of grace and into the unbearable position of an opposition party.

I cannot, however, fault the LDP for lax discipline. While the Democratic Party of Japan gave DPJ members of the House of Representatives who voted against consumption tax bill two month suspensions of party privileges -- save for former party leader Hatoyama Yukio, who earned a six month suspension -- and a stiff warning to the DPJ representatives who absented themselves from the crucial vote, the LDP leadership dropped an anvil on former party secretary-general Nakagawa Hidenao for absenting himself from the consumption tax vote: a six month suspension of party privileges. (J)

For Nakagawa, who has tried to keep the flame of Koizumiism alive inside the LDP, abstaining from the vote was a matter of principle. Indeed, in an ideologically reordered political world, Nakagawa would be with his intellectual comrades in the Your Party, rather than waging a quixotic battle against the LDP's mishmash of laissez faire capitalism, paternalism, state capitalism and socialism.

Such is the logic of party discipline, however, that free thinkers face punishment for not following orders.

The Answer Is Fifty-Two

PLEASE WAIT LOADING ,,,,,,,,, Jiji Press is reporting that Ozawa Ichiro has delivered his sheaf of party resignations to Democratic Party of Japan headquarters. (J)

The final count of 40 members of the House of Representatives and 12 members of the House of Councillors is remarkably close to advance predictions, which had about 40 Representatives and 10 Senators resigning.

It is worthwhile noting that:

- the number of those resigning is way short (54 was the magic number) of the number of House of Representatives members Ozawa had to take with him for the DPJ membership in that House to fall beneath 50%.

- the eventual number of defectors is going to be greater than the number resigning today. Yamada Masahiko has made his resignation contingent on the passage of the consumption tax legislation through the House of Councillors. Guess what, the consumption legislation will pass through the House of Councillors.

- with the likely formation of a caucus with the nine earlier DPJ escapees who formed Kizuna, the four three representatives of Shinto Daichi, the 40 House of Representatives members of the new, as yet unformed and unnamed Ozawa party, the combined voting strength will be 53 representatives, two one over the limit of 51 representatives needed to submit at a no-confidence motion against the government.

- for any non-conficence motion to succeed, the new caucus would have to not only have every single one of the opposition voting with them but also 14 members of the DPJ turning on the Cabinet. Any takers for a bet on how likely that is going to be?

- it is now open season on Ozawa, like it has never been before. He has lost the majority party protecting him. No existing party is even considering an alliance with those defecting with him today and their fellow travelers in Kizuna and Shinto Daichi.

- with the losses in the House of Councillors, the number of DPJ members in that House falls to 95. This forecloses an alliance in between the DPJ and the New Komeito, as the combined strength of the two parties together is 95 + 19 = 114, eight votes short of the >50% line. The DPJ must now cut a deal with the Liberal Democratic Party on every bill it wants to become law.

Ozawa Ichiro - The Final Act

PLEASE WAIT LOADING ,,,,,,,,, In a few hours from now, Ozawa Ichiro, after a third and final meeting Koshi'ishi Azuma, his erstwhile friend in the Democratic Party of Japan leadership, will announce what he, Ozawa, will do with his party membership credentials.

Chances are he will tear them up.

Unlike in the case of his attempt to out prime minister Kan Naoto, where Ozawa watched the no-confidence vote on a television screen from his office, Ozawa turned up in person to hand the token takers the little blue-green tablet indicating that he was voting "no" agains the pending legislation.

For Ozawa, who is usually either at his home in Setagaya-ku or on the road when the Diet is in session, and who has a history of not showing up at crucial showdowns, to actually show up and vote on legislation in defiance of the party leadership is a strong indicator that he has made up his mind to go down with his ship, one way or the other.

One can imagine the frustration of Koshi'ishi, appealing to Ozawa's considerable sense of self-protection, describing to Ozawa what his future will be should he bolt from the DPJ:

"Without the party to protect you, you will be spending the rest of your living days giving testimony to Diet committees investigating everything you have done in your entire career. Are you ready to face such a future? Are your followers? Or do you actually believe that the LDP, having joined hands with you once, leading to the circumstances contributing to the death of Prime Minister Obuchi Keizo and, out of desperation, nearly joining hands with you again until you backed out after your private deal with Prime Minister Fukuda Yasuo and Watanabe Tsuneo led to your DPJ allies turning on you -- that the LDP will now join hands with you to turf out Prime Minister Noda Yoshihiko and form a conservative-liberal alliance of convenience with you? Do you not understand there is no there there? Does it not enter your imagination that the LDP and the New Komeito, whom you have both jilted (in the LDP's case four times) will not take this opportunity to join hands with your new enemy the DPJ and redistrict you and all who follow you out of existence? That your newest friends like Yamada Masahiko are nihilists, with nothing to lose?"

It is tempting to believe that Ozawa, having plunged so many times deep into a pool of resolution, only to climb out at the last moment, leaving his followers wet, cold and bedraggled, might be willing try this ploy one last time -- whether or not it salvages a single line of the DPJ manifesto of 2009. It is tempting to believe that his peculiar insertion of the phrase kyoko ni ("forcibly") in his criticisms of the Noda Administration's approach toward the passing the consumption tax legislation indicates he has some flexibility toward the legislation -- that if the passage were somehow accomplished without force, that he might entertain the notion of staying in the party.

However, the indicators are not in favor of this interpretation. Ozawa showed up for a vote in the Diet: that alone is "we interrupt this program to bring you a special announcement" level news. Kyoko ni is probably just rhetoric, an appeal to swing voters who are confused about whether the imposition of the rise in the consumption tax is a good thing or a bad thing, telling these voters, "Good or bad, it was the way that Noda approached the problem that was wrong."

Clouds wreath the capital. Rain has fallen and more is threatened.

The murky beginnings of what one presumes will be a long and memorable day.

And Ozawa Ichiro As Moe Greene

PLEASE WAIT LOADING ,,,,,,,,, Former Democratic Party of Japan leader Ozawa Ichiro has met three times over the last two days with his erstwhile friend in the DPJ leadership Koshi'ishi Azuma, this over Ozawa leading his followers and allies in an open rebellion against the leadership's sponsorship of legislation raising the consumption tax from 5% to 10% by April 2015.

After the first two rounds of talks on Thursday, Ozawa said that if the talks end in failure, he will have to make a grave decision. After the third meeting on Friday afternoon, Ozawa promised he would make the decision one way or the other (presumably he was referring to leaving the DPJ or staying) on Monday.

In terms of the content of the Ozawa-Koshi'ishi discussions, one can say with some degree of confidence that it does not require three meetings and a weekend to deliver an ultimatum.

For that, one meeting would have been more than sufficient.

It does take three meetings and a weekend for a talking-things-over with one's minions for a very arrogant man who thought he was in an impregnable position to come to the realization that he has been made an offer he cannot refuse.

In all the discussions of Ozawa's magic numbers -- whether it is the 54 DPJ members he would have to drag along with him out of the party (lest any of his followers have second thoughts about the jump, Ozawa made sure to extort letters of resignation from his supporters, which he keeps stashed in his pocket) to reduce the DPJ to minority status in the House of Representatives; or the 43 42 he would need to lead out of the party in order to form a parliamentary caucus of 51 representatives, the minimum necessary to propose a no-confidence motion; however many billions of yen it is his followers would need to run credible campaigns in their districts, should elections be held; the percentage of the public apprecia Ozawa's departing the DPJ with his followers in tow to form a new party [15%, according to The Asahi Shimbun, 16% according to the Yomiuri Shimbun)] -- two little problems have been overlooked:

1) the Noda government has established a working, if not exactly cordial, relationship with the Liberal Democratic Party and the New Komeito, and

2) whilst the LDP/New Komeito alliance wants to replace the DPJ/rump PNP as the ruling coalition, it absolutely craves the chance to crush Ozawa once and for all.

Talented amateur player of Go that he is, Ozawa may be a little taken aback to find himself in an impossible position, neither able to cut a deal nor walk away from the table undiminished.

Everything hinges now on pride, whether Ozawa overcomes his, or sends the political world reeling again based upon his confidence in the rightness of his own vision.


Later - The original text of this post contained a number of links, all of which were lost in a software crash at midnight, Tokyo time.

Even later - I confess a certain sympathy with the view expressed by Okumura Jun over in his June 26 post over at GLOBALTALK 21: that Ozawa has lost control of his followers, leading to their redefining on their own what fanatical devotion to him should be.

Of Course I Do

PLEASE WAIT LOADING ,,,,,,,,, Of course I want to write a contrarian post about the present situation inside the Democratic Party of Japan and the Diet following the House of Representatives vote on the three bills paving the way for a raising of the consumption tax, insulting along the way a whole raft of persons, including:

- Hatoyama Yukio

- Ozawa Ichiro

- Tanigaki Sadakazu

- Yamaoka Kenji

- Watanabe Yoshimi

However, such was the jet lag from my trip that when I sat down at my computer, I could see five objects on the screen when I knew there were only three -- meaning I was in no shape to try to tackle the grand opera performance we folks in the cheap seats are not expected to even think about, much less understand.

Suffice it to say that not all the 57 members of the DPJ who voted against the bills or the 16 members who sat out the vote are necessarily ready to commit political suicide out their love for Ozawa Ichiro. A certain fraction are true believers, with enough brains to figure out what their interests are but incapable of seeing that their dear leader is only using them, alternating between bullying and flattering them, terrifying them into craving his approval. A goodly number, the most senior members of the cabal, have made the journey with Ozawa from party to party -- meaning they are just flunkeys, with scarcely a brain wave disturnbing their cerebellums. There are also idiot-savants like Hatoyama who have such a blind faith in the Doctrine of the Mean that they forget the Texas Rule of Politics: "The only things in the middle of the road are yellow lines and dead armadillos."

It should also be remembered that the larger-than-expected number of nay-voters and abstainers may not represent a victory for Ozawa but indeed a failure of the imagination of the prognosticators. Think about it: you are a fence sitter in the DPJ, not tight with Ozawa but not tight with the mainstream leadership either. You have a tough election fight ahead of you. The New Komeito and the Liberal Democratic Party are all in on the vote, meaning it will pass by a huge margin. Why not be on record as an opponent of tax rises?

As for the threat to the cohesion of the DPJ, one cannot threaten that which has never existed. Every voter in 2009 had read what was on the DPJ label -- "Contents do not represent an organized political party, just an organized movement against the LDP. Westministerian-like levels of party discipline will be freakish and brief." (E)

The electorate also knew, because the newspapers, magazines and news programs went over the numbers in excrutiating detail, that the 2009 manifesto was a Potemkin Village, an improbable passel of promises to every possible constituency -- and that electorate was still was willing to grant the DPJ a huge majority in the House of Representatives.

As for Ozawa, he is on trial again. Ostensibly, he should have been stripped of his party privileges upon the refiling of charges against him. That he has not means that the party central leadership can choose to strip him of his privileges, making it impossible for him to run or even vote in the September DPJ leadership election. All those who followed his lead in voting against the legislation could suffer similar, if lesser, trimmings of their wings. If those are not punishments eliminating Ozawa's influence on party affairs, then what are? Recall that Ozawa already ordered an auto-purge of his followers from their government and party positions in April. Without party privileges, the rebels are dead to the party.

So whatever it is that Koshi'ishi Azuma and Ozawa Ichiro will be discussing this afternoon, it is likely not the end of Noda Yoshihiko's world.

Well, So Much For That Eternal Verity

PLEASE WAIT LOADING ,,,,,,,,, I once issued a definitive proclamation regarding Peter Tasker, a founding partner of Arcus Investments.

It turns out I was wrong.

In his latest opinion piece for the Financial Times, Mr. Tasker has nothing interesting to say (Link).

It seems that sometimes even the best just phone it in.

For a better look at the short-term and mid-term consequences of the consumption tax legislation, read this Bloomberg report (E). Ignore the title (titles on wire service reports are too often misleading) and concentrate on what the analysts are saying about 2013, the election year. The looming threat of a tax rise in April 2014 will likely increase consumption over 2013, stimulating overall economic growth, as companies and individuals pick up big ticket items before the 3% jump in prices. The likelihood that consumers will shell out for goods and services at current prices, staring as they are at whalloping, regressive tax rise in 2014, will likely stabilize prices, nullifying, even if only temporarily, the long-term deflationary trend. Whether the halt in deflation triggers a spike in equities investments, given the sudden crash in real returns on bonds, is a question best put to Naomi Fink, a.k.a the Smartest Person In Tokyo, of Jefferies.

I am not as sanguine as Adam Richards (E), I certainly cannot be convinced that in a world where every country's bond yields are low -- some even lower than Japan's -- and a rock hard yen that is killing exporters, that a tax rise taking a first stab at stabilizing the nation's fiscal health is a really bad idea.

Of The Financial Times And Japan

PLEASE WAIT LOADING ,,,,,,,,, I love the Japan team of the Financial Times. Mure Dickie, Jonathan Soble and Michiyo Nakamoto (and former Tokyo bureau chief David Pilling, when he takes a flyer at writing about his former home base) deserve nothing but the most effusive of praise for presenting the country as it is, without only-in-Japan dross or a misguided/lazy rephrasing of what appears in the less-than-reflective, scandal-fluffing domestic news media.

I just wish they would stop one-on-one interviews with Japanese figures. It causes their interview subjects nothing but trouble.

The latest victim of the curse of the FT interview is ambassador to China Niwa Uichiro (J). In an interview with the FT, he was asked about Tokyo Metropolitan District Governor and agent provocateur emeritus Ishihara Shintaro's plan to have the TMD purchase three of the Senkaku Islands from their private owner (if you are Chinese, Taiwanese or from Hong Kong, p-r-iv-a-t-e o-w-n-e-r is of course pronounced "färs-kl ˈkleɪmənt").

According to the FT, Niwa responded:

“If Mr Ishihara's plans are acted upon, then it will result in an extremely grave crisis in relations between Japan and China.”

(Link)

True, or at least possibly true. It depends on how the Chinese view Ishihara's making Kurihara Kunioki (E) a very rich man in the one-hop transfer, thanks to the quick thinking of Vice and Actual TMD Governor Inose Naoki, of private donations to Mr. Kunioka's account (E). If the Chinese government, which has been very circumspect and withdrawn of late, shrugs the sale off as bunch of self-described patriots throwing their money away, all will be well.

Trigger the deluge of condemnation, nevertheless, from the usual suspects: Ishihara (no surprise here), the anti-government press (E) and the Noda government, obsessed as it is with the concept that nothing -- NOTHING -- can get in the way of the passage of the bills raising the consumption tax.

As for the Financial Times, it landed a two-for-one deal out of the interview, publishing the interview, then publishing the government's response to the interview. (E)

It has been six years since I dashed off my ever-more-seriously-in-need-of-an-update-and-revision Rules of Japanese News. Despite the list's intemperate origins, Rule #2 still seems to have some juice left in it:

"If an exclusive interview produces a scoop for the Financial Times, the interviewee probably did not understand the question."

Later - Prime Minister Noda Yoshihiko was waded in the Niwa controversy. In testimony to the House of Representatives, the PM stated he will not be asking for Niwa's resignation, saying that Foreign Minister Gemba Ko'ichiro delivered a warning to Niwa, and that Niwa had reflected deeply upon his actions. (J)

Of course, this was the same vote of confidence that Noda expressed in Minister of Defense Tanaka Naoki and Minister of Infrastructure, Land, Transport and Tourism Maeda Takeshi...and we all know how well that turned out for those two men.