September 3, 2008
In Japan, a Leadership Vacuum

By MARTIN FACKLER
TOKYO ― Prime Minister Yasuo Fukuda’s abrupt resignation, the second by a Japanese premier in under a year, underscores the chronic leadership vacuum plaguing the world’s second-largest economy, even as it threatens to slip into recession.

Mr. Fukuda’s announcement on Monday night surprised Japan, coming almost a year after the equally sudden resignation of his predecessor, the rightist Shinzo Abe.

After two political misfires in such a short time, Japan looks increasingly incapable of producing strong leadership despite facing a host of pressing issues, from the rise of neighboring China to crucial upcoming domestic elections.

However, economists said the resignation’s actual impact on Japan’s direction will be limited, largely because Mr. Fukuda ― already an unpopular leader who had accomplished little during his year in office ― had largely ceded decision making to entrenched political interests and the nation’s powerful bureaucrats.

“Another year, another prime minister,” said Richard Jerram, an economist in Tokyo for Macquarie Capital Securities. “The policy impact of the new prime minister will be relatively limited.”

Just days before his announcement, Mr. Fukuda unveiled a $17 billion stimulus package that was seen by economists as too small to boost Japan’s stalling $4.7 trillion economy, which many economists agree is heading into a recession caused by higher commodity prices and a slowdown in exports to the United States and China.

Indeed, a string of unpopular, colorless leaders has actually been the political norm in Japan, which has gone through 13 prime ministers in the last two decades. For generations, political decisions here have been made by consensus, usually in back rooms among the various factions of the Liberal Democratic Party, which has enjoyed nearly unbroken rule for 50 years. Strong leaders capable of putting a personal imprint on policy, such as former Prime Minister Junichiro Koizumi, a Liberal Democrat who resigned two years ago, have been the rare exception.

Economists and political analysts said there was not much prospect for a return to Mr. Koizumi’s style of charismatic leadership short of a comeback by Mr. Koizumi himself, which few here expect. The current favorite to replace the 72-year-old Mr. Fukuda is Taro Aso, 67, an outspoken, conservative former foreign minister who has scored poorly in public opinion polls.

Mr. Aso, whom Mr. Fukuda defeated to become prime minister last year, has called for more government spending to boost the economy, unlike the fiscally hawkish Mr. Fukuda. On Tuesday, he announced his candidacy for leader of the Liberal Democrats, which will be decided in a vote on Sept. 22.

Whoever wins the party vote will immediately replace Mr. Fukuda, since the Liberal Democrats control the lower house of Parliament, which chooses the prime minister.

Because the upper house is in the hands of the largest opposition party, the Democratic Party of Japan, even the few measures that Mr. Fukuda did try to pass during his time as premier ran into stalemate in Parliament. Those included the selection of a new central bank chief and the renewal of a law allowing Japanese ships to refuel American and other vessels involved in the war in Afghanistan.

The biggest chance for a change, say economists and political analysts, will come during upcoming lower house elections, which must be held sometime in the coming year.

If the opposition party can defeat the unpopular Liberal Democrats in the elections, it will gain control of government for only the second time during the last half century. But even if it does win, the Democratic Party may end up altering little, given its own lack of both strong leaders and a clear policy agenda, say political analysts.

If the ruling Liberal Democrats hold onto control of the lower house, as many political analysts predict, the parliamentary deadlock could continue for at least five years, until upper house elections give the ruling party a chance to retake the upper chamber.