All bets are on Yoshihiko Noda to become Japan's next prime minister after he won the presidential election of the ruling Democratic Party of Japan on Monday. Noda, 54, took the majority vote in a runoff. Lawmakers in the Upper and Lower Houses of Parliament will likely give their approval for Noda's post as prime minister on Tuesday. He will then be Japan's sixth prime minister in five years.
As the present Finance Minster, Noda's win appears to reflect major concern about Japan's embattled economy. The head of the nation's most powerful branch of the bureaucracy since June 2010, Noda has overseen efforts to revive the nation's poor fiscal health. Japan is now afflicted with a debt twice the size of its economy, and the worst among the developed countries. Moody's Investor Service cut the nation's credit rating last week in light of the country's bulging debt, political instability and the lack of an established plan to stabilize the world's third largest economy. (Read about Japan's self-fulfilling prophecy, concerning its prime ministers)
Noda's rise reflects another development - which could affect the longevity of his premiership. He was not the candiate of the DPJ's kingmaker, the so-called Shadow Shogun, Ichiro Ozawa, who had thrown his support to Trade Minister Banri Kaieda. Ozawa, who espouses hardline attitudes toward the U.S. and China, had made a bid to come out of the shadows and contest the leadership of the party in 2010 but was defeated. Nevertheless, he still controls the party's largest faction of more than 100 lawmakers, about one-fourth the total number.
Can Noda lead? Analysts are not sanguine. "He emerged as a compromise," says Jeff Kingston, Director of Asian studies at Temple University Japan. "He's not charismatic, or a populist or a good communicator, [and] not a particularly bold or visionary leader. He's sort of a 'Steady Eddy' and doesn't raise expectations that much. Maybe in the context of Japanese politics, that's the best you can hope for."
While Noda could be filling the prime minister's seat for the next two years as DPJ elected head, opinions are mixed on how long he will actually last as prime minister. "Noda is a typical, simple, honest person but at the same time he is very stubborn," says Takao Toshikawa, editor of the political newsletter Tokyo Insideline. "But among the five candidates who ran for DPJ party head I think he has the strongest leadership ability and will continue as prime minister for two more years, maybe more." Says Yoshi Yamamoto, a political advisor to DPJ congressmen: "Noda seems a bit like the former LDP prime minister Keizo Obuchi [in the 1990s], generally known internationally as a 'cold pizza,' but respected domestically by working level staffers and officials as someone who listens and rewards."
A fiscal conservative, Noda has been a staunch supporter of hiking taxes rather than more borrowing. His win raises the possibility of a tax increase that would help fund reconstruction from the earthquake and tsunami (with an estimated cost of almost 20 trillion yen over the next five years) and pay for the nation's ballooning health and social security costs in one of the world's most rapidly aging societies. (Read about six things Japan can teach the West.)
The rising yen has also weakened the country's export-led economy. As a counter to this, Noda favors the Trans-Pacific Partnership (TPP) as a way of liberalizing the economy, improving Japanese competitiveness abroad and opening up free trade. But this move would not be a short-term cure. Nevertheless, Takuji Okubo, chief economist at Societe Generale Securities in Tokyo told Reuters, "Of the five candidates, Noda was the best choice for Japan's economy."
The economy, however, is only one portion of a bevy of problems Noda must navigate after he takes the helm as prime minister. Besides the stagnant economy, high public debt, rising yen, slow reconstruction in the disaster-hit Tohoku region, and nuclear crisis, there is rampant infighting within the DPJ and a gridlocked Parliament. "The real problem is that Noda is being handed a poisoned chalice," says Kingston. "The key is whether the DPJ can unite and whether it can work with the opposition Liberal Democratic Party (LDP) in Parliament."
"Unfortunately, 'politics with a deep grudge' remain within the DPJ," says Toshikawa. "The party will remain divided unless the bickering between the pro- and anti-Ozawa camps ends." Dubbed the kingpin of Japan's political world over the last several decades, Ozawa has been suspended from the DPJ pending a funding scandal investigation. The defeat of his candiate Kaidea may indicate a slip in the powerbroker's hold over the party. "But Ozawa will not give up," says Shinichi Nishikawa, professor of politics at Meiji University in Tokyo. "He has a lot of resources and is always ambitious."
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In his victory speech Noda said, "If the Democratic Party falls apart, old politics will prevail. Let's all persevere and work hard for the good of the people, and achieve political stability."
The lack of cooperation between the DPJ and opposition parties has been the major stumbling block in getting vital bills passed in Parliament. Noda has been a proponent of a grand coalition, working with the main opposition Liberal Democratic Party (LDP). But the LDP shows no sign of wanting to cooperate. "Their strategy has been to discredit the ruling party and the prime minister by provoking legislative gridlock," says Kingston. "Cooperation would mean getting things done and that would not necessarily help the LDP." (See the long road to Japan's recovery.)
During a post-election news conference, Noda said, "I hope to build trusting relations with the opposition parties to hold policy negotiations and ask for their cooperation. Japan can't afford a political vacuum or dissolution of the lower House. Everyone has to work together..."
But even Noda's position on the grand coalition proposal has been wavering. "[He] started toning down his intention to team up with other parties," says Yamamoto. "The biggest change [Noda] could bring is to put substance to the currently hollow phrase seiji shudo or 'policy led by politicians rather than bureaucrats.'" (See TIME's video on braving the radiation in Japan.)
Beyond domestic bickering, another challenge for Noda will be foreign policy; getting bilateral relations back on track with both China and the U.S. But Noda's policy position again appears vague. Japanese war crimes in China during World War II have not been forgotten and the issue has been the source of diplomatic flare ups. In addition, tensions between China and Japan spiked in September last year when a Chinese fishing boat collided with Japanese Coast Guard boats near the disputed Senkaku islands (which Beijing calls the Daiyu Islands). Chinese boats continue to enter the disputed waters. Noda's visits to Yasukuni Shrine may also be considered a provocative issue. The Shinto shrine is considered by some as a symbol of Japanese domination in Asia during World War II. "Noda is one of the few DPJ members to visit Yasukuni Shrine which could be criticized by China," says Toshikawa. On the American side, the U.S. military airbase in Okinawa has been a bone of contention with Japanese locals on the southern island who want to see it moved. "But Noda feels strongly about maintaining close ties with the U.S.," Toshikawa adds.
Public opinion shows growing cynicism towards the revolving door nature of Japanese politics and the country's prime ministers. "I'm not sure Noda is going to be able to restore and rebuild the government, and be able to restore popular faith in politicians. It's going to seem more of the 'same old.'" says Kingston. "People really long for the days of a bold leader like Junichiro Koizumi [LDP prime minister from 2001 to 2006] with a vision of hope who would say, 'Yes, we're all facing difficulties now but if you follow me - no pain, no gain - things will be better.'"
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