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Japan in Action

TOKYO – Japan’s prolonged political anni horribiles – spanning more than half a decade – has ended. The Liberal Democratic Party (LDP) won a decisive victory in elections to the upper house of parliament held on July 21, bringing to an end the indecisive politics caused by the lack of an effective majority.

During the previous six years, there were six prime ministers, ten defense ministers, and 14 justice ministers (ten of whom came and went during the 39 months of rule by the Democratic Party of Japan). These figures indicate just how unstable the country’s political situation had become.

But anxiety about the immature DPJ government, prolonged deflation, and unprecedented challenges posed by neighboring countries created a widespread sense of crisis among Japanese voters. It was this that motivated them to return the LDP to power, though many voters seemed fed up with the party just a few short years ago.

In the recent election campaign, the LDP continued to criticize the previous DPJ government’s immaturity, but avoided attacks on other parties. Instead, the LDP highlighted the beneficial effects of Prime Minister Shinzo Abe’s reforms (colloquially known as “Abenomics”), such as increased share prices, faster GDP growth, and higher employment, all of which have created hope for a turnaround in Japan’s prospects.

Since Abe returned last December for a second stint as Prime Minister, Japanese voters have entrusted him with maintaining political stability and ensuring economic revitalization. But, following monetary easing and fiscal expansion, it is Abenomics’ third “arrow” that will prove most important – and most politically challenging. The Abe government must implement deregulation and other structural reforms while convincing powerful interest groups to adjust to a new national and global environment in which Japan’s old economic model no longer works.

Fortunately, Abe will not need to worry about elections for the next three years. With strong majorities in both houses, he should be able to secure whatever reform legislation he needs – that is, provided that he can maintain the LDP’s internal discipline (his enormous popularity will help him).

Abe’s agenda includes reform of social security in response to demographic trends, as well as gaining the agriculture sector’s acceptance of the Trans-Pacific Partnership, the bold regional trade agreement that will unite the United States, Japan, Australia, New Zealand, and much of the rest of Asia, with the exception of China. The rigors of the TPP are bound to force significant agricultural reforms, and pushing it through will, indeed, test party discipline.

But Abe is also pressing for change in medical research and the technology sector by embracing long-shunned innovations such as iPS cells (artificial stem cells). He is also emphasizing the development of renewable energy and power-saving innovations, which became an urgent policy objective following the accident at the Fukushima Daiichi nuclear power plant two years ago. Abe is resolved to make steady progress on each of these key issues.

But Abenomics has a strategic corollary as well. Japanese diplomacy lost its footing in the unstable – and often naive – politics of the DPJ years. Thus, Abe has been traveling abroad every month since last December in an effort to demonstrate that Japan has returned as a global player, and is particularly keen to play a prominent role in recasting Asia’s security structures in the wake of China’s rise. Indeed, Abe has visited 13 countries in the last six months alone (a schedule that has helped him to cast aside any lingering memories of his previous tenure as Prime Minister, when ill health forced him from office after barely a year).

Abe has placed particular emphasis on strengthening Japan’s alliance with the Unites States, which had atrophied as a result of the DPJ government’s feckless behavior (relations with China deteriorated as well). More broadly, Abe envisages Japan’s future as that of a trading country that has assumed its rightful role in ensuring a free and open maritime order. Abe’s diplomatic whirlwind is aimed at strengthening ties with countries that share this commitment, as well as Japan’s other values, including human rights and democracy.

Of course, given Asia’s size and dynamism, there are many other issues that will need to be addressed in the years ahead, including improvement of the security environment in a currently unstable East Asia and amending the country’s constitution, which the LDP has considered doing for many years. But the first priority for Abe’s second government is to revive the Japanese economy. That task has already begun, and the LDP’s recent election victory will strengthen Abe’s ability to complete it.