Friday, April 25, 2008

Can DPJ Dissenters Join the Ruling Coalition on the Other Side of the Road Money?

I swear I've never spent so much time on a single post. And it still needs editing. But I’ve run out of energy. Now back to life…

Tetsuro Yano is a three-term member of the House of Councilors (HC) whose only claim to national fame came last August during the wholesale Cabinet reshuffle that Prime Minister Abe undertook in a vain attempt to revive his political fortunes after the disastrous HC election the month before.

Many people, including Mr. Yano himself, had believed that he would be appointed to the Cabinet as one of two slots always reserved for the HC. Unfortunately, Mr. Abe was not among them, and kept Mr. Yano waiting in vain for the phone call that never came. (Mssrs. Yoichi Masuzoe and Shinichi Izumi got the nod.) Mr. Yano is not one to take things lying down, and made his displeasure known on national TV. He also called Mr. Abe and, if media reports are true, delivered a 25-munite diatribe.

Now, Mr. Yano is in the news again for giving a talk on April 23 in his home district where he claimed, “Some people are now emerging [among the DPJ HC members] who are willing to work with us. Pretty soon, those people are going to set up on their own.” The bone of contention is, of course, the gasoline tax revenue and its uses.

Coming from most people, this would be dismissed as mere pre-election tongue-wagging. That Mr. Yano is a member of the Ibuki faction--Bunmei Ibuki is the hardtalking Secretary-General of the LDP--raise more flags. However, the HC is a clubby place, and Mr. Yano worked closely with the opposition as the Chairman of the LDP’s HC Diet Affairs Committee between 2004 and 2007, so he should have a better-than-average idea of what’s going on in the hearts and minds of the people across the HC aisle than most of his LDP colleagues do. Then there’s Yasuhiro Ōe, the rebellious DPJ Councilor who claimed more than a month ago that he had the signatures of 39 DPJ Diet members (including 25 in the all-important HC) on a petition opposing the elimination of the surcharge.

But will enough DPJ Councilors break ranks and vote for or at least abstain from voting on the Fukuda administration’s tax bill to reinstate the surcharge? And if they do, will they break away to form a new party, or even join the LDP? If I had to make a guess, I’d say, possible, but unlikely.

On one hand, public works brings together one of the most powerful agglomerations of vested interests imaginable. Representatives of the provinces, whose economies are highly reliant on public expenditures, not to mention other old school, pork-barrel politicians, will find their beseeching hard to ignore. On the other hand, the DPJ wants to push the Fukuda administration and the ruling coalition over the edge on the issue, so the party leadership will come down more heavily on dissenters than in the case of the BOJ appointments*. In fact, there appears to be a real likelihood that the DPJ leadership will make it so uncomfortable for any members who vote with the ruling coalition on the tax bill that they will have no choice but to, in the words of Mr. Yano, “set up on their own”. Here, note that two of the likely ringleaders, Yasuhiro Ōe (2007), next to last, and Hideo Watanabe (2004) hold proportional seats. This is important.

Mssrs. Ōe and Watanabe and other HC proportional members in the DPJ, with their strong though limited local ties, are likely to find the siren call of the vested interests and assemblymen and mayors and governors hard to resist. But they have little appeal beyond their immediate environs, and as a result will have a hard time attracting votes over and above what they can carry over individually from their old DPJ haunts. Banding together, they will manage to elect the top vote-getters on their proportional candidates list, but the others will surely wind up losing their seats. They could stand for election in the prefectural districts in parallel, but that’s where they would be in the first place if they had sufficient local appeal, wouldn’t they? In fact, many of them are local losers who made it on the national list, so they would wind up being caught in the crossfire as the quasi-LDP, third-party candidate.

It turns out that Mssrs. Ōe and Watanabe are perfect examples of those likely losers. The DPJ won 19 proportional seats (allocated on a national basis) to the LDP’s 15 in the 2004 HC election, enabling Mr. Watanabe to scrape through at the very bottom, as the 19th highest vote-getter among the DPJ candidates. The DPJ was even more successful in the 2007 HC election, winning 20 proportional seats to the LDP’s 14, DPJ landslide victory, where Mr. Ōe slipped past the stiles in, yes, 19th place. In other words, in both cases, if the DPJ margin of victory in the popular vote had been much lower, they would very likely be out of a job now.

Would it help them to join the LDP outright then? Not necessarily. Mssrs. Ōe and Watanabe both received substantially less votes than the LDP proportional Councilors-elect with the least individual votes in the respective elections. Barring an LDP victory of 2004/2007 DPJ proportions, it is likely that they will lose their seats in their next elections.

Likeminded DPJ cohorts may be in a better position to bolt and hold onto their proportional seats. But remember, the number of seats that a party receives will be determined by the total of the votes for the entire party. A splinter party consisting of members with no national name recognition and without the money to field a large number of candidates with local appeal will be little more than the sum of its parts. A safe proportional seat in a big party would be at serious risk in a minor upstart. Those figures would be advised to switch to the LDP, rather than start a new one. Since we don’t have their names, it is impossible to be sure how many of them there are. What is clear is that their interests are not necessarily consonant with those of the two of the most prominent dissidents.

Yoshitake Kimata voted for Toshirō Mutō and was slapped with a one-month suspension, and is thus seen as a possible co-conspirator. He is elected from Aichi Prefecture, so he will not suffer from the same constraints that make a rebellion problematic for many proportional seat-holders. So could he join the LDP. But Aichi is a DPJ stronghold, with support from its powerful, moderate wing of the labor movement, with which global industrial giant Toyota has enjoyed very good relations. Mr. Kimata was himself one of two DPJ Councilors elected in the 2007 victory. The lone 2007 LDP incumbent will be very reluctant to compete against another LDP incumbent for what is likely to end up as one, not two, LDP seat in the 2013 HC elections. Other Councilors elected from prefectural districts may have an easier time of it, but in the 18 multiple-seat election provinces (with 4 or more seats, so that 2 or more are contested in any election), they could face fierce opposition from the LDP incumbents. Mr. Kimata and his non-proportional cohorts do have the option of setting up a party of their own. Good luck contesting the next elections as a small, quasi-LDP offshoot from the DPJ.

What is likely to happen, then?

Assuming that it continues to receive the unanimous support of the 105 LDP and Komeito Councilors, the Fukuda administration needs 17 non-coalition votes, 33 non-coalition abstentions, or combinations thereof for a HC majority. With more to lose either way, many potential DPJ dissenters will be strongly tempted to catch the flu, miss a connecting flight, anything, just to avoid voting at all. So if I’m reading the situation correctly, dissent will be expressed mainly through abstention and there won’t be many outright crossovers. That means that the coalition will require a fairly large number, much closer to the maximum 33 than the minimum 17, to step out of line if it is to gain a working HC majority. That seems like a tall order, though I don’t have the data to do a one-by-one analysis.

So far, I’ve argued that the opposition is more likely than not to be able to hold the line. But since I’ve been wrong quite often--not that professional pundits do a particularly good job of foretelling the twists and turns of the political game very well--it’s probably prudent to do a what-if and consider what sufficient crossover would mean to the coalition’s fortunes.

It is easy to think that this would yield immediate benefits to the LDP. They could very likely do more than just pass the tax and road bills without resorting to the House of Representatives supermajority override vote. In fact, in the case of an irrevocable DPJ split, they would be able to pass other contested bills as well.

But would the tactical success be a good thing for the LDP’s fortunes? I don’t think so. The would-be rebels are not going to bolt the DPJ just to put off the transfer of the gasoline tax money to general-purpose funds to FY2009 as the Fukuda administration intends instead of immediately as the DPJ demands, or just to reinstate the surcharge for the greater good as the Fukuda administration claims, but to keep as much of the money as possible for roads, earmark or no earmark. The would-be rebels will surely spare no effort to leverage their hold on the legislative fortunes of the coalition to achieve that aim.

This leverage that vested interests will be able to exercise on the end uses of the gasoline tax revenue will be bad enough on its own. But Prime Minister Fukuda has promised, with the post facto approval of the ruling coalition, to eliminate the earmark as part of “thoroughgoing” tax reform this autumn. In other words, Mr. Fukuda, he has linked the maintenance of the surcharge with what is very likely to be a substantial, albeit phased in, hike of the consumption tax, currently standing at 5%.

Now the public understands, in principle, the inevitability of a greater tax burden. But it has seen ample evidence of waste, corruption, and plain indifference; it will be ill-disposed to accept any tax package that is not accompanied by credible reform on the administration and expenditure of public funds. The public pension and healthcare systems are an obvious example of this; the road development and maintenance program is another. Mr. Fukuda faces a formidable task in putting together a publicly credible package by autumn. It will become even more daunting if vested interests could hold the gasoline tax revenues as hostage in return for their political support.

The coalition should be careful what it wishes for, don’t you think?

* I posted on the matter here. The three dissenters merely received “severe admonishments”.

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