Friday, July 10, 2009

Yukio Hatoyama’s Money Woes Take a Turn for the Worse

DPJ leader Yukio Hatoyama’s issues with regard to his political finances management organization (PFMO) keep getting weirder. When he addressed the issue publicly on 2 July after completing an internal investigation employing a team of lawyers, he was left to guessing why the aide had used the names of unsuspecting acquaintances, some of them dead, to disguise illegal transfers from Hatoyama’s private account by recording them as donations from individuals in reports filed with the Ministry of Internal Affairs and Communications in compliance with legal requirements and available to the general public on the Internet*. I had been wondering why he or the team of lawyers hadn’t bothered to ask when, a week later, the saga took another turn as it was revealed that Hatoyama’s PFMO had sought and obtained from MIAC certificates that would enable a large number of these same unsuspecting individuals to claim tax credits for their donations. Now, at least some of these individuals—the ones who were alive at the time we assume—are claiming that yes, they had made those donations after all.

The best case scenario for the Hatoyama camp is that the “investigation” was so shoddy that the lawyers struck out a large number of individual donors without bothering to ask them if they had actually made those donations or not. The worst case scenario is that the aide obtained permission to use the names of Hatoyama acquaintances, and took the necessary measures to give them tax benefits as a quid pro quo, but forgot about that when he gave evidence during the internal investigation. In any case, like so many other “internal” investigations during institutional crises, it appears that the Hatoyama camp has avoided the kind of thorough process that uncovers questions that it would avoid if it only could. Except it couldn’t—wishing rarely makes things come true—and the result is a stream of embarrassing and often illegal revelations that could wind up destroying Hatoyama’s bid for the Prime Minister’s chair.

I think that attention will soon turn to what Hatoyama knew and when. He needs to explain himself, and do so soon, or he will be obliged to leave.

* It amazes me that the LDP and DPJ have not been using the information on the MIAC website to better political advantage. Is this a Japanese politics version of the MAD doctrine? But shouldn’t at least the JCP and Socialists be doing something about this?


Mark said...

I must admit, I don't know what the hell is going on with Hatoyama and his campaign funds. I doubt the Japanese public knows what's going on. I'm not even sure you know what's going on. But what I do believe, is that this story will not have much of an impact without lots more flash photography at the press conferences with Hatoyama. Flash photography seems to be the one true measure of how important a new story is in Japan. So...Jun...if you could, please get the press to use much more flash photography when questioning Hatoyama about his campaign finances. Please.

Jun Okumura said...

HAHA, Mark, good point. The lack of photo-ops and embarrassing quotes limits media exposure. Give good marks to his handlers for that. It also helps Hatoyama that the level of alleged moral degeneracy is far below that in the case of the Ozawa camp. Given the unlikelihood of any poll leading up to the Lower House election showing a DPJ loss, my current view is that Hatoyama will be forced to give up his DPJ leadership position only if one of two things happen: the criminal investigation winds up implicating Hatoyama’s political aide in income tax fraud by “donors,” or it is revealed that the money is not Hatoyama’s*. He may even be able to weather one or the other, though surely not both.

I think that the real effect of all the fuss is to shroud Hatoyama in a miasma that will color media reports and narrow the margin of error for his administration. It definitely will not be much of a honeymoon, though certainly not as bad as one that an Ozawa administration would have had.

My reply to your previous comments requires a lot of work—work that I enjoy, by the way. I’m maybe 1/4-1/3 there. I’ll let you (and everyone else) know when it’s up.

* There may be one more bump in the road, if and when the investigation winds up revealing where the thousands of under-50,000 yen donations came from. Hatoyama and the rest of the DPJ are acting very suspiciously when questioned. They could have dealt with this up front with the rest of the donations and taken the lumps at once; now, it’s too late to own up to it on their own.