Japan: Pension scandal leaves opposition
adrift By Richard Hanson
TOKYO
- Japan's shadow prime minister, Naoto Kan, chose his
only option and resigned this week as leader of the main
opposition Democratic Party of Japan (DPJ) to make
amends for not paying his obligatory national pension
premiums several years ago while serving in the cabinet.
In the tit-for-tat political scheme these days, that
evens things up.
But it leaves the DPJ with a
couple of major problems.
First: The party has
yet to decide on a new leader to replace Kan. A decision
on an election is expected by Friday. Kan is a tough act
to follow. He was elected chief of the faction-prone
party in the midst of a bitter internal power struggle
in late 2002. To his credit, Kan cooled the worst of the
internal bickering and set the party on a path to
challenge the ruling Liberal Democratic Party (LDP) of
Prime Minister Junichiro Koizumi.
The candidate
generating the most speculation is Ichiro Ozawa, who
joined forces with Kan last year by merging his small
Liberal Party with the DPJ. Together they ran an
effective election campaign last November, when the
party gained a substantial number of seats in the Lower
House of parliament. Ozawa is now the acting DPJ
president, but he also faces opposition within the
party. Ozawa has his roots as a power broker in the
ruling LDP, which he once ran as secretary general
before attempting to topple it in a political coup.
Another potential leader: DPJ secretary general Katsuya
Okada, a moderate who considers himself too close to Kan
to be elected. That is a good measure of how bizarre
politics suddenly have become.
Second: Just
remember that Kan's decision to step down follows last
Friday's dramatic withdrawal from the powerful post of
chief cabinet secretary by Yasuo Fukuda, one of
Koizumi's most influential advisers, admitting that he
too had failed to pay his obligatory fees in earlier
times, for about 37 months.
Both men - and all
the other scofflaws - said their non-payments were
inadvertent, the results of oversights and
misunderstandings in the complicated pension system.
The scandal is serious because one-third of the
17-member cabinet has admitted that it hasn't paid
mandatory pension premiums at a time when the government
is pressing for passage of a bill to increase most
citizens' premiums while reducing their pension
benefits. Japan's shrinking workforce and reduced
payment of pension premiums raise fears that there may
not be enough money in the pension fund to pay for
future retirees.
The flow of revelations from
pension-payment delinquents among politicians is
expected to continue. But with Fukuda and Kan out of the
closet, so to speak, both the DPJ and the LDP can get
down to the serious business of preparing the upcoming
battle for the Upper House election scheduled for July
12. There are no good ways of measuring the impact of a
politician's confessing dubious behavior and wrongdoing
- for which non-payment of pensions qualifies - but so
far the indications are that resignation is not
mandatory. Still, voters will be paying more attention
this time around. And it cannot hurt a party if its
members come clean, admit their faults, make amends and
restitution - or even resign.
Resignation
also may mean electoral face-lift While
ex-cabinet secretary Fukuda's resignation may have
forced Kan's hand in resignation, the DPJ also gets a
chance to give itself a badly needed face-lift before
the July election.
There is literally little
downside for the DPJ at this stage of the race. Among
all political parties, the LDP is supported by 33.5
percent. The DPJ garners only a 10.0 percent sliver of
support.
Meanwhile, Koizumi's personal support
among voters remains above 50 percent. That doesn't mean
automatic votes for his party. But all he is aiming at
is to survive as prime minister over the next two and
half years of his LDP presidency, long enough to make
him one of the longest-serving Japanese leaders since
World War II.
Kan achieved his major gains for
the DPJ last November when the party flashed a lot of
"new faces" and a popular "manifesto" of such policies
as abolishing non-urban highway tolls. That gained it a
healthy increase of 40 seats in the powerful Lower House
of the Diet (parliament).
Fukuda's resignation
last week will do nothing to add new faces. Rather, it
leaves Koizumi with a cabinet still packed with
non-pension-payers. Only Koizumi himself is clean as a
whistle. The DPJ in the next few days could organize a
party election, which, if the leaders are smart, would
give the younger and very motivated newly elected
lawmakers a chance to flex their muscles. The DPJ is
potentially still more attractive to a younger voter and
politician. That makes the choice of Kan's successor a
delicate matter indeed.
On the immediate agenda,
the DPJ will still have a chance to display knee-jerk
anti-LDP instincts over the issue of the future of
Japan's very unpopular and chaotic pension system.
Before Fukuda's resignation, the two parties had reached
a tentative arrangement on the shape of the pension
debate doing into the year 2007.
Opposition
factions could fight each other That could
unravel as factions in the DPJ - which run the gamut
from socialists to ultra-conservatives - battle each
other. That is precisely what Koizumi would appreciate.
Who knows, but that might even have crossed his mind as
as his now former "right-hand man" Fukuda dropped his
resignation bombshell.
While Kan was looking not
too vexed over his demise, after announcing his decision
to resign, members of the press asked the prime minister
what he thought. "He [Kan] must have been disappointed,"
Koizumi replied. Given the options available, Kan
actually could have done worse. And he has promised to
pay his pension premiums. He, like Fukuda, was able to
give a ritual apology to the nation.
"My
non-payment problem has brought about distrust from the
public and our party members. I have decided to step
down as party leader to take responsibility for this
extremely serious situation," Kan told DPJ lawmakers,
including his yet-to-be-named successor. He might have
added that things could be worse.
The DPJ can,
and did, end up saving some face in a Lower House vote
on Tuesday that passed a package of government-sponsored
pension-reform bills. These came out of the ruling
coalition, which includes the New Komeito. But the
chaotic state of the government's pension schemes are at
the heart of the current political non-payment scandals,
which has spread far and wide.
Even the
conservative Yomiuri Shimbun newspaper offered Kan some
backhanded praise in an editorial that noted that his
resignation "has fulfilled his obligation" as signatory
to a three-party accord as signed just before Fukuda
announced his resignation last Friday.
Goal
to unify all public pensions This is what the LDP
and the DPJ agreed to in a loose compromise agreement.
The idea is to review the pension system by 2007 with an
aim to unify all the public pension plans sometime in
the future.
"His resignation prevented the
agreement from becoming just a scrap of paper," the
newspaper said.
The actual package of pension
bills on Tuesday in the Lower House was passed by a
majority vote, with all votes along strict party lines.
A final vote in the Upper House is expected the before
the end of the current session on June 16.
For
the public, the pension-reform bills consisted mainly of
a plan to raise the premiums for mandatory national
pensions operated by the government. By the year 2017,
the monthly premiums will be raised from the current
13,300 yen (US$117) per month to a ceiling of 16,900 yen
in 2017.
The reasoning is that money is needed
to support the growing number of old people in Japan.
But at same time, other legislation will lower the
pension benefits paid by the government.
It
should be noted that this is still basically the same
premium-payment system into which some 40 percent of the
pension payers, including elected members of parliament,
resoundingly have chosen to evade paying. The bills will
provide for tighter collection methods to be put in
place.
Legislation-wise, given all the fuss,
that is not much of a legacy for Kan or the LDP's
Fukuda, who helped shepherd the compromises with the
opposition before he resigned.
What remains to
be seen is what sense voters will make of all of this in
the upcoming July 12 Upper House elections.
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