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Your Party touting smaller government

by Maya Kaneko

Kyodo News

Your Party is campaigning on a growth-oriented policy in hopes of striking a chord with businesspeople unhappy with the economy.

Compared with the Democratic Party of Japan and Liberal Democratic Party, which both somewhat back big government with their vow to hike the consumption tax for fiscal reform, Your Party wants smaller government and deregulation to achieve sustained growth that would make a tax hike unnecessary.

The tiny party, headed by the outspoken Yoshimi Watanabe, a former LDP member and financial services and administrative reform minister, is fielding 44 candidates in the July 11 election. Among them are entrepreneurs and self-made businesspeople.

Kota Matsuda, 41, one of the party’s key candidates, is running in the fiercely contested Tokyo district. He pledged on the first official day of the campaign last week in front of JR Shinjuku Station to “rejuvenate the Japanese economy so as to prevent the country from being regarded as the deadwood of Asia.”

The former banker, who introduced Tully’s Coffee shops to Japan under license from the U.S. chain, said Your Party aims to boost the nation’s global competitiveness by eliminating unnecessary regulations and nearly halving the corporate tax, which currently stands at around 40 percent.

“We are the only party that can effectively run the Japanese economy with management skills,” he said.

Matsuda said Japan should emulate the economic policy of Singapore, where his business had been based for the past two years. The city-state has been drawing foreign investment with incentives such as lower taxes, and its per capita gross domestic product has already surpassed that of Japan, he said.

Watanabe is promising on the campaign trail that Your Party will strive to achieve annual economic growth of more than 4 percent in nominal terms through considerable downsizing of the public sector, reckoning such growth would up income levels 50 percent over the next 10 years.

“We have to make government smaller to avoid the fiscal situation faced by Greece,” which was hit by a sovereign debt crisis, he said.

Watanabe criticized the DPJ and the LDP for posturing for a sales tax hike, saying there is no reason to think bureaucrats will spend taxpayer money wisely.

Before the resignation of Yukio Hatoyama as DPJ leader and prime minister in early June, Your Party had enjoyed a rapid rise in opinion polls, apparently gaining support from nonaligned voters who had backed the DPJ but later became fed up with its lackluster performance.

Watanabe said his party, whose one uncontested seat is in the Upper House, aims to win at least 20 seats so it can exert major influence by possessing the crucial votes needed to pass legislation if the DPJ-led coalition fails to retain a majority in the election.

He has said there is no chance of joining the DPJ-Kokumin Shinto (People’s New Party) bloc even in that event.

Other Your Party candidates include Tsukasa Kobayashi, 39, an executive of online shopping mall Rakuten Inc.; Kenji Nakanishi, 46, former deputy president of JPMorgan Securities Japan Co.; and Yukio Fujimaki, 50, known as a former “charismatic buyer” at department store chain Isetan Co.

Among supporters of Your Party, Kahoko Tsunezawa, president of Trenders Inc., a marketing firm that assists female entrepreneurs, said she backs Matsuda, one of her corporate manager friends, believing he would spearhead a reform drive with his entrepreneurial spirit.

“I’m disillusioned by the current Japanese government, as it is leaning toward socialism and economically isolating the country from the world,” Tsunezawa said, alluding to what Your Party and other critics say are the DPJ’s insufficient deregulation efforts and handout policy of providing monthly child allowances and waiving high school tuitions.

“Mr. Matsuda competed with Starbucks Coffee in Japan by himself. Our country now needs such people who can break away from old regulations and take steps to spur the economy,” she said. “If the number of managers-turned-politicians increases, it will drastically change Japan.”

Hideo Kumano, chief economist at Dai-ichi Life Research Institute, said Your Party’s growth policy and focus on minimal government interference and free-market forces resembles steps taken by ex-Prime Minister Junichiro Koizumi and his reform architect, Keio University professor Heizo Takenaka.

“Since every other party advocates economic policies that are generally considered to be middle of the road, Your Party’s pursuit of smaller government presents an extreme option,” Kumano said. “I find it very desirable.”