The Upper House election is Sunday. The election represents a chance for voters to give their verdict on the performance of the Democratic Party of Japan-led administration, which began in mid-September 2009 after a historic Lower House election ended decades of Liberal Democratic Party rule.
The leading topic in the election campaign is dicussions on raising the consumption tax in the future to pay for the increasing costs of social welfare and to help push Japan’s financial reconstruction.
The DPJ’s manifesto for the 2009 Lower House election contained no mention of the consumption tax and the administration of former Prime Minister Yukio Hatoyama refrained from discussing raising the tax. But reversing this, the DPJ under the leadership of Prime Minister Naoto Kan is now asking other parties to jointly discuss the future shape of the tax. Mr. Kan is calling for a three-pronged approach to achieve a “strong economy, strong finances and strong social welfare.” The LDP is more specific about the consumption tax. It wants to raise the tax from the current 5 percent to 10 percent.
Unfortunately, both parties have not presented a grand design of the future of social welfare, including the financial burden people will have to bear and the benefits they will receive in return.
Mr. Kan has started talking about ways to lessen the burden on low-income people if the consumption tax is raised. But it is unclear whether his remarks are based on well-thought-out studies of the issue. Former DPJ Secretary General Ichiro Ozawa has criticized Mr. Kan for taking up the consumption tax issue by departing from the DPJ’s 2009 election manifesto. The party should offer a unified view to voters.
The consumption tax is not the only issue. Other issues that need to be addressed include Japan’s relations with the United States as well as with neighboring countries, the relocation of U.S. Marine Corps Air Station Futenma, Okinawa, and how to attain economic growth and create jobs. Voters need to scrutinize what each party intends to achieve.