Approval of the 81.79 trillion yen fiscal 2003 budget package by the Lower House Budget Committee — with little deviation from the ruling coalition’s schedule — should spell one victory for the administration of Prime Minister Junichiro Koizumi.

However, deliberations on the budget, the first key topic in the 150-day regular Diet session that runs through June, have so far only revealed the vulnerability of the Koizumi Cabinet, Diet watchers say.

Since the legislative session began in January, three key Cabinet ministers have become mired in serious — if not ruinous — scandals, providing ammunition not just to the opposition camp but also Koizumi’s opponents within the ruling coalition to take the offensive.

Farm minister Tadamori Oshima drew flak for kickbacks and embezzlement involving his former aides, Financial Services Minister Heizo Takenaka for promoting a specific financial product, and Justice Minister Mayumi Moriyama for overlooking abuses of inmates by guards at Nagoya Prison.

Some lawmakers in the ruling Liberal Democratic Party have even called for Foreign Minister Yoriko Kawaguchi to resign, after she draw criticism for being vague on what specific actions Japan would take if the U.S. attacks Iraq without U.N. authorization.

Political commentator Hisayuki Miyake said the fallout Cabinet ministers invoked dealt a particularly severe blow to Koizumi, because he depends heavily on each for handling specific policies.

Miyake likened Koizumi’s policies to mere newspaper headlines without stories, saying his ministers must support him to provide the content. “But the Cabinet ministers themselves are now dragging Koizumi down,” he said.

March will be a particularly difficult — if not critical — month for the weakened Koizumi administration, Miyake said, because he will be facing the diplomatic test of how to respond when and if the U.S. and its allies attack Iraq, and he will need to keep the stock market afloat at the end of the month, when most listed companies close their books for the current business year.

During Diet debate in recent weeks, Koizumi has mostly been on the defensive on economic issues — a critical issue for him and the ruling camp to win public support ahead of local-level elections coming this spring.

The prime minister, using dramatic gestures and emotional terms, had sold the electorate on a series of bold public promises: to overcome deflation, to reduce government dependence on debts, to privatize inefficient and heavily indebted government-linked firms, to reform the postal savings system and to establish a number of special deregulated economic zones.

All of these pledges are now recognized by the public as broken promises, as Koizumi appeared to lack the political initiative to overcome resistance from die-hard bureaucrats and vested-interest politicians.

Koizumi has been reduced now to only asking for more time and public patience during his Diet appearances.

“The reforms remain half-finished, and it will take some time for the results to become clearly visible,” Koizumi repeatedly said during recent sessions of the Lower House Budget Committee.

That excuse may have worked a year ago. But now, nearly two years after he swept into office, and his public support having steadily slipped, voter patience may have run out as anxiety mounts over the deep-seated economic slump.

In recent opinion polls conducted by media organizations, the Koizumi Cabinet’s public approval ratings have again tumbled below 50 percent, encouraging opposition lawmakers and many in the ruling bloc to lash out openly against the prime minister and his Cabinet during Diet debate.

“It’s the beginning of the end. The end of Koizumi’s popularity,” claimed Naoto Kan, leader of the Democratic Party of Japan, the largest opposition party.

It may take some more time to see if Kan’s forecast will prove right.

But at least Koizumi’s opponents within the LDP, many with vested interests that would suffer under his planned reforms, are gearing up to take advantage of his diminishing public support.

Former LDP Secretaries General Hiromu Nonaka and Makoto Koga, together with Toshihiro Nikai of the New Conservative Party, in late January launched a policy study group to draw up their own proposals on sensitive social security issues.

Koga reportedly said that whether Koizumi accepts the group’s proposals on such issues as public pensions will be a litmus test that will influence their decisions on whether to support his re-election as LDP president in September when his term expires.

Discussion on reforms to save the financially pinched public pension system is expected to inevitably include debate on whether to raise the consumption tax.

Political haggling over social security reforms will be a key issue that could trigger critical battles between Koizumi and his opponents, as already indicated in the ongoing confrontation over the Cabinet’s plan to raise the amount salaried workers will have to pay under the medical insurance system beginning in April.

The government is scheduled to set a direction on the issue of pension reform by the end of this year.

“A consumption tax hike has always been something that could blow up the administration,” said a senior LDP lawmaker as he explained the politically risky nature of the ongoing debate on social security reforms.

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