Dark clouds hang over Japanese politics. The ruling Liberal Democratic Party has been jolted by allegations that some of its leading members took payoffs from the mutual-aid organization KSD. The scandal came after Prime Minister Yoshiro Mori reshuffled his Cabinet last month and the restructured central bureaucracy began operations early this month.

Fukushiro Nukaga was forced to resign Tuesday as state minister for economic and fiscal policy in connection with the scandal, dealing a severe blow to the Mori administration. Earlier, Masakuni Murakami, chairman of the LDP members’ general assembly in the Upper House, resigned after admitting his close links with KSD.

Murakami was one of the five LDP heavyweights who decided to name Mori prime minister in a secret meeting last April to replace the ailing Keizo Obuchi. The other participants were then LDP Deputy Secretary General Hiromu Nonaka, LDP policy chief Shizuka Kamei, then Chief Cabinet Secretary Mikio Aoki and then LDP Secretary General Mori. The deal became known as a conspiracy by the “Gang of Four” — excluding Mori.

The departure of Nukaga, a rising star in the largest LDP faction, which is headed by former Prime Minister Ryutaro Hashimoto, was just as shocking for the Mori administration. Nukaga, a potential future candidate for the prime minister’s post, was in charge of the government’s powerful Economic and Fiscal Advisory Council.

Prosecutors are continuing all-out investigation of the KSD scandal. In the Diet, opposition forces are gearing up to grill government officials about the affair, in particular about Mori’s responsibility for ministerial appointments, in an extraordinary session scheduled to start Jan. 31.

The scandal started smoldering last October, when an extraordinary Diet session was under way. The major issue in the session was Upper House electoral reform. Opposition lawmakers, aware of Murakami’s possible involvement in the scandal, expected that confrontation between the ruling and opposition forces over the scandal would make Diet passage of electoral-reform bills difficult before the session closed. As it turned out, however, the opposition forces failed to make an issue out of the KSD affair, and the ruling forces railroaded electoral-reform bills through the Diet.

The Mori administration and the ruling forces, which were little damaged by the budding scandal, could suffer more serious damage from the affair now, as Japan moves closer to the Upper House election in July. The Mori administration is likely to try to quell the confusion over the scandal as soon as possible and minimize its impact on the outcome of the Upper House election.

However, the government and the LDP will have a tough time dealing with the scandal as two leading LDP members have now been implicated. Furthermore, the LDP’s unity with its coalition partners — New Komeito and the New Conservative Party — is likely to weaken as the election approaches.

Another problem for the government is the alleged misappropriation of state funds for diplomatic purposes by a senior Foreign Ministry official. The Cabinet secretariat funds in question have long been treated as a national secret, but people are beginning to demand full disclosure of government-related information as a symbol of democracy. It is doubtful if public opinion will be lenient toward the idea of secret government funds.

Mori, apparently unaware of the serious political difficulties he faces, continues to make inept remarks. I hope he realizes that his qualifications to serve as prime minister are at issue.

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