Nearly 20 months since the administration of Prime Minister Junichiro Koizumi began, popular support for the Cabinet hovers around 50 to 60 percent, down from the extraordinarily high levels of 70 to 80 percent last year.

As the end of the year approaches, the domestic and international situation surrounding the Koizumi administration is becoming increasingly severe. Signs of instability and fluidity are starting to show in politics, foreign policy and the economy. In economic management especially, as the state of stagnation and deflation worsens, the prime minister’s one-track policy of giving priority to structural reform is gradually reaching the stage at which amendments and compromises must be considered.

A good example is the shameful inability of the government’s committee for promoting the privatization of four highway-related public corporations — which, along with privatization of the postal service, is the centerpiece of the Koizumi administration — to put together a unified final report due to internal discord.

Amid intense opposition from the “old guard” and resistance forces within the Liberal Democratic Party, Takashi Imai, honorary chairman of the Japan Business Federation and chairman of the committee, tried in vain to seek a compromise.

On the diplomatic front, too, talks to normalize diplomatic ties with North Korea have reached an impasse with the two sides looking daggers at each other. In September, when Koizumi moved to settle the abduction issue, which had been shut away in a Pandora’s box for many years, popular support for his Cabinet shot up. Since then, however, the problem appears to have been shelved because of the deadlock in negotiations and because of differences with the United States, which puts priority on investigating North Korea’s suspected nuclear-weapons development program.

The situation is such that the Koizumi administration certainly cannot score marks through its foreign policy. In addition, the possibility of a U.S. attack against Iraq poses uncertainties for Japan’s security and oil supplies.

As for domestic politics, the signs of instability and fluidity, more than anything else, stem from the chaotic situation in the Democratic Party of Japan, or DPJ, the No. 1 opposition party. In the DPJ leadership election Sept. 23, Yukio Hatoyama was re-elected as the party’s leader despite a strong challenge by secretary general Naoto Kan. After his election, though, Hatoyama appointed Kansei Nakano the new secretary general as a token of gratitude for his help in the election campaign. This appointment sparked fierce criticism from within and outside the party. As a result, the DPJ suffered serious defeats in the seven by-elections held Oct. 23, and Hatoyama’s popularity plummeted.

On Nov. 29, the fretting Hatoyama secretly held talks with Ichiro Ozawa, the leader of the Liberal Party, and they agreed to form a new party. Hatoyama’s tactic was to create a new party with himself as leader, but there was never any chance of this selfish double-edged tactic succeeding.

Last week Hatoyama announced his resignation, and the DPJ began preparing for another leadership election. Although this commotion amounted to nothing more than a storm in DPJ’s teacup, taken from a longer perspective, it seems certain that Hatoyama’s last desperate move will have repercussions on Japanese politics in general.

In this connection, Mie Prefecture Gov. Masayasu Kitagawa announced Nov. 25 that he will not run for a third term in next spring’s gubernatorial election. Observers now talk about the two lions of local politics, Tokyo Gov. Shintaro Ishihara in the east and Kitagawa in the west. The fact that both politicians have hinted that they may return to central government politics before their terms are up in half a year suggests that a period of dramatic political change may be in the offing.

Although Koizumi remains popular as a prime minister, discontent and resistance within his LDP are gradually increasing. Criticism of his administration’s economic management is growing, too. It is almost certain that the Koizumi administration will survive until 2003, but after that it is going to enter tricky waters before unified local elections in April and again next summer — before the LDP’s presidential election in September.

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