The 164th regular Diet session — the last Diet session for Mr. Junichiro Koizumi as prime minister — has ended without fanfare. The session was tasked with making an overall review of his reforms, achieved or unachieved, since he took the reins of power in April 2001. But lawmakers have failed to fulfill that duty despite a prevailing sentiment among the people that Mr. Koizumi’s reform policies have not necessarily enhanced the quality of their lives. Such a feeling is epitomized by the expression kakusa shakai (society of gaps), which refers to a widening gap between the haves and have-nots.

With the goal of delegating as much work as possible from the government sector to the private sector, the nation’s highway corporations were privatized. But the privatization lacks a mechanism to restrain wasteful highway construction. Mr. Koizumi’s Liberal Democratic Party won big in the general elections last year by selling the privatization of postal services as a centerpiece of the nation’s reform. But full privatization of the services will take 10 years. With resistance persisting, it is uncertain what fruit the process will bear.

The downside of deregulation is in the fore these days. The falsification of earthquake resistance data for condominium and hotel designs surfaced in November 2005, shaking confidence in the safety of such buildings. A series of railway accidents have occurred, including the West Japan Railway accident of April 25, 2005, in Amagasaki, Hyogo Prefecture, in which 106 passengers and the motorman were killed. Although Mr. Koizumi’s reforms and deregulations were not directly responsible for those events and scandals, the public have come to have second thoughts about deregulation amid the continuing sloganizing of reform in which rhetoric tended to take precedence over substance.

Mr. Takafumi Horie, the high-flying former president of the Internet service firm Livedoor Co., was indicted on charges of window dressing his firm’s financial statements and making false statements to mislead the stock market. Mr. Yoshiaki Murakami, a maverick investment fund manager, was arrested on suspicion of insider trading involving shares of Nippon Broadcast System Inc. These two people are apparently products of stock-market deregulation under Mr. Koizumi’s administration. It even came to light that Mr. Toshihiko Fukui, governor of the Bank of Japan, has 10 million yen invested in Mr. Murakami’s investment fund, tarnishing his neutrality and independence as the nation’s central banker.

On many occasions, Mr. Koizumi did not squarely respond to questions in Diet sessions. Mr. Ichiro Ozawa, head of the Democratic Party of Japan, appeared to be paying more attention to next year’s Upper House election than an assessment of Mr. Koizumi’s track record on reform and regulation.

Many controversial bills have been carried over to the Next Diet session. They include: a bill to revise the Fundamental Law of Education, which is mainly aimed at instilling patriotism in students, a bill to make conspiracy a crime, a bill to upgrade the Defense Agency to ministry status, and bills to specify procedures for holding a referendum to amend the Constitution. The first two bills could infringe on the right to freedom of thought and expression. The Defense Ministry bill could weaken civilian control on defense by shifting the authority to propose policies and personnel appointments to the Cabinet from the prime minister to the defense minister. It would also make overseas operations a basic mission of the Self-Defense Forces. The referendum bills are apparently aimed at adding momentum to efforts to revise the Constitution, especially the war-renouncing Article 9.

Mr. Koizumi does not seem to be enthusiastic about revising the Fundamental Law of Education, causing one to wonder why he allowed the ruling coalition to hastily submit the bill to the Diet.

The ending of the Diet session shifts the political focus to the LDP presidential election in September, whose result determines Japan’s next prime minister. Chief Cabinet Secretary Shinzo Abe, Foreign Minister Taro Aso and Finance Minister Sadakazu Tanigaki have virtually made clear their intention to run. Mr. Abe is the front-runner. Former Chief Cabinet Secretary Yasuo Fukuda ranks second to Mr. Abe in popularity, but he has yet to clarify his intentions.

Since public opinion can sway the voting of LDP members, candidates should announce their candidacy as soon as possible to give the people time to form opinions. The candidates should clearly address such issues as how to rectify the downside of Mr. Koizumi’s policies, how to reconstruct the nation’s finances and how to improve relations with neighboring countries, especially China and South Korea, which have been impaired by Mr. Koizumi’s repeated visits to Yasukuni Shrine.

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