Tuesday, March 10, 2009

Bumpin' It Up For The Ruling Coalition

The weekend polls ran badly against the Democratic Party of Japan and its leader, Ozawa Ichirō. In all but one poll over 50% of those polled thought that Ozawa must resign as head of the party. In most polls over 70% thought that they could not accept Ozawa's explanations of the the arrest of his political secretary Ōkubo Toshinori. In answer to one somewhat silly polling question -- did Ōkubo's arrest and Ozawa Ichirō's and the DPJ's response to the arrest make them think more highly of the DPJ or less highly of it -- 1% of those polled thought that the news made them think better of the DPJ.

1% of those polled.

Can we assume a generous rounding upward?

The populace is simply not buying "the arrest of Ōkubo is a purely political action intent on preventing Ozawa from becoming prime minister through the electoral process so we should suspend judgment, for the time being" proposition. It seems that Ozawa has something of a reputation as a fixer and a disciple of Tanaka Kakuei. Somehow this "reputation" thing is rather significant, making it hard for the populace to suspend its judgment. That Ozawa is probably also the victim of a purely political action intent on preventing him from becoming prime minister is seen as a side issue.

The weekend polls may have been bad for the DPJ but the party could take solace that the prime minister and his party were not accruing any major benefit from Ozawa's troubles. Most of the increases in the Cabinet's popularity over the weekend were laughably small, from one to two percent -- hardly the stuff of panic, even as the news crews crowd around. Given that the news crews are now gathered even more tightly around Minister of Economics, Trade and Industry Nikai Toshihiro than around Ozawa, DPJ members must have been feeling a sense of, if not stability, at least a shift in momentum.

This salubrious state of affairs may be ending, however.

Last night, TV Asahi broadcast a startling result, a 7% upward shift since the last poll, resulting in 26% of those polled now on board as "supporting" the Asō Cabinet - the first time anyone as seen a figure starting with a "2" for a while. Nippon Television for its part claims Cabinet support has doubled, from 9.7% to 18.8%, in since its latest poll. The shift in the party support numbers was even more dramatic, with the LDP edging past the Democrats in both polls.

OK - now it is time for the Democrats to panic.

While this significant bump upward in LDP and Cabinet ratings is in part due to Ozawa's troubles, it also is possible that it is a reflection of the other big piece of political news from last week: the House of Representatives' override of the House of Councillors' rejection of the second supplementary budget. Distribution of the 12,000 to 20,000 yen per person supplementary budget disbursement began the next day to much fanfare, while former prime minister Koizumi Jun'ichirō's supposedly epic absence from the revote was relegated to the inner pages of the papers.

Now the press has been hounding the government on the issue of the disbursement, and polling has, until now, shown it to be rather unpopular with the electorate -- in the aggregate.

All the umbrage and eyebrow arching may be moot, however, as the cash handout plan swings into action, revealing itself for what it always has been: a shamelessly feel-good hamlet and rural area vote-buying plan.

The disbursement is pretty much a dead letter as a short-term economic stimulus in urban and suburban areas. No ward of Tokyo has the infrastructure to distribute cash to hundreds of thousands of residents. Imagine trying to establish booths at the ward office capable of servicing hundreds of thousands of residents showing up to get their cash, this in the odd event that they would take a day off from work to do so, or were able to convince Grandma to go down to the ward office to get everybody's share. You cannot do home delivery -- most of the residents are commuters. Getting all the money into the economy via the urban and suburban municipal governments will take months, if ever. Adamu at Mutant Frog Travelogue outlines how Adachi-ku is trying to deliver the money, by sending out application forms for a delivery of the money to the head of the household via wire transfer.

In the rural areas, however, distributing the money is easier and upfront, a true "cash handout" to the residents. In the first town in the nation to begin the disbusement process, a metropolis of 537 residences, local officials just turned on the town's PA system and told everyone to come on down to the town office to pick up their envelopes. In other hamlets the top local bureaucrat and the rest of the town's office staff have just picked up baskets of full of envelopes, hopped in the town vans and driven to people's residences in order to drop off the Fukuzawa Yukichis.

Guess what -- in towns with over 25% of the residents over 60 years of age, there always seems to be someone at home.

It was the technical aspects, not the economics, of the cash disbursement (lost on some of the English language press--one English-language news organization even talked about the amount of time it would take until the citizens "get their checks in the mail." Checks? In the mail? In the Land of the Rising Sun?) that made it such a bad idea. The economics of plan was actually rather good -- given the zero rate of interest, almost all of the cash being handed out -- when it is handed out -- is likely to be spent.

When the money is being deposited into bank accounts...well...

Funny thing about rural areas full of retirees -- they tend to be rather poor. Twelve thousand to twenty thousand yen per person is a huge cash windfall. Another funny thing about retirees and the elderly -- they tend to vote like they have nothing else to do, which they don't.

Free money + high voting rates + overly represented rural districts = ?

On a national level, the video of all these ojīchan and obāchan receiving their cash, joyously shaking the hands of local bureaucrats, telling the reporters, with a hint of wickedness in their shining eyes, about the items and services they are going to buy -- has been fabulous PR for the ruling coalition.

Oh, and yes, the LDP and New Kōmeitō candidates out on the hustings will never make mention that the Democratic Party of Japan fought tooth and nail against the cash disbursement program's passage.



Maybe I am being unnecessarily nostalgic, but vote buying used to require subterfuge...and a personal touch. It used to be that a politician would have to inadvertently leave behind or drop an unmarked envelope full of cash whilst leaving a constituent's residence or place of business.

Nowadays, politicians cannot be bothered. Just pass a law ordering local officials to deliver the damn envelope to the constituent.

Such vulgar and unimaginative times we live in.

Later - I leave to others to comment on the attempts by the local authorities to channel the cash disbursement to local merchants through preferential coupon programs.

Is anyone else thinking that these coupon programs might impact nominal inflation statistics, as well as impacting the voting patterns of the retailers in the traditional shopping arcades?

1 comment:

To Iu Wake said...

There was a NY Times article a few weeks ago about the lack of spending in the Japanese economy following the collapse of the bubble in the early 90s. They said Americans may follow the same path meaning unless a replacement comes forward to overspend, the economy is going to be tough for a long time.

I am amongst the many that put little faith in this latest (as you wisely put it) vote buying of a "stimulus". Most purchases with the money would have been made anyway even with the coupons, and the money will sit in bank accounts making zero interest. It does nothing to fix the damaged psyche of the average Japanese worker who endured shukatu only to lose his job and not be able to find another one since he is "damaged goods".

Fundamental changes have to occur to the Japanese system in order produce results and restore confidence. I do not think America will follow the same road as Japan simply because the system is more flexible over there. Still, it is a tough time no matter where you are in the world.