Asia | Politics in Japan

Negative rates, positive polls

Shinzo Abe weathers the exit of a scandal-hit minister with surprising ease

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|TOKYO

RECENT days have witnessed unusual phenomena in Japan. On January 29th, for the first time in its history, the central bank adopted negative interest rates as a way of dealing with the threat of deflation. Then came the public’s equally striking response to a bribery scandal involving Akira Amari (pictured), the economy minister, who had resigned a day before the bank’s move. The government was braced for a drop in its approval ratings, but instead public support for it rose in three polls, to over 50%. Shinzo Abe, the prime minister, may be wondering at his luck.

The Democratic Party of Japan (DPJ), the biggest opposition party, had been preparing to make hay from Mr Amari’s departure—the fourth such scandal in Mr Abe’s cabinet. But the DPJ is still floundering following its defeat in a general election in 2012. It has yet to find a new message that appeals strongly to voters. Its campaign for an election this summer for the parliament’s upper house is not inspiring. “I do not like the DPJ,” one of the DPJ’s posters imagines a voter musing, “but I want to protect democracy.”

Mr Abe’s skilful handling of the Amari affair helped to minimise the damage. After the scandal broke in the Shukan Bunshun, a conservative weekly magazine, Mr Amari appeared confident of the prime minister’s backing. He was mistaken. Money scandals have been rife in Japanese politics due partly to vague rules on reporting political donations. But the magazine’s allegations that Mr Amari’s office accepted ¥12m ($100,000), including envelopes of cash, from the representative of a construction company seeking favourable treatment from a government agency, proved too much. Within a week, he announced his resignation. In his first, disastrous term as prime minister between 2006 and 2007, Mr Abe had allowed ministerial scandals to drag on with damaging effect.

Mr Amari’s exit came at an awkward time for Mr Abe as he tries to boost a stubbornly lacklustre economy (though it may get a lift thanks to the Bank of Japan’s interest-rate decision). The scandal has delayed debate in the Diet (parliament) over the government’s budget for the coming financial year, which starts on April 1st, though there is little doubt this will be approved eventually.

One of Mr Abe’s boldest attempts to promote structural economic reform (there are not many of them), namely getting Japan into the Trans-Pacific Partnership (TPP)—an ambitious 12-country free-trade agreement that includes America—may also suffer delays. Mr Amari was Japan’s chief negotiator for TPP entry. Without his guidance, it will be far harder for the government to get the terms of accession ratified by the Diet during its current session (due to end on June 1st), says Heizo Takenaka, a former economy minister. Even though farmers are to receive some ¥110 billion ($890m) to help them adapt to lower tariffs, opposition to TPP from the farm lobby is expected to be strong.

Mr Amari’s successor is Nobuteru Ishihara, who leads the second-smallest faction of Mr Abe’s Liberal Democratic Party (he is the son an ultranationalist former governor of Tokyo). Backers of economic reform bemoan the younger Mr Ishihara’s relative lack of economic-policy experience and his proneness to gaffes .

But apart for his enthusiasm for TPP, Mr Amari was hardly a gung-ho promoter of reform himself. And Mr Abe has his eye on other goals. Such is the opposition’s disarray that there is now even speculation that he may call a snap election for the Diet’s lower house as early as this spring. Though the economy is weak, voters tend to blame China’s slowdown rather than Mr Abe’s policies, says Koichi Nakano of Sophia University in Tokyo.

Mr Abe may use his political strength not so much to push for economic reforms, but to change the constitution to make it easier for Japan to operate as a normal military power, instead of being bound by its post-war commitment to pacifism. For this he would need the support of two-thirds of legislators in both houses of the Diet (never mind that he lacks it with the public). With the help of like-minded parties, that may be thinkable if the LDP does well in both the upper-house election and a snap poll for the lower house. A strangely resilient Mr Abe may decide that now is the time to try.

This article appeared in the Asia section of the print edition under the headline "Negative rates, positive polls"

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