The big shift arriving on Japan

FRONT PAGE: "Rise of a New Era for Japan: A 50-Year Dominance Ends as Voters Oust LDP; Rivals to Spend More, Weigh U.S. Ties," by Yuka Hayashi, Wall Street Journal, 31 August 2009.

FRONT PAGE: "Japan Is Bracing For Power Shift: Long Economic Stupor Is the Spur for Voters," by Martin Fackler, New York Times, 26 August 2009.

WORLD NEWS: "Likely Japan Leaders to Focus on Asian Ties: The Party Poised to Win Sunday's Election Is Expected to Seek Greater Independence From U.S. and Better Regional Relations," by Carlos Tejada and Evan Ramstad, Wall Street Journal, 27 August 2009.

First, Japan is poster child for my observation that many states basically go one-party for about half a century post-revolution/whatever (in Japan's case, it was defeat in WWII and U.S. occupation) as they modernize and connect up with the global economy. The LDP first won in 1956 and has basically ruled uninterrupted since, with the sole deviation being 1994-1998. Being a parliamentary system, we're talking domination in both the executive branch and legislative.

No quick choice this, as the "long economic stupor" goes back to the early 1990s, so this isn't the first time Japan has decided to replace the LDP. It's just that, this time, the shift is more profound and therefore seems more permanent.

China was Japan's biggest trade partner in 2008 at 28T yen. US next at 22T, then Korea, Taiwan, Australia, UAE, Thailand, Indonesia, Germany and HK (also China). So seven of top 10 trade partners are Asian locals.

Given the underlying economic drivers, no surprise that a new focus on Asia will emerge, reducing the special relationship with America. First Australia with Rudd and now Japan: we see Asian "Western" leaders who see their nation's strategic future being one of managing China's rise versus following America's lead.

Clearly inconceivable, but it happens anyway.

Comments

[Louis Heberlein]

For a brief time after WW II Japan tried to have an open domestic investment market, completive management and labor, and 'free' political and social relationships ... as their idealistic American advisors recommended. Social, labor chaos and investor anxiety followed. So they established a national managed social and economic partnership with state sponsored rather than owned activities. I'm curious whether this will now change. The managed nation limited the opportunity options of very fine folks.

I'm also curious as to whether the new political establishment will feel comfortable enough with domestic support to partner with Russia, China and South Korea to deal with next cycle of North Korea crisis. It is a very old problem now.

Finally, I hope the new culture will encourage more Asian settlers to have extended family stays in Japan to facilitate Asian economic partnerships.