Japan

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Political Developments

In the 1960s and 1970s Japan’s major diplomatic initiatives were aimed at improving relations with its Asian neighbors. In 1965 Japanese prime minister Sato Eisaku hosted South Korea’s foreign minister at the first meeting of the two governments since World War II. The meeting produced a far-ranging agreement on mutual relations. After the United States suddenly reestablished relations with the People’s Republic of China in 1971, surprising and exasperating the Japanese government, Japanese prime minister Tanaka Kakuei visited China in 1972. The two countries agreed to resume diplomatic relations immediately, and Japan severed official diplomatic ties with Taiwan. Finally, in 1972 Japan regained sovereignty over the Ryukyu Islands, although the United States continued to maintain military bases on Okinawa.

In domestic politics, the LDP continued to hold the reins of government throughout the 1970s, although the party’s cabinets changed frequently, due largely to factional infighting. Six LDP politicians succeeded one another as prime minister in the ten years that passed between the cabinet of Tanaka Kakuei in 1972 and that of Nakasone Yasuhiro in 1982.

Factionalism and the growing expense of elections led politicians to become increasingly involved in dubious financial dealings, and during this period the first of a series of influence-peddling scandals involving the LDP came to light. In 1974 Tanaka had been forced to resign amid accusations of improprieties, and in 1976 he was arrested for taking bribes from the Lockheed Aircraft Corporation, a U.S. firm. The scandal widened as it became clear that Lockheed had paid at least $10 million in bribes and fees to Japanese politicians and industrialists since the 1950s.

Tanaka’s trial and judicial appeals lasted for more than a decade. National voting rates declined steadily, and public opinion polls showed a rising indifference to politics.

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In the aftermath of the scandals, the LDP lost its absolute majority in the lower house between 1976 and 1980. During the mid-1980s, Nakasone, a conservative who supported rearmament and a more active international role for Japan, revived the fortunes of the LDP. Under his leadership the party won its largest electoral victory in 1986, but this success owed much to the continuing influence of the Tanaka faction.

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Japan in Recent Years

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The Economic Bubble and Its Aftermath

In the latter half of the 1980s Japan experienced a period of financial euphoria that came to be known as the bubble. The bubble was triggered in 1985 by a sudden rise in the value of the yen. As Japanese goods became more expensive overseas, Japan’s exports decreased and its economy slowed. To stimulate economic growth, the LDP government increased public spending and eased interest rates. Real estate and stock prices soared, and even middle-class Japanese began to speculate. In addition, the high value of the yen encouraged Japanese investment overseas. In Southeast Asia, where labor costs were lower, Japanese companies built new production facilities. In the United States they invested not only in electronics factories and automobile assembly plants but also bought highly visible assets such as Rockefeller Center in New York City. In early 1990, however, the economic bubble burst suddenly when the government raised interest rates to dampen speculation.

The collapse of the bubble ushered in a period of prolonged economic slowdown. Large corporations attempted to deal with the slowdown through downsizing, but many large banks and financial institutions remained saddled with huge amounts of bad loans left over from the economic boom period. In 1997 an economic downturn in Southeast Asia harmed Japanese trade and investment in the region and further undermined the strength of Japan’s economy. Public confidence in the economy steadily deteriorated as the economic bureaucracy appeared unable to deal with the country’s economic problems. By the early 2000s Japan remained mired in its longest recession since World War II.

Blame for the continuing economic slowdown was laid at the door of the MOF, which did little despite strong domestic and foreign demands for economic deregulation and greater market freedom. In May 1997 the MOF announced plans for a “Big Bang” to deregulate banking and finance, but daily newspaper and television news continued to headline stories about bureaucratic inflexibility, incompetence, and corruption. In 1998 the Diet passed a series of bills intended to initiate economic recovery by increasing government spending and authorizing measures to address the banking problem. By late 2002, however, a decade of massive stimulus packages and emergency measures had failed to stimulate Japan’s stagnant economy. An economic turnaround was under way when the financial crisis of 2008 hit the country’s economy.

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Political Turmoil

In January 1989 Emperor Hirohito died after a 62-year reign. His son Akihito succeeded him as emperor, inaugurating what was officially called the reign of Heisei, which means “achieving peace.” But it soon proved to be a period of turmoil and reform.

Scandals brought down the administrations of prime ministers Takeshita Noboru and Uno Sosuke in rapid succession in 1989. In national elections held that year, the LDP lost its majority in the upper house for the first time in more than three decades. Kaifu Toshiki was elected as a “clean” candidate to improve the LDP’s image. By then, however, the Tokyo stock market had begun a decline that would last until mid-1992 and see the Nikkei average lose almost two-thirds of its value in what was referred to as the bursting of the bubble economy. Unable to cope with economic malaise and lacking the confidence of prominent party members, Kaifu was replaced in late 1991 by a veteran politician, Miyazawa Kiichi.

In 1993 younger LDP leaders, led by Hata Tsutomu and Ozawa Ichiro, became frustrated by the party’s inertia and broke away to form new parties of their own. The loss of these members deprived the LDP of its majority in the lower house, and national elections held that year did not restore it. A coalition of eight opposition parties formed a cabinet under Prime Minister Hosokawa Morihiro, putting an end to the LDP’s long political hegemony.

The political situation continued to deteriorate, however, as the new parties maneuvered for position. Amid allegations that he had accepted an illegal loan in 1982, Hosokawa stepped down in 1994, and the coalition chose Hata as prime minister. Soon afterward, the largest of the eight parties withdrew from the coalition, leaving Hata without a majority in the lower house of parliament. He resigned after only two months in office.

Meanwhile, the power of the political left had dwindled substantially during the late 1980s. After decades in the opposition, the Social Democratic Party of Japan (SDPJ; formerly the Japan Socialist Party) moved to gain more support among voters by adopting a more pragmatic platform. The party even abandoned long-standing positions such as opposition to the mutual security treaty with the United States and the maintenance of the SDF.

In 1994 a coalition cabinet came to power made up of the LDP and its former rival, the SDPJ, electing Murayama Tomiichi Japan’s first socialist prime minister since 1948. But the political parties continued to combine, split, and recombine into new political factions and parties. Murayama, whose coalition government was weak, resigned in January 1996, and the Diet elected LDP leader and former trade minister Hashimoto Ryutaro to the post. Hashimoto formed a coalition government with the SDPJ and Sakigake, a progressive conservative party.

In late 1997 the LDP regained a majority in the lower house when a key opposition member returned to the party. Political maneuvering and a stubborn opposition, however, made it difficult for Hashimoto’s cabinet to confront the country’s many economic and political problems. The following year, the coalition of the LDP, SDPJ, and Sakigake broke up. Unhappy with the state of the economy, Japanese voters inflicted a defeat on the LDP in elections for the upper house in 1998. Accepting responsibility for the defeat, Hashimoto resigned as prime minister. LDP politician Obuchi Keizo replaced him as prime minister, and the LDP entered a new coalition in 1999, this time with the Liberal Party, a group of former LDP members led by Ozawa. Obuchi suffered a stroke in 2000 and lapsed into a coma. He was replaced as prime minister and head of the LDP by longtime LDP politician Mori Yoshiro.

In early parliamentary elections held in 2000 for Japan’s lower house, the House of Representatives, the LDP and its coalition partners suffered losses but retained a majority. Public approval ratings for Mori plunged to below 10 percent due to his reported political blunders and the LDP’s lack of success in reviving the economy. In 2001 the LDP held an early internal election to choose a new party leader to replace Mori as prime minister. Junichiro Koizumi (Western style), a reform-minded former health and welfare minister, was chosen over former prime minister Hashimoto Ryutaro. Koizumi’s victory over the candidate favored by party seniors broke with tradition and was widely interpreted as a sign of growing frustration with Japan’s economic problems.

Koizumi pursued structural reforms of the Japanese economy. In 2005, however, some LDP members in the upper house of the Diet blocked his goal to privatize the national postal service. In response, Koizumi called an early parliamentary election for the lower house. LDP members who had opposed him were officially banished from the party; some of them founded the New People’s Party. In the 2005 election the LDP and its coalition partner, New Komeito, won a landslide victory, taking 327 out of 480 seats. The two-thirds majority gave Koizumi the power to override any opposition to his reforms in the upper house.

Despite his popularity, Koizumi announced his intention to step down at the end of his term in 2006. Accordingly, the LDP chose an ally of Koizumi, Shinzō Abe (Western style) to succeed him. Abe’s selection raised the prospect that Koizumi’s reforms would continue. However, Abe abruptly resigned a year later, citing health reasons. His government had lost its ruling majority in the upper house of the Diet, and his troubles were compounded by a series of corruption scandals involving several of his cabinet ministers.

The LDP still held a majority in the lower house of the Diet and thus was able to choose Abe’s successor. Yasuo Fukuda (Western style), son of former prime minister Takeo Fukuda, became the new leader of the LDP and prime minister of Japan. He pledged to follow Abe’s pursuit of a greater role for Japan in world affairs and also voiced a more conciliatory approach to Japan’s neighbors. Fukuda lasted less than a year, however, as his approval ratings plummeted and his legislative agenda was stymied in the opposition-controlled upper house of the National Diet. Fukuda was succeeded in 2008 as LDP leader and prime minister by Taro Aso (Western style), a former foreign minister and veteran legislator known as a stalwart conservative.

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International Affairs

The end of the Cold War in the late 1980s brought new uncertainties in Japan’s relations with the outside world. Although the mutual security treaty remained in force, the United States pressured Japan to assume responsibility in international politics commensurate with its economic power. A country with a large stake in international stability, the Americans argued, should take some responsibility for maintaining it.

Japanese political leaders, aware that public sentiment strongly supported the peace constitution, remained reluctant to take a more active role in international military efforts. During the Persian Gulf War in 1991, the Japanese government provided $13 billion to help reimburse the expenses of the anti-Iraq coalition, but sent no troops. In 1992 the Diet passed a law allowing noncombatant SDF personnel to take part in UN peacekeeping operations, but the law required Diet approval in every case. And the Japanese public expressed concern in 1997 when a new U.S.-Japanese security plan committed Japan to cooperate with U.S. forces in conflicts occurring in areas around Japan.

During the 1990s the Japanese confronted hostility among their Asian neighbors despite growing trade, investment, and other economic ties. Memories of Japan’s wartime activities remained alive in North and South Korea and China. In the early 1990s, for example, South Koreans and other Asians demanded that Japan admit responsibility for forcefully recruiting women to serve as “comfort women,” or prostitutes, for Japanese soldiers during the war. On August 15, 1995, the 50th anniversary of the end of the war, Prime Minister Murayama expressed “deep remorse” for war victims, particularly in Asia. But leading LDP politicians continued to make statements that appeared to defend or justify Japan’s actions as an imperialist and military power. The issue resurfaced in 2001 when a new history textbook appeared to gloss over Japan’s past military aggressions in China and Korea, and it was further aggravated the same year when Prime Minister Koizumi visited the Yasukuni war shrine in Tokyo, where Japanese war dead are honored, including Japanese convicted of war crimes. Koizumi continued to make annual visits to the shrine on the anniversary of Japan’s surrender in World War II, further straining relations with neighboring countries that regarded the shrine as a symbol of Japan’s wartime militarism.

In 2002 Koizumi and North Korean leader Kim Jong Il signed a joint declaration to begin normalizing relations between their two countries. The summit meeting, held in North Korea, marked the first diplomatic relations between the two countries since 1948. In the joint declaration, Japan formally apologized for Korean suffering under Japanese colonial rule from 1910 to 1945. Prior to the meeting, North Korean officials admitted that North Korean agents had abducted a number of Japanese citizens since the 1970s in order to conduct spying operations under stolen identities. North Korea’s refusal to fully comply with Japan’s demand for the return of its kidnapped citizens remained a point of contention between the two countries.

In the 1990s and early 2000s Japan and Russia took steps toward resolving their long-standing territorial dispute over the Kuril Islands. The dispute had prevented Japan and the Soviet Union from signing a peace treaty after World War II, leaving them technically in a state of war. The lingering dispute also posed a significant obstacle to diplomatic and economic relations between Japan and Russia after the collapse of the Soviet Union in 1991. Meetings between Russian president Boris Yeltsin and Japanese prime ministers in the late 1990s produced statements of commitment to resolving the dispute. In 2003 Prime Minister Koizumi and Russian president Vladimir Putin signed an agreement calling for an accelerated effort to resolve the dispute and produce a peace treaty. In general terms, the agreement also indicated that the two countries would cooperate in exploiting Russia’s vast energy resources.

An initial group of an intended 600-strong noncombat contingent was sent to Iraq in 2004 to assist in the reconstruction of the country. It represented the first Japanese ground forces to be deployed in a combat zone since World War II. The measure was widely seen as controversial and potentially unconstitutional, especially as it came after the deaths of two Japanese diplomats in a bombing in the city of Tikrīt in northern Iraq in late 2003 (see U.S.-Iraq War).

Japan began withdrawing its noncombat forces from Iraq in June 2006. Japanese prime minister Shinzō Abe, who succeeded Koizumi in 2006, announced his intention to revise Japan’s pacifist constitution so that the Self-Defense Forces could play a more active role in international missions. Abe also supported the annual renewal of an antiterrorism law allowing Japan to provide naval support to U.S.-led coalition forces in Afghanistan. During his first month in office, Abe visited China and South Korea in a move to ease strained relations. In another fence-mending gesture, Abe avoided honoring Japan’s war dead at the Yasukuni shrine during his term in office.

The History section of this article was contributed by Peter Duus.

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