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The Economist September 22nd 2018 33
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1
THE outcome was never really in doubt,
just the margin—and in the end that
proved comfortable too. This week Shinzo
Abewona third consecutive termas leader
of the Liberal Democratic Party (LDP), earn-
ing 69% of the vote in a ballot of the party’s
members and MP s. Since the LDP has a big
majority in parliament, that gives him
three more years as prime minister. They
are likely to be his last, since the LDP’s
rules, which he has already had changed
once, limit leaders to three terms.What, be-
yond seeing through the installation of a
newemperor in 2019 and the Tokyo Olym-
pics in 2020, will he dowith them?
Mr Abe has a fixation with foreign and
security policy. Hewould dearly like Japan
to shed the complexes it has developedas a
result of its history of militarism and colo-
nialism, and assert itself more in interna-
tional affairs. To that end, he has long de-
sired to do away with Article 9 of the
constitution, committing Japan to paci-
fism,whichAmerica imposedafter the sec-
ond world war. “Constitutional revision is
in his soul and blood; a magma within
him,” says Takao Toshikawa of Insideline, a
political newsletter.
ButMrAbe is also a pragmatist.When it
became clear that any perceived retreat
from pacifism would incense China and
the Koreas, and alarmmany voters, he set-
tled on a more modest plan. He now says
tion to re-open the subject to enact reforms
that would make more difference, such as
making it easier to fire people. By the same
token, Mr Abe has exposed certain protect-
ed industries to greater competition
through trade deals, but has said little
about spurring competitionmore broadly.
Meanwhile, even Mr Abe’s most loyal
lieutenants, such as Midori Matsushima,
an LDP lawmaker, admit he is neglecting
Japan’s demographic time-bomb. The pop-
ulation is shrinking by 1,000 people a day
and ageing to boot: one in every five peo-
ple is over 70. Unless something is done
soon, the atrophying of the economy due
to the shrinking number of workers and
consumers is likely to cancel out the bene-
fits of any reformsMr Abe institutes.
The prime minister, however, seems
unwilling to countenance, let alone cham-
pion, large-scale immigration. He is letting
inmore foreignworkers, but only for short
stays andwithout families; he has gone out
of his way to stress that the new arrivals
will not be allowed to remain. The propor-
tion of women working has risen during
his tenure, which has helped offset the de-
cline in the working-age population. But
the tax code still penalises the lower-paid
person in a couple, almost always a wom-
an, if she earns more than ¥1.5m ($13,362).
Many women have therefore opted for
only part-time jobs.
What is more, as Shigeru Ishiba, Mr
Abe’s challenger, pointed out often during
the leadership election, the government’s
policies are financiallyunsustainable. Pub-
lic debt is 250% of GDP. The government
has pushed back the date when it expects
to balance the budget to 2025; the deficit
stands at 4.4% of GDP . Mr Abe says he will
raise the consumption tax from 8% to 10%
in a year’s time, but almost all of the ex-
he simply wants to add a sentence to the
article that bars Japan from having an
army, to legitimise its “self-defence forces”.
The LDP and its allies enjoy a two-thirds
majority in both houses of the Diet,
enough to pass an amendment. But not all
of its MP s are keen on the change, so push-
ing it through is likely to consume a lot of
Mr Abe’s attention. After that, the amend-
ment will have to be ratified by voters in a
referendum—an even more daunting chal-
lenge, judging by the polls.
It’s the economy, Shinzo
That may not leave Mr Abe much time to
minister to the economy. Mr Toshikawa
reckons he would like to declare an end to
Japan’s three decades of deflation during
his third term. But growth still seems de-
pendent on unprecedented fiscal and
monetary stimulus. MrAbe has talked a lot
about structural reform since becoming
prime minister in 2012, but delivered only
dribs and drabs. His final three years look
likely to conform to that pattern.
The prime minister has mused about
introducing tax breaks to encourage big
companies to spend their huge hoards of
cash on higher wages or domestic invest-
ment. There is also vague talk about boost-
ing entrepreneurship, especially in the ru-
ral areas. But having tweaked employment
laws earlier this year, he shows no inclina-
Japanese politics
Abe’s ambition
Tokyo
The primeministerhas a lot to do during his last years inoffice
Asia
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