Disenchanted Japanese Give Abe Another Chance

Japan’s prime minister wins reelection, but voters are disappointed he has been unable to improve the economy.

Japan’s ruling conservative parties were on track to win another majority in snap elections on Sunday but low voter turnout reflected rising disenchantment with Prime Minister Shinzō Abe’s economic reforms.

Japanese media projected Abe’s Liberal Democrats and their socially more conservative coalition partners in the Komeito party would win more than 317 seats in the country’s lower house of parliament, a loss of under ten seats but enough to maintain a comfortable majority.

However, barely one in two eligible voters turned out compared with almost 60 percent turnout in the last election in 2012.

Abe called early elections last month to seek a fresh mandate for his economic policy when the country slipped back into recession.

Key parts of the reform agenda have stalled.

A more expansionary monetary policy has successfully driven down the value of the yen, benefiting exports. But it has also made imports more expense at a time when wage increases have not kept pace with price rises.

Consumption has been further depressed by tax rises that were needed to slow the growth of Japan’s debt which now equals 237 percent of annual economic output.

While Abe has promised to lower Japan’s corporate tax rate, which is currently the highest in the developed world, to under 30 percent, he has shied away from comprehensive agriculture and labor reforms that could revitalize the island nation’s economy.

Powerful agricultural cooperatives and high subsidies shield Japan’s farms from international competition while rigid labor laws make it nearly impossible to lay off workers. Many firms limit hiring to part-time or temporary workers who are typically paid a third less than full-time employees. 17 percent of Japanese men aged 25 to 34 now hold such jobs. For women of all ages, the rate is a staggering 57 percent. 70 percent of Japanese women also still quit their job when they have children.

Abe has recognized the problem of low female participation in the labor market but done little to increase the rate.

Productivity is also lagging. Firms are reluctant to invest in workers who are on temporary contracts while those with secure jobs need not compete. Japan’s GDP per hour worked is a quarter below the average for rich countries.

Trade negotiations with other countries around the Pacific Ocean, including the United States, are on hold because Japan is reluctant to reform agriculture and discuss significant cuts in tariffs.

It is doubtful Sunday’s election result will boost Abe’s ability to push through meaningful reforms. The prime minister has spent much political capital on restarting nuclear reactors taken offline after the 2011 disaster at Fukushima and reinterpreting Japan’s constitution to allow for military deployments abroad, a move that strained relations with the pacifist Komeito party.

Abe’s victory probably owes more to voters’ mistrust of the opposition Democratic Party to do better. The party saw three prime ministers in as many years when it ruled the country between 2009 and 2012 and failed to arrest Japan’s slide into economic malaise.