Japan Finance Minister Warns of Opposition Landslide

Reuters Created: Aug 24, 2009 Last Updated: Aug 24, 2009
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Finance Minister Kaoru Yosano. (STR/AFP/Getty Images)
TOKYO—Japanese Finance Minister Kaoru Yosano, his ruling bloc facing likely defeat in an election less than a week away, sought to lure back voters with a warning on Tuesday that a big opposition win risked creating one-party "despotism". 

In the latest survey to forecast a ruling bloc loss, the Sankei newspaper said the opposition Democratic Party was expected to win 300 seats in parliament's powerful 480-seat lower house, ending more than 50 years of almost unbroken rule by the conservative Liberal Democratic Party (LDP). 

That was in line with other media forecasts, though analysts have cautioned that an opposition win may be less overwhelming. 

The Nikkei business daily said an LDP internal survey last week had shown the Democrats winning just under 260 seats while the LDP would get around 160 from Sunday's election. 

"The situation is tough. The angry waves of the Democratic Party are attacking all over Tokyo," said Yosano, who himself faces a fight to hold onto his constituency in the capital. 

"If this momentum continues, there is a risk of one-party despotism," he told a news conference. 

An opposition win of the magnitude forecast would be almost the mirror image of the results of the last general election in 2005, when charismatic leader Junichiro Koizumi led the LDP to a huge victory with promises of market-friendly reforms. Since then, Japan has had three more prime ministers and support for the ruling party has sagged due to scandals, policy flip-flops and a perception that the party has failed to address the deep-seated problems of a shrinking, fast-ageing population. 

Pensions Top Voter Worries Voters may not have high hopes for the novice Democrats, but many seem ready to give them a chance. 

"I would like to let them try once and see how much they can do," said Hiroshi Sugimoto, a 43-year-old wine bar owner who plans to vote for the Democrats. 

"It's going to be tough for Yosano." 

Investors in Japan's stock market would generally welcome a Democratic Party win if it breaks the policy deadlock created when opposition parties won control of the upper house in 2007, allowing them to delay legislation. 

But analysts worry the Democrats' promises to spend more on households with steps such as child allowances, toll-free highways and aid for farmers might inflate a public debt already equal to 170 percent of GDP and push up bond yields.

The opposition says it could fund the steps mostly by cutting waste. 

"If the Democratic Party were to win, a landslide victory would be better. Otherwise, policies would lack a specific direction," said Kazuhiro Takahashi, a general manager at Daiwa Securities SMBC. 

"Once a change in the government becomes a reality, risks related to that change and the Democrats' ability to lead the country will be in focus." 

The Sankei newspaper said the LDP could see its number of seats more than halved to around 130 while its junior partner, the New Komeito, would have trouble keeping its current 31 seats.

But it said that with more than 30 percent of voters yet to make clear their views, the situation was fluid. Seeking to attract voters back to the ruling camp, Yosano took a swipe at the opposition's spending plans. 

"It wouldn't be easy for the DPJ to realise its pledges as fiscal conditions are tough," he said. 

Prime Minister Taro Aso is trying to convince voters that only an experienced LDP can handle problems such as an economy struggling to emerge from its worst recession in 60 years and security threats from unpredictable neighbour North Korea. 

But worries about Japan's creaking pension and health care systems topped the list of issues voters are focusing on in the election, the Sankei reported, with more than 30 percent saying it is their main concern.

That was nearly double the figure who see the economy as the top priority.

 



 
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