Japan election: What PM Ishiba’s exit would mean amid US tariffs and rising prices

Japanese Prime Minister Shigeru Ishiba is facing a tough challenge in tomorrow’s (Sunday) upper house election.

If he loses, it could add to the political uncertainty at a time when Japan is dealing with several problems, including rising prices and high US tariffs.

Notably, Ishiba became the party’s leader in September after four earlier failed attempts, making him the Liberal Democratic Party (LDP)’s 10th different prime minister since 2000. All have been men.

He has led a minority government since October, after taking the LDP through one of its worst general election results in years.

Last October, the LDP faced a huge setback in the general election as regular supporters stayed away, expressing anger over corruption scandals and rising living costs. Ishiba is now trying to rebuild trust with voters.

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The LDP has held power in Japan for most of the time since 1955. But it remains unclear whether anyone is ready to take over from Ishiba.

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With no majority in parliament, Ishiba’s government has had to work with opposition parties to pass bills. This has slowed down efforts to control price hikes and push for wage growth.

Along with food shortages and soaring rice prices, a key concern in Japan, Ishiba has also been under pressure from US President Donald Trump’s demands on trade.

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Trump has already set tariffs on Japanese cars, steel and aluminium, making negotiations even harder.

If no deal is reached, more tariffs, 25 per cent on other Japanese goods, will be introduced from August 1.

Disappointed with the government, many voters are now backing new populist parties, including one that is taking a tough line on foreigners and stepping back from gender and diversity goals.

Here’s a look at Sunday’s election:

Instability

Ishiba has set a low bar for the vote — a simple majority. Half of the 248 seats for six-year terms in the upper house are being decided, and the LDP and its junior coalition partner Komeito would need to win a combined 50.

Added to the 75 coalition-held seats that are not being contested in this election, it would be a big retreat from the 141 seats the coalition held before the election.

If the ruling coalition fails to secure a majority, “there will be a move within the LDP to dump Ishiba,” said Yu Uchiyama, a University of Tokyo professor of political science. “It makes a leadership very unstable.”

Under any successor, the ruling coalition would be a minority in both houses, he said.

If Ishiba’s coalition secures a majority and he stays on, his leadership will remain weak, with little hope of improved support ratings, Uchiyama said. “Either way, it is essential for the minority government to seek opposition parties’ co-operation to achieve any policy.”

Trump and soaring prices

Measures to mitigate soaring prices, lagging incomes and burdensome social security payments are the top focus of frustrated, cash-strapped voters.

Rice prices have doubled since last year due to supply shortages, overly complex distribution systems and other reasons related to Japan’s farming, causing panic buying as Ishiba has struggled to resolve the crisis.

Trump has added to that pressure, complaining about a lack of progress in trade negotiations, blaming a lack of sales of US autos and American-grown rice to Japan despite a shortfall in domestic stocks of the grain. A 25% tariff due to take effect Aug. 1 has been another blow for Ishiba.

Ishiba has resisted any compromise before the election, but the prospect for a breakthrough after the election is just as unclear because the minority government would have difficulty forming a consensus with the opposition.

The rice issue has cost Ishiba one farm minister. Rice prices remain high even after the farm minister’s replacement, Shinjiro Koizumi, moved quickly and boldly to address the problem by ordering the emergency release of stored rice from reserves, helping to refill grocery store shelves in time for the election.

Koizumi, son of popular former Prime Minister Junichiro Koizumi, is a potential challenger to Ishiba.

An emerging populist right 

Stricter measures targeting foreign residents and visitors have suddenly emerged as a key issue.

The Sanseito party stands out with the toughest anti-foreigner stance with its “Japanese First” platform that proposes a new agency to centralise policies related to foreigners. It wants stricter screening for allowing Japanese citizenship and to exclude non-Japanese from welfare benefits.

The party’s populist platform is also anti-vaccine, anti-globalism and favours traditional gender roles.

Its stance has encouraged the spread of xenophobic rhetoric in the election campaign and on social media, critics say. A typical claim is that a rapid increase in foreign workers has hurt Japanese workers’ wages and that foreigners use a large share of welfare benefits and have made Japanese society unsafe.

“Foreigners are used as targets to vent their discontent and unease,” Uchiyama said, comparing the scapegoating to that in Europe and the United States under Trump.

Experts say most of the rhetoric is disinformation aimed at frustrations among Japanese struggling to get by. Government statistics show foreign residents account for about 3% of both Japan’s total population and of welfare benefit recipients.

The Liberal Democrats, under a slogan “zero illegal immigrants,” have pledged to crack down on growing illegal employment of foreigners and against allowing them to default on social insurance payments or medical bills. The party also set up a task force to promote an orderly society, a move aimed at enforcing stricter measures on foreigners to address growing public unease.

The rising conservative Democratic Party for the People, or the DPP, also is calling to restrict foreign ownership of Japanese real estate.

The move triggered protests by human rights activists and alarmed foreign residents.

Given that its population is rapidly ageing and shrinking, Japan needs foreign workers. It should discuss immigration policy more strategically, Takahide Kiuchi, an executive economist at Nomura Research Institute, wrote in a recent analysis.

Why the opposition is still fractured

Conservative to centrist opposition groups, including the main opposition Constitutional Democratic Party of Japan, or CDPJ, the DPP, and Sanseito, have gained significant ground at the Liberal Democrats’ expense.

Headed by charismatic Sohei Kamiya, a former local assembly member and a member of the defence reserve, Sanseito ranked as the second favourite in the opposition after the CDPJ in some recent surveys.

They are believed to be raking in conservative supporters of the ruling party who are disappointed by Ishiba’s leadership and flip-flops on policies. Ishiba is caught between his party’s ultraconservatives and mainstream opposition leaders.

Still, the eight main opposition groups are too fractured to forge a common platform as a united front and gain voter support as a viable alternative.

When Ishiba lost big in October, there was speculation about a trilateral coalition government with the Komeito and the DPP or another conservative group, the Japan Innovation Party.

But they’ve since cooperated only on certain legislation. If the ruling coalition loses its upper house majority, that could spark a regrouping among coalitions.

Yoshihiko Noda, a former prime minister and head of the opposition CDPJ, said the loss of ruling coalition majorities in both houses of parliament would enable opposition parties to push policies blocked by the LDP.

Those include cuts in the consumption tax, recognition of same-sex marriages, and a law allowing married couples the option of each keeping their own names.

With inputs from AP