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    Japan Post privatization voted down

    The Japan Post privatization bill has been voted down by the upper house of the Diet; Koizumi pledges to dissolve the lower house and call new elections on 11 September. There were 22 LDP votes against the bill, 4 more than the 18 required for it not to pass. The final total was 108 for, 125 against. It’s the only thing NHK is talking about right now, naturally, but there’s nothing really enlightening being said. The main noise in the House of Councillors’ chamber after the tally was announced sounded like cheering, naturally.

    Given the pressure the party leadership had put on LDP legislators to vote in favor, I’m sure some of those who weren’t cheering were still feeling inward relief. There had not been much effort to get voters behind the bill, and those constituents that did voice opinions–such as, you know, the postal workers’ unions–didn’t support it. Ditto, of course, for the unelected officials in the Ministry of Finance and the Ministry of Internal Affairs, which oversee the current semi-governmental Japan Post corporation. Japan Post privatization has been presented in public all along as an example of the rifts in the LDP; it fulfilled that role to the end. The next month or so promises to be interesting.

    Added at 16:00: As Atsushi just remarked to me while NHK’s camera panned the assembled cabinet, the Prime Minister decided against cool biz today (though Heizo Takenaka and another minister or two are tie-less), and man, were they wearing some sour expressions.

    Added at 11:59: Much hot air emitted since this afternoon. Few surprises. Koizumi has vowed that the lower house members who voted against the Japan Post privatization bill will not be supported by the LDP in the upcoming snap election. Otherwise, mostly a reaffirmation of positions by those whose talking heads have appeared for months.

    BTW, it’s worth noting in all the brouhaha that the point to which Japan had progressed before todays set of documents was formulated represented no small feat. The 2001 reorganization of the federal ministries involved the dissolution of the Trust Fund Agency of the Ministry of Finance, to which all Postal Savings deposits had theretofore been required to be routed. Granted, the creation of the Japan Post semi-governmental corporation didn’t solve the spending problems, either on pork-barrel public works projects or on government bonds, but at least it let some light and air into the shadow budget. These things take time.

    3 Responses to “Japan Post privatization voted down”

    1. Kelvin says:

      Please enlighten me on this one: if JPost privatization is such a threat to the power base of the LDP as it is often portrayed in English media (rural vote-buying system, receive support from postal workers’ union, etc.), why did the DPJ vote against it? The DPJ’s support base is urban so I wouldn’t think that pissing off villagers with crappy postal service would be a big disincentive for them, and you’d think they’d make an issue out of plugging this big pipeline that sends government funds towards politically strategic spending. Or are they really that scared of Koizumi riding on his personal popularity to help him, even after the LDP losses in the House of Councillors just a while back?

    2. Sean Kinsell says:

      Let’s start with the lofty-philosophical interpretation: the DPJ party platform supports economic reform through localization, not privatization. That is, the administration of most public services is supposed to be delegated to regional and local governments, with tax money allocated accordingly. (To my knowledge, the DPJ did not support the prong of koizumi’s three-pronged reform that involved actually spinning off the *collection* of many taxes.)

      Then there are the strategic issues: even if the bill–I keep using the singular because they were all voted on together, but there were actually a bunch of documents–had passed, the DPJ would have had loads of ammo against the Koizumi administration with respect to the way it had gone through. When the vote in the House of Representatives was finished, the DPJ immediately came out saying that those voting in favor had actually been voting against the dissolution of the lower house. The Koizumi administration tries to get what it wants by intimidation and flouting the wisdom of its own mentors. Furthermore, the postal service is one of the few federal services that run efficiently–why would we wreck that? Let’s just keep going after cozy LDP spending based on pork-barrel relationships with construction and transportation companies instead. That’s the line.

      Also, the DPJ now has an opportunity to tell postal workers (and other federal employees) that it supported their interests while the LDP wanted to leave them at the mercy of its crony-capitalist friends. That was always the line Katsuya Okada and DPJ legislators used in their questions and public comments, “Whom is the privatization supposed to benefit? Japan Post is already a semi-governmental corporation; what public interest would total privatization serve?” I don’t think the DPJ would have had much incentive to vote for privatization in the hopes of driving a wedge between the LDP and rural postmasters–it would have made itself look bad with them at the same time, and its constituents wouldn’t have gotten the other economic benefits, after all.

    3. Kelvin says:

      Ahh I see. Thanks for clarifying the issue. While I haven’t been following the issue long enough to really take a stance, the idea of that so much of Japan’s private savings is invested in essentially government liabilities, and not into capital for firms in the marketplace, is certainly a peculiar one.

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