So let's review, quickly:
1) Koizumi, who is quite popular, could not get his own Liberal Democratic Party (LDP), which is in control of parliament, to go along with his plan to privatize the state postal service.
2) The state postal service is more than just a postal service; it is also the world's largest bank, controlling more than $3 trillion dollars in assets (the Japanese actually save money, unlike Americans).
THE DEBATE
3) Critics say that the state postal service uses its funding largesse to dole out patronage to supporters (the CSM called it "old-style pork politics" and a "campaign war chest for politicians to win votes").
4) Others say that privatization of the largest bank in Japan would only benefit the private-sector banks that are currently in competition with the postal service. The privatization can also be seen as a giveaway to the Japanese stock market. Read, for example, this, from some pleased-with-himself market analyst:
Japan Post holds 350 trillion yen in deposits and insurance assets. That's $3.3 trillion, making it the largest financial organization in the world. Mr. Koizumi's idea, if realized, would inject all of that capital into the economy. The resulting growth would really light a fire under the stock market.I'm no economist. But this sounds to me a lot like Bush's plans to inject Social Security money into the American stock market. The similarity becomes more apparent when you realize that the monies that the postal service holds are more than likely the retirement savings of millions of Japanese citizens.
Japan apparently has a problem with banks issuing bad loans. This reform may be a part of more sweeping financial reform, or it might be the solution to the problem. I'm just too ignorant of the situation and of economics to really know.
THE OUTCOME OF THE ELECTION AND WHAT IT MEANS
5) Koizumi called a quick election after his "reform" plans failed. His party won a historically significant amount of seats (the second-highest amount of seats on record), seemingly giving him a mandate for his policies. See below, however.
6) The election may also signify more geopolitical assertiveness on the part of Japan. Koizumi has been viewed by some as aggressively nationalist (read about his trips to the controversial Yasukuni Shrine here). The opposition Democratic Party (DP), on the other hand, ran on a seemingly cautious platform of "withdraw[ing] Japanese troops from Iraq and repair[ing] relations with China and South Korea." This editorialist for the CSM seems to believe that the electoral victory for "reform" in Japan may signify broader changes in Japan than mere postal service reform:
[Koizumi] staked his career on this reform and this election, seeing them as a test of whether Japan's conformist mura ishiki (village mentality) could give way to a spirit of self- reliance and global perspective, driven by a new-style nationalism. In other words, could Japan become - and be seen as - a "normal" nation, ready to stand up to a bullying China and able to easily deploy forces for peaceful purposes.More on the geopolitical implications of Koizumi's win here.
AN ASIDE: PR AND "THE ASSASSINS"
7) It is unclear to me how much of Koizumi's support was actually because of his policies or platform. It sounds as if there was an utterly masterful effort on the part of Koizumi's faction of the LDP to run hot chicks (dubbed "the assassins") against crusty old anti-reform LDP members and otherwise hep up the LDP. Seriously.
By replacing postal opponents with younger, mostly female candidates, Mr. Koizumi succeeded in changing the image of the Liberal Democratic Party, long associated with old men in dark suits. The strong results suggested that Mr. Koizumi had made his party more attractive to the same younger and urban voters who had handed the opposition Democratic Party victories in cities in previous elections.There was record turnout with substantial numbers of previous nonvoters showing up at the polls.
If you read nothing else, check out this double-excellent Washington Post article on the assassins.
