Japan faces electoral stalemate as LDP bloc loses grip

Japan’s general election has dealt a major blow to Prime Minister Shigeru Ishiba, whose ruling Liberal Democratic Party (LDP) and its coalition partner, Komei, lost their parliamentary majority for the first time since 2009, plunging the country into political uncertainty.
While the LDP and Komei won 215 seats in the Diet (the lower house of parliament) — down from 279 — the opposition Constitutional Democratic Party (CDP), led by former prime minister Yoshihiko Noda, secured 148 seats, up from 98. The remaining seats were divided among smaller opposition parties, most notably the Democratic Party for the People (DDP), which made gains, and the Ishin Party, which lost six seats.
With the LDP and Komei falling well short of the 233 seats needed for a majority, Japan’s ruling bloc faces an uphill battle to regain control, even if it manages to recruit former LDP members now serving as independents. Meanwhile, the left-leaning CDP is equally unlikely to achieve a majority by forging an alliance with the centre-right Ishin and DDP.
This adds a new layer of uncertainty to the upcoming prime ministerial election in the Diet, which will begin on Nov 11 in a session expected to last four days. Barring an unexpected coalition forming around one of the two largest parties, the LDP and Komei are set to back Mr Ishiba, while the CDP and other opposition parties will probably support their respective leaders. With no one receiving a majority, the Diet will hold a runoff between the two leading candidates — most likely Mr Ishiba and Mr Noda. Unless the CDP can reach a deal with smaller opposition parties, Mr Ishiba will be re-elected, albeit as the head of a minority government.
Such a scenario would leave Mr Ishiba’s administration on shaky ground, reliant on ad hoc negotiations with Ishin and the DDP and continually forced to make policy concessions. By the next election of the House of Councilors (the upper house) next summer, Mr Ishiba may already be on his way out.
Previous LDP losses triggered significant shifts in Japan’s political landscape. In 1993, internal disputes drove some LDP members to break away and establish their own parties. In the subsequent election, the LDP lost its majority, and these splinter groups joined forces with other opposition parties to form a non-LDP, non-Communist coalition, elevating Morihiro Hosokawa to the premiership and marking the first time that the LDP had lost power since its founding in 1955.
Mr Hosokawa’s coalition, however, lasted only one year, and the LDP eventually regained power in 1994 in partnership with the Socialist Party, its longtime rival, and allowing Socialist leader Tomiichi Murayama to become prime minister. Though Mr Murayama stepped down after less than two years, the alliance survived until 1998.
But while this example suggests that the LDP could, if necessary, cede the premiership to a coalition partner to retain power, such a scenario seems doubtful today. Similarly, the significant disagreements between the CDP and other opposition parties make a non-LDP coalition highly improbable.
The LDP’s crushing defeat did not reflect domestic or foreign-policy missteps. Instead, it can be largely attributed to the party’s kickback scandal, in which prominent LDP members were found to have violated the Political Funds Control Law by failing to report profits from selling tickets to fundraising events.
The LDP’s response to the scandal — a minor reprimand for members who received the payments — was widely seen as inadequate. Some of those who were implicated resigned from the party to run as independents, while others ran as LDP members in single-member districts without official party support. The opposition seized on the scandal, and its portrayal of the LDP as tainted by corruption clearly resonated with voters.
The kickback scandal’s broader relevance stems from the fact that it overshadowed any meaningful debate about economic policy, enabling leading parties to offer vague plans with little substance. Mr Ishiba, for example, centred his campaign on national security, advocating a larger defence budget and enhanced disaster resilience, funded by higher taxes. But while he called for wage growth to outpace inflation, he did not offer a clear economic strategy. Similarly, Mr pledged to revive the middle class, boost consumption, and stimulate economic growth but failed to provide a clear roadmap for achieving these goals.
That said, Mr Noda’s track record suggests that he has more in common with the LDP than with other opposition parties. A member of the CDP’s moderate faction, Mr Noda is known as a fiscal conservative. As prime minister, he negotiated a landmark fiscal reform with the LDP and Komei that included a plan to raise the value-added tax gradually from 5% to 10%. Although the CDP was defeated in the 2012 election, then-LDP leader Shinzo Abe implemented the planned VAT increases in 2014 and 2019.
Given this history, Mr Noda’s CDP is expected to resist calls from smaller opposition parties to cut the VAT rate or provide large cash transfers to citizens. And with the LDP-Komei coalition lacking a majority, Mr Ishiba would struggle to advance his policy agenda without some opposition support. Thus, while structural reforms and major rural support programmes remain unlikely, Japan’s commitment to fiscal discipline will probably remain firm. ©2024 Project Syndicate
Takatoshi Ito, a former Japanese deputy vice minister of finance, is a professor at the School of International and Public Affairs at Columbia University and a senior professor at the National Graduate Institute for Policy Studies in Tokyo.