Vol.34-No.11 November 1,1995
1. Japan's Turbulent Decade
Japanese politics have been tossed about by internal and external turbulence during the last decade.
The starting point of the turbulent decade was negotiations for opening Japanese markets between the Japanese and U.S. governments in 1985. Negotiations were necessitated by the long-standing and severe trade conflicts between both countries and the rise of protectionism in the U.S. This made confrontation with Japanese political interests, in which the ruling party LDP (Liberal Democratic Party), the strong bureaucracy and special interest groups put up a united struggle, unavoidable. Negotia-tions developed into the Japan-U.S. Structural Impediments Initiatives. In this way, the basic pattern of Japanese politics during this decade, in which domestic politics were twisted by the pressure over economic policies from foreign countries, started.
In this year, the committee of the finance ministers and the governors of the central banks in the U.S., Britain, West Germany, France and Japan(G5) agreed on strengthening cooperative intervention in the exchange market. Thus, the Plaza Agreement brought on the transition from a high dollar rate period to high yen rate period. The high yen rate since then has damaged Japanese export industries, while it has pressured the Japanese government into opening markets amidst the political pressure mentioned above.
These political and economic pressures from abroad brought clear results immediately. In 1986, the Research Council for Economic Structural Adjustment for the sake of International Cooperation in Japanese Government presented the "Maekawa Report" which emphasized the necessity to steer a national course from a "production orientation" toward a "living orientation" economy. And also, from 1986 to '87, the yen rate skyrocketed on the Tokyo foreign exchange market.
On the other hand, tax reform shocked Japanese politics during this decade, too. The urgency of dealing with the financil crisis and the aging society has made this subject a key issue for governmental finances and social security. The first event was the setback in introducing a sales tax by Nakasone cabinet in 1987. Tax reform can't generally succeed without political trust in the government. However, the revulsion of people toward tax reforms was often amplified by political money scandals of the LDP and Bureaucrats. In 1988, the Recruit Scandal revealed that the burgeoning information service and real estate company had bribed many LDP politicians and bureaucrats and this hit directly a consumption tax which the Takeshita cabinet introduced in the year and forced the cabinet to resign. Furthermore, the Recruit Scandal and the consumption tax coupled with the issue of the liberalization of rice imports, which the GATT-Uruguay Round compelled from the Japanese government, damaged the LDP. In the 1989 election of the House of Councilors, the LDP was defeated decisively and lost a majority for the first time since forming the party.
Political indecision continued. The Persian Gulf War, which broke out in 1990, gave the Japanese government the dilemma of whether or not to dispatch Self-Defense Forces to the UN Peace-Keeping Operation. At that time, the Kaifu government paid enormous support money to the Multinational Force, while Cooperation in the UN Peace Keeping Operation was rejected in the Diet. In 1992, when the revised bill was passed in the Diet, severe cracks appeared among the opposition parties. As a result, opposition parties were defeated in that year's election of Councilors. This confusion over the "international contribution" issue revealed that Japanese politics had no fixed principle of diplomacy for the post cold war period.
There was no end to political money scandal, though the LDP seemed to get back its support. After the Kaifu government failed to pass bills concerning political reform including the election system in the Diet in 1991, the cases of graft involving many important politicians and governors were disclosed one after another in 1992. In 1993, a vote of no confidence in the Miyazawa cabinet passed in the Diet at last because of the lack of political reform. Immediately after that, the group promoting reform left the LDP, the party lost a majority in the general election and a non-LDP coalition cabinet was formed for the first time in 38 years.
The Hosokawa coalition cabinet indeed succeeded in passing the political reform bill including the small constituency system in the Diet. However it strayed over the pending issues of tax reform and trade frictions between Japan and U.S. After Hosokawa resigned due to a political money scandal again in 1994, the political situation changed quickly.
First, when the incoming Hata cabinet was formed, JSP (Japanese Socialist Party) left this cabinet due to aggravation of relationship among members.
Second, two months after, the JSP, LDP and NPH (New Party Herald), a group of ex-LDP politicians, formed a coalition cabinet. Prime minister Murayama, whom JSP sent as their first prime minister in 46 years, abandoned JSP's principles of opposition to the Self-Defense Force, the Japan-U.S. Security Treaty and the existing national flag and anthem, in order to form the coalition with the LDP which JSP strongly had opposed for a long time.
Third, at the end of the year, a non-LDP coalition party group excepting JSP and NPH established NFP (New Frontier Party). NFP was composed of NBP (New Birth Party), based on what formerly had been the strongest faction of the LDP, JNP (Japan New Party), which made a comet like appearance in the 1992 election and sent Hosokawa to the prime minister's position, DSP (Democratic Socialist Party), backed up by big business unions, CGP(Clean Government Party), which was supported by a huge religious organization. NFP made preparations for elections under the influential politician, Ichiro Ozawa and achieved a great victory in 1995's election of Councilors.
Fourth, JSP's position became more and more chaotic owing to the anomalous way of participating in the cabinet. The conflict over the coalition with the LDP developed into a split involving related unions. After that trouble was put to an end, JSP was struggling to make a new democratic party with NPH due to a sense of crisis stemming from the situation that the Japanese political world was controlled by two big conservative parties. However, there is no telling whether this proposed new party will be realized or not.
How does policy develop amidst such confused political conditions? The so-called "living orientation" issue raised in the Maekawa report changed with rise and collapse of the "bubble economy" and the above mentioned political situations. In the middle of the "bubble", the government policy for "living orientation" was devoted to expanding domestic consumption including the promotion of imports and public investment. After collapse of the "bubble", the Miyazawa cabinet settled on "a five-years plan to improve living standards" whose main points were reduction of working hours and housing expenses and the front-loading of spending of public investment. Since then, interweaving measures for an "aging society", the "living orientation" policy has been colored by incrementalism and re-regulation which the LDP and JSP were good at in the past. On the contrary, the original structural adjustment, such as de-regulation or administrative reform, didn't go smoothly. Although some criticism rose against the exclusive power of the business world and excess bureaucratic controls in public opinion through mass communications' campaign, the government didn't make drastic cuts in regulations and administration. The export industry, which was hit by the high yen rate as retaliation for slow structural adjustment, became increasingly discontented with government.
2. An Eventful Decade for Labor
It is very interesting that labor unions have played a key role in the vicissitudes of the political process. Therefore, the turbulent political situation threw unions into disorder. The ever-changing track of the new national center Rengo symbolizes this situation.
First, the beginning message of structural economic adjustment contained in opening market, Plaza Agreement and the Maekawa report in the latter half of 1980s was impressed on the identity of Rengo, which was established during this time. The key words "comfort", "affluence" and "fairness" which Rengo stated at its inaugural meeting in 1989 were strongly influenced by the "living orientation" of the Maekawa report. In 1987, Zenminrokyo(Japanese Private Sector Trade Union Council), the forerunner of Rengo, planned to make a similar statement to the Maekawa Report as a base for the DPCIR(Demand for Policy Changes and Institutional Reform), which was the activity by which national centers make demands and proposals concerning the governmental policies and attempt to influence cabinets, political parties and administrative bureaucracies every year.
This statement was really made by Rengo in 1993 under the title of "the course of Japan". It was noteworthy that there was a difference in tone between the lines used by Rengo and such forerunners as Private Rengo(Japanese Private Sector Trade Union Confederation), Zenminrokyo and Seisuikaigi(Trade Union Council for Policy Promotion). For example, Private Rengo published its "general welfare vision for an aging society", which included the contents for extending social welfare and was succeeded to Rengo, just before the latter's establishment, while Seisuikaigi and Zenminrokyo, which private sector unions led, insisted on a "cheap government" and supported the Nakasone cabinet's administrative reform. Administrative reform had the goals of reconstructing public finance without tax increases, restraining the tax burden in the social security system and privatizing public corporations in the first half of 1980s. In the background were Sohyo affiliated public sector unions' joining in the Movement for Labor Front Unification, which brought Rengo, and the encompassing organization orientation specifically to a national center as well as the social trend toward "living orientation". From this we can see the live coal, on which sector clashes to be mentioned later, were included.
Rengo's tone of policy change toward "living orientation" was colored by the political movement for change of the government after 1989. In 1989's election of Councilors, in which the LDP lost a majority, Private Rengo put up 12 candidates and supported the candidates of JSP and DSP, which included union related candidates, with the intention of beating the LDP. However, because Rengo's candidates unexpectedly won the signal victory, Rengo had to form RHC(Rengo in the House of Councilors) as a group within the House. This success obliged the newborn Rengo to change its political strategy from policy participation, which used the direct communication channel with ministries and government offices for DPCIR, to advocating change of government and thus it became involved in political turbulence. In 1992, Rengo made preparations for a large scale effort in the election of Concilors. LDP aimed its attack at Rengo and lured DSP and CGP into Cooperation on the UN Peace-Keeping Operations issue. As a result of the schism between the JSP and DSP, Rengo candidates was beaten thoroughly in that election. This defeat lead the major affiliated unions to give up on the idea of reconciliation between JSP and DSP, which unions had expected at the birth of Rengo, and they moved toward more drastic party alignment positively. In the political change of 1993, Rengo and major unions broadly supported non-LDP parties including JNP, NPH and NBP in the election and they endeavored to establish the coalition cabinet from behind the scenes. Furthermore, Rengo was delighted with the establishment of a non-LDP cabinet as if it had been its own.
This happy time for Rengo, however, didn't last. When the Hata and Murayama cabinet happened to be born in 1994, Rengo had to express a policy of judging matters on their own merits to both cabinets because JSP and DSP split into ruling and opposition parties each time. This autumn, the first president of Rengo who had played an key political role during this period was replaced by a less political one. At the time of establishing NFP and the conflict in JSP over the coalition with LDP this winter, the reformists in JSP, who expected to merge with DSP, schemed a split, at the same time, the relations among the related unions supporting JSP became hostile. Furthermore two elections of 1995 shocked Rengo and its affiliated unions. In nationwide elections of the head of local governments, amateur non-partisan candidates defeated the professional candidates who local Rengo co-supported with almost all political parties. Mass communication estimated the result as the electrorate's veto against all existing political parties and regarded Rengo as the ringleaders of the co-sponsored elections. In the election of Councilors, in which the lightest turnout in history was recorded, NFP achieved a great victory and JSP suffered a crushing defeat. Immediately after that, JSP related unions, which had a sense of impending crisis for the next general election, push forward with forming a new party to replace JSP. In opposition, ex-DSP related unions began to back NFP more than before. The political activity of Rengo reaches a deadlock in the face of the trend away from voting the existing political parties of the electorate and the difficult situation where affiliated unions split into both sides of the NFP and JSP with the first general election by the small constituency system at hand.
Originally, with the birth of Rengo a change in Japanese labor politics was expected. Really, Rengo's Political Committee released an interim report on political policy which included attempts changing the traditional relationship between unions and political parties, upholding a basic policy of forming a political force worthy of being entrusted with power. Rengo, concretely, launched the Rengo In-house Dietmen Round Table Conference, which mustered dietmen supported by affiliated unions, and the Rengo Political Forum, which was designed to confer with dietmen who supported Rengo's policies. This was done for the purpose of establishing a cooperative relationship with legislators, to a broader range apart from the conventional cooperative relationship with specific political parties. Furthermore, Rengo intended to promote functional separation of the union from political parties and to form voluntary support relations between parties and politicians and union members, replacing the traditional ones based on support for a specific party determined by a union. However, many affiliated unions seemed not to take these trials seriously, while Rengo continued to adopt measures for a transitional period and the actual proceedings of the Conference and the Forum have been suspended. But, the political experiences during this period didn't necessarily leave anything to unions. For one thing it became possible for unions to cooperate openly with conservative parties including LDP, and for another, unions understood the significance of being the party in power. These changes may bring transition from the "party orientation"to the "policy orientation" in Japanese labor politics as a result, which Rengo intended originally. In any case, Rengo and the affiliated unions may repeat more trial and error until that trend becomes concrete.
On the other hand, "How was Rengo commited to the policy issues during this period?" As mentioned above, it was an important matter that the structural adjustment policy had two sides; de-regulation and re-regulation or supply side and demand side. And the DPCIR of Rengo left a characteristic track about this.
Rengo continued to criticize indecisiveness of successive cabinets regarding deregulation and administrative reform during the period, while it was the actual condition that Rengo did't reach a consensus on the matters internally. The conflict of interests within Rengo on the matters rose not only between public and private sector unions but also among processing, material and energetic industry unions within private sector. Among them, unions in the export processing industry such as automobiles and electronics, whose center is the JC (Japan Council of Metalworkers' Unions), became irritated with the situation and began to form a common front with Nikkeiren(Japan Federation of Employers' Associations) which took a strong stance of promoting deregulation. For example, when president Nagano of Nikkeiren criticized the government about an increase in public utility charges in 1994, JC cheered on him. And on the discussion of reexamining Shunto, "self-determination of industrial federation of unions in the fight for wage increases" appears as the key word. JC uses this as a way to criticize low productivity industry unions taking a free ride on wages decided by the high productivity industry unions such as JC. At the same time, employers in the export industries put the blame for low wage increases on delayed deregulation. Furthermore, JC and Nikkeiren recently co-published the "big ten proposals of labor and management toward correcting the high yen rate and stopping deindustrialization" which clearly suggests deregulation, opening of markets and improving the low productivity sectors.
On the other hand, Rengo made a great contribution to the extension of social welfare, particularly under the difficult situation of business recession and curtailed budget after the 1990s. Almost all results which DPCIR of Rengo has obtained during this period includes establishment or revision of laws and policies regarding following issues: child care leave, nursing leave, reduction in working hours, part-time worker, employment for persons of advanced age, nurse securing, the handicapped medium and small sized enterprises support, insurance for the aged, public employee wage, reduction of income tax, 10-year plan for the aged welfare, 5-year plan for child care, and so on.
There was some background besides "social democratic turn" at the birth of Rengo mentioned above. First, governments sent out a lot of policies related to social welfare in rapid succession during this period. Rengo had to undertake all these policies as union's domain and the way of grappling with them tended to be a bargaining style and additional oriented because its activities such as DPCIR requested visible results. Second, Rengo's participation in the party in power since Hosokawa cabinet spurred this trend. The realization of the five trillion yen reduction of tax cut as Rengo's long-cherished desire from the Hosokawa cabinet and gaining concessions from the government on pension institutional reform of the Murayama cabinet were good examples. Third, there was backing-up of public sector unions. Needless to say, the extention of social welfare for an aging society bring on expansion of the public sector. Jichiro(All Japan Prefectural and Municipal Workers' Union) organized by local government employees, who were expected to be providers of social welfare services for the aging society under the condition that decentralization of power was making progress, played a key role in realizing Rengo's demands particularly by making full use of the pipeline with JSP, LDP and related ministries. Incidentally, we can understand the recent historic reconciliation of Nikkyoso(Japan Teachers Union), the LDP and the Ministry of Education, Science and Culture, as a scheme for the expansion of educational budgets in the similar contexet.
Thus Rengo's Janus-faced dealing with the structural adjustment issue accounts for the sector clash situation and political divergence within Rengo. And recently, affiliated unions, particularly private unions, which have complaints about the actual situation, put the blame on Rengo's weak leadership and ask the reason for Rengo's existance.
3. New Wine in Old Bottles?
How can we understand this situation of contemporary Japanese labor politics?
There are the opinions of both sides about the political commitment of unions during this period. However, although one is more enthusiastic than the other, some political commitment of unions is a logical result, as long as Japanese unions, particularly private sector unions, have taken a "real wage" orientation since the latter half of the 1970s, which was based on a limits of corporate welfare. The question is that the variables related to real wages became uncontrollable owing to environmental changes. The straightforward example is the high yen rate situation. Unlike domestic matters such as taxes or prices, the high yen rate is an international matter and particularly depends on the U.S.
Of course, it is not a situation where there isn't anything to do domestically. Structural adjustment was just the right subject. However, it unfortunately was beyond the ability of Japanese politics. Certainly, although a series of political disturbances started partially with the intent to abolish these situations, the dream hasn't yet come true. Even Rengo has similar circumstances, for DPCIR was originally based on the character of political process under the control of bureaucracy. Therefore, DPCIR is effective for incrementalistic politics, while it is unsuitable for "starting afresh" politics. And what is more, it is much more difficult than before for national centers to coordinate the interests of affiliated unions.
After all, the matters get back to a corporate welfare again in the way of reexaminating Japanese corporate governance. And now the extension of social welfare has significance in compensating for "down-sizing" of corporate welfare. It may be suitable in the Japanese context of labor politics that "the micro level matters".
previous page next page MENU Special Topic Title Index-Labour Law and Social Policy Special Topic Title Index-Industrial Relations Special Topic Title Index-Others