According to inside sources who have spoken with at least two Japanese newspapers, Prime Minister Shinzo Abe is by all accounts (except his own, at least publicly) going to dissolve the lower house of the Japanese Diet shortly after he returns from his tour abroad on the 17th; the same day third quarter growth figures will be released. An aide close to Abe has said any election “would be a referendum on Abenomics,” and indeed, annualized GDP figures for the third quarter are not likely to be strong enough for Abe to justify next October’s consumption tax increase to 10 percent without first gaining national approval. However, there are other issues on next year’s political docket that would likely be smoothed over by a snap election (and assumed LDP victory) that otherwise might cause the Abe administration further problems, and perhaps derail large policy objectives.
According to the Jiji Press, “informed sources” told the publication on Wednesday that Abe sent a message to a senior ruling party official to prepare for a House of Representatives election, while he was attending the APEC Summit in Beijing. The Yomiuri Shimbun reported on Wednesday that “sources close to the government” say Abe could on Monday meet with the LDP’s coalition partner Komeito’s leader Natsuo Yamaguchi to discuss the decision, and “instructed senior members of the Liberal Democratic Party to speed up preparations for a possible general election.”
The impending tax increase and a general referendum on Abe’s economic policies, particularly the structural reforms, will undoubtedly be the main issues for voters and politicians in the run up to an election on either December 14 or 21. However, the ruling LDP has more to think about than just gaining a political mandate for its economic policies. It is also seeking to put itself in a good position nationally before unified local elections in April, and particularly before the ordinary Diet session begins in January.
Many of Abe’s key non-economic policies have been put on hold this fall during the current extraordinary Diet session, as his coalition seeks to shore up the nascent economic gains that the policies of monetary easing and government spending have achieved so far during Abe’s premiership. Operating under the assumption the LDP keeps its relative hold on power in the lower house (and thus Abe retains his position), the party will have the political bandwidth to attack two key issues: the U.S.-Japan Defense Cooperation Guidelines and legislation to codify the Cabinet’s reinterpretation of Japan’s pacifist Constitution concerning self-defense. The LDP has said all through the fall that these will be core issues to address early next year, and the update to the defense guidelines was likely postponed in order to accommodate the LDP’s schedule. A potential fresh mandate on all of the administration’s policies, not just Abenomics, will provide the catalyst to push these defense measures through early next year.