Prime Minister Fukuda Yasuo outlined his foreign policy agenda in an address to the Diet, highlighting – as did his predecessors Abe Shinzo and Koizumi Junichiro – the U.S.-Japan alliance and international cooperation as the foundations of Japanese diplomacy.  But legislation authorizing Japan’s naval refueling mission in the Indian Ocean became a political football in a divided legislature and expired on Nov. 1, forcing Fukuda to draft a new bill and extend the Diet session twice in an attempt to continue Japan’s support for the war on terror.  Fukuda noted the importance of the bill during a November summit with President Bush in Washington that also covered other issues including the Six-Party Talks and concerns in Japan about a perceived shift in the U.S. position on Japanese citizens abducted by North Korea.  Other developments such as a new agreement on host nation support for U.S. forces in Japan and a successful sea-based missile defense test demonstrated forward trajectory for alliance cooperation.  Yet the quarter ended with other issues unresolved, namely Japan’s suspension of Indian Ocean refueling operations and Pyongyang’s failure to come clean on its nuclear programs.

Deadlock in Japanese domestic politics

The issue at the heart of the domestic political debate last quarter was the fate of the Antiterrorism Special Measures Law (SML), first passed in 2001, which enabled Maritime Self-Defense Force (MSDF) vessels to participate in refueling operations in the Indian Ocean in support of Operation Enduring Freedom (OEF).  Fukuda’s ruling Liberal Democratic Party (LDP) tried to extend the law but the opposition led by Ozawa Ichiro, head of the Democratic Party of Japan (DPJ), took advantage of its majority in the Upper House to stall and essentially kill the bill.  The legislation expired Nov. 1 and the government was forced to order MSDF ships home.

On Nov. 13 the LDP passed new legislation, the Replenishment Support Special Measures Bill, in the Lower House that would narrow the MSDF mission somewhat by allowing refueling strictly for vessels involved in maritime patrols.  The LDP extended the Diet session until mid-January in an effort to pass the bill but the DPJ did not compromise, guaranteeing a dramatic showdown immediately after the New Year’s holiday.  Fukuda appears set to use the ruling coalition’s two thirds supermajority in the Lower House to override the DPJ’s opposition in the Upper House, but it will not be a cost-free move for him.  While public support for the deployment is higher than it was late last year, the use of the supermajority is not popular with the public.  Moreover, the entire Japanese political leadership became consumed with the SML this quarter, leaving very little bandwidth for legislative progress on other critical issues.

While Ozawa appeared determined to cause a legislative train wreck to bring down the LDP, the public (and his own party) were stunned to learn that he had secretly met with Fukuda on Oct. 30 to explore modalities for compromise on the legislative agenda.  The two met again on Nov. 2 and word leaked that the notion of a grand coalition of the LDP and DPJ was broached.  Ozawa discussed the idea with DPJ leaders but they summarily rejected it, prompting Ozawa to shock the nation by calling a press conference on Nov. 4 and announcing his intention to resign as DPJ leader.  He said he supported the coalition concept because the DPJ would struggle to win a majority in the next Lower House election and was too inexperienced to run the government on its own, a damaging statement from a politician who had spent most of the year repeating his party’s vow to dethrone the LDP.  He was convinced that his party had lost confidence in him by rejecting so vehemently a proposal he supported and therefore decided to quit.  The DPJ leadership scrambled to engineer a response and soon asked Ozawa to reconsider, which he did in another press conference on Nov 6.  This bizarre chain of events left the DPJ appearing weak but the political landscape remained unchanged.  Fukuda also faced other political difficulties that further complicated his efforts.

Two scandals Fukuda could do without

Fukuda had to weather two scandals that coincided with the SML debate.  The first surrounded an allegation made by a pacifist group that some fuel provided by MSDF vessels in 2003 was diverted for U.S. missions in Iraq, which would have constituted a violation of the SML. The U.S. categorically denied the allegation but it was revealed that Japan’s Defense Ministry misreported the amount of fuel provided during the period in question.  Further, the ministry acknowledged on Oct. 30 that on two occasions the MSDF engaged in fueling operations in the Persian Gulf but that the fuel was strictly for OEF missions.  Opponents of the SML legislation seized on this story to criticize Fukuda, who at that time served as chief Cabinet secretary under Koizumi.  The government appeared at the end of the quarter to have made it through this problem, but only after extracting mountains of documents from the U.S. Navy.

The second scandal involves former Vice Defense Minister Moriya Takemasa and allegations that he violated the Self-Defense Force (SDF) ethics code by accepting gifts from a defense contractor and giving preferential treatment to that same firm for no-bid contracts.  Reports surfaced in mid-October that Miyazaki Motonobu, a former executive director of Yamada Corp., had damaged the company’s finances through fraudulent accounting, prompting a probe into his relationships with bureaucrats and politicians including Moriya.  Prosecutors began a criminal investigation and Moriya was forced to testify before the Diet on Oct. 29 where he denied the allegations but acknowledged a friendship with Miyazaki.  The two were later arrested along with a counterpart of Miyazaki’s, creating a public relations dilemma for the Fukuda government precisely when the debate over SDF missions such as OEF was most intense.

Division on the abductee issue

Fukuda also faced a serious political challenge with respect to the nuclear negotiations with North Korea.  His predecessor, Shinzo Abe, rose to power because of a hard-line stance regarding the fate of Japanese citizens who had been abducted by North Korea in the 1970s and ‘80s.  While Fukuda is known to be more pro-engagement with respect to North Korea, he nevertheless could not ignore strong public opinion on the issue even in the wake of Abe’s resignation as prime minister.   Fukuda stuck with the condition that Pyongyang would have to be more forthright about the fate of the abductees before Tokyo could consider aid to the regime as part of any denuclearization agreement.  After it was reported that the U.S. and the DPRK reached an agreement Oct. 3 that Washington would lift the DPRK from the official U.S. State Sponsors of Terrorism List, the Japanese government and public cried foul.  The 2003 U.S. State Department report on terrorism had stated that this would only happen after “progress” was made with respect to Japanese abductees.  While “progress” was never officially defined by the U.S., it was quite clear that nothing was happening between Japan and the DPRK that could be considered forward movement.

The gravity of this issue became clear when Fox News reported on Oct. 24 that U.S. Ambassador to Japan Thomas Schieffer had sent President Bush a cable warning that the relationship with Japan could be seriously damaged if the U.S. removed North Korea from the state sponsors of terrorism list without action by the DPRK on the abductee issue.  A story in the Washington Post on Oct. 26 noted that Schieffer requested clarification of the president’s position on the abductees and expressed frustration at having been cut out of the six-party process.  The details of the cable were leaked a few weeks prior to a scheduled summit between Fukuda and Bush, ensuring the inclusion of the abductee issue in an already lengthy agenda.

Reassurance at the Bush-Fukuda summit

The two leaders met at the White House on Nov. 16 and engaged in a wide-ranging discussion covering Iraq, Afghanistan, Burma, Iran, realignment of U.S. forces in Japan, bilateral economic issues including beef, international trade negotiations, and climate change.  But the issue of greatest import to the bilateral relationship and the health of the alliance was the abductee issue.  To the great relief of the Japanese participants, Bush reiterated his support for the abductees publicly during a joint press conference, stating, “We will not forget the Japanese abductees, nor their families.” However, it was not clear how that statement would impact U.S. policy if North Korea made a complete and correct declaration of its nuclear programs.

A statement released after the meeting emphasized bilateral coordination in addressing energy security, clean development, and climate change through existing frameworks such the Asia-Pacific Partnership on Clean Development and Climate (APP) and the UN Framework Convention on Climate Change meetings, later held in December in Bali.  Fukuda also introduced an initiative to strengthen exchanges between the U.S. and Japan, citing the need to cement a foundation for the future of the relationship.  As part of that initiative, he held a roundtable in Washington with experts from CSIS, SAIS, Georgetown, AEI and other think tanks, universities, and civil society groups.

Alliance initiatives and missile defense on target

The summit agenda exemplified the global nature of the U.S.-Japan alliance, as did various developments in bilateral and multilateral cooperation this quarter.  For example, in mid-October Japan hosted Pacific Shield 07, a three-day maritime exercise under the rubric of the Proliferation Security Initiative (PSI) that included the U.S., Australia, Britain, France, New Zealand, and Singapore.  Japan and the U.S. also worked closely during the UN climate change talks in Bali to exclude specific benchmarks for emissions reductions from a new global framework for addressing climate change while encouraging developing countries such as China and India to play a more active role.  On the bilateral front, the two governments reached an agreement in December on a new three-year Special Measures Agreement regarding Japan’s contributions toward costs associated with stationing U.S. forces in Japan, or “host nation support.”  On Dec. 17, the U.S. Missile Defense Agency and Japan’s MSDF announced the successful completion of a joint Aegis Ballistic Missile Defense (BMD) intercept flight test near Hawaii, signaling continued progress on a strategic and budgetary priority for the alliance.  The U.S.-Japan Sub-Cabinet Economic Dialogue was held in December in Tokyo and yielded a potential breakthrough in efforts to further expand access to the Japanese beef market for U.S. exporters.  Pundits in both countries had been predicting disaster on a number of these initiatives – particularly with respect to the host nation support agreement, but these successes proved the pundits wrong and demonstrated that the two governments can make progress on key priorities despite political turmoil in Japan and the reality that the presidential campaign will take center stage in the U.S.

Looking Ahead

The opposition-led DPJ could not derail Fukuda’s policy agenda and force a general election.  Fukuda has survived even with the emergence of new scandals and continued policy paralysis in the Diet, though a showdown over the new SML could embolden the opposition and increase the likelihood of a call for a snap election.  That move may prove too risky for the DPJ given the fiasco that followed the discussions over a grand coalition, making a continuation of the status quo (i.e., a divided legislature and little enthusiasm for compromise) a likely prospect.

Japan’s extended absence from refueling operations in the Indian Ocean was an embarrassment, but if the SML passes in January, the ships could be back on station by February.  In the meantime, the Fukuda government will showcase Japan’s global leadership role in other areas as it prepares to host large summits such as the Tokyo International Conference on African Development (TICAD) in May 2008 and the G-8 Summit in July.  North Korea’s failure to meet a Dec. 31 deadline to provide a complete declaration of its nuclear programs will prolong the six-party negotiations and require close coordination among diplomats in Washington and Tokyo.  The two governments will persevere on key economic and defense issues during a new year that will begin with political distractions in both capitals.