USC-UCLA
Joint East Asian Studies Center
See a chart showing Upper House party breakdown before and after the voting. (This is part of the Joint Center's statistics index.)
Asahi Evening News report
Asahi Shimbun analysis
Christian Science Monitor report on angry voters
Japan Times report on business leaders'
attitudes
Japan Times editorial on the election results
PM Hashimoto's June 18, 1998 statement at the end of parliament
Other useful sites:
Clicking on the links below will take you away from this page.
These links take you to the English language websites of these parties.
Of course, once there you can move to the parties' Japanese language sites.
Liberal
Democratic Party, led into the elections by Prime Minister HASHIMOTO
Ryutaro.
Democratic Party
of Japan
Social
Democratic Party
Japanese Communist
Party
Komei (established in 1994 to
continue the effort of Komeito, the Clean Government Party)
Liberal League
(no seats in the Upper House)
Sakigake
(New Party)
New Socialist
Party (no seats in the Upper House)
These parties have only Japanese language websites.
Japanese Well-being Party
Liberal Party
Youth Freedom Party
(Seinen Jiyu Party, no seats in the Upper House)
The Upper House website (both English and Japanese language resources)
Voters lambaste economic policy
By KISHIKO HISADA
Asahi Evening News
July 13, 1998, Visit
the Asahi Shimbun website.
Prime Minister Ryutaro Hashimoto was to announce his resignation today following the LDP's crushing defeat in Sunday's Upper House election.
The outcome, which is being viewed as a rejection by voters of the Hashimoto's economic policies, was also seen as a victory for Minshuto (Democratic Party of Japan) headed by Naoto Kan and the Japanese Communist Party (which campaigned on the strength of more moderate policies than it has had in the past).
"The results are my own responsibility," Hashimoto told a press conference after the vote, suggesting he would step down. "My decision is in my heart as a politician."
Hashimoto was expected to meet with LDP senior executives at 12:30 p.m. before announcing his intention to resign at a press conference at 2 p.m.
Observers said senior LDP executives have already started to discuss possible successors to Hashimoto. But they said it could be some time before a successor is decided.
Hashimoto's resignation is expected to have a dramatic effect on the nation's foreign policy schedule. For instance, an official visit to France and the United States set for this month will likely be canceled. Moreover, peace treaty negotiations with Russia are also expected to lose momentum, and may face a review, since they have so far depended heavily on the personal relations of Hashimoto and Russian President Boris Yeltsin.
The new uncertainty concerning Japan's leadership and its government is also expected to have a large adverse effect on the global economy.
The Hashimoto administration's measures to clean up mounting bad banking loans had become the center of market attention overseas. Whether these measures are smoothly implemented or whether they succeed are expected to influence the global economy and Japan's credibility in the international market. The fate of these measures are in question now that the nation's political foundations have changed.
Observers say the market's reaction to the election will be closely watched by investors.
The LDP gained only 44 seats in Sunday's poll, 17 fewer than the 61 it had up for grabs. The result was a far cry from the 69 seats the party needed to secure a majority in the chamber.
The LDP was most badly beaten in major cities where large numbers of unaffiliated voters cast what many observers are calling protest ballots. The party won no seats in eight of the multiple-seat constituencies, including those in Tokyo, Osaka, Aichi, Kanagawa, Saitama, Kyoto and other prefectures. Of 24 single-seat constituencies where the party fielded candidates, the LDP lost in seven. In the proportional representation vote, Liberal Democrats won just 14 seats--its lowest proportional representation showing on record.
For its part, Minshuto won 15 seats in the prefectural constituencies, virtually doubling eight it had. Overall, the largest opposition party garnered 27 seats, nine seats more than 18 it had before the election. Minshuto won both seats up for grabs in Gifu prefectures, monopolizing the vote in that electoral district with help from an independent affiliated with the party.
The JCP more than doubled the number of its seats in the Upper House, winning 15 in Sunday's vote. Going into the election, the party had six.
Komei failed to expand its power. And the Social Democratic Party--formerly a junior partner of coalition government--lost more than half the seats it had.
Voter turnout was 58.84 percent and higher than the previous upper chamber election in every constituency, especially in major cities like Tokyo and Osaka. In Osaka, for instance, 21 percent more voters cast ballots than in the last Upper House vote.
Observers said among the reasons for the high voter turnout were eased regulations concerning absentee votes and an extension of voting hours. But, they said, the rule changes do not account for all of the increase.
Ikuo Kabashima, a professor of political science at Tokyo University, said voters also shared the feeling that they had to make their views about Hashimoto's government known if they wanted democracy to work.
"Mounting discontent made voters choose non-LDP candidates," Kabashima said. "This is very similar to the tendency seen in the 1989 Upper House election" when the LDP suffered a severe loss because of votes protesting the introduction of the consumption tax and a series of bribery scandals that forced the resignation of then-Prime Minister Sosuke Uno. In that election, 65 percent of voters turned out.
Kabashima said this time voters were casting ballots protesting the government's ineffective economic measures and Hashimoto's slow response in dealing with the economy's troubles.
In particular, Kabashima said, Hashimoto's indecision concerning a permanent tax cut during the final phase of campaign contributed to voter cynicism and made them distrustful of the LDP.
Earlier in the campaign, there was a strong mood of indifference among voters. However, that changed dramatically during the final stages and people felt an urgent need to reflect their opinions at the ballot box.
"This result may trigger a dynamic change in the framework of political parties," Kabashima said. "Voters are expecting opposition parties to take positive action."
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LDP driven out of traditional strongholds
ANALYSIS
Asahi Shimbun
July 13, 1998, Visit the Asahi Shimbun website.
The Liberal Democratic Party's defeat was evident as they suffered crushing defeats in three and four-seat districts, partial defeat in two-seat districts and more disappointment in the single-seat districts.
MULTIPLE-SEAT DISTRICTS
In the 18 two-seat constituencies, the LDP fielded two candidates in eight constituencies, aiming to monopolize those electoral districts. They succeeded in sweeping only two districts--Gunma and Kagoshima Prefectures. The other six districts gave one seat each to either Minshuto (the Democratic Party of Japan) or independents.
In the remaining 10 two-seat districts, the LDP limited its fielded candidates to one each in order to avoid LDP votes being divided among candidates in the same district. They still lost in three districts.
In the three-seat districts, the LDP was completely defeated in Saitama, Aichi, and Kanagawa, with two candidates in each of the three districts going down. Osaka was also left LDP-free after an incumbent's defeat.
Tokyo, a four-seat district, also became an LDP-free zone with the defeat of two LDP candidates.
As a result, the LDP was defeated in all five of the three or four-seat districts.
Three years ago in the previous Upper House elections, the LDP fared well by fielding only one candidate in each district. A total of 19 LDP candidates won and three lost. This year, the party increased the number of fielded candidates to 35, but scored only 15 wins compared to 20 losses.
Minshuto, on the other hand, celebrated a great victory. They won 15 seats and lost two in multiple-seat districts.
In three multiple-seat districts--Kanagawa, Aichi and Okayama--two Minshuto candidates ran. Both candidates won in Kanagawa and Aichi.
In previous elections, two-seat districts were usually shared by LDP and Social Democratic Party candidates.
In this year's election however, the SDP had only one victory in multiple-seat districts--Niigata--and lost all remaining six districts they competed in.
Komei limited its candidates to incumbents in two multiple-seat districts and won in both, Tokyo and Osaka.
The Japan Communist Party increased its number of seats dramatically, winning in Kyoto, Hyogo, Saitama, Osaka, Kanagawa, Aichi and Tokyo.
SINGLE-SEAT DISTRICTS
The LDP fielded a candidate in all but one of the 24 single-seat districts, but lost in seven districts, despite being traditionally strong in single-seat districts.
In 1995, the LDP limited its candidates in single-seat districts to 15, and won in 12.
Minshuto lost in all of the six single-seat constituencies it ran in, as well as the SDP which lost all eight it ran for.
JCP candidates ran in 22 single-seat districts. They competed with the LDP in nine districts, but were defeated.
The Liberal Party beat an LDP candidate in Wakayama, but lost in all other single-seat districts.
Shinshakaito, the New Social Party, fielded 12 candidates in single-seat districts but none of them won.
EACH DISTRICT
In Miyagi, The LDP fielded two candidates in the two-seat district. One candidate was elected, but Kaname Endo, 82, failed to win his fifth term. LDP members had speculated that Endo would soon retire, but if he had won, they were willing to put him forward as Speaker of the Upper House.
But despite being well known and having a solid foundation of support, Endo's advanced age worked against him and helped bring about his defeat.
In both Okinawa and Aomori, LDP candidates lost, in an election seen as a preview of the hotly-contested governor's races to be held in November in Okinawa and February in Aomori.
In Okinawa, Soko Shimabukuro, who was backed by anti-LDP governor Masahide Ota, beat the LDP candidate by demanding the unconditional return of a U.S. military base and stressing the importance of stimulating the Okinawa economy.
In Gifu, the LDP aimed for two seats but lost both, allowing Gifu to became the only district in which the Minshuto swept a multiple seat district.
In Osaka, the city of merchants, the LDP's failed attempts to stimulate the economy spelled defeat for the party's only candidate, Kazutaka Tsuboi.
In Tokushima, the LDP was defeated by independent Kiseko Takahashi, the daughter of former Prime Minister Takeo Miki.
Takahashi won LDP votes because of her connection to Miki, who was an LDP member.
She also gained the support of unaffiliated voters by holding women's rallies and going around to morning markets to talk directly with residents.
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'Don't let election stall reforms'; Business leaders urge politicians to back LDP measures
By SAYURI DAIMON
Japan Times, Staff writer
July 13, 1998. Visit
the Japan Times website.
The election outcome is a clear indication of Japanese voters' desire to change Japanese politics and economy, Japanese business leaders said Sunday.
But at the same time, they also stressed that the government must not fail to immediately implement economic measures to shore up the Japanese economy regardless of the election results.
Commenting on the relatively high voter turnout, Jiro Ushio, chairman of the Japan Association of Corporate Executives (Keizai Doyukai), said, "There is still hope in Japanese democracy."
"Many people who usually do not support a particular political party went to vote, and it should be noted that those people voted against the Liberal Democratic Party," Ushio said.
Yotaro Kobayashi, chairman of Fuji Xerox Co., said the election results indicate that Japan faces serious financial instability, and a feeling of uncertainty is spreading among Japanese citizens.
"The Japanese economy has come to a point where many Japanese voters strongly desire for a change in politics," Kobayashi said. "It means that people are not satisfied with the answer that the government has hammered out."
However, Takashi Imai, chairman of the Japan Federation of Economic Organizations (Keidanren), stressed the LDP's defeat in the Upper House election does not mean there will be a power shift in the government, and he urged the LDP to steadily implement financial stabilization measures proposed during the previous Diet session.
Fuji Bank Chairman Tooru Hashimoto also said the financial stabilization measures are indispensable.
Despite the LDP's defeat, politicians should cooperate in clearing the necessary bills during the next Diet session since opposition parties are also aware of the importance of stabilizing the nation's financial system, he said.
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Copyright Japan Times, 1998.
The voters' stunning rebuke
Japan Times editorial
July 14, 1998. Visit the Japan Times website.
Sunday's election results have injected greater uncertainty into Japan's political future, but at the same time the outcome has raised hopes for the realization of greater justice and fairness in the nation's parliamentary democracy. What is crucial is whether or not the politicians can learn the correct lessons from the voters' verdict, which was particularly harsh on the ruling Liberal Democratic Party and its two former governing allies, the Social Democratic Party and Shinto (New Party) Sakigake.
The LDP, the party led by Prime Minister Ryutaro Hashimoto, suffered a stunning defeat. It was able to retain only 44 of the 61 seats the party was defending in the election for half of the 252-seat House of Councilors (Upper House). Even combined with its 58 uncontested seats, the party's total strength in the second chamber now falls further short of a majority.
What this means is that, even if the party remains in power, it will find it impossible to get any controversial bill (except for the budget) through the Diet, even though it is still the majority force in the all-important House of Representatives (Lower House). The LDP, therefore, must once again seek a governing ally or allies if it wants to assure itself of the ability to steer the nation effectively.
Success in that attempt will depend largely on what message the other parties take from Sunday's polls. The voters' rejection of the SDP and Sakigake for their roles in the Hashimoto administration must have stung them to the quick. Another attempt to play a similar role will certainly ruin these minor parties. Indeed, the election results are likely to throw the nation's politics into greater confusion than ever.
The Liberal Party, an opposition group of breakaway former Liberal Democrats, with 12 seats in the Upper House, appears to be flirting with the possibility of joining hands with the LDP. But the impact of the voters' rejection of the Hashimoto administration will likely render even this conservative party unsure whether such an action would doom or boost its political fortunes.
It seems out of the question that major opposition parties, the Democratic Party of Japan and the Japan Communist Party, will form a working coalition with the LDP. The DPJ, headed by Mr. Naoto Kan, won a major victory, increasing its Upper House seats to 47 from a pre-election 38. The JCP also gained nine seats for a total of 23, which compares with the 22 held by Komei, the fourth-largest group in the Upper House.
Evidently, these opposition groups rode mainly on the strength of public rejection of the Hashimoto administration's poor economic management. Making its debut with a heavy but attractive basketful of reform proposals, the Hashimoto government initially appeared to have set itself on the path toward reform of the nation's administrative and financial systems. But those reforms are already ending up as cosmetic changes lacking their intended substance. The example that typifies this is the failure to slim down the central government.
At the same time, the Hashimoto government has tried only belatedly to deal with the worsening economic situation and has resorted to unprincipled pump-priming measures centering on public works projects, a gambit that not only contradicts its fiscal reform policy but also has helped the notorious pork-barrel-oriented "tribes" to revive within the LDP.
Thus, we can safely say that the LDP is not yet essentially different from the pre-1993 LDP in terms of either thinking or political management. This encourages us to raise the question: Is it only Mr. Hashimoto and his Cabinet that should suffer the voters' stunning rebuke? It should be noted in this connection that many voters rejected the LDP as well as the Hashimoto administration. What is the real message to be drawn from the fact that, according to an exit survey, some 20 percent to 25 percent of the voters who had supported the LDP in the past cast their ballots this time for other parties?
Mr. Hashimoto's decision to quit has already touched off a commotion over the selection of the next leader within the LDP. But that leader should be selected, at the very least, on the basis of political aptitude and quality of leadership -- not on a rotation among intraparty factions.
There will be no respite allowed for the next Cabinet, which will have to tackle immediately the urgent issue of recession by making effective use of the measures adopted by the Hashimoto adm
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Copyright, the Japan Times, 1998
Japanese Voters Roar
Angry and engaged, they reject the premier's party and
its economic revival plan.
Cameron W. Barr
Staff writer of The Christian Science Monitor
July 13, 1998. Visit the Christian
Science Monitor website.
TOKYO
If you or your mutual fund manager were waiting for a quick revival of Japan's economy, your wait just got longer.
In a stunning repudiation of the way Prime Minister Ryutaro Hashimoto has managed this country's troubled economy, Japanese voters yesterday strongly backed untested opposition parties in elections for the upper house of parliament.
It seemed all but certain last night that Mr. Hashimoto would have to resign, although his Liberal Democratic Party (LDP) will be able to choose the next prime minister since it has a majority in the more powerful lower house.
If Hashimoto is surprised at how the voters have turned against him and his party, he is not alone. Until yesterday, the public seemed remarkably undisturbed by Japan's crumbling economy, which has excited so much concern abroad. Suddenly, they seem angry and engaged.
Though the LDP remains in power, it will now have to wrestle with a more intimidating opposition, in particular a political maverick and former Cabinet member named Naoto Kan."The voters have given us a chance," said Mr. Kan, the leader of the newly formed Democratic Party, which was yesterday's most notable victor. The voters chose representatives to occupy half of the 252 seats in the upper house. According to media projections available early today, the LDP will take no more than 50 seats, down from the 61 seats it contested. The party had hoped to win 69, which would have given it a majority in the house.
Hashimoto's failure to achieve the break-even point was said to be reason enough for the party to find a new leader. Appearing under the klieg lights as the votes were counted yesterday, the prime minister seemed shaken, apologetic, and a little sweaty. "It's my responsibility," he said wanly, using the code language that indicates a resignation is in the offing.
Even so, the LDP has more or less run the country for all but 10 months of the past 43 years and remains a formidable force. It's also worth noting that Japan's voters have used upper house elections to register protests, and then turned around to favor the stability and familiarity of the LDP in balloting for the lower house, the more influential body and the one that elects the prime minister.
In the long run, Sunday's voting may impel Japan's leaders to take more radical steps to clean up this country's bad-loan-burdened financial system and bring the economy out of recession. In the meantime, however, political turmoil and economic inaction are the most likely prospects.
For one thing, the LDP will likely have to select a new leader and then elect him prime minister in the lower house. The choice of the party's elders could be Seiroku Kajiyama, an LDP veteran who has lately been writing lengthy magazine articles critical of Hashimoto's leadership, or Foreign Minister Keizo Obuchi, a bland politician who is next in line for the top job, according to some party watchers.
The most unexpected aspect of yesterday's voting - and the factor that probably brought down Hashimoto - was the high turnout rate. According to media estimates, nearly 58 percent of Japan's voters came to the polls, compared with 44.5 percent in the last such elections three years ago.
Behind the upward surge was the country's vast bloc of independent voters, always the most unpredictable part of the local political calculus. A third of them voted for the Democratic Party (DPJ) and a fifth cast their votes for the stalwarts of Japanese opposition politics, the Japan Communist Party (JCP). The Communists are not considered serious contenders for power. Yesterday, independent voters, in a part of the balloting where one chooses a party and not a candidate, offered their strongest support to the Democrats, followed by the JCP. The LDP came in third.
Almost everyone seems to think the stagnant economy, which is causing
record unemployment and high bankruptcy rates, drew the voters to the polls.
But some observers are skeptical about the voters'
message. "The wind didn't blow for the DPJ or the JCP," says Takashi
Mikuriya, a political historian at Tokyo Metropolitan University. "It simply
blew against the LDP."
"Even though people raised a 'red card' against the LDP's economic policy," the professor adds, referring to the way soccer officials eject players, "there is no other alternative. That's the reality Japan is facing."
Kan "is probably the biggest winner," says Isamu Ueda, a member of the lower house. The DPJ may end up with 27 seats, up from 18, and now becomes the central force in opposition politics. The party is also the opposition leader in the lower house.
Unlike many of Japan's opposition figures, who are LDP defectors, Kan is an independent politician who came into politics as a citizen activist. Two years ago he impressed many Japanese when he served as health and welfare minister in a coalition cabinet.
He exposed ministry policies linked to the deaths of hundreds of Japanese who used tainted blood products in the 1980s, and his forthright apologies have brought him an enduring popularity.
But Yasunori Sone, a politics professor at Tokyo's Keio University and a longtime associate of Kan's, says the market reaction to the elections is unpredictable.
Investors could conclude that Japan's voters, having found the LDP incapable of resolving bad loans and other economic problems, are now demanding tougher reforms, he says.
"The market could react quite positively to that, but on the other hand the LDP still has power," he adds. "It will have to work with the opposition and that could mean a delay" in addressing reform. The upper house can delay legislation for 60 days.
As in other Asian countries over the past year, Japanese leaders have discovered that they are responsible not just to their voters but to the thumbs-up, thumbs-down verdicts of investors around the globe. And the Asian financial crisis, which a delay in Japan's recovery could make even worse, has demonstrated that the global economy also requires a kind of global political accountability.
"This time you had foreigners asking questions," Professor Sone explains. "The No. 1 question was: Hashimoto has made many mistakes, yet he remains in power. Why? And ... the economic situation is so serious, but voters never get angry. Why?"
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Copyright, the Christian Science Monitor.
TRANSCRIPT OF PRESS CONFERENCE BY PRIME MINISTER
RYUTARO HASHIMOTO AT THE CLOSING OF THE 142ND
SESSION OF THE DIET
18 June 1998
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website.
(OPENING STATEMENT)
Today the 142nd session of the Diet came to a close. In my opening statement, I would like to refer to the tasks ahead by reflecting on the accomplishments of this session.
Firstly, intense deliberations were held in both Houses on the FY1997
supplementary budget, the FY1998 annual and supplementary budgets, as well
as the many bills and treaties proposed by the Government. As a result,
all four budgets including the (FY1998) provisional budget, were approved,
97 bills were passed and 18 treaties were approved. I would like to take
this occasion to express my sincere gratitude to all of the members of
both Houses and to all the others who made this possible. Concerning the
bills which are important but were not passed during this Diet session,
such as the bill on information disclosure, the bill related to the Guidelines
for Japan-U.S. Defense Cooperation and the bill on the settlement of the
debts owed by the former Japanese National Railways, I would like to reiterate
my request for their passage at the earliest possible occasion in the future.
I also hope for the early passage of the political reform bills and the
national civil servants ethics bill and
other legislation submitted by Diet members.
Each of the budgets approved during this session of the Diet contains elements which are absolutely necessary for the Japanese economy. In particular, the FY1998 supplementary budget which was approved yesterday includes social infrastructure development amounting to 7.7 trillion yen and special tax reduction. These are strong measures to achieve the expansion of domestic demand necessary for the recovery of our economy. Another major feature of the supplementary budget is the clear priority boldly placed on projects that are truly necessary for both current and future generations, such as: (a) measures to counter dioxins and environmental hormones, concerns close to the lives of the Japanese people; (b) welfare, medical care and education, in response to the decreasing birthrate and aging population; and (c) investment in telecommunications networks and science and technology.
I would say that at present there is an excessive loss of self-confidence in Japan. We face a very severe situation marked by a weakening yen, sluggish stock prices and a rising unemployment rate. However, it is also true that Japan has many irreplaceable strengths: one of the highest education standards in the world, an extremely diligent work ethic, outstanding capacity for technological development and great capital resources. I believe the prompt and steady implementation of the annual and supplementary budgets, combined with the implementation of measures to resolve the issue of non-performing loans which I will address later, will enable Japan to tap its potential strengths fully and restore vigorous economic growth pulled by the people and private enterprises.
In response to the sudden economic changes both in Japan and abroad since last autumn, including the financial and economic crises in Asia and the collapse of major financial institutions in Japan, I have thoroughly considered what is necessary for this country and decided to take firm measures for a strong Japanese economy and Asian economy. In order to rebuild and revitalize Japan's economy, which is in a serious condition, I intend to make my utmost efforts to stabilize the financial system by resolving the issue of non-performing loans to achieve economic growth led by domestic demand, to open markets and to promote deregulation. With these in mind, I talked to President Clinton on the phone yesterday. We agreed that it was good to be able to cooperate in exchange markets to support a stable yen.
In the future, I intend to take every possible measure to bolster the strength of the Japanese economy while carefully monitoring the economic situation at hand.
On this very occasion last year, I stated that the regular Diet session which had just concluded was the point of departure for the Six Reforms. If I can express myself in the same way today, I would say that the wheels of each reform turned steadily during this past Diet session.
On administrative reform, for example, the establishment of the Basic Law on Central Government Reform marks a major advance. This law sets up a new basic framework for ministries and agencies. Now, aiming at a transition to the new structure in January 2001, the Central Government Reform Promotion Headquarters to be established on 23 June will play a central role not only in realizing the basic concept of administrative reform, which calls for a shift from government to private sector and from central government to local governments, but also in advancing a new streamlined administrative structure.
Of course, these changes will be promoted on the basis of the previously announced Three-year Deregulation Promotion Plan and the previously drafted Decentralization Promotion Plan, as well as any opinion which may be put forward by the Decentralization Promotion Committee in the future.
In doing so, I intend to show strong leadership and to fully utilize the third-party advisory council which I supervise directly to ensure that there will be no allegation that such activities were initiated by the bureaucracy.
Regarding fiscal structural reform, as I have said repeatedly, the need for it in the long run has not changed. We must not forget the opinions of the younger generation which want us to rebuild the fiscal structure. At the same time, to take the necessary measures for economic recovery - the first and foremost challenge facing us - we have made the necessary revisions to the Fiscal Structural Reform Law during this session of the Diet while maintaining the basic framework of the Act. I firmly believe that this decision will gain the support of the Japanese people, as a response to the very difficult task of writing an appropriate prescription to cope with issues over both the short-term and the medium- to long-term.
In response to issues involving the financial system, we established both legal and budgetary measures to stabilize this system at the start of the Diet session, while approving the Financial System Reform Bill for the development of markets and systems which are both easily accessible and trustworthy. I believe these measures will help to restore the vitality of the financial systems which form the arteries of our economy and will bring about a recovery in the Japanese economy.
As for other efforts related to the so-called Six Major Reforms, significant progress was made in a variety of areas: for example, on economic reform, the abolishment of the Large-scale Retail Stores Law and its replacement by a new legal framework, revision of the Rationalization in Energy Use Law, and the enactment of the University Technology Transfer Promotion Law.
Important bills were passed in other areas of reform as well. On the reform of the social security system, the National Health Insurance Law, which incorporates a review of the medical insurance system, was amended. With regard to educational reform, the School Education Law was revised, introducing a system integrating junior and senior high schools and promoting diversification and flexibility in the school education system.
Based on this progress, we will continue to make active efforts toward reform and ask the Japanese people for their continued understanding and support.
As I have just said, steady forward progress is being made on each of the Six Major Reforms which I have promised. I believe the Japanese people will come to understand my political position and philosophy of implementing one-by-one everything that I have promised.
Now I would like to address several future tasks.
Firstly, we must take sweeping measures toward resolving the issue of non-performing loans held by our financial institutions, which is a major hindrance to economic recovery. Economic recovery and the settlement of non-performing loans are, in a sense, two wheels on the same axle. As I have just said, we are making every effort to achieve economic recovery. Now we are trying to establish an environment which will facilitate the settlement of bad loans. By establishing systems and structures to settle the relation between claims and liabilities related to bad loans secured by real estate as well as to promote the sale or securitization of such collateral real estate and non-performing loans, we can promote the liquidation of real estate and bonds.
I have already initiated concrete study of this issue on which the Cabinet is taking the lead. I will maintain cooperation with the political parties, even during the period of the upcoming election of the House of Councillors, and based on the results of our further discussions, will submit to the next session of the Diet the bills needed for the creation of the necessary legal framework.
Of course, in addition to these measures, it is also important to enforce greater market discipline in the management of these financial institutions through such means as further disclosure of information by financial institutions. Needless to say, we must ask these institutions to be strictly accountable in their management.
There is also a need to conduct a more thorough review of our tax system. Corporate taxes, both national and local, must be reduced to international levels at the earliest possible time within the next three years, namely without waiting for three years. As for income taxes, we must create a system that is both fair and highly transparent, and which will stimulate the Japanese people's motivation. I would like to promote in-depth discussion toward a radical review of both systems.
Economic recovery is our first and foremost task and to ensure that we are firmly on the way to such a recovery, we will make our utmost efforts to translate the policies above into action.
Today, I would like to take this opportunity to point out one additional issue. That is the issue of our decreasing birthrate. Needless to say, a government should not intervene in private matters such as marriage and childbirth. At the same time, Japan's birthrate is decreasing with a rapidity which is unprecedented and unparalleled anywhere in the world. If this trend continues, it is true that the population structure of Japan will change dramatically and exert a serious impact on our future socioeconomic situation. I proposed the Six Reforms aware of the need to face the realities of not only our aging population but also our decreasing birthrate.
Considering this situation, today I think it is extremely important for Japan to eliminate the various social and economic factors that interfere with childbirth and child rearing, and to build homes, communities and workplaces where both old and young, men and women can build homes, communities and workplaces with which they can be happy. On this point, I hope the Japanese people begin to engage in truly active debate. I also want the government to be aware of the situation I have just described and to think sincerely about what it can do and what it should accomplish.
Now let me turn your attention to the international community. Last month India conducted nuclear tests, followed by Pakistan. This is truly deplorable, since these acts go against the efforts of the international community towards a world free of nuclear weapons. Japan took resolute measures against both India and Pakistan mainly in the areas of economic cooperation, and took initiative to discuss this issue at the Birmingham G8 Summit, the United Nations Security Council, G8 Foreign Ministers meeting and at other fora. Just the other day, Japan also announced the establishment of the Conference on Urgent Action for Nuclear Non-Proliferation and Disarmament. Within the next year, Japan will host several meetings of this forum in order to formulate proposals to the world on the maintenance and strengthening of the non-proliferation regime, the promotion of nuclear disarmament and on efforts toward the elimination of nuclear weapons. I hope this forum will produce good proposals for that purpose.
I would like to make further efforts toward nuclear disarmament and the abolishment of nuclear weapons. I feel strongly that this is a duty incumbent on Japan as the only nation to have experienced the devastation of a nuclear bombing.
I have been invited by Presidents Clinton and Chirac, and will visit them to hold a Japan-US Summit and a Japan-France Summit in July. I also plan to visit Russia this autumn. Visits by Presidents Jiang Zemin (of the People's Republic of China) and Kim Dae Jung (of the Republic of Korea) are also scheduled. During these talks, I would like to clearly explain Japan's position and discuss what should be accomplished through mutual cooperation based on the relations of trust I have cultivated with these leaders. At the same time, I would like to make every effort to build world peace and prosperity in the 21st century.
At the closing of this Diet session I have offered my frank impressions and shared some of my thoughts on future policy, although not all of these thoughts have taken concrete shape yet. Still I intend to bear in mind the various issues I have described, and vigorously make my utmost efforts by concentrating the knowledge and wisdom of the Japanese people. One by one, I hope to eliminate the concerns of the Japanese people.
I look to the good judgment of the Japanese people in the forthcoming House of Councillors election. I will be campaigning throughout the nation and will share my beliefs and thoughts with you, and ask for your kind attention. I also hope you will take a hard look at the long future that awaits Japan and share with me your own views on what should be done.
I sincerely look forward to meeting you. I would once again like to take the opportunity to thank the various parties, the Diet members of the various factions, and the people of Japan for their understanding and cooperation during this session.
Thank you for your attention.
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This page, like others in the "Asia via the Web" series was compiled
by Clayton Dube. Send him comments and suggestions at cdube@isop.ucla.edu.