The opposition, by contrast, is on the right track.
Concentrate first on job-creating reforms and government spending with multiplier effects so as to get back to growth. "You can't reform wildly," my DPJ source says. "It's a question of setting priorities that are consistent with the state of the economy."
Then the banks. Re-inspect them to assess just how much bad debt there is -- which nobody now knows, though the current figures run to 150 trillion yen (US$1.24 trillion). Inject funds where needed and let the institutions too weak to make it go under. In a growing economy, this is more feasible. But does this mean a "nationalization" process?
"It's an option to be consider-ed," the DPJ man says. So is a US-style Resolution Trust Corp, he tells me. It wasn't called nationalization when the RTC took on all those savings-and-loan problems back in the 1990s, selling them off when conditions were more favorable. Americans don't like the term, but it amounted to the same thing.
Koizumi's responses to these ideas have so far been two. He has publicly adopted many of the DPJ's policy proposals as his own -- though the Liberal Democrats routinely reject the DPJ's bills in the Diet. (So much for consistency.) At the same time, there is Koizumi's snow job on Japanese voters.
But while Koizumi's ratings continue to soar near the 90 percent mark, those of the LDP are just under 30 percent. (And so much for the solid substance beneath all the snow.) At this point, it is hard to say whether the DPJ is spurring Koizumi forward or whether Koizumi's weird appeal -- I simply don't get this, I confess -- has prompted the Democrats to shift into a higher gear, as some Tokyo observers suggest. Pre-Koizumi, it must be remembered, an opposition victory in July was a foregone conclusion. No longer, as party insiders admit privately.
You can call the DPJ's platform a third way, as some party people do. There's a touch of Thatcher in the attack on vested interests and a touch of Jospin's brand of French socialism in the welfare reforms.
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