Bad politics

Japanese voters have given a clear signal of what they think is wrong with the economy: bad politics. The reverses suffered by the ruling Liberal Democratic Party in Sunday's (July 12) elections to the Upper House are nothing less than a vote of no- confidence in a system that is palpably incapable of dealing with the malaise that has settled on the world's second largest economy.

The vote is a protest, and a warning, against the way Japan is being run. It is being administered as if the economic crisis were but a passing phase, an aberration which the institutionalized practices of post-War Japan would absorb, more or less as easily as they overcame previous challenges.

But this recession is different. It calls into question, not so much the ability of Japanese practices to prevail, but the right of several of them to exist at all. Among those practices is the traditionally close link between the financial and political systems. Japan's economy need structural reforms, not cosmetic tinkering, if the changes initiated by the promised bridge bank scheme and tax cuts are to be sustained.

-- The Straits Times, Singapore