New Scandal Hits Japan's Ruling Party

  • Share
  • Read Later
Yuriko Nakao / Reuters

Japan's ruling Democratic Party Secretary General Ichiro Ozawa is surrounded by reporters after attending the party's annual convention in Tokyo on Jan. 16, 2010

After masterminding the historic electoral victory of the Democratic Party of Japan (DPJ) last year, the party's co-founder and Secretary General, Ichiro Ozawa, has once again found himself in the national spotlight. But rather than basking in the glory of pulling off a successful election, Japan's so-called Shadow Shogun finds himself under investigation by the powerful Public Prosecutors Office on suspicion of wrongdoing in a controversial land purchase.

Just days into the spring Diet session, Ozawa, probably the DPJ's most powerful politician, casts a shadow not only over Diet deliberations but also the competency of Prime Minister Yukio Hatoyama's administration. While scandals come and go in Japan, some observers wonder if the young government that swept the Liberal Democratic Party (LDP) out of more than five decades of single-party rule is resilient enough to ride this storm, with the Upper House elections slated for July.

"Obviously, it's not good for the DPJ. They can't say that they're different from the old crooks," says Robert Dujarric, director of Temple University's Institute of Contemporary Japanese Studies. Business as usual is not what the public expects from an underdog party that just won the people's mandate on a platform of regime change. Dujarric, however, says that Ozawa is widely understood to be an "old-fashioned" politician. "If you want Mr. Clean, you're not going to date Ozawa," he says. "Everyone has their strengths and weaknesses. That's his weakness."

Ozawa has had many run-ins with the Prosecutors Office over the course of his career, as have many of Japan's political élite. Last May, then DPJ president Ozawa stepped down from that post following the arrest of his top aide, Takanori Okubo, who is now on trial for accounting irregularities and illegal donations from a large construction company that allegedly wanted to win contracts in areas where Ozawa has political influence. Ozawa bowed to cries for his resignation from within the party just months before August's Lower House elections. That move, however, did not satisfy the prosecutors, an influential group of Japanese officials with the power to investigate any criminal offense. Takao Toshikawa, editor of political newsletter Tokyo Insideline, says that Ozawa and his mentors have been fighting various battles with the office since the late 1970s. "At this moment, the Prosecutors Office and Ozawa are fighting the final war," says Toshikawa.

The office now wants to know to what extent Ozawa is mired in the tangled path of how a sum of 400 million yen ($4.4 million) came to be used to buy residential land in western Tokyo in October 2004 to build housing for Ozawa's aides. Rikuzankai, Ozawa's funds-management body, failed to properly report the sum and could be in violation of Japan's Political Fund Control Law for misreporting the funds, not logging the land purchase properly and concealing an illegal donation from the construction company. Ozawa has apologized to the Japanese people for any "misunderstanding" in misreporting the funds, saying there was no criminal intent. It is reported that Ozawa will submit to prosecutors' questioning this weekend and that he plans to tell them he had personally given at least 600 million yen ($6.6 million) to finance the purchase in question. So far, prosecutors have arrested three aides linked to Ozawa, including Okubo. Another is Tomohiro Ishikawa, a former secretary to Ozawa who is now a Diet member representing Hokkaido's 11th District.

Some observers, including Ozawa himself, suggest that the Public Prosecutors Office could be flexing its muscle in a partisan show of force, as the office has long been controlled by the LDP. But that doesn't diminish the fact that similar investigations have occurred in the past. Says Dujarric: "Prosecutors, from time to time, like to indict someone powerful. It was done in the era of LDP, and now Ozawa is getting a visit." Toshikawa says it's possible that a special investigation team will search Ozawa's home in early February. And depending on what they find, he says, it might lead to Ozawa's arrest.

However it unfolds, the imbroglio doesn't bode well for the DPJ — or for Hatoyama. Still building public confidence in his fifth month in office, Hatoyama is in the throes of trying to pass the second supplementary budget for the current year by the end of January, and the 2010 budget by the end of March. "[Ozawa's] situation highlights Hatoyama's judgment," says Dujarric. "A lot of criticism has said that he's too indecisive. At first he supported Ozawa and then vaguely backtracked. That doesn't make Hatoyama look good."

After initially seeming to come out in public support of Ozawa earlier this month, Hatoyama has since taken more of a wait-and-see stance. It's not helping his falling approval ratings, which, at 41.5%, are now lower than his disapproval rate of 44.1%, according to a recent Kyodo News poll. Last month, news broke that contributions from Hatoyama's mother were recorded as political funds coming from other donors — some of whom were dead. Hatoyama has promised to pay hundreds of millions of yen in tax on that sum, but the damage control has been slow. Still, according to a recent survey in the Yomiuri Shimbun newspaper, the DPJ's approval rating is still 23 points higher than that of the LDP. But cries for Ozawa's resignation grow louder as each day moves the ruling party closer to July's election.

In the meantime, Toshikawa says the situation between Ozawa and Hatoyama is delicate. He says, "Hatoyama isn't enjoying Ozawa's frequent interference" on issues from the budget to what to do about the Futenma base relocation. But, he adds, Hatoyama needs Ozawa's support and that of the DPJ to pass the 2010 budget, which will require patience through the end of March.

Addressing the DPJ's annual party convention last week, Ozawa said, "During the 40 years of my political career ... I have carried out my endeavors with only one aim in mind, that is to see parliamentary democracy, a true democracy in which changes of government are possible, established in Japan." The result of his questioning this weekend will likely fall somewhere between taking the entire DPJ ship with him and his ability to stage a great recovery.