A Japanese reformer emerges – far from Tokyo

It appears that meaningful political and economic reform in Japan is beginning at the grass roots rather than in Tokyo.

Yasuo Tanaka's reelection as governor of Nagano Sept. 1 conveys a message from grass-roots voters that is not entirely welcome to Prime Minister Junichiro Koizumi, to his Liberal Democratic Party (LDP) or to the main opposition party – the Democrats.

As a slogan, reform is embraced by all three. But none has delivered the goods, except Governor Tanaka, an independent. He made a specific promise to halt construction of two dams, on environmental grounds, even though work had already started. Almost all the mayors in Nagano prefecture opposed this stand, as did members of the Nagano legislature, who largely represent the local establishment. In June the legislature passed a vote of no-confidence in the governor, precipitating the election.

Landlocked, mountainous Nagano, which is about the size of Connecticut, is the Switzerland of Japan. Even its industry resembles that of Switzerland; it is the center of Japan's watch and precision industry, including brands like Seiko and Epson.

But Nagano is also typical of the incestuous ties between local governments and the construction industry. Towns, villages, and the prefecture itself need subsidies from the central government, since they have limited tax powers. Local governments rely on a network of legislators and government officials to get their subsidies. At election time, construction workers are often the foot soldiers who get out the vote on behalf of local and national legislators. In every prefecture, including Nagano, public works are a prime source of subsidies. When times are bad, as they have been for the past decade, public works are the most reliable way to funnel central government money to the prefectures.

Mr. Koizumi has spoken out for reforming budget procedures even if it causes pain to ordinary citizens. Wasteful public works, including roads, bridges, tunnels, and dams, are ripe for cancellation and retrenchment. But for all his rhetoric during the Nagano campaign, Koizumi conspicuously failed to take a position, calling it a local affair.

Opposition leaders like former Prime Minister Tsutomu Hata, who is from Nagano and who attacked Koizumi for waffling on reform, were also silent on the dam issue, because in national elections they rely on town and village notables to bring out the vote. Only the Communist Party took an unequivocal stand supporting Tanaka. Not only the Democrats (Mr. Hata's party) but the Socialists were split on the issue.

The embarrassed silence of these parties shows the difficulty of advocating reform, when it comes down to rice-bowl issues like public-works budgets for towns and villages and alternative employment for workers. The case for continuing the dams was put on a boost-Nagano basis by LDP legislator Kenji Kosaka, who was quoted by the Asahi Shimbun newspaper as telling an election rally, "If we return the subsidy we have received [from the national treasury] to build the dams, that money will just be spent by a governor of some other prefecture. After having gone to all that trouble to get the money in competition with other prefectures!"

It sounds like a refrain from a US state. But the voters of Nagano overwhelmingly rejected that argument, giving 822,897 votes to Tanaka, compared with 406,559 votes to his nearest competitor.

Thus, for the first time in Japan's history, an ongoing dam construction project will be halted midstream.

On Sept. 2, Asahi Shimbun gave figures for one of the two dams in question – the Asakawa Dam in the outskirts of Nagano City, capital of Nagano Prefecture. The total sum budgeted was 40 billion yen – about $350 million. Half of this has already been spent, and about two-thirds of the remainder will be canceled. Angry construction firms say they will sue for breach of contract.

If Japan is to enact serious economic reform, many more cancellations will be needed. Tanaka, a flamboyant figure, has bitten the bullet, as have a few other governors, though not as conspicuously. The clear evidence from Nagano will encourage them. But to promote change on a national scale, leaders at the national level, whether Koizumi or his opponents, will have to take stands that they have not so far shown themselves willing to tackle.

• Takashi Oka is a former Monitor correspondent.