Japan-U.S. Relations: Issues for Congress ：「安倍首相の歴史認識は米国の国益を害する恐れがある」

Japan-U.S. Relations: Issues for Congress


「安倍首相の歴史認識は米国の国益を害する恐れがある」

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Japan-U.S. Relations: Issues for Congress

Congressional Research Service

http://www.fas.org/sgp/crs/row/RL33436.pdf

PDF 1~38:

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Japan-U.S. Relations: Issues for Congress

Emma Chanlett-Avery
Specialist in Asian Affairs
Mark E. Manyin
Specialist in Asian Affairs
William H. Cooper
Specialist in International Trade and Finance
Ian E. Rinehart
Analyst in Asian Affairs
May 1, 2013


Summary

Japan is a significant partner for the United States in a number of foreign policy areas,
particularly in terms of security priorities, from hedging against Chinese military modernization
to countering threats from North Korea. The post-World War II U.S.-Japan alliance has long been
an anchor of the U.S. security role in East Asia. The alliance facilitates the forward deployment of
about 49,000 U.S. troops and other U.S. military assets based in Japan in the Asia-Pacific.

Japan has struggled to find political stability in the past seven years. Since 2007, six men have
been prime minister, including the current premier Shinzo Abe, who also held the post in 2006-
2007. His Liberal Democratic Party (LDP) returned to power in a landslide election in December
2012. Japan’s leaders face daunting tasks: an increasingly assertive China, a weak economy, and
rebuilding from the devastating March 2011 earthquake, tsunami, and nuclear disaster. In recent
years, opposition control of one chamber of parliament has paralyzed policymaking in Tokyo and
made U.S.-Japan relations difficult to manage despite overall shared national interests. Abe is
unlikely to pursue controversial initiatives before the next national elections, for the Upper House
of parliament (called the Diet) in July 2013. Perhaps most significantly, the United States could
become directly involved in a military conflict between Japan and China over the
Senkaku/Diaoyu islets in the East China Sea.

Comments and actions on controversial historical issues by Prime Minister Abe and his cabinet
have raised concern that Tokyo could upset regional relations in ways that hurt U.S. interests. Abe
is known as a strong nationalist. Abe’s approach to issues like the so-called “comfort women” sex
slaves from the World War II era, history textbooks, visits to the Yasukuni Shrine that honors
Japan’s war dead, and statements on a territorial dispute with South Korea will be closely
monitored by Japan’s neighbors as well as the United States.

The massive and immediate humanitarian relief provided by the United States following the
March 2011 “triple disaster” bolstered the bilateral alliance, but difficult issues remain,
particularly those related to the stationing of marines on Okinawa. Washington and Tokyo have
agreed to relocate several thousand marines from Okinawa to Guam and other locations in the
region, but the two governments have been unable to make tangible progress on implementing a
2006 agreement to relocate the controversial Futenma Marine Corps Air Station to a less densely
populated location on Okinawa. In addition, the U.S. Congress has restricted funding for the
realignment because of concerns and uncertainty about the cost of the realignment plans.

Japan is one of the United States’ most important economic partners. Outside of North America, it
is the United States’ second-largest export market and second-largest source of imports. Japanese
firms are the United States’ second-largest source of foreign direct investment, and Japanese
investors are the second-largest foreign holders of U.S. treasuries. In April 2013, the United
States and the 10 other countries participating in the Trans-Pacific Partnership (TPP) free trade
agreement (FTA) negotiations completed discussions with Japan and invited Tokyo to join the
talks. Accordingly, the Obama Administration notified Congress of its intent to launch
negotiations no earlier than 90 calendar days hence.

Japan’s membership in the TPP, if an agreement is reached, would constitute a de facto U.S.-
Japan FTA. Congress must approve implementing legislation if the TPP is to apply to the United
States. Japan’s participation in the talks could enhance the credibility and viability of the TPP,
which is a core component of Administration efforts to “rebalance” U.S. foreign policy priorities
toward the Asia-Pacific region. If successful, the negotiations could reinvigorate a bilateral
economic relationship that has remained steady but stagnant, by forcing the two countries to
address long-standing, difficult issues. On the other hand, failure to do so could indicate that the
underlying problems are too fundamental to overcome and could set back the relationship.



Recent Developments

Shinzo Abe and the LDP Return to Power

In elections for the Lower House of the Japanese parliament (called the Diet) on December 19,
2012, the Liberal Democratic Party (LDP) scored a commanding victory that swept the party and
its leader, Shinzo Abe, back into power. The LDP and its coalition partner won 324 of the
chamber’s 480 seats, up from 141. The LDP has now ruled Japan for all but about four years
since the end of World War II. Abe (pronounced “ah-bay”) was also prime minister for about a
12-month period in 2006 and 2007. The December elections toppled the Democratic Party of
Japan (DPJ), which had been Japan’s ruling party since the previous Lower House vote in 2009.
The DPJ’s seat total tumbled from 230 seats to 57. A new group, the Japan Restoration Party, led
by two controversial figures known for their iconoclastic and generally hawkish views, won 54
seats to become Japan’s third-largest party. As discussed in the Japanese Politics section below,
most observers interpreted the election more as a rejection of the DPJ than an endorsement of the
LDP.

The LDP will now turn its attention toward securing an outright majority in the Upper House in
elections for half of that chamber’s seats in July 2013. Since 2007, no party has controlled both
the Lower and Upper Houses of the Diet for more than a few months, paralyzing policymaking.
Because these elections will be pivotal—if the LDP loses seats, the Diet will remain divided—
many analysts believe Abe is likely to delay until after the vote steps that are politically
controversial, such as loosening Japan’s ban on participating in “collective self-defense,” that is,
combat cooperation in defense of another country. As of mid-April, Abe’s public approval ratings
topped 65% in many polls, largely due to support for his economic policies.

The TPP and Abe’s Economic Agenda

On April 24, 2013, Acting USTR Demetrios Marantis, in a letter addressed to House Speaker
John Boehner, notified Congress of the Obama Administration’s intent to launch negotiations
with Japan as part of the TPP no earlier than 90 calendar days hence. The notification followed
the April 20, 2013, announcement by trade ministers from the United States and the other 10 TPP
partners that they have formally invited Japan to join the TPP negotiations. Japanese officials
would like Japan to be able to participate in an expected July round of TPP negotiations.1
Abe has made it a priority of his administration to grow the economy and to eliminate deflation,
which has plagued Japan for many years. After assuming power, Abe’s government announced a
$122 billion stimulus package aimed at spending on infrastructure, particularly in areas affected
by the March 2011 disaster. While the package is expected to boost growth somewhat, it will also
add to Japan’s already large public debt. Under pressure from Abe, the independent central bank
announced that it would undertake quantitative easing measures and raise its inflation target to
2% within two years. The Japanese yen then rapidly dropped in value against the U.S. dollar and
other major currencies.

On February 1, 2013, the Japanese government loosened its restrictions on U.S. beef imports to
allow beef from cattle 30 months or younger for the first time since December 2003. These steps
would appear to provide the opportunity for growth in U.S. beef exports to Japan and to resolve
an issue that had been a major irritant in the bilateral trade relationship, as well as a potential
obstacle for Japan to join the TPP.

Senkaku/Diaoyu Territorial Dispute with China

Japan and China have engaged in a struggle over islets in the East China Sea known as the
Senkakus in Japan, Diaoyu in China, and Diaoyutai in Taiwan, which has grown increasingly
heated since summer 2012. The uninhabited territory, administered by Japan but also claimed by
China and Taiwan, has been a subject of contention for years, despite modest attempts by Tokyo
and Beijing to jointly develop the potentially rich energy deposits nearby, most recently in 2008-
2010. In August 2012, the Japanese government purchased three of the five islands from a private
landowner in order to preempt their sale to Tokyo’s nationalist governor Shintaro Ishihara.
Although intended to tamp down the controversy, Japan’s “nationalization” of the territory upset
the status quo, leading to massive Chinese protests, sharp objections from Beijing, and a drop in
Sino-Japanese trade. In April 2013, the Chinese foreign ministry said for the first time that it
considered the islands a “core interest,” indicating to many analysts that Beijing was unlikely to
make concessions on this sensitive sovereignty issue.

Since then, China has conducted increasingly aggressive operations by dispatching both military
and maritime law enforcement ships and aircraft to the area, compelling the Japanese to respond
with their own forces and heightening the potential for escalation. On one occasion both countries
scrambled fighter jets, and in February 2013 the Japanese government reported that a Chinese
naval ship locked its weapons-targeting radar on Japanese assets on two occasions. Although no
shots were fired, the incident was considered a major escalation in the standoff and sparked
questions about whether the Chinese operator was acting on orders from Beijing, military
commanders, or his own discretion. Beijing has denied the accusation. Chinese activities
continued through the spring; in April, eight Chinese surveillance ships appeared in Japanese
territorial waters at once, according to a Japanese news report.

The United States has remained neutral on the sovereignty of the islands but re-affirmed that the
territory is covered under Article Five of the U.S.-Japan Security Treaty, which stipulates that the
United States is bound to protect “the territories under the Administration of Japan” and Japan
administers the Senkakus (Diaoyu Islands). The Treaty obligates the United States to defend
Japan. Due to the risk of U.S. involvement in military operations, U.S. officials have urged
caution and encouraged both sides to avoid a conflict.

The Senkaku/Diaoyu conflict embodies Japan’s security challenges. The maritime confrontation
with Beijing is a concrete manifestation of the threat Japan has faced for years from China’s
rising regional power. It also brings into relief Japan’s dependence on the U.S. security guarantee
and its anxiety that Washington will not defend Japanese territory if it risks going to war with
China. Operationally, Japan has an acute need for its military, known as the Japan Self Defense
Forces, to build up their capacity in the southwest part of the archipelago. Similarly, many
observers cite the lack of coordination and clear delineation of responsibilities between the
Japanese Maritime Self Defense Forces and Coast Guard.

Historical Controversies Resurface

As Abe’s high approval ratings held steady in spring 2013, a series of history-related issues arose
in Japanese politics that threatened to destabilize regional relations. (See “Abe and History
Issues” section below for background.) In April, 168 Japanese parliamentarians, including three
cabinet ministers, visited the controversial Yasukuni Shrine during its spring festival. The shrine
houses the spirits of Japanese soldiers who died during war, including several individuals who
were convicted as “Class A” war criminals after World War II. South Korea and China
denounced the visits just as they had in past instances, saying that the shrine visits demonstrate
Japan’s lack of remorse for Imperial-era aggression. The Japanese politicians say that they went
to Yasukuni to pay respects to the nation’s war dead, as any national leader would do.

In addition, Abe made comments to the Diet in April that suggested that his government would
not re-affirm the apology for Japan’s wartime actions issued by former Prime Minister Tomiichi
Murayama in 1995. The “Murayama Statement” has been upheld by every Cabinet since it was
issued, including Abe’s first term Cabinet in 2006-2007, and is regarded as Japan’s most
significant official apology for wartime acts. Abe stated to the Diet that his government may not
uphold the statement “as is” and that the definition of “aggression” has not yet been “firmly
determined.” He has declared that his Cabinet would release a more forward-looking official
statement in 2015, on the 70th anniversary of Japan’s surrender,that supersedes the Murayama
Statement. Seoul canceled a minister-level meeting and the South Korean National Assembly
unanimously passed a resolution condemning Abe’s statements and the Yasukuni visits. A
Japanese newspaper reported that the United States government informally conveyed its concern
over the remarks to Japan. Abe himself refrained from visiting the Shrine and insisted that he
wanted to avoid history issues interfering with diplomatic relations.


Japan’s Foreign Policy and U.S.-Japan Relations2

The U.S.-Japan relationship is broad, deep-seated, and stable but has been handicapped by the political paralysis in Tokyo. The annual replacement of prime ministers since 2006 has made long-term planning with Japan complicated, particularly as the United States seeks reliable partners in the Obama Administration’s  rebalancing to Asia strategy, also known as the “Pacific Pivot.” Both Tokyo and Washington seek to manage relations with a rising China, as well as address the
North Korean threat. Alliance cooperation at the working level has been strong, driven closer by assertive Chinese behavior and North Korean provocations.

Although major basing issues in Okinawa remain stubbornly unresolved, other security matters such as ballistic missile defense cooperation have progressed under both the DPJ and LDP governments. The joint response to the March 2011 disasters remains a vivid reminder to both sides of the underlying strength of the alliance.

It remains uncertain how Prime Minister Abe will fare as a steward of the relationship. On the one hand, he is nown as a strong supporter of the U.S. alliance and promotes a number of security positions that align with the United States. He is an advocate of building relations with fellow democracies, particularly advancing security ties with Australia and India. On the other hand, Abe faces questions about his ability to steer foreign policy away from divisive regional issues that could hurt U.S. interests. (See section below for discussion.) In addition, domestic political divisions mean that major U.S. priorities such as Japan agreeing to the terms for the Trans-Pacific Partnership (see “Economic Issues” section for more) and allowing for more advanced defense cooperation (see “Alliance Issues” section for more) will be difficult to pursue. Abe’s approval ratings after his initial fourth months in office remained high, but action on many agenda items may be determined by the July 2013 Upper House election results.

Abe and History Issues

During his year-long stint as prime minister in 2006-2007, Abe was known for his nationalist
rhetoric and advocacy for more muscular positions on defense and security matters. Some of
Abe’s positions—such as changing the interpretation of Japan’s pacifist constitution to allow for
Japanese participation in collective self-defense—were largely welcomed by U.S. officials eager
to advance military cooperation. Other statements, however, suggest that Abe embraces a
revisionist view of Japanese history that rejects the narrative of imperial Japanese aggression and
victimization of other Asians. He has been involved with groups arguing that Japan has been
unjustly criticized for its behavior as a colonial and wartime power. Among the positions
advocated by these groups, such as Nippon Kaigi Kyokai, are that Japan should be applauded for
liberating much of East Asia from Western colonial powers, that the 1946-1948 Tokyo War
Crimes tribunals were illegitimate, and that the killings by Imperial Japanese troops during the
1937 “Nanjing massacre” were exaggerated or fabricated. Historical issues have long colored
Japan’s relationships with its neighbors, particularly China and South Korea, who remain
resentful of Japan’s occupation and belligerence during the World War II period. Abe’s selections
for his Cabinet appear to reflect these views, as he chose a number of politicians well-known for
advocating nationalist, and in some cases ultra-nationalist views.

The previous DPJ government adopted a more conciliatory view of Japan’s past and worked to
mend historical wounds with South Korea and China. In August 2010, the 100th anniversary of
Japan’s annexation of the Korean Peninsula, then-Prime Minister Naoto Kan renewed Japan’s
apology for its treatment of Koreans during colonial rule, and offered to return historical
documents and other artifacts taken from Korea. Until the end of their time in power, DPJ leaders
also avoided visiting the controversial Yasukuni Shrine, a shrine that honors Japan’s wartime dead
and includes several Class A war criminals. Visits to the shrine by LDP Prime Minister Junichiro
Koizumi had severely strained Tokyo’s relationships with Beijing and Seoul in the early and mid-
2000s. In April 2013, a large group of lawmakers, including three cabinet ministers, visited
Yasukuni, again drawing protests from China and South Korea.

Abe last visited the Yasukuni Shrine in October 2012, after he was elected president of the LDP
but before the parliamentary elections that made him prime minister. Many analysts say that
Abe’s re-ascension to the premiership risks inflaming regional relations, which could disrupt
regional trade integration, threaten security cooperation among U.S. allies, and further exacerbate
already tense relations with China. Abe is under pressure from the Japan Restoration Party, a new,
fiercely nationalist party that won the third largest number of seats in the Diet. On the other hand,
during his last stint as prime minister, Abe successfully repaired ties with South Korea and China
and is regarded by some observers as a pragmatic politician. Since becoming prime minister, he
has not repeated his calls while in opposition to station Japanese civilians on the Senkaku Islands
and to designate a national “Takeshima Day” to promote Japan’s assertion of sovereignty over the
Dokdo/Takeshima island that is controlled by South Korea. Although relations with China are far
more problematic now, he recently sent an envoy to reach out to the new government in South
Korea, raising hopes that relations will not deteriorate significantly.

Comfort Women Issue3
Abe’s statements on the so-called “comfort women”—sex slaves used by the Japanese imperial
military during its conquest and colonization of several Asian countries in the 1930s and 1940s—
have been criticized by other regional powers and the U.S. House of Representatives in a 2007
resolution. Abe has suggested that his government might consider revising a 1993 official
Japanese apology for its treatment of these women, a move that would be sure to degrade Tokyo’s
relations with South Korea and other countries.

In the past, Abe has supported the claims made by many on the right in Japan that the women
were not directly coerced into service by the Japanese military. When he was prime minister in
2006-2007, Abe voiced doubts about the validity of the 1993 “Kono Statement,” an official
statement issued by then-Chief Cabinet Secretary Yohei Kono that apologized to the victims and
admitted responsibility by the Japanese military. As the U.S. House of Representatives considered
H.Res. 121 (110th Congress), calling on the Japanese government to “formally acknowledge,
apologize, and accept historical responsibility” for forcing young women into military
prostitution, Abe appeared to soften his commentary and asserted that he would stand by the
statement. The House later overwhelmingly endorsed the resolution. Then-Deputy Chief Cabinet
Secretary Hakubun Shimomura had been leading the movement to revise the statement; Abe
recently appointed him Minister of Education, Culture, Sports, Science, and Technology.

The issue of the so-called comfort women has gained visibility in the United States, due primarily
to Korean-American activist groups. These groups have pressed successfully for the erection of
monuments commemorating the victims, passage of a resolution on the issue by the New York
State Senate, and the naming of a city street in the New York City borough of Queens in honor of
the victims. In addition, former Secretary of State Hillary Clinton reportedly instructed the State
Department to refer to the women as “sex slaves,” rather than the euphemistic term “comfort
women.”4

Territorial Dispute with China5

Japan, China, and Taiwan all claim sovereignty over a small group of uninhabited islets located
about 120 miles northeast of Taipei, known as the Senkakus in Japan, the Diaoyu in China, and
the Diaoyutai in Taiwan. China considers the islets to be part of Taiwan, over which it claims
sovereignty. Geologists believe that the waters surrounding them may be rich in oil and natural
gas deposits. The disputed claims are long-standing, but the episodes in early 2013 escalated
beyond previous incidents. In April 2012, Tokyo governor Shintaro Ishihara announced in
Washington, DC, that he intended to purchase three of the five islets from their private Japanese
owner. Ishihara, who is known for expressing nationalist views, called for demonstrating Japan’s
control over the islets by building installations on the island and raised nearly $20 million in
private donations for the purchase. In September, the central government purchased the three
islets for ¥2.05 billion (about $26 million at an exchange rate of ¥78:$1) to block Ishihara’s move
and reduce tension with China. Protests, sometimes violent, erupted across China in response.
Starting in the fall of 2012, China began regularly deploying China Maritime Surveillance (CMS)
and Fisheries Law Enforcement Command (FLEC) ships near the islands and stepped up what it
called “routine” patrols to assert jurisdiction in “China’s territorial waters.” Chinese military
surveillance planes reportedly have entered airspace that Japan considers its own, in what Japan’s
Defense Ministry has called the first such incursion in 50 years. In early 2013, near-daily
encounters have escalated: both countries have scrambled fighter jets, Japan has threatened to fire
warning shots, and, according to the Japanese government, a Chinese navy ship locked its firecontrol
radar on a Japanese destroyer and helicopter on two separate occasions.

U.S. administrations going back at least to the Nixon Administration have stated that the United
States takes no position on the territorial disputes. However, it also has been U.S. policy since
1972 that the 1960 U.S.-Japan Security Treaty covers the islets, because Article 5 of the treaty
stipulates that the United States is bound to protect “the territories under the Administration of
Japan” and Japan administers the islets. China’s increase in patrols appears to be an attempt to
demonstrate that Beijing has a degree of administrative control over the islets, thereby casting
into doubt the U.S. treaty commitment. In its own attempt to address this perceived gap, Congress
inserted in the FY2013 National Defense Authorization Act (H.R. 4310, P.L. 112-239) a
resolution stating, among other items, that “the unilateral action of a third party will not affect the
United States’ acknowledgment of the administration of Japan over the Senkaku Islands.” Perhaps
responding to the criticism of the Administration’s rhetoric, in January 2013 Secretary Clinton
stated that “we oppose any unilateral actions that would seek to undermine Japanese
administration,” of the islets.

China-Japan Trade

One of the side-effects of the China-Japan islands dispute has been the adverse impact on their
bilateral trade, especially on Japanese exports to China. China is Japan’s most important trading
partner—its largest export market and its largest source of imports—having overtaken the United
States in that role long ago. The relationship developed as Japanese multinational companies
established production facilities in China that assemble finished goods that are exported
elsewhere, including to the United States. In addition, as Chinese citizens have become wealthier,
China has become a growing market for consumer goods such as cars. Japanese exports to China
declined 11% in 2012 with much of the decline occurring in the fourth quarter.6 These trends are
similar to those with other major partners: Japan’s exports to the United Kingdom declined 18.8%
and to Germany—14.6%, reflecting moderate economic growth or slowdown and the strong yen.
However, observers have noted that the political tensions caused by the confrontations over the
Senkaku/Daioyu islands may have spilled over in the commercial arena. During the height of the
fracas in September 2012, nationalists in China called for a boycott on Japanese goods and
defaced Japanese retail stores. Japanese auto manufacturers experienced sharp declines in sales in
China beginning in September 2012.7 To what degree these trends are a function of politics or
macroeconomic factors would require further analysis and more data.

Japan and the Korean Peninsula

Japan’s Ties with South Korea

After a period of relatively warm ties and the promise of more effective security cooperation,
Tokyo-Seoul ties appear to have cooled anew. Under the DPJ governments and the Lee Myungbak
administration in Seoul, South Korea and Japan managed historical issues, cooperated in
responding to North Korean provocations, and exchanged observers at military exercises. The
two countries were on the verge of concluding two modest but significant bilateral security
agreements on information sharing and military acquisitions until an anti-Japanese outcry in
South Korea scuttled the signing. The new governments in both capitals appear less likely to
reach out to each other, dimming U.S. hopes for more sustained trilateral cooperation among the
three democracies. Policy toward North Korea has been the one issue where regular trilateral
consultation persists.

In addition to the comfort women issue discussed above, the perennial issues of a territorial
dispute between Japan and South Korea and Japanese history textbooks continue to periodically
ruffle relations. A group of small islands in the Sea of Japan known as Dokdo in Korean and
Takeshima in Japanese (referred to as the Liancourt Rocks by the United States) are administered
by South Korea but claimed by Japan. Mentions of the claims in Japanese defense documents or
by local prefectures routinely spark official criticism and public outcry in South Korea. Similarly,
Seoul expresses disapproval of some of the history textbooks approved by Japan’s Ministry of
Education that South Koreans claim diminish or whitewash Japan’s colonial-era atrocities.

Some of Abe’s cabinet appointments have raised concern among South Koreans. Minister of
Education Hakubun Shimomura has criticized history textbook companies for being insufficiently
patriotic by, among other items, giving undue deference to the concerns of China and South
Korea in their presentation of Japan’s colonial past. Abe’s appointment of Shimomura appears to
signal his intent to follow through on the LDP’s pre-election advocacy of reducing “self-torturing
views of history” in education and of giving the central government greater authority over the
content of history textbooks. Abe’s Cabinet also includes Internal Affairs Minister Yoshitaka
Shindo and Minister for Administrative Reform Tomomi Inada, who have aggressively asserted
Japanese territorial claims, including a well-publicized attempt to visit South Korea in 2011 to
advocate for Japanese sovereignty over the Dokdo/Takeshima islets.

North Korean Issues

Since 2009, Washington and Tokyo have been strongly united in their approach to North Korea.
Although the U.S. and Japanese positions diverged in the later years of the Bush Administration
over prioritization of the abductee issue (see below), Pyongyang’s string of provocations in 2009-
2010 forged a new consensus among Japan, South Korea, and the United States. North Korea’s
provocations have helped to drive enhanced trilateral security cooperation between Washington,
Tokyo, and Seoul. Japan also appeared to be at least somewhat in sync with the United States in
late 2011 and early 2012 when the Obama Administration—with the blessing of the South Korean
government—was negotiating agreements with North Korea over its nuclear and missile
programs and food aid. North Korea’s 2012 missile launches and the February 2013 nuclear test
are likely to drive closer cooperation among the three governments.

Tokyo has adopted a relatively hardline policy against North Korea and plays a leadership role at
the United Nations in pushing for stronger punishment for the Pyongyang regime for its military
provocations and human rights abuses. Japan has imposed a virtual embargo on all trade with
North Korea. North Korea’s missile tests have demonstrated that a strike on Japan is well within
range, spurring Japan to invest in ballistic missile defense (BMD) capabilities and enhance BMD
cooperation with the United States. In addition to Japan’s concern about North Korean missile
and nuclear programs, the issue of several Japanese citizens abducted by North Korean agents in
the 1970s and 1980s remains a top priority for Tokyo. Japan has pledged that it will not provide
economic aid to North Korea without resolution of the abductee issue. The abductee issue
remains an emotional topic in Japan. In 2008, the Bush Administration’s decision to remove
North Korea from the list of state sponsors of terrorism in exchange for North Korean
concessions on its nuclear program dismayed Japanese officials, who had maintained that North
Korea’s status on the list should be linked to the abduction issue. Although the abductions issue
has lost potency in recent years, Abe came onto the political scene in the early 2000s as a fierce
advocate for the abductees and their families and could dedicate attention to the issue.



March 2011 “Triple Disaster”

On March 11, 2011, a magnitude 9.0 earthquake jolted a wide swath of Honshu, Japan’s largest island. The quake, with an epicenter located about 230 miles northeast of Tokyo, generated a tsunami that pounded Honshu’s northeastern coast, causing widespread destruction in Miyagi, Iwate, Ibaraki, and Fukushima prefectures. Some 20,000 lives were lost and entire towns were washed away; over 500,000 homes and other buildings and around 3,600 roads were damaged or destroyed. Up to half a million Japanese were displaced. Damage to several reactors at the Fukushima Dai-ichi nuclear power plant complex led the government to declare a state of emergency and evacuate nearly 80,000
residents within a 20 kilometer radius due to dangerous radiation levels.

In many respects, Japan’s response to the multifaceted disaster was remarkable. Over 100,000 troops from the Self Defense Forces (SDF), Japan’s military, were deployed quickly to the region. After rescuing nearly 20,000 individuals in the first week, the troops turned to a humanitarian relief mission in the displaced communities. Construction of temporary housing began a week after the quake. Foreign commentators marveled at Japanese citizens’ calm resilience, the lack of looting, and the orderly response to the strongest earthquake in the nation’s modern history.

Japan’s preparedness—strict building codes, a tsunami warning system that alerted many to seek higher ground, and years of public drills—likely saved tens of thousands of lives.

Despite this response to the initial event, the uncertainty surrounding the nuclear reactor accident and the failure to present longer-term reconstruction plans led many to question the government’s handling of the disasters. As reports mounted about heightened levels of radiation in the air, tap water, and produce, criticism emerged regarding the lack of clear guidance from political leadership. Concerns about the government’s excessive dependence on information from Tokyo Electric Power Company (TEPCO), the firm that owns and operates the power plant, amplified public skepticism and elevated criticism about conflicts of interest between regulators and utilities.

Japan’s Nuclear Energy Policy

Japan is undergoing a national debate on the future of nuclear power, with major implications for
businesses operating in Japan, U.S.-Japan nuclear energy cooperation, and nuclear safety and
non-proliferation measures worldwide. Looking back to 2006, the “New National Energy
Strategy” had set out a goal of significantly increasing Japan’s nuclear power generating capacity,
partly as a way to decrease dependence on foreign energy supplies and partly to decrease
emissions of greenhouse gases. By 2011, nuclear power was providing roughly 30% of Japan’s
power generation capacity.

The policy of expanding nuclear power encountered an abrupt reversal in the aftermath of the
March 11, 2011, natural disasters and meltdowns at the Fukushima Daiichi nuclear power plant.
Public trust in the safety of nuclear power collapsed, and a vocal anti-nuclear political movement
emerged. This movement tapped into an undercurrent of anti-nuclear sentiment in modern
Japanese society based on its legacy as the victim of atomic bombing in 1945. As the nation’s 54
nuclear reactors were shut down one by one for their annual safety inspections in the months after
March 2011, the Japanese government did not restart them—except for two reactors at one site in
central Japan.

The drawdown of nuclear power generation resulted in many short- and long-term consequences
for Japan: rising electricity costs for residences and businesses; heightened risk of blackouts in
the summer, especially in the Kansai region; widespread energy conservation efforts by
businesses, government agencies, and ordinary citizens; the possible bankruptcy of major utility
companies; and increased fossil fuel imports (see next section). The Institute of Energy
Economics, Japan, calculated that the nuclear shutdowns led to the loss of 420,000 jobs and $25
billion in corporate revenue in 2012.8

With prominent intellectuals and politicians calling for the end of nuclear power in Japan, the
DPJ attempted to author a long-term energy policy. On September 14, 2012, the sub-Cabinetlevel
Energy and Environment Council announced an ambitious plan to eliminate all nuclear
power generation in Japan by 2030. Leading voices in the Japanese business community harshly
criticized the plan and warned of the hollowing out of Japanese industry. One week later, the
Noda Cabinet announced a more flexible “Innovative Strategy for Energy and the Environment,”
which pushed back the deadline for nuclear drawdown to 2040, continued the present nuclear fuel
cycle policy, and allowed the completion of under-construction plants and possible reactor lifespan
extensions past 2040. American observers have raised concerns about losing Japan as a
global partner in promoting nuclear safety and non-proliferation measures.

The LDP has promoted a relatively pro-nuclear policy, despite persistent anti-nuclear sentiment
among the public. The LDP party platform for the December 2012 election called for the restart
of nuclear reactors as soon as new safety regulations are implemented and promised to study
Japan’s energy situation thoroughly before developing a national policy. In comments to the Diet
on January 30, 2013, Abe called the DPJ’s zero-nuclear energy policy “groundless.”9 Yet, 48% of
the population does not agree with the Abe Cabinet’s approach to reactor restarts, compared to
46% in favor. Temporary failures in the safety systems of the crippled Fukushima Daichi reactors
caused nuclear safety fears to resurface in spring 2013. The Abe Cabinet faces a complex
challenge: how can Japan balance concerns about energy security, promotion of renewable energy
sources, the viability of electric utility companies, the health of the overall economy, and public
concerns about safety?

Exports of Liquefied National Gas (LNG) to Japan

Japan imports more LNG than any other country and would be a large market for potential LNG
exports from the United States. Due to the suspension of nuclear power at present, Japan has
become increasingly dependent on fossil fuels for electric power generation (see previous
section). Japan imported a record 87 million metric tons of LNG in 2012—an 11% increase on
the previous year.10 Japanese utility companies are attracted to the large difference between global
market prices for natural gas and the much lower price prevailing in North America. The lower
price is largely a result of the recent expansion of natural gas production from shale.

The U.S. government must satisfy legal requirements before additional LNG exports from the
continental United States to Japan are permitted (Japan currently imports less than 1% of its
natural gas supply from Alaska). The 2005 Energy Policy Act requires that the Department of
Energy (DOE) issue a permit to export natural gas to countries with which the United States does
not have a free trade agreement (FTA), including Japan. DOE must also determine that export to
non-FTA countries is in the public interest. A DOE-commissioned study concluded in December
2012 that LNG exports would produce net economic benefits for the United States, but the study
has been controversial. Critics of increased exports have raised concerns about the environment
and higher gas prices for domestic industries and consumers. The study completed a public
comment period in early March 2013, and now DOE must make a decision on 16 pending permits
to export LNG to non-FTA countries. At present only one such permit has been approved, for the
Sabine Pass terminal in Louisiana. That terminal will likely begin export operations in late 2015
or early 2016.11

Japanese Participation in Sanctions on Iran

Over the past decade, growing concerns over Iran’s nuclear program have led to increased
scrutiny of Japan’s longstanding trade with and investments in Iran. Japan is the third-biggest
customer for Iranian oil, accounting for over 14% of the 2012 total.14 For most of the past decade
Iran has been Japan’s third largest source of crude oil imports, although it fell to sixth in 2012,
accounting for 5% of Japan’s imports.15 As part of their efforts to enhance economic penalties on
Iran, the Bush and Obama Administrations have pushed Japan to curtail its economic ties with
Tehran. In general, although Japan has been a follower rather than a leader in the international
campaign to pressure Tehran, Japanese leaders have in recent years increased their cooperation
with the U.S.-led effort, reducing significantly what had been a source of tension between
Washington and Tokyo during the 1990s and early 2000s. Japanese firms have withdrawn from
energy sector investments in Iran, and some major companies such as Toyota Motors have ceased
doing business there, viewing it as a “controversial market.”

Most recently, in September 2012, the Obama Administration granted Japan a second exemption
under P.L. 112-81, the National Defense Authorization Act for Fiscal Year 2012, which could
have placed strict limitations on the U.S. operations of Japanese banks that process transactions
with Iran’s Central Bank.16 Japan has reduced its imports of Iranian oil over the past several
years, despite its increased need for oil imports with the shutdown of virtually all of its nuclear
power industry. Japan’s crude oil imports from Iran fell by roughly 40% in 2012, and a further
decline of 15% is projected for 2013.17 Iran’s share of Japan’s oil market has fallen by several
percentage points, to less than 8%, a level not seen since 1988.18 Additionally, Japan has restricted
the activities of 21 Iranian banks.19

New U.S. sanctions that went into effect on February 6, 2013, pressure banks that deal with the
Iranian Central Bank to either prevent repatriation of Iran’s foreign currency (non-rial) assets or
else be frozen out of the U.S. financial system. Iran can still use the funds to finance trading
activities not covered by sanctions, but, since it runs a large trade surplus with Japan (and other
Asian oil importers), a significant portion of its oil export earnings will likely be held in Japan
and other importing countries.20

International Child Custody Disputes

Another prominent issue in bilateral relations is child custody cases involving overseas Japanese
women in failed marriages taking children to Japan without the consent of the foreign husband or
ex-husband. Sometimes, these women have acted in contravention of custody settlements and,
after arriving in Japan, have prevented the children from meeting their fathers. In recent years,
both Congress and the executive branch have urged Japan to address the problem, provide access
to the children to the aggrieved parents, and join the 1980 Hague Convention on the Civil Aspects
of International Child Abduction. The Hague Convention sets out rules for resolving child
custody in failed international marriages.

The increased publicity has raised awareness of the issue in Japan, particularly among Diet
members. The Japanese government in March 2012 submitted a bill that would have adjusted
domestic law to allow Tokyo to accede to the Convention, but the Diet did not vote on the bill
during that session. A year later, the Abe government submitted a similar bill, and the Lower
House of the Diet passed it on April 23, 2013, thus ratifying the treaty.

With cases involving approximately 100 American children, the United States reportedly has the
largest number of such disputes with Japan.21 Legally, Japan only recognizes sole parental
authority, under which only one parent has custodial rights, and there is a deep-rooted notion in
Japan that the mother should assume custody. Japanese officials say that, in many cases, the issue
is complicated by accusations of abuse or neglect on the part of the foreign spouse, though a
senior U.S. State Department official has said that there are “almost no cases” of substantiated
claims of violence.22 Some observers fear that, even if Japan signs the Hague Convention, it is
unlikely to enforce the treaty’s provisions, given the existing family law system.23
U.S.World-War II-Era Prisoners of War (POWs)

For decades, U.S. soldiers who were held captive by Imperial Japan during World War II have
sought official apologies from the Japanese government for their treatment. A number of
Members of Congress have supported these campaigns. The brutal conditions of Japanese POW
camps have been widely documented.24 In May 2009, Japanese Ambassador to the United States
Ichiro Fujisaki attended the last convention of the American Defenders of Bataan and Corregidor
to deliver a cabinet-approved apology for their suffering and abuse. In 2010, with the support and
encouragement of the Obama Administration, the Japanese government financed a
Japanese/American POW Friendship Program for former American POWs and their immediate
family members to visit Japan, receive an apology from the sitting Foreign Minister and other
Japanese Cabinet members, and travel to the sites of their POW camps. Annual trips were held in
2010, 2011, and 2012.25 It is unclear whether the Abe government will continue the program. It is
also unclear if Abe and other LDP politicians’ suggestions that past Japanese apologies should be
reworded or retracted include the apologies to the U.S. POWs.

In the 112th Congress, three resolutions—S.Res. 333, H.Res. 324, and H.Res. 333—were
introduced thanking the government of Japan for its apology and for arranging the visitation
program.26 The resolutions also encouraged the Japanese to do more for the U.S. POWs,
including by continuing and expanding the visitation programs as well as its World War II
education efforts. They also called for Japanese companies to apologize for their or their
predecessor firms’ use of un- or inadequately compensated forced prison laborers during the war.

Alliance Issues27

Japan and the United States are military allies under a security treaty concluded in 1951 and
revised in 1960. Under the treaty, Japan grants the United States military base rights on its
territory in return for a U.S. pledge to protect Japan’s security. Although defense officials had
hoped that the 50th anniversary of the treaty would compel Tokyo and Washington to enhance
bilateral defense cooperation, a rocky start by the Democratic Party of Japan (DPJ) government
generated concern about the future of the alliance. The coordinated response to the March 2011
disaster by the U.S. and Japanese militaries made a strong statement about the strength and the
value of the bilateral alliance, and commitment from top U.S. leadership to assist the nation in its
recovery may have assuaged fears that the alliance was adrift after a series of public
disagreements. On the other hand, the crisis response did little to change the fundamental
challenges of the thorny base relocation issue in Okinawa. Although the governments have now
amended the plan to allow several thousand marines to depart Okinawa in order to ease local
frustrations, fundamental questions about the existence of problematic military facilities and the
political sustainability of the Marine Corps presence on the island remain.

Futenma Base Relocation Controversy28

A prominent controversy over the relocation of a Marine Corps base in Okinawa has vexed the
alliance for years. While a comprehensive resolution remains elusive, the two governments have
adjusted the plan in a way that removes the issue from the center of the security relationship. The
2006 agreement between the U.S. and Japanese governments to relocate the Futenma Marine
Corps Air Station from its current location in crowded Ginowan City to Camp Schwab, in a less
congested part of the island, was envisioned as the centerpiece of a planned realignment of U.S.
forces in Japan.29 Under this agreement, the United States would redeploy 8,000 marines and their
dependents from Okinawa to Guam in exchange for permitting construction of a new Marine
Corps facility at Camp Schwab, located offshore of the Henoko area of Nago City. Problematic
from the start, the base relocation developed into a major point of contention between Tokyo and
Washington after Yukio Hatoyama became prime minister in 2009; Hatoyama had promised
Okinawans during his election campaign that he would oppose the relocation. Although
Hatoyama and his DPJ successors all eventually endorsed the plan, local opposition and
management missteps by Tokyo appeared to render the plan unworkable.

To remove impediments to the realignment of U.S. forces, the United States and Japan changed
their agreement in April 2012 by “de-linking” the transfer of marines off Okinawa with progress
on the new base in Henoko. In order to ease the burden on Okinawan residents, about 9,000
marines and their dependents would be transferred to locations outside of Japan: to Guam,
Hawaii, on a rotational basis to Australia, and perhaps elsewhere. Alliance officials described the
move as in line with their goal of making U.S. force posture in Asia “more geographically
distributed, operationally resilient, and politically sustainable.”30 The official timeline for the
reversion of U.S. base territory back to Japanese control indicates that substantial amounts of land
will not be turned over to local authorities until the mid-2020s.
28

After the announcement, Senators Carl Levin, John McCain, and Jim Webb, who had together
criticized the realignment plan as “unrealistic, unworkable, and unaffordable,”31 wrote in a letter
to Defense Secretary Leon Panetta, “No new basing proposal can be considered final until it has
the support of Congress.”32 Concern about the ballooning costs of the Guam construction and
uncertainty about the future U.S. force posture in the Asia-Pacific region drove Congress to zero
out the Administration’s request for related military construction funding in the FY2012 and
FY2013 National Defense Authorization Acts, P.L. 112-81 and P.L. 112-239. The acts prohibit
authorized funds, as well as funds provided by the Japanese government for military construction,
from being obligated to implement the planned realignment of Marine Corps forces from
Okinawa to Guam until certain justifications and assessments are provided. In April 2013, the
Senate Armed Services Committee (SASC) issued a report that examined U.S. costs associated
with the American military presence overseas, including in Japan.33 The report found that
relocation of the Futenma base remained “unlikely” and that it would cost far more and take
longer than the Department of Defense currently projects.

Significant obstacles remain in Japan as well. Public opposition has hardened considerably in
Okinawa, with all the major political figures involved in the new base construction process
declaring opposition to the plan. The deployment of the MV-22 Osprey tilt-rotor aircraft to the
Futenma base in summer 2012 heightened safety concerns of nearby residents, and a string of
crimes committed by U.S. servicemembers in late 2012 further inflamed local resentments. The
grievances that the Okinawans have harbored for decades seem unlikely to fade, driven by the
presence of foreign troops on a crowded urban landscape. The current controversy reflects a
fundamental tension in the relationship between Okinawa and the central government in Tokyo:
while the entire country reaps the benefits of the U.S. security guarantee, Okinawans bear a
disproportionate burden. The April 2012 announcement that the U.S. and Japanese governments
will undertake long-deferred repairs on Futenma raised suspicions that the base will remain
indefinitely, and the 2013 SASC report expressed concerns that Japan’s contribution was in
question.34

Progress on Other Elements of Military Realignment and Alliance Transformation

The relocation of Futenma air station is the largest and most controversial part of a broad
overhaul of U.S. force posture in Japan and bilateral military activities, but it is not the only
element. In 2002, the U.S. and Japanese governments launched the Defense Policy Review
Initiative (DPRI) to review force posture and develop a common security view between the two
sides. With the exception of the Henoko relocation, the plan has been largely successful. A
training relocation program allows U.S. aircraft to conduct training away from crowded base
areas to reduce noise pollution for local residents. U.S. Carrier Air Wing Five is being relocated
from Atsugi Naval Air base to the Iwakuni base, where a new dual-use airfield is operational. In
2010, U.S. Army Japan established at Camp Zama (about 25 miles southwest of Tokyo) a forward
operational headquarters, which can act as a bilateral joint headquarters to take command of
theater operations in the event of a contingency. The SDF Air Defense Command facility at
Yokota U.S. Air Base was recently completed. Since 2006, a bilateral joint operations center at
Yokota allows for data-sharing and coordination between the Japanese and U.S. air and missile
defense command elements. In June 2011, Japan announced a long-sought agreement to allow the
transfer of jointly developed missile components to third parties, representing an exception to
Japan’s ban on arms exports.

Deployment of the MV-22 Osprey Aircraft to Japan

The U.S. Marine Corps is replacing the 24 CH-46E “Sea Knight” helicopters stationed at the
Futenma base with 24 MV-22 “Osprey” tilt-rotor aircraft. The deployment of the first 12 Osprey
aircraft to Japan in mid-2012 created a public outcry in Okinawa and mainland base-hosting
communities. Japanese politicians and civil society groups strongly opposed introduction of MV-
22 to Japan due to the aircraft’s safety record.35 The crashes of V-22 tilt-rotor aircraft in training
exercises in Morocco and Florida in early 2012 reminded Okinawans of the U.S. military
helicopter crash on the grounds of a school near Futenma Air Station in August 2004. In response
to these concerns, the Japanese Ministry of Defense conducted its own investigation of the
aircraft’s safety. The investigation cleared the MV-22 for deployment, but Japan requested that
Osprey pilots adhere to a set of operational guidelines to reduce the risk of accidents in populated
areas. Intense public scrutiny of the aircraft’s safety record may be connected to widespread
distrust of the government stemming from the nuclear disaster at the Fukushima Daichi reactors.
The introduction of these advanced aircraft to Okinawa reportedly will enhance the operational
capability of the Marines based there, particularly in a rapid response scenario.

March 2011 Earthquake and Tsunami: U.S.-Japan Alliance Performance

Appreciation for the alliance surged after the two militaries worked effectively together to
respond to the 2011 earthquake and tsunami. Years of joint training and many interoperable assets
facilitated the integrated alliance effort. “Operation Tomodachi,” using the Japanese word for
“friend,” was the first time that SDF helicopters used U.S. aircraft carriers to respond to a crisis.
The USS Ronald Reagan aircraft carrier provided a platform for air operations as well as a
refueling base for Japanese SDF and Coast Guard helicopters. Other U.S. vessels transported SDF
troops and equipment to the disaster-stricken areas. Communication between the allied forces
functioned effectively, according to military observers. For the first time, U.S. military units
operated under Japanese command in actual operations. Specifically dedicated liaison officers
helped to smooth communication. Although the U.S. military played a critical role, the Americans
were careful to emphasize that the Japanese authorities were in the lead.

The successful bilateral effort held several important consequences. First, it reinforced alliance
solidarity after a somewhat difficult period of public disagreement over the Futenma base issue. It
was also very well-received by the Japanese public, leading to exceptionally high approval ratings
of both the SDF performance and the U.S. relief efforts. The operation demonstrated to others the
capability of the alliance. It also illuminated challenges that the two militaries might face if
responding to a contingency in the defense of Japan in which an adversary were involved,
including having more secure means of communication as multiple agencies and services
mobilized resources.36

Constitutional Constraints
Several legal factors restrict Japan’s ability to cooperate more robustly with the United States.
The most prominent and fundamental restriction is Article 9 of the Japanese constitution, drafted
by American officials during the post-war occupation, that outlaws war as a “sovereign right” of
Japan and prohibits “the right of belligerency.” It stipulates that “land, sea, and air forces, as well
as other war potential will never be maintained.” However, Japan has interpreted this clause to
mean that it can maintain a military for national defense purposes and, since 1991, has allowed
the SDF to participate in non-combat roles overseas in a number of U.N. peacekeeping missions
and in the U.S.-led coalition in Iraq.
The principle of “collective self-defense” is also considered an obstacle to close defense
cooperation. The term comes from Article 51 of the United Nations Charter, which provides that
member nations may exercise the rights of both individual and collective self-defense if an armed
attack occurs. The Japanese government maintains that Japan has the sovereign right to engage in
collective self-defense, but a 1960 decision by the Cabinet Legislation Bureau interpreted the
constitution to forbid collective actions because they would exceed the minimum necessary use of
force to defend Japan itself. Participation in non-combat logistical operations and rear area
support of other nations, however, has been considered outside the realm of collective selfdefense.
Prime Minister Abe has repeatedly proposed that this restriction be reconsidered, a move
that has been welcomed by U.S. officials in the past.
During the deployment of Japanese forces to Iraq, the interpretation prevented the SDF from
defending other nations’ troops. Some Japanese critics have charged that Japanese Aegis
destroyers should not use their radar in the vicinity of American warships, as they would not be
allowed to respond to an incoming attack on those vessels. As the United States and Japan
increasingly integrate missile defense operation, the ban on collective self-defense also raises
questions about how Japanese commanders will gauge whether American forces or Japan itself is
being targeted. Under the current interpretation, Japanese forces could not respond if the United
States were attacked.

Burden-Sharing Issues

According to the Department of Defense, costs to maintain U.S. forces in Japan in FY2012 was
expected to total over $4.8 billion, in addition to the roughly $2 billion contributed by the
government of Japan annually.37 This total includes approximately $2.75 billion in personnel
costs and over $2 billion in non-personnel costs. In December 2010, Japan agreed to continue
Host Nation Support (HNS), the funds provided to contribute to the cost of stationing U.S. troops
in Japan, at current levels for the next five years, starting in FY2011. The agreement came as a
compromise, as the government of then-Prime Minister Naoto Kan had been pressured to cut
Japan’s contribution due to Japan’s ailing fiscal health. Japan pays for most of the salaries of
about 25,000 Japanese employees at U.S. military installations. The current agreement calls for
Japan to pay about 188 billion yen annually (about $2.2 billion at 82 yen to one USD) through
FY2016 to defray the costs of stationing troops in Japan. The agreement also commits to reducing
the number of Japanese nationals working for the U.S. military and affirms that the proportion of
utility costs paid by the Japanese government will fall from 76% to 72% over a five-year period.
The 2013 SASC report expressed concerns about a downward trend in Japan’ s contributions to
Host Nation Support, compared to higher amounts contributed in the 1990s.38

Extended Deterrence

Another source of strategic anxiety in Tokyo concerns the U.S. extended deterrence, or “nuclear
umbrella,” for Japan. The Bush Administration’s shift in negotiations with Pyongyang triggered
fears in Tokyo that Washington might eventually accept a nuclear armed North Korea and thus
somehow diminish the U.S. security guarantee for Japan. These anxieties have persisted despite
repeated statements by both the Bush and Obama Administrations to reassure Tokyo of the
continued U.S. commitment to defend Japan. However, Japan’s sense of vulnerability is
augmented by the fact that its own ability to deter threats is limited by its largely defensiveoriented
military posture. Given Japan’s reliance on U.S. extended deterrence, Tokyo is wary of
any change in U.S. policy—however subtle—that might alter the nuclear status quo in East Asia.

Japan’s Counter-Piracy Mission in the Gulf of Aden

Japan’s military, known as the Self-Defense Force (SDF), has been engaged in counter-piracy
activities in the Gulf of Aden since March 2009. Approximately 400 personnel are stationed in
Djibouti and currently housed in Camp Lemonier, the large U.S. military base located close to
Djibouti’s airport. In April 2010, the Japanese government announced plans to build its own $40
million facility in Djibouti, effectively establishing an overseas base for its military. Although this
would be Japan’s first foreign base since World War II, the move has sparked little controversy
among the generally pacifist Japanese public.

Economic Issues39

Trade and other economic ties with Japan remain highly important to U.S. national interests and,
therefore, to the U.S. Congress.40 By the most conventional method of measurement, the United
States and Japan are the world’s largest and third-largest economies (China is number two),
accounting for around 30% of the world’s gross domestic product (GDP) in 2012. Furthermore,
their economies are intertwined by trade in goods and services and by foreign investments.

Overview of the Bilateral Economic Relationship

Japan is an important economic partner of the United States, but its importance has slid as it has
been edged out by other partners. Japan was the United States’ fourth-largest merchandise export
market (behind Canada, Mexico, and China) and the fourth-largest source for U.S. merchandise
imports (behind China, Canada, and Mexico) at the end of 2012. These numbers probably
underestimate the importance of Japan in U.S. trade since Japan exports intermediate goods to
China that are then used to manufacture finished goods that China exports to the United States.
The United States was Japan’s second-largest export market and second-largest source of imports
as of the end of 2012. The global economic downturn had a significant impact on U.S.-Japan
trade: both exports and imports declined in 2009 from 2008. U.S.-Japan bilateral trade has
increased since 2009 reflecting the recovery, albeit weak, from the economic downturn. (See
Table 1.)







Japanese Politics 50

The December 2012 Elections: A Landslide Without a Mandate for
the LDP
Since 2007, Japanese politics has been plagued by instability. Six men have been prime minister,
including the current occupant of the post, Shinzo Abe (born in 1954), who was also prime
minister for a 12-month period from 2006-2007. The LDP’s dominant victory in the December
2012 Lower House elections swept the party back into power. However, in the view of most
observers—and even many in the LDP—the results were more attributable to voters’ desire to
eject the Democratic Party of Japan (DPJ) from power rather than enthusiasm for the LDP or its
policy proposals.51 Indeed, by some measures, the LDP garnered less support than in the last
Lower House election, in 2009. Nonetheless, it was able to secure a commanding number of seats
because of one of the lowest turnouts (59%) in the post-World War II era and the splitting of the
anti-LDP vote among the DPJ and a number of new or relatively new parties.

In two ways, the December elections are likely to partially break some of the logjams that for
more than half a decade have paralyzed Japan’s political system and have complicated U.S.-Japan
coordination on a number of issues. First, since 2007, no party has controlled both the Lower and
Upper Houses of the Diet for more than a few months. Currently, the LDP and its coalition
partner, New Komeito, together form the largest bloc in the Upper House, which will make it
easier for the Abe government to pass legislation than its recent predecessors. Second, the two
parties won enough seats in December to form a “super majority” (i.e., two-thirds) in the Lower
House, so that even if they cannot secure an Upper House majority, they could override the Upper
House’s actions and pass legislation.





Abe’s Priorities

During and since the election campaign, Abe has spoken of building a “new Japan.” He has
placed primary emphasis on economic recovery, particularly fighting what he describes as
deflationary tendencies, an over-valued yen, and delayed reconstruction of areas affected by the
triple disasters of March 2011.52 Abe has also revived many of the security-oriented themes of his
first stint in office, when he upgraded the Japan Defense Agency into a full-fledged ministry and
spoke of loosening or abandoning the legal and political restrictions on the operations of Japanese
military forces. He has revived the latter goal and has pledged to increase Japanese defense
spending for the first time in a decade. Notably, however, Abe has presented national security as
secondary to economic revitalization. In contrast, Abe’s fall from power in 2007 was in part
attributable to his tendency to downplay economic and social welfare issues at the expense of his
security policy priorities. At the time, the opposition Democratic Party of Japan (DPJ) was able to
take advantage of this, which contributed to perceptions that his Cabinet was incompetent and
allowed the DPJ to wrest control of the Diet’s Upper House from the LDP in 2007 elections.
Shortly thereafter, Abe suddenly resigned. One difference between now and then is that the
Japanese polity, especially the LDP and its supporters, appear more willing to support tough
positions on national security, in part due to a widely held sentiment that China, Russia, and
South Korea have been asserting themselves at Japan’s expense.

Abe’s main electoral priority will be ensuring that the LDP and its coalition partner, the New
Komeito party, do well in the July 2013 elections for half of the seats of Japan’s Upper House.
These elections will be pivotal; if the LDP loses seats, the Diet once again could become divided.
Two key developments to watch are whether the July elections weaken or deepen the LDP’s
reliance on New Komeito and, relatedly, the extent to which New Komeito leaders assert
themselves in various policy issues. Specifically, New Komeito opposes efforts to weaken or do
away with Japan’s collective self-defense ban. In practice, however, New Komeito leaders often
have placed a greater priority on maintaining their coalition with the LDP than upholding the
party’s principles in many matters of national security.

In 2007, Abe cited his poor health as one reason for his abrupt resignation. Days after he stepped
down he was hospitalized for what was later revealed to be ulcerative colitis, a chronic and
episodic form of inflammatory bowel disease in which ulcers and sores in the colon can cause
pain and other symptoms. Stress can trigger flareups, and Abe’s symptoms reportedly became
nearly unbearable in the weeks after he led the LDP to its 2007 Upper House defeat. Abe
reportedly says that the disease is now under control thanks to medication that was not available
in Japan until 2009.53

The DPJ and Alternative Political Forces

The DPJ appears to have been thrown into a state of disarray by the magnitude of its December
2012 defeat, which saw a number of prominent DPJ leaders lose their seats. In the days following
the election, the remnants of the former ruling party chose Banri Kaeda as their leader. Although
the DPJ is Japan’s second-largest party, as of early 2013 the prevailing narrative is such that its
actual power appears less than its numerical strength. Formed in the late 1990s by an
amalgamation of former conservative and progressive politicians, the party continues to be riven
by divisions among its more hawkish and dovish factions. It remains to be seen whether some of
the DPJ’s advocates for a tougher security stance will break with the other members of their party
and support some of Prime Minister Abe’s security initiatives.

Over the past 20 years, growing frustration with Japan’s political status quo has periodically
given rise to small-to-moderate protest movements. One such wave resulted in the defeat of the
LDP in the 2009 Lower House elections, ushering in the DPJ’s three-year reign. Many Japanese
have embraced alternative leaders such as Osaka mayor Toru Hashimoto, who since mid-2011 has
captured national attention as the de facto leader of a populist deregulatory and decentralization
movement. Together with former Tokyo mayor Shintaro Ishihara, Hashimoto formed the Japan
Restoration Party (JRP, also known as Ishin No Kai) in the fall of 2012 and captured enough seats
to almost overtake the DPJ as the leading opposition party. Both Hashimoto and Ishihara are
known to support nationalist positions on matters of security and history, and thus could perhaps
be natural ad hoc allies for Abe on these issues.

Structural Rigidities in Japan’s Political System

The turmoil of the past six years at the top of the political structure has compounded Japan’s
political peculiarities. Compared to most industrialized democracies, the Japanese parliament is
structurally weak, as is the office of the prime minister and his cabinet. Though former Prime
Minister Junichiro Koizumi (who served from 2001 to 2006) and his immediate predecessors
increased politicians’ influence relative to bureaucrats’, with important exceptions Japan’s
policymaking process tends to be compartmentalized and bureaucratized, making it difficult to
make trade-offs among competing constituencies on divisive issues. The result is often paralysis
or incremental changes at the margins of policy, particularly during periods of weak premierships
such as the one Japan has experienced in recent years.
Five of the past six prime ministers have confronted a major structural challenge: overcoming a
divided parliament. Japan’s Diet, as its legislature is called, is divided into two chambers, the
Lower House and the Upper House. Although the Lower House is the more powerful—among
other powers, it chooses the prime minister—in reality, it is numerically and politically difficult
for it to exert its will over the Upper House. For decades after World War II, the Upper House’s
effective veto was not an issue because one party, the Liberal Democratic Party (LDP), controlled
both chambers. However, in recent years, the Diet’s two chambers have been controlled by
different parties. From 2007 to 2009, the LDP was ascendant in the Lower House (and therefore
the ruling party), with the DPJ in control of the Upper House. From mid-2010 until the December
2012 elections, the reverse was true. Both times, the party in control of the Upper House has
blocked most of the ruling party’s bills, in an attempt to force the prime minister to hold early
elections. As discussed above, for this reason, a major priority for the Abe government will be
ensuring that the LDP does well in the July 2013 Upper House elections.

Japan’s Demographic Challenge

Japan’s combination of a low birth rate, strict immigration practices, and a shrinking and rapidly
aging population presents policymakers with a significant challenge. Polls suggest that Japanese
women are avoiding marriage and child-bearing because of the difficulty of combining career and
family in Japan; the birthrate has fallen to 1.25, far below the 2.1 rate necessary to sustain
population size. Japan’s current population of 127 million is projected to fall to about 95 million
by mid-century. Concerns about a huge shortfall in the labor force have grown, particularly as the
elderly demand more care. The ratio of working age persons to retirees is projected to fall from
5:2 at present to 3:2 in 2040, reducing the resources available to pay for the government social
safety net.54 Japan’s immigration policies have traditionally been strictly limited, but policy
adjustments have allowed for a larger foreign labor force. With government encouragement, some
private firms offer incentives to employees with children.




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