Arrest of Japanese `Kingmaker' Divides Party on Reform

CORRUPTION SCANDAL

SINCE he became a politician 45 years ago, Shin Kanemaru has campaigned on the slogan: "the homeland that I love."

Yesterday, prosecutors plan to indict this former kingpin of Japanese politics for failure to report to his homeland about some $42.8 million in taxable income, with most of the money reportedly having come from business payoffs.

Once mighty enough to pick and dismiss prime ministers, the elderly Mr. Kanemaru now sits in a Tokyo jail eating barley and rice like any other prisoner, vulnerable to a five-year sentence.

Kanemaru's vast rake of wealth has sparked the expected ire among Japanese already angry at top politicians for a massive bribery scandal last year involving the Sagawa trucking firm.

Each day since Kanemaru's surprise arrest March 6, investigators have unearthed more details, many of which he reportedly admits, such as his huge stash of gold bars, the use of his family to accept payoff money, and his brazen dealing in corrupt funds even after being forced to resign from parliament last October.

Despite his audacity and a string of other money scandals in Japanese politics since 1989, any reform of the nation's peculiar electoral system that breeds such corruption still appears far off.

Prime Minister Kiichi Miyazawa, who relied on Kanemaru to gain office and was stunned by his arrest, admits that the issue of political reform is "a problem of the system as a whole."

A major restructuring of the system is unlikely soon simply because Japanese firms still pay off politicians to mitigate the effects of myriad government rules and "guidance" by bureaucrats, an Asahi newspaper editorial states. "Hardly anyone in business tries to call the makers of such contributions - business leaders themselves - to account," the editorial says.

Business seems to prefer strict government regulations to the fierce competition that would likely ensue without them. "Put simply, the money contributed from the business world overtly and covertly has underpinned the politics of the ruling Liberal Democratic Party since the end of World War II," the editorial states.

Whether the LDP is capable of even slightly reforming politics, at the risk of weakening its hold on power, may be known within a few weeks as it prepares reform legislation. So far, top LDP leaders have preferred to distance themselves from Kanemaru, hoping all blame falls on him. He already left the LDP last fall after admitting he took $4.2 million from the Sagawa firm.

IN the past, LDP chiefs have relied on public amnesia to surmount their scandals. The current scandals could be overshadowed by a royal wedding in June and the summit of the seven leading industrial nations in Tokyo this July.

An internal LDP struggle is under way, says analyst Minoru Morita, between those who want to make Kanemaru a scapegoat and those who want to use his case as a starting point for reform.

The party remains split over the type of reform: whether to replace Japan's multiseat electoral districts with a single-seat system. Many LDP members and opposition politicians fear losing their seats under a single-seat arrangement. But without such a step, Japan may not be able to reduce the amount of cash needed to campaign in a multiseat system, in which members of the same party run against each other.

Rather than strongly seeking reform, politicians are angling for a realignment of parties, with those professing reform sounding each other out for possible alliances.

Ironically, Kanemaru's former prot, Ichiro Ozawa, has set up his own faction within the LDP, hinting that he might split off and form an alliance with some opposition parties if reforms are not enacted. He denies knowing of any payoffs to Kanemaru.

The party most likely to gain from this latest scandal is the Japan New Party, which was formed last year mainly to clean up Japanese politics. It has quickly picked up popularity, already winning four seats in the upper house.

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