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In Japan, mounting anger over bread-and-butter issues

Rising prices, shortages of food items, and political gridlock spur calls for a quick election.

By Christopher JohnsonCorrespondent of The Christian Science Monitor / May 8, 2008


At a Jomo gas station in western Tokyo, an attendant in green-and-orange overalls recently explained why rising prices may topple the governing party after more than 50 years in power.

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"People don't come here to complain. But they will complain during the next election," says Mayumi Uchida, noting the line of drivers who hurried to fill their tanks before a liter of gasoline jumped from 126 yen ($1.18) to 160 yen on May 1. "Many people didn't even bother to vote in the last election. But this time they are going to vote against Prime Minister Fukuda and the governing party, because the cost of everything is increasing and our salaries are the same."

Amid political gridlock, the first significant price hikes in a decade for basic items are politicizing consumers long known for their apathy and resignation. Many worry that inflation, which many economists once said would spur growth, will instead stifle demand and sink Japan back into the recession of the 1990s.

Polls suggest that two-thirds of Japanese disapprove of Prime Minister Yasuo Fukuda's move to reinstate the gas tax on May 1, after it had expired March 31, resulting in artificially low prices for a month.

Due in part to the tax controversy, Mr. Fukuda's approval rating has dropped by between 5 and 8 points to below 21 percent, according to separate surveys by the Nikkei and Asahi newspapers. The ratings are lower than those of his predecessor, Shinzo Abe, when he resigned in September.

Sensing the public's anxiety, opposition politicians, who control the Upper House, have stepped up pressure on the ruling Liberal Democratic Party to call a quick election.

Fukuda argues that the taxes are needed to cover a burgeoning deficit. "In the last month, we have lost 180 billion yen worth of revenue," he told a press conference last week. "If this state continues, every day the local and state governments will lose 6 billion yen of revenue. We can't just neglect this revenue shortage. I'm not considering dissolving the Lower House at this moment."

But the Democrats claim that the ruling party has long used road taxes for wasteful spending on pork-barrel construction projects. Since winning Upper House elections last year, the Democrats have criticized the LDP, who control the Lower House, for ignoring bread-and-butter issues.

Indeed, those have compounded the ruling party's woes. Prices for bread and instant noodles have spiked. And butter has disappeared from shelves in recent weeks, partly a result of the growing popularity of bread and declining output by farmers, who face rising fuel and grain costs. While not a serious threat, the shortages have a symbolic impact as well as practical political one: Instead of trumpeting a longtime policy of shielding markets, Japan is calling for more imports and hopes to boost local production.

Japanese officials are also concerned about the broader global food crisis. During the Asian Development Bank's annual meeting in Madrid Sunday, Japanese Finance Minister Fukushiro Nukaga warned that soaring prices might wipe out a decade of economic growth in Asia.