Japan 2014 Elections: PM Abe’s Crafty Strategy to Win Elections

Last weekend, I noted that Japan’s PM Shinzo Abe wanted to portray that by winning the snap elections in December, his victory would represent a popular mandate on Abenomics. 

Yet any such victory would represent a cunning skullduggery of the average Japanese.

With reference to the 3Q GDP I wrote, (bold original)

the lift from government spending means BIGGER BUDGET DEFICITS—(see right window from the Ministry of Finance) as tax revenues swoon due to recession while public spending surges.

And this would pressure Japanese politicians to impose even HIGHER TAXES in the FUTURE.

And this is why PM Abe has opted to dissolve the parliament last week where elections are likely to be held possibly in mid-December. PM Abe has emphasized that the elections will be a mandate on Abenomics: "I want to make it clear through the debates during this general election, whether our economic policies are right or wrong, or if there is no other choice available to us" he said, "I will step down if we fail to keep our majority because that would mean our 'Abenomics' is rejected," the prime minister added.

The idea for the swift or snap elections may be to reduce campaign period for the opposition. So PM Abe will rely on his machinery and from his residual political capital to get a mandate. PM Abe seems confident to win from a campaign blitz against disorganized opposition.

Here is how the Japanese elections has been shaping up as pointed out by the International Business Times:

1 Uninterested electorates 

Japanese voters may stay home for the Dec. 14 snap parliamentary elections called by Prime Minister Shinzo Abe last week, which many see as a referendum on his “Abenomics” economic policy. The election's timing has confounded some Japanese. Experts said Abe called the “referendum” to catch the opposition off guard and strengthen his justification for the policies before he and Abenomics became too unpopular to win another election.

Only 65 percent of voters in a poll published Sunday by the Yomiuri daily newspaper were interested in voting in the mid-December elections, according to Reuters.

This just goes to show how PM Abe will ram Abenomics down the throats of the unfortunate citizenry. This is a sign of desperation. This also gives a clue why those tax promises--delay in sales tax and cutting corporate taxes--may not be fulfilled once PM Abe gets his mandate.

2 PM Abe’s Pearl Harbor strike against the opposition

Abe’s Liberal Democratic Party heads into the election with the support of 37 percent of voters who participated in a poll by the Nikkei Business Daily and TV Tokyo over the weekend, despite Abe’s low approval ratings. Just over half of Japanese voters oppose Abe’s economic policy and only a third support it.

Japanese voters have few alternatives. The LDP’s main opposition party, the liberal Democratic Party of Japan, had the support of only 10 percent of polled. The surprise call for election has caught Abe's opposition unprepared to launch a proper campaign, experts said.

Still, 45 percent of voters in the Nikkei and TV Tokyo poll were undecided, possibly indicating they still need to be convinced of Abenomics, which Abe undertook following his appointment in 2012. The Japanese economy contracted 0.4 percent in the third quarter of this year following a second-quarter shrink of nearly 2 percent.

PM Abe exudes overconfidence. 

The most likely part of the grand insidious scheme to secure such mandate would be for the administration to continue to push higher Japan’s stock market in order to generate popular appeal.

But as pointed out in the past, only about 20% of Japan’s population are likely to benefit from this, which comes at the expense of a much larger segment of society who suffers from a weaker yen and more importantly a reduction of purchasing power.

The distribution of popularity numbers above seem to indicate on this (more than half opposed, a third support).

And notice too that in terms of elections undecided voters have been reported at 45%. If accurate, then this would account for  a substantial number. What if the  “over half of Japanese voters” who “oppose Abe’s economic policy” make up the gist of undecided voters? What if the current recession deepens enough to influence these undecided to vote against the administration despite the unpopular opposition? This choice between the devil and the deep blue sea signifies a huge gambit for Abenomics.

So PM Abe will have to increasingly depend on his machinery to “do whatever it takes” to get the job done and secure his desired mandate.

This should be a wonderful example of how elections are about egregious manipulation of the public.

As New York University’s Mario Rizzo wrote: The will of the people is a construct that is quite malleable to the political purposes of whichever group is better at manipulation

Yet despite PM Abe’s overconfidence and the consensus expectations of  a status quo--back to the yen and stocks--what happens if a black swan event happens—where PM Abe losses? Will there be a financial earthquake in Japan that may spillover to the world?