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Next Step : Carving Out a New Politics in Japan : Sunday's pivotal parliamentary election offers the possibility of greater change than the country has seen in four decades. And reform is the byword.


He had done little practical planning, but four of the party's candidates still won at-large seats in the election--including Yuriko Koike, an exuberant former television newscaster; Yoshio Terasawa, an urbane former executive for Nomura Securities' United States operations, and Hosokawa himself.

The party's agenda is based largely on Hosokawa's experiences as a governor. In Japan, local governments have extraordinarily little leeway: the central government's powerful ministries dominate public works, education, transportation--all major and minor aspects of public policy. If your taxi company wants to add a cab in Kumamoto, you'll have to get approval from the Transportation Ministry in Tokyo half way across the country.

Hosokawa, like other critics here, blames that centralization for the political system's endemic corruption, as businesses lean on Parliament members to lean on the bureaucracy for contracts and necessary approvals. His proposed solution is to decentralize power from Tokyo to the prefectures.

But the heart of Hosokawa's complaint is that the iron triangle of business, the bureaucracy and the Liberal Democrats has controlled Japan for so long that the country has ceased to function as a real democracy. "The root cause of our structural problems . . . is that we haven't had political change," Hosokawa told me one day this spring. "For over 50 years, we've had a kind of pseudo-democracy in practice here in Japan."

Today, maybe only about one-fourth of the Japanese people share those sentiments, estimates Terasawa, the former securities executive now in the upper house. But that still offers the New Party a potentially large base of support in the next election, if they can mobilize it. In the June elections for the Tokyo Assembly, the equivalent of a state legislature, the New Party gained dramatically.

For all his regal tranquillity, Hosokawa understands the opportunity in Sunday's national election. "At the time I started the party I was thinking we should gradually increase our candidates over the next five to 10 years," he said earlier this year.

"But now I think we should work toward this election as if it were our last chance."


In the heart of Tokyo's Roppongi nightclub district, it's an incongruous sound. But there in Studio One of TV Asahi's brightly colored complex of buildings is Larry King's Brooklyn baritone booming through the loudspeakers.

"Next we'll talk about politics Japan-style. And we'll meet Japan's Ross Perot."

When he hears that introduction, the man seated on the stage to King's left leans back suddenly and throws out his arms and legs as if an electric current had passed through his chair. "I'm not rich!" cries Kenichi Ohmae, the management consultant who has formed a citizen's movement to reform Japanese politics.

"Yeah, yeah, yeah," says King, who is in Asia to tape a week's worth of programs.

As I had already discovered in conversation with Ohmae, his real objection to comparison with Perot is more fundamental: The American billionaire doesn't measure up to his standards. "Everyone who knows the man doesn't respect him," he says, "and therefore the American public had a nightmare."

This is the way Ohmae, 50, talks about most subjects. People in Tokyo frequently describe him as un-Japanese, by which they mean two things. One, that he has very strong opinions. Two, that he has a very strong opinion of himself. He actually rather resembles Perot in his Napoleonic level of self-assurance.

Few here, then, thought it out of character when Ohmae last November announced that he was forming something virtually unprecedented in Japan: a nationwide citizen's political reform movement. Ohmae christened the group the Reform of Heisei (borrowing the name applied to the reigning era of the current Japanese Emperor Akihito) and structured it as a cross between Common Cause and a mutual fund. Supporters can join for about 10,000 yen (about $90 at the current exchange rate).

With the money, the group screened candidates for the election and provided contributions to those it deemed the most committed to fundamental political and economic reform. Last month, Ohmae announced that Heisei had managed to interview 166 candidates and was endorsing 94.

According to several of his confidantes, Ohmae hopes that all the successful candidates the group endorsed will quit their own parties after the election to form a new Heisei Party.

Like Perot, Ohmae had circled the political world for years before stepping in. Trained as a nuclear engineer, he spent two years designing nuclear reactors for Hitachi Manufacturing and then joined McKinsey & Co., one of the world's leading management firms. Twenty years later, he is chairman of McKinsey's Japanese operation.

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