That Japan needs reforms is hardly in doubt. The country is experiencing the worst recession since the Second World War, with forecasts of up to minus 3 per cent growth this year. Japan is not only the world's second largest economy; it also dominates the East Asian economic zone, and so recovery throughout that region depends directly on Japan.
There is a fair measure of agreement that the most urgent of the reforms is to support the banking system, but there is disagreement over the details of how this should be done.
The underlying problem is that there is no consensus about other, deeper reforms: the power of the central government vis-a-vis regional government, the power of the civil servants who run the various ministries vis-a-vis the Prime Minister and cabinet, and the changes in the tax and regulatory system in this still highly regulated society. How will the political impetus for change manifest itself?
I have just spent most of a day with the Democratic Party of Japan (DPJ), the principal opposition party. It came second to the Liberal Democrats (LDP) in the recent elections, but doubled its vote. As a result, its leader, Naoto Kan, who tops the opinion polls as Japan's most popular politician, is being talked about as the next prime minister; or, given that they seem to change the office rather frequently, maybe the next but one. Mr Kan himself is cheerful and telegenic, at 51 a different generation from the Liberal Democrat top politicians - and openly admiring of Tony Blair. He met him earlier this year and cited him as a model a couple of times in our conversation. A delegation from the DPJ is going to the UK later this year to see what it can learn from young Blairite party workers.
Mr Kan also talked of Japan facing a change as radical as the Meiji restoration 130 years ago, and the establishing of the present democracy after the Second World War. He wants, he said, to form a cabinet on the UK model. The prime minister would choose the ministers, rather than accepting the people supported by the party and the bureaucrats. Those ministers would have full responsibility for the policies they carried out, rather than rubber-stamping policies agreed collectively beforehand. He also wants to decentralise power (another Blair parallel) by allowing local government to have much more freedom in allocating resources.
Some of the people around Mr Kan have even more radical ideas. One of the driving forces behind the party is Yoshito Sengoku, the chief planner, who is the Gordon Brown to Mr Kan's Tony Blair. Mr Sengoku told me that his own aim was to get the top rate of income tax down to 20 per cent. At present it is 65 per cent, and the ruling LDP has a proposal to bring it to 50 per cent. Mr Sengoku reckons that closing all the loopholes would make a cut of this sort credible. Were that to happen, the whole world would be looking to Japan to see if it could pull it off.
What does all this mean? For a start, it is interesting, and a bit of a change, to come from a country that is seen as a model for reform. One of Mr Kan's aides explained: "We see Britain as a success story, and we want to learn from its experience." But that is really more a reflection of the Thatcher reforms than anything Mr Blair has done. Privatisation of public utilities and the London stock market's Big Bang have been directly carried over to Japanese institutions, even if the volume of Big Bang has been somewhat muted in the transmission.
There seem to me, however, to be two areas where the Blair influence is directly relevant to Japan, or indeed the politics of other developed countries.
The obvious one is style. Voters clearly like politicians to appear unstuffy, approachable and slick - and ideally to have a good head of hair. It is not just a Blair model; it is also a Clinton one. He admires the US President for the way in which, up to now anyway, he has been able to build support for a broad range of apparently successful policies.
I haven't see the DPJ adverts, but the posters are stylish and modern. Its party offices are like the new Labour headquarters in Millbank Tower, or a successful software company: white walls, busy young people scurrying about, and banks of computers. The DJP hasn't yet got its spin-doctoring in order, for Mr Kan was worrying about the difficulty of getting his ideas accurately represented in the Japanese media, but I guess they will get round to it.
The more substantial parallel is the way in which the Blair model (or rather the Clinton/Blair model) stresses what politicians can and cannot do. Instead of saying, "We have a vision and this is the way it is going to be," the message is more: "We live in a global economy and all governments can do is create a broadly favourable environment in which you can then be a success within it."
In the case of Japan, this translates as: "The bureaucrats do not know best, and our job as politicians is to liberate you, the voters, from them." Deregulation is justified as freeing people from bureaucracy, not letting them be ruled by the markets. It is a practical justification for governments doing less, not an ideological one.
Just as there is a world market for goods, so there seems to be a world market for political ideas. Britain happens to have an exportable product at the moment, the thing everyone wants to buy. What the product in fact consists of is much harder to gauge. Japan has a tradition of importing ideas, modifying them and improving on them. It is an intriguing notion that Japan might be able to buy UK reforms, and them improve on them. It would, so to speak, be buying a bundle of Thatcher policies, but given a more compassionate, human face by Tony Blair.
We put it to Mr Kan that Japan really needed a Thatcher before it could have a Blair. He leapt to his feet, and ruffled around in his bookshelf for his current reading. It was, he said, a biography of Margaret Thatcher.
No, Japan is not going to get a set of reforms pushed down from above by a conviction politician. Whatever happens, even if Mr Kan does win power in the next election, there will have to be a reasonable level of general agreement before radical reform can be carried through. He would, he said, have to make the direction of reform clear, but there would have to be discussion on it. It is almost as though he is hunting for that elusive animal, the Third Way. Can you get the benefits of efficiency that the market can bring, and still protect the weak from its harsher effects? Radical change always hurts someone. Can you get people to agree to be hurt?
Maybe in Japan you can - I don't know. But I am sure that it is very much in our self-interest in the UK that Japan should recover, in both political and economic terms. And if the Blair model can help it along the way, then we should be glad to have been helpful.Reuse content