Partly, this is because investors know that the other two parts of Japan's governmental 'iron triangle' - big business and the bureaucracy - still stand. The nature of the new parliament elected on 18 July helps, too: the reforming parties that made the most startling gains have their roots in the LDP itself.
But the overwhelming reason for the smoothness of the transformation is to be found in the new coalition's promise that Japan's policies on defence, the economy and foreign affairs will remain unchanged. Elsewhere, such a statement would be impossible. Yet ideology counts for little in Japan. Even the socialists, who have been kept out of power for a generation by their wish to disarm unilaterally, to expel the 44,800 US troops from Japanese soil and to bring in a Soviet-style economy, were able to swallow their scruples.
The new government needs to act quickly if it is to reform the country's creaking political system. The LDP's performance in the election - only 33 seats short of a majority, scandals notwithstanding - was proof that its local machine remains undamaged. If it chooses a young leader, the party will give further evidence of its ability to change with the times. At the first sign of indecision, the LDP will be ready to delay or neutralise the reforms, and then win back enough friends from the opposition to forge a parliamentary majority and take back power.
To prevent such a retreat, the new government must not stop at abolishing the multi-member constituencies in the current electoral system that make party factions necessary. It is not only the demand for corrupt money but also its supply that needs to be tackled: further deregulation of the economy would make business less dependent on government, and thus more able to refuse politicians' requests for money.
Threatening the great changes ahead, however, are doubts over public support. Although the election was probably the most important since the Second World War, only two voters out of three chose to vote. In Tokyo - full of just those urban consumers who stand to benefit most from radical change in Japanese politics - only one in two bothered to turn out. With such an indifferent public, Japan's leaders will have to impose change from above. This is nothing new: modernisation under the Emperor Meiji in the 1870s and democratisation under the occupying American forces in the Forties were carried out in exactly the same fashion. But that is hardly a recipe for stability; nor does it say much for the citizens of the world's second most powerful country.Reuse content