Japan shifts to the right under ‘Iron Lady’ admirer Sanae Takaichi

TOKYO - Ms Sanae Takaichi, the pro-stimulus conservative who has become Japan’s first female prime minister, is an energetic nationalist with a soft spot for the hard-nosed politics of Iron Lady Margaret Thatcher and the heavy metal music of Iron Maiden.

Ms Takaichi broke the glass ceiling to become

the nation’s leader after a parliamentary vote on Oct 21.

Her choice as leader is essentially a bet by the ruling Liberal Democratic Party that a swing back to the right will attract the younger voters who have flocked to smaller populist outfits, including the arch-conservative Sanseito party.

Even before becoming prime minister, Ms Takaichi has shown a steely resolve and ability to turn adversity into advantage. Her refusal to take further action on a party funding scandal prompted a shock rupture in the ruling coalition earlier this month.

After more than a quarter century of cooperation, the more moderate Komeito party bolted from the alliance while Ms Takaichi stood her ground. That fanned the prospects of an opposition bid to seize the premiership.

But Ms Takaichi quickly struck a deal with the right-leaning Japan Innovation Party, also known as Ishin, that actually gives her a closer ideological bedfellow to run her government.

Still, the choice of Ms Takaichi could backfire if the ruling party is seen simply reverting to the easy money and hawkish diplomacy of her mentor, former Prime Minister Shinzo Abe, without any new ideas.

Her ascent to the top of the political world will send ripples through the male-dominated society that languishes near the bottom end of global gender equality rankings. But like Ms Thatcher, the former UK prime minister whom she cites as an inspiration, her conservative views place her a long way from the stance of progressive feminism.

Her ability to build a lasting legacy as the nation’s leader will depend less on her ability to further the position of women than on her capacity to restore the fortunes of a ruling party in disarray after decades of dominance in postwar Japan. 

“From a normal woman’s perspective, she’s what you might call an idol for ‘old men,’” said Ms Mieko Nakabayashi, politics professor at Waseda University. “She’s someone who expresses ‘old man’ opinions from a woman’s mouth and makes them happy.”

Her longevity at the head of a fickle political machine known for quickly axing its presidents will depend on how swiftly she can unite the LDP, win back public support and connect with those younger voters. 

Now she’ll need to extend her reach beyond party lines, as the LDP’s lack of a parliamentary majority forces her to build a consensus with opposition parties to pass legislation. While the new coalition with Ishin has more seats in the lower house than the alliance with Komeito, it is still two short of a majority.

One of Ms Takaichi’s first tasks will be to build ties with Donald Trump, who has said he plans to visit Japan on a trip to Asia next week.

Ms Takaichi was the most forthright among the five candidates in the LDP leadership race over the possibility of renegotiating parts of Japan’s trade deal with the US. While an immediate renegotiation is not on the table, she said Tokyo would make its opinions known through the appropriate routes should the deal not serve its interests.

On issues such as ramping up Japan’s defense spending and capabilities, containing China’s growing influence and building supply chains that align with US interests, she is likely to be a good match for Trump’s views. 

Ms Takaichi’s coalition agreement with Ishin gives her party a more closely aligned partner on defense and foreign policy.

While Komeito sought to maintain smooth ties with Beijing and was wary of loosening Japan’s restrictions on defense exports, Ishin is more closely aligned with Ms Takaichi’s concern about the security challenge from China and wants to build up Japan’s defense sector, as well as deepen Tokyo’s alliance with the US.

As part of their pact, Ishin and the LDP said they would seek to remove all restrictions on defence exports by next year, build weapons factories that would be operated by private companies and advance plans for a new multi-year program of investment in the nation’s military.

Those moves would likely be welcomed by officials in Washington. Still, she likely has less name recognition among US conservatives who have met her rival in the leadership contest, Mr Shinjiro Koizumi, and who remember his father Junichiro wearing Elvis shades and serenading former President George W Bush two decades ago.

Local media reports indicate that Ms Takaichi will tap Mr Koizumi to be defence minister when she announces her cabinet lineup later on Oct 21.

“Takaichi has extensive experience as a politician, and since the US’s hardline stance toward China does not significantly conflict with her own views, she should be able to build a good relationship with President Trump,” said Mr Yuichi Kodama, chief economist at Meiji Yasuda Research Institute.

For investors, the main concern will be her reputation for wanting spending to achieve growth and her penchant for central bank stimulus to goose the economy. That’s a combination that can keep downward pressure on the yen while bumping up super-long government debt yields.

Keeping the yen weak would do little to help the inflationary pressure irking households and more domestic-orientated firms. But a weak currency will likely support the earnings of Japan’s big exporters and fuel stock gains. The Nikkei 225 set a fresh record high on Oct 20, amid news of the new coalition deal.

In the latest leadership campaign, Ms Takaichi toned down her scathing views on the Bank of Japan’s interest rate hikes from last year, when she described its raising of rates as “stupid.”

But in a recent Kyodo survey she still said the BOJ should leave interest rates unchanged for now. The central bank meets next week, and with Ms Takaichi taking the helm, market expectations are low for a rate increase this month.

Her spending plans are less clear. All of the candidates were expected to unleash a package of economic measures to help consumers deal with inflation in the fall, but she was the boldest in saying that extra bond issuance may be needed. 

Under the deal with Ishin, she has agreed to discuss the possibility of lowering the sales tax on food to zero temporarily. That’s one of the costlier options for dealing with the cost-of-living crunch, but might finally show the public that the government is on their side. 

Ms Takaichi has also hinted at raising the tax-free income allowance before the end of the year, a move that would resonate well with the Democratic Party for the People, another populist party that has made major inroads in the last year or two. 

While saying her spending plans will be “responsible” and that she’ll ensure the nation’s net debt load will fall over time, she said “the goal is achieving economic growth, not fiscal health,” in a sign of her expansionist spending tendencies. 

“While she always leaned toward a reflationary stance, the current economic environment has changed significantly, and curbing inflation has become the country’s mission,” said Meiji Yasuda’s Mr Kodama. “Opposing the BOJ’s rate hikes would be contradictory, so I don’t think she can make extreme statements regarding monetary policy.”

Ms Takaichi was born on March 3, 1961 and grew up in the ancient capital of Nara, a city known for the emergence of Buddhism in Japan. Her father worked as a salesman at an equipment manufacturing company while her mother worked for the Nara police force. She studied business management at Kobe University. 

As a student, she rode a motorbike and played drums in a heavy metal band, and counts herself as a fan of British heavy-metal bands Black Sabbath and Iron Maiden, according to local media.

She still occasionally picks up the sticks to hammer away on an electric drumset at home, if she squabbles with her husband, she told a local broadcaster in an interview. Her go-to song is Burn by Deep Purple. 

“To be honest I wish I could go out for karaoke, but I’ve been reining myself in these past years,” she said in that interview.

She studied at the Matsushita Institute of Government and Management, an organisation focused on producing leaders in the world of politics and industry. 

She worked briefly as a news anchor before winning her first election in 1993 as an independent at a time when the LDP was in disarray following the bursting of Japan’s economic bubble. That election saw a multitude of opposition parties join forces to form a patchwork administration and oust the LDP for the first time since its formation.

But as it has done subsequently, the LDP found a way of regrouping and taking back power, while most of the parties that ousted it have vanished.

Over her years as a politician, including her time as internal affairs minister, promoter of “Cool Japan” and as economic security minister, Ms Takaichi has garnered a reputation as studious with an attention to fine detail. She is known to shun socializing and drinking with her peers.

“If I’m going to go out for dinner or have a drink, I’d much rather work or study something new,” she said during a campaign speech last year, adding that she often works over weekends. 

Shortly after winning the LDP election earlier this month she doubled down on that message.

“I’m going to abandon the phrase ‘work-life balance,’” she said, prompting laughter from the rows of LDP lawmakers listening to her speech. “There is a mountain of things that we must accomplish together and I would like to see you work like horses.”

As a conservative darling and Abe protege, China may be wary of how she navigates a relationship that has remained tense in recent years. 

Previously, Ms Takaichi did not mince her words when asked whether she would visit Yasukuni, a shrine in Tokyo that honors Japan’s war dead including those who were charged as war criminals after World War II. Visits by previous prime ministers have angered neighbouring countries and proven to be a flashpoint for Japan and China.

“Once the sentence is carried out, they are no longer criminals,” she said during a live TV show in the runup to the LDP election. 

But in a sign that she can also be pragmatic, she skipped a visit to the shrine last week.

“This shouldn’t become a diplomatic issue,” she said earlier this month when asked if she would continue to visit the shrine. “I’ll make appropriate decisions at the appropriate time on praying for peace.” 

Ms Takaichi has also honed in on anxieties felt by the public as the number of foreign-born visitors and workers rises amid a drop in Japan’s own population. She started her LDP campaign speech with a gripe about foreign tourists in Nara, saying she had heard of some tourists kicking the deer that roam freely in the local parks. 

With Sanseito gaining ground in elections by capturing such concerns under a “Japanese first” message, Ms Takaichi could be the conservative icon the LDP thinks it needs to win back right-wing voters. The strength of her popularity among local ruling party supporters was a key factor that secured her ascent to the top of the LDP.

The coalition partners said they would formulate a population strategy that would set numerical targets and basic policies for accepting foreigners, strengthen measures to deal with crimes by foreigners and aim to create a panel to review foreign investment in Japan similar to the Committee on Foreign Investment in the US.

In a twist of irony for Japan’s likely first female prime minister, her conservatism may not bode well for gender equality issues. 

She opposes same-sex marriage or allowing spouses to have separate surnames, claiming it could undermine family unity. Novelist Kyoko Nakajima once called Ms Takaichi “an honorary man” for maintaining views consistent with a traditional male-centered society, the Japan Times reported in 2021.

And while her appointment breaks a glass ceiling, it also risks becoming a glass cliff.

“Female leaders are often given some leeway for not doing things the ‘traditional’ way,” said Waseda’s Nakabayashi, who was skeptical whether Takaichi’s election represents a new era for women in Japan. “That’s why it’s often the case that women only get the leadership positions when the going gets really tough.” BLOOMBERG