Opinion Japan elections: The post-Abe consensus has fractured

Anatomy of the fall

At its core, the election reflects the growing rift between Japan’s political class and its economic anxieties. Inflationary pressures, particularly the spike in food staples like rice, converged with long-standing frustration over wage stagnation.
Japan’s fiscal credibility also hangs in the balance. With debt already exceeding 260 per cent of GDP, Ishiba cannot afford appeasement through blanket spending. Yet voters, especially those outside Tokyo’s financial districts, are demanding relief.
Market actors, especially bondholders, are watching. The yen has already weakened, and yields have climbed amid political uncertainty.

Sanseito’s shadow

Lurking just beneath this macroeconomic discontent is the rise of Sanseito, a right-wing populist party that surged from 2 to 15 seats, gaining traction with its nationalist, anti-immigration, and “Japanese First” rhetoric. Its success mirrors the pattern seen in Europe (think AfD in Germany, PVV in the Netherlands), where economic insecurity fuels identity-based politics.

For a nation confronting acute labour shortages, particularly in caregiving and agriculture, an anti-immigration tilt is deeply counterproductive. But if mainstream parties continue to echo Sanseito’s positions to woo disillusioned voters, Japan risks closing itself off at a time when demographic realities demand openness. Sanseito’s rise is a symptom of disaffection with elite governance, and unless addressed structurally, it may grow beyond containment.

Their leap is a signal that Japanese politics, long thought to be immune to the kind of populism seen in the West, is changing.

Roots of rejection

A turning point in Japanese postwar political history, commonly referred to as the beginning of the “1955 System,” was when two major conservative parties, the Liberal Party and the Japan Democratic Party, merged to form the Liberal Democratic Party (LDP). The LDP was created as a big-tent conservative party committed to pro-business policies, constitutional pacifism, and the US-Japan alliance.

From then onwards, the party dominated Japanese politics almost uninterruptedly for decades. This period was even known as the start of a “one-and-a-half party system”, with the LDP as the major ruling party, and the Japan Socialist Party acting as a weak opposition. While it ushered in an era of political stability and economic growth, it also bred clientelism, factionalism, and centralised party control.

In that context, the coalition’s defeat was neither shocking nor sudden. During the snap general election held in October last year, it lost its majority in the lower house. Securing just 215 seats, it fell 18 short of the 233-seat majority needed in the 465-member House of Representatives. Public approval ratings for the cabinet have also been steadily declining for months. Further, multiple pre-election polls projected an unfavourable outcome, reinforcing expectations of an electoral setback.

What’s next for Japan

For now, Ishiba has chosen to stay in power, even as calls for his resignation grow within LDP ranks. Without a clear majority, he must now cobble together issue-based alliances with opposition parties, such as the Constitutional Democratic Party of Japan. His coalition partner, Komeito, might also play a larger role in tempering both internal dissent and external demands given its moderate and welfare-oriented stance.

The short-term goal is to pass a supplementary budget before Japan’s fiscal year ends in March. But looming ahead is a far more urgent task: concluding tariff negotiations with the United States by August 1st. Japan’s chief tariff negotiator, Ryōsei Akazawa, flew to the US on July 21st for an eighth ministerial round of talks. However, without political clarity at home, Japan’s negotiating strength weakens.

While voters may have punished the LDP, they did not explicitly reward an alternative. This means that the government will be forced to negotiate every budget, every policy, and every international agreement piecemeal. To complicate matters further, the far right’s influence, which is discursive rather than legislative for now, risks shifting the policy centre toward exclusionary nationalism.

In this context, Ishiba’s challenge is not just governing day-to-day tasks but involves a larger project of restoring public faith in governance itself. That will require more than parliamentary manoeuvring. To move forward, the party must address this crisis of legitimacy and re-articulate its purpose. Voters are demanding a more transparent, responsive, and visionary politics. Whether Ishiba rises to this moment or becomes its casualty will shape the next decade of Japanese politics.

The writer is a Research Analyst for the Indo-Pacific Studies Program at the Takshashila Institution