Lots of folks are pretty sure that the success of Koizumi’s rejuvenated LDP in yesterday’s elections [here’s a good summary] means something. What? It seems to me impossible to know what it means in a policy sense, but it clearly marks a step in the evolution of party politics and campaigning… a step away from past verities, but not necessarily towards anything easily recognizable or categorizable.
For myself, the privatization of the Postal Savings and Insurance system would mark the end of something historically interesting. The Postal Savings system was a fundamental institution in the Meiji modernization, enabling reliable low-cost long-distance transactions (including remittances from overseas, which is where my research comes in) and accumulating small deposits into a pool of capital that was agressively used for investment in railroads and other heavy industrial development. The great success of what is now the largest financial institution in the world is part of what forced me to recognize that the “rational actor” theory of economics which I had disdained for so long did in fact have its moments: the speed with which Japanese peasants adopted newer and more reliable banking institutions (and avoided less reliable ones) was a remarkable demonstration of fiscal sophistication and self-interest at work.