Japan's Agricultural Policy Regime (review)

Is Japan really changing? This question is frequently debated by Japan experts. Japan has faced continuing pressure for internationalization, especially since the 1980s. The 1993 political change and the 1994 electoral reform significantly impacted the political scene, leading to stronger powers for the prime minister while reducing the power of factions of the Liberal Democratic Party (LDP) and policy subcommittees. This made it easier for the national leader to introduce reform. In the economic arena, with increasing pressure from the international community, the government continuously introduced economic liberalization and marketization.

Some scholars point to the institutional changes of the last two decades and stress that Japan has experienced significant change. T. J. Pempel, for example, declared that a "regime shift" took place in Japan. Other experts argue that Japan's reform efforts did not change the basic nature of the Japanese government and that the Japanese market is still closed compared with other advanced nations. This book supports the argument of those who believe Japan is not changing by focusing on the continuing bureaucratic behavior in agricultural policymaking despite many pressures toward liberalization.

Throughout the postwar era, the Ministry of Agriculture, Forestry and Fisheries (MAFF) regulated rice distribution and marketing, and the ministry protected rice farming by maintaining a high producer price under the 1942 Food Control Law. With strong support from the ruling party and agricultural interests, the 1961 Agricultural Basic Law was established to protect inefficient farmers and to provide agricultural subsidies, effectively providing MAFF with a "charter of agricultural intervention" (chapter two).

With increasing fiscal and international pressure in the 1980s, however, the agricultural policy area could no longer escape liberalization and marketization. Administrative reform efforts, conducted under Prime Minister Nakasone Yasuhiro to reduce the fiscal deficit, targeted areas of "wasteful government expenditures," including the rice-price subsidy program. The 1986 Maekawa Report to the prime minister strongly urged a market opening and structural improvements in agriculture befitting "an age of internationalization." Tokyo offered a series of market-opening measures for agricultural products in order to accept rulings under the General Agreement on Tariffs and Trade (GATT) and to reach agreement with the United States (chapter three).

Furthermore, in 1993 with increased international pressure, Prime Minister Hosokawa Morihiro accepted the Agreement on Agriculture of GATT's Uruguay Round to open Japan's rice market, which had long been regarded as a political sanctuary. With pressure from competitive farmers, the 1994 Food Law was introduced to allow direct rice sales to retailers and consumers. The law was further revised in 2003 to remove most of the government's control over rice distribution and pricing mechanisms. In addition, the 1999 New Agricultural Basic Law brought a fundamental shift from a price support program to an income compensation system to meet requirements of the World Trade Organization (WTO) (chapters four and five).

Despite these apparent liberalization measures, George Mulgan points out that the gap between the rhetoric of MAFF's policy and the reality of actual policy widened in the 1980s (p. 68). The food control system was maintained to keep the gap between the international and domestic prices for rice. No serious structural change was made to drive away inefficient farmers. Opening the market for agricultural products provided MAFF with control over subsidies to prepare and compensate producers. In return for the 1993 opening of the rice market, for example, the LDP demanded large-scale countermeasures for farmers and rural areas which allowed MAFF to use a massive fund of ¥6 trillion over six years. More than half of the fund went into "MAFF-allocated public works programmes covering both the agricultural and rural sectors" (pp. 87–88). The 1999 New Agricultural Basic Law authorized "continuing intrusive government intervention in agriculture" (p. 116).

The author argues that MAFF constantly put priority on maximizing its influence on agricultural policies. Her hypotheses highlight various points surrounding this argument: that the ministry strongly resisted policy proposals that would reduce its...