It has been three years since Prime Minister Junichiro Koizumi launched a "no reform, no growth" program for economic revival. What has changed, or has not changed, under his administration? Simply put, are people better off now than they were three years ago? Voters will give their answers in Sunday's Upper House election. At stake is Mr. Koizumi's leadership, particularly his ability -- not just his resolve -- to deliver on his promises.
His much-touted program includes pension reform, highway and postal privatization, and decentralization. The election's outcome will depend specifically on how voters evaluate progress, or the lack of it, in these areas. More generally, the question is: Have Mr. Koizumi's "structural reforms" succeeded so far? If not, where have they failed?
The ruling parties, the Liberal Democratic Party and New Komeito, as well as Mr. Koizumi himself, all emphasize that the ongoing economic recovery reflects the "solid results of reform." In fact, the economy is growing steadily; unemployment is down to 4.7 percent; stock prices have rallied. But few economists give the Koizumi administration high marks. The majority view is that stepped-up corporate restructurings and surging exports to the United States and China, along with a combination of positive cyclical factors, have brought on the recovery. In fact, there is not much evidence to show that the economy is growing on the back of Mr. Koizumi's structural reforms.