For Japan’s governing Liberal Democratic Party (LDP), securing and sustaining political power has been the dominant factor in uniting a diverse coalition of interests over 70 years of remarkable success since the party’s founding at the height of the Cold War in 1955. 

A little like Britain’s Conservative Party, the LDP has embraced often competing policy options, tailoring them to reflect changing political and economic realities. At different times in its history, the party has included advocates of an activist state, reliant on redistributive welfare and interventionist industrial policies to promote economic prosperity (for example, Prime Ministers Hayato Ikeda in the first half of the 1960s and Kakuei Tanaka in the 1970s); at other times, especially since the early 2000s, it has been led by proponents of  a smaller, deregulatory state, stressing economic liberalism and the encouragement of entrepreneurship and innovation (for example, prime ministers Jun’ichirō Koizumi and, most recently, Fumio Kishida). 

On security and foreign policy, LDP leaders have all recognised the indispensability of the country’s alliance with the United States, but some have periodically sought to moderate this partnership by reaching out to other states (China and Russia, for example, in the mid-1950s when Ichirō Hatoyama was briefly prime minister), or by stressing the need to promote the country’s ties with the United Nations and with the non-aligned movement or with regional actors in Southeast Asia (Prime Minister Takeo Fukuda in the 1970s).

Conservative nationalism has also been a core feature of the agenda of the country’s leaders, with some expressing this primarily in economic terms (Prime Minister Shigeru Yoshida in the 1940s and 1950s), and others focusing on gradual but deliberate rearmament and proactive security policies (Prime Minister Nobusuke Kishi in the late 1950s, Yasuhiro Nakasone in the 1980s, and most strikingly of all Shinzō Abe – Kishi’s grandson – between 2012 and 2020). 

These diverse approaches represent differences of emphasis, rather than zero-sum choices. They reflect the inherent pragmatism of a political party that has been remarkably adaptive and pluralistic in responding with Darwinian agility to changing political environments both at home and abroad. 

Now, arguably, for the first time in its long political history the party appears to be facing an existential crisis. Prime Minister Shigeru Ishiba’s announcement on 7 September of his intention to resign, barely a year after being elected, is forcing the LDP to consider whether it can govern effectively; whether it can remain sufficiently united to offset a damaging and perhaps fatal internal rupture, and how best to regain the trust of an electorate increasingly disillusioned with mainstream politics.

The causes of the current crisis for the party are threefold. First, a longstanding and high-profile political corruption scandal, involving illegal fundraising, has damaged the once dominant Abe faction. Further harming the LDP is Japan’s cost of living crisis, driven by high levels of inflation and a low yen that has led to a sharp rise in import prices. At approximately three per cent, Japan’s experience of inflation is low compared to many other countries, but is historically high for a country that has experienced three decades of slow growth. And the doubling in domestic rice prices has had a huge symbolic and psychological impact, given the totemic place that rice occupies in the country’s culture and national identity.

A final, and perhaps most conspicuous, factor contributing to the LDP’s political crisis is the aggressive and transactional foreign policy agenda pursued by Donald Trump’s administration. This includes threats of punitive tariffs on Japan’s exports, such as the critically important auto and steel sectors, as well as anticipated demands from Washington for Japan to significantly increase its defence expenditure, beyond its current commitment to boost defence spending from one to two per cent of GDP by 2027. 

In the face of these challenges, Ishiba appeared ill-equipped temperamentally to manage the complex parliamentary horse-trading with the opposition parties to pass a successful budget. And he failed to come up with a set of policies that could reassure voters that the government had effective options for addressing their economic concerns.

A controversial government-planned subsidy scheme of direct payments to low-income households, meant to offset the cost of living increases, proved less popular than calls from some of the opposition parties to cut taxes, including regressive (and hence unpopular) taxes on petrol and a general consumption tax. Heading into the election season in the summer with cratering public approval ratings at 19 per cent, Ishiba’s political options were narrowing rapidly.

For the prime minister, things came to a head in July when the government, and its coalition partner, Kōmeitō, lost their majority in the Upper House election. Coming on the back of the government’s poor performance in earlier Tokyo Metropolitan elections in June, and having lost control of the Lower House in last October’s elections, Ishiba found himself facing a crisis of confidence within the LDP.

Ishiba has always been the consummate party outsider – something of a maverick and also an indefatigable campaigner who had stood for the party leadership on multiple occasions, securing it finally on his fifth attempt. It is almost certainly this stubborn independent streak and his tendency to defy the party barons, who have played such an influential role in the LDP’s history, that explains why he resisted initial pressure to step down after July’s defeat. Citing the importance of presiding over the successful tariff negotiations with the United States, Ishiba doggedly clung to office. And he took comfort from a rebound in his public standing to the high 30s as the Japanese electorate appeared to give him credit for negotiating a compromise deal with Washington, mitigating some of the acute economic impact from Trump’s tariffs.  

Eventually, however, political gravity reasserted itself as four senior party officials resigned simultaneously from their positions in early September, while former Prime Minister Asō Tarō – a prominent factional leader and a key adviser to the party – urged Ishiba to step down to take responsibility for the party’s successive electoral defeats. 

This is not the first time that the LDP has faced a political crisis. In 1989, it lost control of the Upper House of parliament in the face of an unexpectedly strong showing by the then Japanese Socialist Party (JSP), which was capitalising on voter disaffection with the government’s economic policies. 

More dramatically, in 1993, there appeared, momentarily, to be a major realignment of the political environment. For the first time since 1955, a grand but disparate coalition of old and new political parties emerged – made up, in the case of the latter, of younger ex-LDP politicians who defected dramatically from the party and sought to engineer a new alignment of mainstream politics. The initiative was, however, short-lived, undercut by personal rivalries, limited leadership experience on the part of many of the new politicians and the absence of any discernible policy coherence within the coalition, other than opposition to the LDP. By 1996, the LDP was back in government and it seemed as if traditional party politics had returned. 

Even much later in 2009, when the LDP ceded power again to the opposition, this time in the form of the Democratic Party of Japan (DPJ), political change was short-lived. The DPJ included some of the former conservatives who had defected from the LDP in the 1990s and in many respects the LDP and the DPJ at this juncture both occupied relatively similar positions on the political spectrum as catch-all parties with a broadly conservative leaning. The DPJ’s lack of experience in government and its attempt to undercut or at least marginalise the country’s civil service sharply backfired, contributing to a pattern of policy errors that were compounded by the challenges of responding to the triple earthquake, tsunami and nuclear power-plant disasters of 2011. As a consequence, the experience of opposition government was again short-lived and the LDP stormed back to power in 2012 under the leadership of Prime Minister Abe.

Given this past history of LDP recovery after seemingly dramatic, potentially fatal setbacks, in what way is the current situation different from the early 1990s or 2009? Three factors stand out.

First, the emergence of a new, energised populist political movement in Japan. For many years, it has been assumed by traditional analysts that Japan was largely immune to populist politics. The legacy of the Second World War and defeat as an inoculation against radical politics, the eschewing of sharply confrontational partisanship at least since 1960, the relative absence of demagogic leaders in mainstream politics, a polity of stable institutions and high levels of education have all bolstered the country’s inclusive and moderate political culture.

However, in the July election, seemingly with little prior warning, Sanseitō, (loosely translated as the ‘Participation Party‘) a distinctly populist new political party formed in 2020, achieved a stunning electoral breakthrough, securing nine per cent of the popular vote and prominent representation, with 15 seats in the Upper House. In a crowded political environment in which there are already a significant number of opposition parties, Sanseitō’s profile – centred on strident xenophobia, anti-immigration policies, anti-elitism, and a nationalist outlook that conspicuously echoes the rhetoric and practices of Trump’s MAGA supporters – is striking. 

The party is led by Sōhei Kamiya, a former LDP politician known for his controversial statements, including alleged antisemitic remarks. It has conspicuously embraced many of the techniques used by populist parties in other countries, relying on social media to disseminate sensationalist and intentionally misleading falsehoods, including bogus claims that foreigners – particularly Chinese nationals – are receiving preferential treatment from the government. The party has also taken a provocative position on relations with the Japanese media, in some cases banning journalists from attending its press conferences, marking a sharp departure from the open reporting practices that have long been at the heart of the country’s political culture.

On foreign policy, some of the party’s candidates have taken highly controversial positions on topics long considered taboo, such as advocating that Japan acquire its own independent nuclear deterrent. There is evidence, moreover, that Sanseitō’s approach is resonating with voters across all demographics who feel overlooked by the government, with young voters in particular showing a greater receptivity to Sanseitō’s more combative and divisive style.  

In some cases, the fear-mongering stoked by the party has prompted unprecedented public demonstrations, including, in one notable instance, protests outside Japan’s primary overseas development body, the Japan International Cooperation Agency (JICA). Misleading reporting of the government’s plans to support educational training for nationals of four African countries prompted sensationalist and unfounded claims that individual Japanese municipalities were going to be taken over by Nigeria and Ghana. This has led to calls for Japan to abandon its longstanding and highly influential policy of providing development assistance to countries in the developing world. In a similar context, the Ishiba administration’s announcement of a number of high profile investment deals between India and Japan have led to false claims that Indian nationals will soon be driving Japan’s high speed Shinkansen trains. 

These alarmist rumours are indicative of a new, febrile political environment that is being cynically exploited by Japan’s increasingly emboldened populist politicians. For some conservative members of the LDP, Sanseitō’s rise threatens to undercut their traditional support base and is prompting a number of them to argue that the party will need to ape the more populist style of Sanseitō to avoid being eclipsed on the right. Some conservative members of the party have even suggested that, if the LDP fails to make such an adjustment, they should leave the party and form a new and ideologically more distinctive right-of-centre party, possibly in association with the populists.

The second core challenge for today’s LDP is the marked change in the policy of the United States. Trump’s transactional approach has undercut a long tradition of cooperative relations between Washington and Tokyo and there is little doubt that mainstream politicians and bureaucrats have been shocked by the break with convention. The recent £550 billion investment agreement between the Japanese and US governments has helped reduce the tariff rates levied on Japanese exports, but there remain ambiguities surrounding how the agreement will be implemented, and whether it will be periodically and unilaterally re-negotiated by the US if senior Trump officials deem the agreement to be insufficiently beneficial to the their economy.

American pressure in the economic field is matched by the Trump administration’s approach to security policy. While the Department of Defense’s focus on the Indo-Pacific region at the expense of Europe is partially reassuring for Tokyo, there are concerns that the traditional US policy of providing security guarantees to its key Asian allies, such as Japan and South Korea, may become much more conditional, dependent on explicit, substantial (and potentially unaffordable) defence expenditure commitments by Japanese and South Korean governments. Press reporting in both countries has suggested that the US may be embracing a new Acheson perimeter defence line, echoing the policies of President Truman’s Secretary of State, Dean Acheson, in 1950. Acheson qualified US security guarantees in the region by retreating from some of its continental defence commitments, inadvertently inviting North Korea’s attack on South Korea.

Conversely, the predisposition of some in Trump’s policy circle to push for a more aggressive, combative approach towards the People’s Republic of China (PRC) may drag Japan and South Korea into a wider regional conflict with the PRC, particularly over Taiwan. Regional policymakers are therefore simultaneously managing the risk that their countries may either be abandoned by the United States or entrapped in a conflict not of their choosing. 

It is too early to say how far these fears will be confirmed by new policy announcements from Washington, but governments in the region are waiting nervously for the publication of the administration’s much-anticipated National Defence Strategy (NDS) and global force posture review, expected this autumn, as well as its reassessment of the Australia, United Kingdom, US (AUKUS) nuclear submarine agreement reached under the Biden administration. Both in parliamentary debates and in private discussions, LDP politicians have criticised the bullying tactics of the new administration and the decline in Japanese confidence in the US is likely to force Japan’s leaders to increasingly look to other like-minded countries to help mitigate Tokyo’s reliance on a once trusted senior alliance partner. 

Finally, a third challenge for Japan’s ruling party is the broader necessity of responding to an increasingly emboldened group of authoritarian states. The recent 80th anniversary celebrations of the end of the Second World War in Beijing were a reminder of the convergence of interests between China, Russia, North Korea and Iran. While it is premature to characterise this as an axis, all four states have a common interest in presenting themselves to one another and to the developing world as an alternative model of governance and a competing centre of diplomatic and economic gravity to the US. With liberal democracies facing challenges at home and abroad, Japan’s government must be conscious that past optimistic assumptions that the values and norms of open societies and a liberal international order that were part of the post-Cold War world are now increasingly imperilled. 

The race to succeed Ishiba as leader of the LDP and by extension prime minister of the country formally started on 22 September. The likely candidates to replace him, five in total, are almost identical to those who ran last autumn in the previous contest when Ishiba prevailed. The top two favourites are Shinjirō Koizumi, currently the government’s agriculture minister, and Sanae Takaichi, a former economic security minister and the only woman in the race. 

Koizumi, at 44, is the youngest of all the candidates and the son of Jun’ichirō Koizumi. Koizumi senior, prime minister from 2001 to 2006, was largely considered to have been a very successful leader, based in part on his telegenic ability to connect with the electorate, his willingness to challenge vested interests in the LDP – particularly over the contentious issue of postal sector reform – and his ability to bolster ties with the United States. It is not clear whether his son has the same political star quality, but his liberal profile and his status as a new generational face for the party (if successful he would be the youngest of Japan’s postwar premiers) may work in his favour.

Koizumi junior is also judged to have handled the agricultural brief well, particularly in responding to the political fallout from the rice price increase. He has also been seeking to build links with some of the opposition parties, most notably the Osaka-based Japan Innovation Party (JIP, or Nippon Isshin no Kai), who might be counted on to lend support to a minority LDP government in the future.

Koizumi’s political vulnerabilities are his liberal position (particularly on social issues), which may not endear him to more conservative members of the LDP, as well as his poor performance in debates during the last leadership contest. To compensate for the former, Koizumi has shrewdly secured the support of Finance Minister Katsunobu Kato. Kato is a heavyweight political figure in the party (until recently, he was considered to be a potential leadership candidate), and was close to late Prime Minister Abe. By agreeing to act as Koizumi’s campaign manager, Kato may help mitigate the fears of those on the right of the party who are concerned that the LDP would move too far to the left if Koizumi were elected.

Takaichi, by contrast, has rock-solid conservative credentials. She has long been the darling of the Abe faction and she made it to the final run-off stage of the least leadership battle along with Ishiba. She polls well among the general public, at least according to a Yomiuri Shinbun poll, which places her at 29 per cent favourability over Koizumi at 25 per cent.

Since losing the last leadership contest, Takaichi has kept her distance from the Ishiba government, concentrating instead on visiting local prefectural chapters of the party to increase her public exposure and drum up regional support. This may be significant in the eventual leadership contest, due to take place on 4 October. Under party rules, there will be 590 votes split equally between LDP members of both houses of the Japanese parliament, the National Diet, amounting to 295 votes, and a further 295 votes representing grassroots party members. If no candidate secures an absolute majority of 50 per cent or more of these votes, the top two candidates will compete in a run-off contest where the Diet’s members receive one vote each and the remaining votes are assigned singly to each of the country’s 47 LDP prefectural chapters. 

Takaichi’s strategy of cultivating the grassroots may work in her favour heading into the final contest, but, equally, the grassroots and the parliamentary party could include a high proportion of vocal, younger party members who may decide that Koizumi would better appeal to youthful members of the public, precisely where the LDP’s support has been failing of late. It’s worth recalling that, back in 2001 when Koizumi senior was elected, his ability to prevail against the old guard members of the party was the result of prefectural chapters backing him out of fear that the LDP was becoming unelectable. It’s too early to say whether a similar dynamic may prevail this time for his son. 

Takaichi’s hawkish position on security policy and national identity issues will reassure the more conservative members of the party. But there is a risk that choosing an avowedly nationalist leader who has regularly visited the country’s controversial Yasukuni Shrine (where former Class A Japanese war criminals are commemorated) may complicate Japan’s relations with its key regional partners, such as South Korea, where public opinion is highly sensitive to any hint of historical revisionism on the part of Japan’s leaders. That being said, on a visit to Japan earlier this year, I was told by one prominent, progressive Japanese politician that Takaichi’s right-wing credentials were more performative than substantive – a form, in effect, of political cosplay – and that she would, if elected, be able to moderate her more contentious positions in order to avoid friction with other like-minded countries. At 64, Takaichi’s age is also consistent with past trends among Japan’s postwar prime ministers. 

The remaining three candidates all currently poll in single figures and may struggle to break through in the final contest, but much will depend on how the campaign unfolds. Two of the candidates, Yoshimasa Hayashi and Toshimitsu Motegi, can both capitalise on their extensive experience in government. Both served as foreign minister for example, and they are likely to present themselves as paving the way for the next generation of leaders. Motegi is highly regarded as a sharp intellectual by senior civil servants and has also been secretary general of the party, and therefore has considerable leadership experience. But Yoshimasa has a reputation for being dovish on China-related issues which may limit his appeal to the right within the party.

The fifth candidate, Takayuki Kobayashi, is a former economics minister and former Ministry of Finance official, with considerable educational and career experience in the United States. He has limited Cabinet exposure, but his policy expertise, relative youth (he is 50) and his willingness to disseminate his policy ideas via writing for the general public have marked him out as a rising star with appeal similar to Koizumi.

For the LDP, this line up of candidates comes with significant risks. Given that the final selection does not differ substantively from the last contest in 2024, there is a danger that the public, already highly critical of the ruling party, may feel that little has changed. At the same time, the old factional system within the LDP has been formally undermined by recent corruption scandals, meaning there may be less opportunity and more disincentives for the old guard within the party to attempt to influence the election’s final outcome.

Ultimately, whoever becomes the new leader of the party faces a number of critical challenges. Domestically, they will need to reassure their party colleagues that they can keep the LDP together and avoid any damaging splits. They will need to be able to reach out effectively to potential new coalition partners so that the government can muster the votes to pass essential domestic legislation (some of which has been stalled in the aftermath of the party’s setback in the July election). And they will also have to devise a credible strategy to allow the LDP to have a fighting chance to prevail in a future Lower House election. The new LDP leader will eventually want to seek a mandate from the electorate and he, or she, will be conscious that delaying any future election will expose them to the criticism that they do not represent public opinion. 

In foreign policy, the new prime minister will almost certainly want to build on the strong ties that Ishiba and his predecessor, Kishida, have been able to cultivate with Seoul. The recently elected South Korean president, Lee Jae-Myung, shrewdly chose to visit Japan prior to meeting Donald Trump for his summit meeting in Washington in late August. Japan and South Korea’s leaders find themselves increasingly incentivised to share insights on how best to ameliorate the negative consequences of Trump’s transactional approach. They are also now forced to think imaginatively about how to devise new minilateral partnerships and creative solutions to the threefold challenges posed by Trump’s America, rising populism, and emboldened authoritarian states. 

The good news is that this urgent necessity is fostering new, unexpected policy solutions: South Korea is currently giving renewed attention to the possibility of joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) – an initiative in which Tokyo has played a decisive, formative leadership role; Japan has also promoted new security concepts, proposing last March an innovative ‘one-theatre’ concept that views the East China Sea, South China Sea, Korean peninsula and surrounding areas as one distinct regional theatre to offset the growing Chinese security challenge. More generally, both Tokyo and Seoul are consolidating partnerships with European countries and with the European Union across a range of economic and security dimensions. 

Whoever leads Japan will need to have the depth and breadth of policy knowledge and imagination to think creatively across competing areas. Part of this thinking will also demand an ability to prioritise essential policies and respond to differing time pressures. A short-term approach might recommend a strategy of temporising, and counting on a political reaction against Trump in the 2026 midterms to blunt the administration’s disruptive impact at home and abroad.

However, it is important to keep in mind that Trump’s political rise is a symptom, and not a cause, of the global populist surge. Japan’s next leader will need a vision for a radical, long-term and sustainable reworking of the country’s domestic and foreign policy options. In the coming weeks and months, we will discover whether the LDP, as a political party, has the Darwinian adaptive capacity to deliver one. 

The research for this article was funded in part by a grant from the Korea Foundation.