A weak yen is the root of Japan’s lurch to the right

{"text":[[{"start":null,"text":"

"}],[{"start":6.69,"text":"“European summer holidays stretch into weeks”, roared Saya Ohgi at her Monday night rally in central Tokyo, “and around the world, people take Christmas breaks that run from December into January."}],[{"start":19.88,"text":"“But we work so hard . . . isn’t it crazy that their economies are growing and ours isn’t?” ended the 43-year-old jazz singer: hoarse with the oratory of injustice, primed to be voted into the upper house of Japan’s parliament on Sunday and with an audience hanging on her every sentence."}],[{"start":39.92,"text":"Saya’s “Japanese First” speech — xenophobic, quasi-Trumpian, conspiratorial and exhilarating — bemoaned many hardships endured by ordinary Japanese, but did not explicitly mention the yen exchange rate. "}],[{"start":55.02,"text":"It makes sense to keep things simple on the stump, but this Sunday’s election fundamentally belongs to the yen. So much about the recent rise of the hard-right, anti-foreigner, anti-globalist Sanseito party that Saya represents, and the everyday miseries from which it draws electoral vigour, is about the weak Japanese currency. "}],[{"start":78.95,"text":"A level of ¥149 versus the dollar, to which the yen weakened earlier this week, is not so much an exchange rate as a chronic health condition: compelling the patient into a change of lifestyle, denting its sense of agency and exacerbating a host of other ailments. This feeling of infirmity, as so often, can be warped into anger."}],[{"start":103.24000000000001,"text":"Opinion polls forecast that the distinctly fringe-y Sanseito could win at least 10 seats. They also suggest that some sort of inflection point is coming for a fragmenting Japanese politics. "}],[{"start":117.24000000000001,"text":"The Liberal Democratic party, which has ruled for most of the past seven decades but lost outright control of the lower house in October, is due another drubbing in the less powerful upper house, largely over its handling of the economy but also its evident exhaustion. It may ultimately muddle through via an expanded coalition, but the rise of Sanseito catches Japan at a point where once predictable norms — from zero interest rates to low immigration to a sense of impregnable cultural homogeneity — are in evident flux. Populism has caught up with the country and found fertile soil while business-as-usual incumbency looks withered."}],[{"start":162.82,"text":"Radical politics in Japan have historically had a short shelf life. Conventional wisdom holds that Sanseito will ultimately fizzle and take its distinctly alarming anti-foreigner rhetoric with it. "}],[{"start":176.29999999999998,"text":"But this time may be rather different. In the past, the more extreme political movements always lacked a core suite of grievances around which to coalesce into something mainstream. The weak yen, through its various side-effects and tributary causes, may prove to be the long elusive catalyst. "}],[{"start":198.45,"text":"Its prolonged stint below ¥140 to the dollar is producing various effects, including the sense of national diminution that comes with seeing that your currency is no longer the mighty force that once shook the world. Developed country comparisons of average incomes make Japan’s look risibly low in dollar terms; the suggestion that Japanese wages now trail those higher-end earners in Thailand and Indonesia is an even harder blow."}],[{"start":230.07999999999998,"text":"The more politically potent impact is inflation. After years of deflation, Japan has had three years of sustainably rising prices but for the wrong reasons: cost-push inflation driven by the weak yen and the fact that it imports a high proportion of its raw materials, food and energy. "}],[{"start":252.23,"text":"The strain on households is real. Japan’s Engel coefficient, which measures food as a proportion of household spending, is at a 43-year high and inflation-adjusted wages fell for a fifth straight month in May. The most consequential policy battleground of the election — a cut to VAT — attests to real household pain."}],[{"start":276.63,"text":"All of this might be slightly more palatable if the outside world were not so visibly revelling in the yen’s weakness — picking off industrial gems at the corporate and private equity level, and gorging on sushi and ski resort property at the individual one. "}],[{"start":294.96999999999997,"text":"Prices for modest luxuries like restaurant dining, at which the Japanese now balk, are irresistibly low for the record 18mn tourists who visited the country between January and May. At the same time, Japanese real estate is being bought by foreigners at unprecedented rates. The two flows of foreigners — tourists and longer-term immigrants — are being successfully conflated by Sanseito and others to look like a single exploitative incursion."}],[{"start":326.65999999999997,"text":"The Sanseito movement may run its course quickly. The economic demons propelling it, though, may not dissipate until the yen comes up for air."}],[{"start":343.47999999999996,"text":""}]],"url":"https://audio.ftmailbox.cn/album/a_1752820837_5744.mp3"}