Nobuhiro Hiwatari wrote:
> If being viewed as economically

competent by the voters is critical

> in winning an election it is perfectly rational for
competing

> political leaders to advocate and *realize* such
policies.

>Another theoretical candidate is ambitious politician
theory, which

> expects politicians to climb the party ladder by
showing his/her

> commitment to a certain policy position and winning
their support.

RK:

I do appreciate your effort to place Noda's behavior within some sort of "self-serving rational actor"
framework. However, these explanations are inconsistent with the evidence in this case.

Polls consistently showed that the voters, especially the swing voters, opposed Noda's tax hike, even those who agree that the tax must be raised eventually (raising the issue of possible voter inconsistency or "irrationality"). Moreover, the results of the 2009 UH elections showed that a tax hike hurt the DPJ and forced the eventual resignation of Kan.

As for the second argument, Kan's own fate was just another example of the fact the last several years have shown that PMs who damage their party's electoral fortunes do not last very long.

The only way to make Noda's actions consistent with these two explanations would be to assume, not just a huge miscalculation on his part, but a near-hysterical refusal to believe in what the polls were saying, and what DPJers who visited their districts were saying. To my mind, refusal to heed evidence would smack, not of rationality, but of ideology.

In any case, Noda made it very clear that he was insisting on the tax hike, not to improve the DPJ's electoral fortunes and his own tenure, but in disregard of these considerations. That was because he believed (incorrectly in my view) that passing legislation now was not just necessary, but urgent, for Japan's financial stability at some undetermined point down the road. Delay now risked disaster later. I don't always take politicians at their word, but in this case, it fit his actions. He was clearly willing to fall on his sword to pass this, and force the DPJ to fall on its sword with him. And the Finance Ministry was clearly willing to have Noda fall on his sword over their pet issue.

My own view is that a proper explanation requires a more complete model, one in which politicians care not just about power, but also about policy--just like voters care about policy and values, both interests and passions. It also requires an epistomelogical model in which politicians' judgment calls regarding what policy is "economically competent," as well as power-enhancing, are inevitably seen through the prism of paradigms, some of which are ideologically (and socially)-determined. Politicians not a separate species, limited to a Skinnerian./Benthamite positive/negative reinforcement mode. .

But my own model "preference" is outside of my question. My question was how the "self-serving rational actor" model would explain it.

Richard Katz
The Oriental Economist Report