Entering 2012, we were staring at a host of critical elections and transitions in countries that represent about half the world’s gross domestic product. You would think those elections and political handovers would have been some of the most important events of 2012. Yet they were largely red herrings.
In China, the consensus view is that even with a change of leadership, China is largely the same as it was; if anything, the Chinese leadership has doubled down on the approaches of its former government. In Russia, Vladimir Putin went from running the country as prime minister to running the country as president. In France, Nicolas Sarkozy was voted out and a socialist, François Hollande, voted in, but that hasn’t changed France’s stance toward the European Union, its most important relationship. And in the U.S., Barack Obama swatted aside Mitt Romney while Congress remained divided, making four more years of the status quo likely.
Yet in one major economy an election really did matter, and really will change the way a country behaves in the global arena. That place was … Japan.
At the beginning of the year, this notion seemed preposterous. Japan has had 18 prime ministers in 23 years, a modern-day Asian record. How important could a Japanese election be?
Yet the election that just saw Shinzo Abe return to the prime minister’s office was a statement about the kind of country Japan wants to be for the next few years. And it has major implications for the U.S., China and others.