The Japanese prime minister, Mr Junichiro Koizumi, came to office last May on a platform of structural reform for the country's economic and political system. His colourful personality appealed to voters fed up with the political lethargy and bureaucratic inertia that have afflicted Japan and made it much more difficult to escape from a decade of recession.
There has been a sharp fall in Mr Koizumi's popularity since he sacked his foreign minister, Ms Makiko Tanaka, two weeks ago. It has coincided with a fall in the Nikkei stock-market index and renewed fears about the country's indebted banking system. Ms Tanaka was a reformist ally of Mr Koizumi and set out to shake up a ministry widely seen in Japan as a bastion of arrogant and unaccountable officialdom. But unfortunately, she proved quite incompetent as a minister. She created so much antagonism that when she became embroiled in a row with a powerful member of the Diet, she had to be sacrificed. This was widely seen as a victory for conservatives within the ruling party and leading ministries.
It has brought other critics of Mr Koizumi's reformist plans into the open to oppose a bill overseeing the privatisation of government-owned highway corporations which have been used to channel state funds into road-building. Mr Koizumi has vowed to cut off such spending - thereby reducing state debts and breaking up a powerful cluster of special interest groups. If he fails in his bid to prevent such measures being decided in parliament rather than by a committee appointed by himself, he is likely to suffer a potentially fatal blow.
Mr Koizumi vowed yesterday to persist with his reforms, which are designed to bring much greater flexibility and productivity to the Japanese economy. He said he will do all he can to combat deflation and unemployment. It suits him to announce this ahead of President Bush's visit next weekend, following much US criticism of Japanese policy. There have been many attempts to reorganise the banking system; but the ailing economy and persistent falls in domestic share prices have plagued the banks' efforts to get rid of huge non-performing loans created after the property bubble burst in the early 1990s. If Mr Koizumi is to live up to his reformist reputation he will have to act boldly to restore confidence in his coalition. That means persisting with structural reform rather than palliative tax measures. His honeymoon period is over and his critics are gathering to test his resolve.