More than ever before, the long-ruling Liberal Democratic Party is being forced to curry favor with an opposition party--this time the Buddhist-backed, pacifist Komeito. The LDP needs Komeito's votes in the Upper House, where it lost control in 1989. Komeito is using its leverage to brake LDP moves to expand Japan's global role. Reflecting the views of the Buddhist housewives who are its core supporters, Komeito is putting restrictions on the LDP's $9 billion gulf aid package. The party has also won a shift of defense funds to help pay for the aid.

Politically, Komeito is forcing the LDP to strike risky electoral deals, such as LDP Secretary General Ichiro Ozawa's agreement to back Komeito's candidate for governor in April's Tokyo election. This means deserting incumbent Governor Shunichi Suzuki, favored by the LDP's Tokyo chapter. If Suzuki wins, the powerful Ozawa may have to resign. This could trigger an upheaval in the LDP. While Komeito is helping extend the LDP's rule, the price it is extracting in return may prove politically costly.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE