The '64 Tokyo Olympics were a massive milestone in Japan's postwar rise to full national self-confidence. Japan now needs a major shot in the arm to their very stagnant economy and the Government has sold the idea that investing billions on the Olympics will lead to net positive $, some economic growth effect, and a worthwhile boost out of a national malaise. Sadly all the hype was likely to fizzle out into the most basic reality test they would have faced anyway. How much worse trying to go forward in a pandemic!
But that level of symbolic national hope will die hard. And trying to reschedule to later this year could be will be super risky - if the virus is highly seasonal then July would be the seasonal sweet spot and moving the games to the fall could well be the worst possible plan.