This article by John Lackman in the online current-affairs-and-culture magazine Slate provides a definition and history of the term.
Pundits use Kabuki as a synonym for "posturing." The New Republic's Michael Crowley, for example, has defined it as a "performance, in which nothing substantive is done."
Pundits don't care about the real thing. They use Kabuki precisely because they and everyone else have only a hazy idea of the word's true meaning, and they can use it purely on the level of insinuation. They deploy Kabuki because:
1) It sounds funny.
2) It sounds childish.
3) It sounds foreign.
4) It sounds incomprehensible.
When American official James C. Hagerty visited Tokyo in 1960, protesters surrounded his car, broke its windows, and nearly flipped it. According to my research, it was in this hostile atmosphere that Kabukiacquired its modern derogatory meaning. Writing in 1961 about a State Department plan to revise its security measures, Los Angeles Times writer Henry J. Taylor declared, "[By] finally dismissing Chester Bowles as undersecretary of state at the moment he did, the President unhitched the plan's kingpin in this shoddy piece of left-wing kabuki." Six months later, Taylor struck again, "Agriculture Secretary Freeman announced he has discussed Billie Sol Estes' political corruption kabuki with Robert F. Kennedy and 'had mentioned it informally to the president.' "
Lackman concludes by decrying the use as a libel on a sophisticated art form:
How would you feel if your favorite art form, ballet or truckers' quilts, say, became another nation's derogatory epithet?
It's an excellent piece, well worth reading.