COVID-19 INFORMATION What you need to know about the coronavirus if you are living in Japan or planning a visit.
national

Japan's working poor left behind by Abenomics

100 Comments
By Chang-Ran Kim

The requested article has expired, and is no longer available. Any related articles, and user comments are shown below.

© (c) Copyright Thomson Reuters 2014.

©2020 GPlusMedia Inc.

100 Comments
Login to comment

Well lets be completely honest. "Abenomics" was never meant to help the lower or middle class families. It was mostly to help businesses and the upper class families.

“The Abe administration’s stance is more about fixing things, including poverty, with a trickle-down effect from overall economic growth,” said Takashi Oshio, a professor at Hitotsubashi University specialising in social security. “There’s little political capital spent on issues like alleviating child poverty. It doesn’t garner votes.”

And if it doesn't garner votes, it doesn't exist for the politicians.

34 ( +37 / -3 )

Abenomics is not the problem. The consumption tax hike was drawn up before Abe came to office.

The problem is squarely with Japan's private-sector employers: they're the world's stingiest. They've spent two decades constantly cutting salaries, even while recording growing profits, paying dividends and while productivity rates rise among their workers. They've also cut benefits.

The labor law reforms making this possible were done several years back, easily pre-dating Abenomics.

...."Japan (is) the only country where having a job does not reduce the poverty rate for that group."

Clearly, the slave-driving employers are to blame.

19 ( +29 / -10 )

This poor woman. I really feel for her. Even for many married couples (where the wife used to be a housewife) the economy has made it difficult to survive on one salary. So for this lady and her part time job, and child, it must be crippling. I wish could help.

11 ( +15 / -4 )

Jeff, sounds exactly like American corporations, or corporations anywhere else around the world. The worker's wages stay stagnant and benefits get decreased, while everything else rises.

18 ( +20 / -2 )

I have a friend who did all the training for caring for the elderly and now has the required qualifications to be a professional carer in a care home for the elderly. She has a good office job but she wanted to do something for society. Unfortunately, the reality hit her that she simply wouldn't be able to survive if she quit her office job to be a full-time carer.

You can make lots of money by selling financial products or by being a business consultant or whatever, but try and do something like caring for people's health or education - carers, nurses, teachers - you know, the kind of jobs that have a direct beneficial impact on society, and where do you end up?

I recognise that a sense of vocation is needed for these jobs but that doesn't justify bleeding people dry.

18 ( +19 / -1 )

Putting the blame to PM Abe and Abenomics is simply preposterous. The problem of poverty has been there long before he got elected. In fairness to him, and some of his predecessors, the govt has programs geared to alleviate poverty. The plan to train unskilled people both in the labor market and communication have long been implemented thru Hello Work and quite abused. And re Mrs. Saito, still she's way better than me. She's earning 1080 yen per hour and still complaining. Iam earning 840 per hr. mostly inspecting and wagging screws weighing no less than 13 kgs each box and utmost 20 boxes even 30 boxes at other times! The article is not convincing enough. I understand that welfare if it's seikatsu hogo, is around 150,000 a month. It's way better for some who are earning a gross income of 130,000 yen a month. I just think if ever the govt is going to give hand outs which I believe it is, I shld be the first in line to receive one. Talking about poverty, Mrs. Saito belongs to low income earner but primarily she may not be physically equipped to work hard and long hrs. Otherwise with 1080 yen an hr, if she work for 10 hrs everyday, she'd be earning more and would gross more than 20 man a month. So, really it's only her to be blame. Whereas in my case, no matter how hard I try to do my job well, still some sectors, aren't happy because simply I don't go with the tide. Meaning not sleeping with everyone who ask you out. And all terrible things happen to the point of giving no ovetime and with floating like status due to the whim of someone or some people in the factory. It is I who have the right to receive hand outs as I'm really below the poverty line. Articles like this show half truths maybe just to lash out on the incumbent! Very pathetic writer!

-15 ( +9 / -24 )

Child poverty in working, single-parent households like Saito’s is by far the worst at over 50%, making Japan the only country where having a job does not reduce the poverty rate for that group.

Criminal for the world's third largest economy. But this reflects as much a social/justice issue as an economic one, since many, many divorced men in Japan pay little or no child support.

As Prime Minister Shinzo Abe charges ahead with his “Abenomics” policies to revive economic growth, things look set to get harder, not better, for Japan’s down-and-out.

Trickle-down economics didn't work in the U.S. Why did Abe think it would? Or maybe he knew it wouldn't and just didn't care. Afteraall, the working-poor are not big supposrters of the LDP. Kinda like the 47% Romney talked about.

8 ( +14 / -6 )

Profits for companies, God for all.

I blame the leaders of companies, and I know what I am talking about.

4 ( +6 / -2 )

It's bleeding the middle class dry, too. The dependant child tax deduction was taken away a couple years ago, boom! ¥200,000 tax increase. All prices are up including taxes, but pay is flat. Now he wants to take away the spouse tax deduction under the guise that will help by getting more women the workforce. Clueless Japanese politicians make me sick.

11 ( +14 / -3 )

When LDP starts caring about the working poor - that will be the day pigs fly. All the blue blood politicians and bureaucrats who are daily spouting their propaganda how Abenomics is lifting the economy and all is fine and dandy in the happy inflation land have no idea / interest about the struggles of low paid workers like the lady in this article. They should step out of their bubble and go experience the everyday reality of these folks but hey they might get their shoes dirty. Better to stick to those nice Ginza clubs where there is nice food, drink and staff to enjoy and deals can be made to allocate more budget money billions to the construction amakudari buddies instead of spending it where it might be needed. Oh yes and keep reminding everyone how inflation is soo great for all.

18 ( +20 / -2 )

Era of automated responses, no human callousness involved in cutoff. Tight budget, prioritize basic needs.

-3 ( +1 / -4 )

"The government does not officially define the “working poor”, but the number of part-time, temporary and other non-regular workers who typically make less than half the average pay has jumped 70% from 1997 to 19.7 million today—38% of the labor force." These are the expendable, economic shock absorbers, first to be laid off or dismissed when things slow down, last to be hired when a pickup begins.

10 ( +10 / -0 )

The dependant child tax deduction was taken away a couple years ago, boom! ¥200,000 tax increase.

Instead you got a fixed-rate ¥120,000 per year per child allowance.

The dependent child deduction was ¥380,000 per child, so an increase in your tax bill of ¥200,000 means either you have more than one child in which case you are getting ¥240,000 per year allowance, more than you are losing in tax, or you are paying tax at over 50% (which would be strange because the top rate in Japan is 40%) and an extra ¥200,000 a year in tax is hardly bleeding you dry. If you are paying top rate in tax then your child allowance will be cut in half. If things are really bad, your wife could go out to work. Lots of less affluent women do.

2 ( +10 / -8 )

Trickle down effect is one of the many lies these paid economist made up to benefit their already rich greedy fellows.

9 ( +10 / -1 )

the salary should really be taken care of here! it's very unfair for someone in our company to earn 7x our salary with the same position and skills! i mean how's that even worked?! now take into account the others earning less than me. It will be better if we earn almost the same so companies can get more employees and more people will have a good paying job!

4 ( +5 / -1 )

It is seem like that around the world. Politicians can easily be bought and sold.

8 ( +8 / -0 )

Poor people have no time to complain as they are busy trying to survive...that is the trickle down effect.

7 ( +8 / -1 )

Child poverty ...trips to a nearby park to get water.

Japan has one child for each limousine onsen bus full of rich oldies... and they manage to have poor children that can't get tap water.

if she work for 10 hrs everyday, she'd be earning more... So, really it's only her to be blame

You think she chooses how many hours of work she is given ? Care for elderly, it's typically the kind of job where they tell you to pass at 7 a.m then again at noon then at 9 p.m. to help the person 1 hour each time, so you do that 7 days a week, you're paid 21 hours, but the next week, they call you for only 2 hours in total.Why some workers accept ? Because they have that or no job at all. And the employers want to have 5 or 6 persons like that, that can call any day/hour, instead of hiring two full-time employees : they'd have to give a regular schedule, days off, even pay the full salary on months with less business.

The problem is squarely with Japan's private-sector employers

Maybe she's working for a public hospital. They use the "part-time" workers the same way. As what they do is perfectly legal, employers won't change their ways as long as the law is not forcing them or Japanese economy and society get completely ruined (which is likely to happen before sounds reforms).

5 ( +7 / -2 )

I'm surprised this woman didn't get arrested and charged with "stealing water".

After reading about the rail company billing the elderly woman for her husband's death, that would be the kind of callous treatment that seems to be becoming the norm in Japan...

9 ( +11 / -2 )

Kawaiso... Where is the child's father in this? I doubt he pays child support. I don't know for sure but I heard the family court system in Japan awards meager amounts of child support to the custodial parent. Enforcement is also nonexistent and many deadbeat dad's shirk their financial responsibility and don't even see their kids.

3 ( +5 / -2 )

Yep! 5% of the population get tax cuts and 95% get to pay for it. Sounds like a liberal government to me.

5 ( +12 / -7 )

Abe and Awawnomics are for the filthy rich and powerful but paid out by the poor and not so rich. There s no trikle down, not even a yen!

9 ( +10 / -1 )

All of this does not matter ==> as long as the politicians, corporations and well connected get their hand-outs (Gov welfare) everything is good. =take away the welfare from the rich and and you can almost guarantee politician's heads will roll.

The peons need to work hard, stay silent and pay these higher taxes for the elites.

4 ( +4 / -0 )

Yes, the gap between the "haves and have nots" is a problem capitalist economies worldwide face these days when some governments handle it better than others. "Spreadsheet management" ( just looking at the numbers) - will not solve the disparities. Abenomics focuses on the structure first and people as a side issue.

I am happy however to see there are discussions that this "old capitalism" is not working and how business and government must evolve. Please search for the article below that just came out on Friday.

Business, society, and the future of capitalism Unilever chief executive Paul Polman explains why capitalism must evolve, his company’s efforts to change, and how business leaders are critical to solving intractable problems.

3 ( +3 / -0 )

it's very unfair for someone in our company to earn 7x our salary with the same position and skills!

Why would a company pay one person 7x more than another for the same position and skills? That makes zero sense financially. One (or more) of those facts must be incorrect - either it's not the same position, it's not the same salary, or they don't have the same skills.

1 ( +3 / -2 )

Where is Ms. Saito's family?? trinklets2's too for that matter....

2 ( +3 / -1 )

And re Mrs. Saito, still she's way better than me. She's earning 1080 yen per hour and still complaining. Iam earning 840 per hr; ....So, really it's only her to be blame;...It is I who have the right to receive hand outs as I'm really below the poverty line.

This comment is very revealing and really goes to the heart of the issue. Divide and conquer. Unless the working poor come together to realise that they are all more or less in the in the same predicament and group, they will never be able to organize into a political force to bring about a change in government.

7 ( +7 / -0 )

This proves Abenomics is NOT for everyone!!

5 ( +8 / -3 )

I wonder who is benefiting from Abenomics. I've never found any improvement of living since Abe administration came into office in December 2012.

4 ( +4 / -0 )

This comment is very revealing and really goes to the heart of the issue. Divide and conquer. Unless the working poor come together to realise that they are all more or less in the in the same predicament and group, they will never be able to organize into a political force to bring about a change in government.

I thought Trinklets2's post about his current position is informative ne and did not deserve to be marked down, but this is also a good point.

But for the record I'm not really for too many welfare projects, though. With Japan's debt problems, they are the last thing we need. Better regulation of industry seems to be a better solution.

-1 ( +3 / -4 )

I wonder who is benefiting from Abenomics.

My company has benefitted significantly in that about half of our billable hours are to overseas clients. That said, I still think Abenomics is a joke.

0 ( +2 / -2 )

@ kimuzukashiiiii... I agree with you! If there was a way JT could let us know how to contact her or pass on our information, yes, with our permission I would help!!

Might even give free English lessons to for her daughter too.

JT can you help us help her??

3 ( +3 / -0 )

Conservative governments have been flogging the tripe of 'trickle-down' and a 'rising tide' for decades. It benefits those at the top and screws everyone else. That is what it was designed to do and that sense it's a roaring success.

2 ( +5 / -3 )

This is what Abe is all about, with heavy doses of mainly unhealthy nationalism thrown in. Not one poster on here is remotely surprised. We have all always knows what Abenomics is really about. Tax increases and inflation naturally cause pain for the worse off people, but of course we have huge government hand-outs to right-wing construction companies and their amukudari buddies, who in turn make large political donations to the LDP. This is traditional LDP pork-barrel politics and is really nothing new.

Abe now has his eyes fixed on the revision of the constitution and the compliant media has convinced the population that inflation is great news for the people. Does the average Japanese person even understand what inflation is? They seem to view stagnant wages and rising prices as a magic bullet and something that is in their interest, which shows the level of government control of the media. No one even calls Abe up on his bare-faced lies about the level of wage increases the country has really experienced. The most important issue for Japan is presented as the disputed ownership of a few rocks off the coast of Taiwan, not the increasing poverty that this government is deliberately causing through its dirty policies. Unfortunately the Japanese people are so short-sighted that they come up with terms like "kizuna" to describe their unique relationships with each other.

Old people in rural constituencies elect the government under a skewed voting system and younger people have no voice )especially women) so what can you do? Younger people need to mobilize and vote, but they are too apathetic and the demographics of the country are against them. We're stuck with the LDP. Getting rid of Abe and the LDP is now almost mathematically impossible.

2 ( +6 / -4 )

This all goes back to Koizumi and his winner dogs, loser dogs economic policies. Basically trickle down. He amused the masses with postal reform, which of course failed, but outside of the spotlight he was crafting policies that bankrolled the rich. Abe is the same. Of course he could have stopped the regressive sales tax increase, but he did not despite the horrific effect it is having on the economy. GDP will shrink this quarter. And the most damaged are the working poor. Who benefits, the rich and corporations that export goods. And the middle class, welcome to a big step down in your quality of life.

It is the same story as the Reagan revolution in the USA. People actually thought trickle down was serious, not a joke as everyone now knows it to be. But in Japan that tune is being played now. Abe is destroying his country by taking from the poor and middle classes and giving to the rich. And also trying to remake Japan to what it was like in the 1930s. Sadly, things will get much worse in this country before they get better, if that does happen at all.

It is horrible. But on the other hand he was voted in by the Japanese people and they are getting what they deserve. Just like when Germany voted in Hitler back in the 30s. What a horrible waste of the talents and skills of this incredible country.

6 ( +7 / -1 )

The consumption tax, whatever the rate, impacts the lower income groups the worst, particularly for life's essentials. The wealthier are far less affected. Further, abenomics has already caused more than the supposed "target" inflation(which in Keynesians' Bizarro-logic-world is a "good" thing) compounding the suffering of the working poor. So, the real effects of abenomics is : Benefits for the most well-connected , but at the expense of the rest.

To my knowledge, there are only about two devout defenders of abenomics posting hereabouts. Banking insiders.

5 ( +6 / -1 )

Some of the blame goes to towards the Japanese people themselves. There are some really good retraining programs paid for by the governement in Japan for Japanese, but many dont even bother with it. They could learn machining center, building management, electronics, robotics etc.

They wont learn a second language and are happy with their 180,000 yen a month job. They blame all their ills on the foriegners as well. Who wants to employ somebody with no ambition, who follows the "ruru" that all the other employees group together make, and wont do anything more or less than what is agreed upon the "ruru"?

The days of driving a truck for 400,000 a month are over but they still hold on to that dream. I think many Japanese companies try to be fair, but how can the pay a waiter 250,000 a month and still make a profit?

-2 ( +3 / -5 )

It's very clear as day why Japanese people doesn't pursue on long-term relationship any more. Seems Abe is still very much oblivious to logic, revisiting the constitution is his utmost priority, it's quite irritating to see the same topic resurfacing. In other words, LDP feels woefully incompetent and has lost the touch with the reality. All it is good at is tappity dancing on the edge of imperialism and taunting anyone who crosses them.

2 ( +3 / -1 )

As Prime Minister Shinzo Abe charges ahead with his “Abenomics” policies to revive economic growth, things look set to get harder, not better, for Japan’s down-and-out. These are policies to reverse growth not revive growth. The rich will get richer, the middle class will slip into poverty and the poor will become poorer. Abe is following the same policies that have ruined the world economy but if you hype it enough the people will believe it. Abenomics are only for the rich that invest their money to make a profit, the people will not see any gain as the prices get higher and the Yen falls to record lows reducing the buying power.

2 ( +4 / -2 )

Thanks JT for presenting a very rare non-fiction version of Abenomics.

4 ( +7 / -3 )

Single mother? Always a predictor of childhood poverty. Only 2% of Japan's children are born outside of marriage. Were she married and could work, her life would improve.

2 ( +3 / -1 )

Conservative governments have been flogging the tripe of 'trickle-down' and a 'rising tide' for decades. It benefits those at the top and screws everyone else. That is what it was designed to do and that sense it's a roaring success.

There needs to be a middle ground. The idea of socialism or taking from the top and spreading the wealth doesn't help either. Raising the consumption tax and high prices is doing the exact equivalent. No one has disposable income to throw around.

0 ( +0 / -0 )

A country that cannot feed and offer high level of education opportunity to all its children is a third world country in my conception of social progress.

2 ( +2 / -0 )

The problem is indeed more deeply rooted than just pointing at Abenomics as the fault. Japan needs to step up its standards for better social welfare. If they don't, the gap between very rich and very poor will grow even wider. Politicians are masterfully and ignorantly forging the dystopia.

2 ( +2 / -0 )

'There needs to be a middle ground. The idea of socialism or taking from the top and spreading the wealth doesn't help either. Raising the consumption tax and high prices is doing the exact equivalent. No one has disposable income to throw around.'

The problem with your definition of 'middle ground' is that you yourself are among those who often scream 'socialism!' if anyone puts forward a 'middle ground' idea. To look at two of the countries who implemented this trickle-down rubbish in the 80s - the UK and the US, the parties on the left are now further right than the conservative parties of the seventies. The economic policies of Nixon or Heath would be dismissed as loony left nowadays.

-1 ( +2 / -3 )

The problem with your definition of 'middle ground' is that you yourself are among those who often scream 'socialism!' if anyone puts forward a 'middle ground' idea. To look at two of the countries who implemented this trickle-down rubbish in the 80s - the UK and the US, the parties on the left are now further right than the conservative parties of the seventies. The economic policies of Nixon or Heath would be dismissed as loony left nowadays.

It is socialism (fascism) for the rich now, not the sewer socialism (socialism to help all). Singapore does very well with their capitalism (very few handouts). I believe it is the corruption involved that eventually affects the lowest. The problem here is that the wages are low and the costs are getting higher (inflation).

1 ( +1 / -0 )

"Single mother? Always a predictor of childhood poverty. Only 2% of Japan's children are born outside of marriage. Were she married and could work, her life would improve."

I disagree. A single mother can get a montly income from the government in Japan, plus other assistance. There is allot of support for Japanese, and they can attend free retraining, get paid while they do it, and all they have to do is pay for the text Then they can get a better job. The tax burden and public debt help to pay for these programs.

Japanese are a group society, and many dont have any dreams, expecpt to belong to a group and the company take care of them. I rarely see initiative, but I see lots of foreced conformity. If one plays "safe" and obeys many ridiculous rules, they can enter the warm embrace of the group.

Those who rebel against this culture work at places where the group isnt so important, but they miss out on many benefits and pay.

1 ( +3 / -2 )

@David White

Single mother? Always a predictor of childhood poverty. Only 2% of Japan's children are born outside of marriage. Were she married and could work, her life would improve.

Maybe I should read the article again because I didn't see where it says that she had not been married ? I am a single mother too. My son was only three years old when we divorced.but I insisted upon continuing to live in Japan so that he could see his father from time to time. I received NOTHING from my ex-husband (unless a "kick-in-the-pants" can be considered...) and NOTHING from "welfare" I wish I'd know about :

"you got a fixed-rate ¥120,000 per year per child allowance"

because I never got a cent out of the Government... (it would seem both my "ex" and the Family Court" decided to keep that part to themselves...)

Abenomics is a nightmare for both of us ! It's my son doing all the earning now because I can't find any work...

5 ( +6 / -1 )

There needs to be a middle ground. The idea of socialism or taking from the top and spreading the wealth doesn't help either. Raising the consumption tax and high prices is doing the exact equivalent. No one has disposable income to throw around.

Wrong-0 Adam Smith breath. Look up the term marginality in economics. It is pretty basic. Simply if you have more money then incremental costs are trivial. If you have less money, the opposite is true.

The sales tax is regressive. THe income tax is progressive. Dropping tax rates for the rich actually decreases economic activity as the bush tax cuts clearly demonstrated.

2 ( +3 / -1 )

I wonder if she is registered as a single parent, I am and get 40.000/month aid for raising my son. BTW, I am a single father.

Water didn't used to be cut but they started doing so for people that haven't paid for a year or more. Other utilities you get reminders and final cut-off notices call them and cutoff date can be postponed by a week or so.

If she get social assistance they should also help with medical, school fees like lunches and often water is free.

Sounds like we don't all the details here.

5 ( +5 / -0 )

Thumbs up to Cos and choiwaruoyagi. @FightingViking Have you checked out the training programs from Hello Work? You get a monthly stipend so it may be worth your while.

2 ( +3 / -1 )

I am in Vancouver Canada and feel for this hard working single mother. I want to send her something to help or even offer to relocate here.

0 ( +1 / -1 )

@DenTok2009

@FightingViking Have you checked out the training programs from Hello Work? You get a monthly stipend so it may be worth your while.

Thank you for the info ! When we still lived in Tokyo (five years ago) I did get signed up at Hello Work. I've been trying to find out where there's an office near our place (in the Yokohama suburbs). My problem is I have a bad leg and this is really "inaka" here, so I'd need to go by car but parking could be a problem... (I also have a scooter but I haven't yet paid the insurance for this year and it also needs a new battery). My son is taking very good care of me but I'd really rather work !...

0 ( +1 / -1 )

japan's working poor should be the priority for this government and its Abenomics,,but its just look like the very opposite, the government already moving forward with increasing the sales tax and as i also heard, the tax will rise again perhaps sometimes at the end of this year..that simply means taking more money out of the pockets of consumers, drying them out while wages for the majority at the very bottom still flatly unchanged at all..that also simply means decreasing consumer confidence, and decreasing business confidence..i don't think this will help people like Ririko Saito san as in the article and many others (perhaps most of us commenting here as well) willing to work hard, just to see their government doing very little or nothing to fix the current economic disparities,,i don't think changing the current constitution is also good economics for japan..

1 ( +2 / -1 )

Hello Work does have a special counter for single mothers but none for single father's.

Depending on how bad your leg is you can claim medical disability and visit that counter at Hello Work.

Of course aid and benefits increase if you got PR.

3 ( +3 / -0 )

I'm not clear on how things work in Japan. Here in Canada when people rent a home or apartment the water is included in the rent, there are no meters other than for an entire building so people don't get water cut off. Water is a basic need and here it is covered / built into the property tax. The only water people pay for as individuals here is bottled water we buy in a store.

How much does water cost in Japan? Maybe a fund could be established to help cover the cost of water for people, especially a single parent family struggling to keep food on the table. I would be happy to help this person cover her water bills, one less thing for her to worry about as she raises a child on her own.

0 ( +0 / -0 )

The problem is squarely with Japan's private-sector employers: they're the world's stingiest. They've spent two decades constantly cutting salaries, even while recording growing profits, paying dividends and while productivity rates rise among their workers. They've also cut benefits.

Tell me which Japanese companies have earned record profits? If you are talking about the automakers, most of their money is made overseas, and stays overseas, little is brought back to Japan. If you are talking about Hitachi, Panasonic, Sharp, Sony, Nintendo, Toshiba, every single one of these companies reported a loss last year, and nearly all will end this year with losses as well. If you are talking about Mitsui and Mitsubish, their financial arms earned strong profits, but their manufacturing and real estate operations nearly all lost money.

None of these companies have earned good profits since the bubble economy burst more than two decades ago, so is it any wonder why wages have declined over the same period? What's more, contrary to popular belief, Japanese companies depend more upon domestic sales than exports, as domestic sales absorb more than 60% of their output. With the population shrinking by hundreds of thousands of people each year, exactly how are these companies going to be able to make more money to pay more wages?

The main reason that the economy is shrinking, along with the wages, is because of the simple reason that that people have less and less money to spend. Why do they have less and less money to spend? It is not directly the fault of the companies and employers.

First, the corporate tax rate in Japan is 38%. This is the highest tax rate of any developed country in the world. next, we have the consumption tax, which was recently raised to 8%. But the rate isn't just 8%, because in Japan the consumption tax is levied at more than one level of transaction. It is charged by the distributor, the wholesaler, and the retailer, so the effective rate is more like 24%. And in Japan, the tax is applied to things like food, medicine, and services, which are not taxed in other developed countries. In addition to all of this, you still have to pay income tax, residency tax, taxes on gasoline, utilities, tolls, licenses, etc.

When you get down and do the math, the majority of the income earned by people and companies ends up being collected by the government. The result of this is that among developed nations, Japan comes in nearly at the bottom of the list in disposable income, only ahead of Spain and Greece. No wonder why the population is decreasing, and the number of working poor is increasing.

The sales tax is regressive. THe income tax is progressive. Dropping tax rates for the rich actually decreases economic activity as the bush tax cuts clearly demonstrated.

Nonsense. Of course there will be a few people here who say we should tax corporations and the rich to help the poor, but this is absurd. You cannot tax a particular class of people without the tax eventually being paid by all the classes. It is impossible to increase the tax on the rich without the poor eventually paying for it, and the opposite is also true, increasing taxes on the poor also increases the tax burden on the rich. The greatest myth every perpetrated by politicians and the stupid is that it is possible to raise the tax on upper income earners without the tax increase affecting low income earners, it simply isn't possible. A tax on any part of the economy is paid for by every part of the economy. People must get this through their heads.

Without the so-called Bush tax cuts in place, the recession might have been far worse than it was. The tax cuts might have had a better positive effect had the subprime loan nonsense, and the resulting housing bubble and burst not occurred. Those who caused the crisis have not been called to account, but then again Freddie Mac and Fannie Mae were huge donors to Obama's campaign in 2008, and those who mixed subprime loans in with their mortgage backed securities have also not been punished, and it looks like they never will be.

The best way to improve the economy would be to increase the size of the private sector, and reduce the size and cost of the public sector. But this will not happen, at least not until the public sector collapses under the weight of it's crushing debt. This is going to hurt far more than the financial crisis of 2008, but it might finally motivate people to stop reelecting these bloodsucking liars.

-2 ( +7 / -9 )

@It"S ME

Thank you for the info ! I shall try to work it out.

0 ( +1 / -1 )

FightingViking.

Visit the local City-Hall and stop by Family Affairs and also Social Welfare, in addition speak to your local Komeito Official.

Hello Work offices are few but your town will have a represantive working there, days and times vary.

Was surprised how much help I got after my Japanese wife died.

2 ( +2 / -0 )

Sangetsu - the first half of your post was correct, but the second half was not.

1 ( +4 / -3 )

FightingViking.

Forgot check if your doctor is approved and works with your city-hall, mine is and helped me get disability for my depression, he is also our GP. Just got my disability renewed.

Hang in there and use all the options you can get, some like disability and single parent aid take a bit of time.

Rooting for you.

2 ( +2 / -0 )

Sangetsu03,

Excellent post, in it's ENTIRETY.

If more people would read Hazlitt's "Economics In One Lesson"(available as free download in PDF), they would easily learn the many economic fallacies forwarded by the dopes in charge and their lemming economic supporters.

-5 ( +1 / -6 )

If Kim's observation were right, then, that's what he wanted for. Abe succeeds his intention of making poor poorer and rich richer!!! Abenomics jeopardises the prices at home!!

-2 ( +1 / -3 )

Excellent post, in it's ENTIRETY.

Other than the second half, which was wrong, in it's entirety.

2 ( +5 / -3 )

@fighting viking every major city has a hello work. Kawasaki is about 15 min from the station and there is one in Kanai yokohama I think

Get ready for fun and games, its been awhile since I been there, but thats how it used to be.

Its best if you can type in the key word yourself and look for jobs, then get some staff to do the intro letter

some good jobs there as I recall, but takes allot of effort to get past the pigheaded staff

0 ( +1 / -1 )

Might be a bit off-topic but I just spend two Sunday afternoons as part of a workgroup gathering ideas on how to improve life in my city.

Was shocked as I was the only foreigner even though we got a fair foreigner population. Showed me how little people know about their own city and services offered even among the Japanese that attended.

0 ( +1 / -1 )

It"S ME

FightingViking.Visit the local City-Hall and stop by Family Affairs and also Social Welfare, in addition speak to your local Komeito Official.

Actually, when my son was still living in France, I did go the the City Hall and felt extremely embarrassed to ask for some financial help... "You have a car, you don't qualify for any kind of financial help" was the "warm" reply I received...

Forgot check if your doctor is approved and works with your city-hall

Unfortunately, my leg problem was caused by a young Japanese intern (after an accident I had). Four operations later, the problem is still there. I used to get back to France to visit my son from time to time and saw French doctors who said there isn't much they can do about it now... I'm afraid to say I just don't trust Japanese doctors any more ! But thank you for your kind concern !

0 ( +1 / -1 )

FightingViking.

Don't give up Japanese docs like any others are hit and miss. But you can get around those probs.

City-Hall of course got rules for aid know them and use them, local komeito official will help.

0 ( +2 / -2 )

@ITS ME

Congrats on getting that benefit, I never heard of getting single parent pay or depression from Hello Work, learn something new all the time. My experience a long time ago was not very pleasant with those people. Just seemed to me they were there to practice their English or get a rise out of seeing your face when when dialing a job for you and getting the "japanese only" reply. If you can read Japanese, you can use the computer to find a variety of Jobs. As everything in Japan is done through introduction, you need to get the introduction letter from a staff member. I know if you quit your job you get 3 months unemployment after a 3 month wait, and must show your getting interviews. You can get 6 mos if you get fired, but I think they are trying to stop that There isnt allot written in English about benefits like ITS ME mentioned. I learned it all on my own. I think its done on a case by case basis. I didnt even know about the training programs until I met some people who attended it.

-1 ( +1 / -2 )

5petals.

I got those from family service, social welfare, etc not from Hello Work.

Like I recommended speak to your ward, again PR and Japanese knowledge helps.

Hello Work also got an online service where you can search and apply for positions online using your Hello Work number, again Japanese only. Granted a call from a Hello Work employee helps, they even told me that some jobs will never go to a male or a foreigner, even though I had the qualifications.

The only Hello Work office that supports foreign speakers that I know off is in Shinjuku.

Said that I have been here for 17yrs so Japanese knowledge is a given, IMHO?

0 ( +1 / -1 )

True, Japanese goes a long way; I been to Hello Work offices and used only Japanese, only to be told by the company, "japanese only"

If you dont understand/speak japanese, good luck on that

My point is I dont think its all doom and gloom for Japanese. I was told by a Japanese that the homeless here can get free shelter and job counseling; its just many dont want it

I think the average Japanese has a pretty good deal when it comes to employment and the Japanese gov tries to accomodate them well

If they are going to all mass immigration, however, I think allot of these benefits will be extended to this non Japanese, and many will not be happy about it.

0 ( +2 / -2 )

I agree it is not all doom and gloom, knowing many Japanese and foreigners that receive aid.

On the same token many Japanese don't know what is offered or are afraid to use them as it might reflect bad on them. Ditto for mental health care, etc.

1 ( +2 / -1 )

@FightingViking Glad It"S ME is giving some good advice; hope you will get some assistance and land a job. @5petals Just a bit more on the unemployment benefits... If the individual was employed as a 社員for twelve months then unemployment kicks in but no help for アルバイト or temp work. One man I know is keeping busy with the help of two temp agencies. It's turning out good for him. When one is dry the other has something on the books. I was flabbergasted by one girl I met a couple of months ago. She has some neurological condition the university doctors haven't pinned down yet (so she visits the hospital for tests every month) where her left side freezes up (she's immobile and has to use her right side to drag her body) every now and then. She used to have a long term temp job (she wished she could get on permanent) at the 税務署. When that gig came to an end, one job she took was a warehouse position way out in Haneda. The girl commuted from Saitama and the job didn't cover train fare. One way was over 2,000 yen and the hourly wage was under 1,000. The girl wasn't being picky about jobs. She was willing to do whatever she could do - retail, warehouse, clerical - but she did check with her local city office about getting some financial assistance. They told her that since both her parents and a brother were alive, there was nothing they could do. She lives with her parents and her brother is living on his own. She feels awful about burdening her parents with her situation (health and lack of a steady income). My point in relating this story is some people are struggling to survive here despite the sorry economy. I feel the suicide is rampant in Japan because there is so much unhappiness. If only we all could be productive...

2 ( +3 / -1 )

They have to create some exceptions for the tax hike like food sold in supermarkets and convenience store.

3 ( +3 / -0 )

Yeah, the changed the law a few years ago from 6-month employment to 12- month.

I recall a member here that struggled with his own business, 2 kids(one with down), he was denied single father benefits as he lived in an apartment in his ex-wifes name.

He refused to move to a ward supplied one, last I know he was worried about the next months rent. Don't know what happened after that.

1 ( +1 / -0 )

Sangetsu03's post was correct IN ITS ENTIRETY. Wealth redistribution, which certain unscrupulous types promote, is the sickness in current populist economic deceitful thinking.

-1 ( +3 / -4 )

@ sangetsu03

next, we have the consumption tax, which was recently raised to 8%. But the rate isn't just 8%, because in Japan the consumption tax is levied at more than one level of transaction. It is charged by the distributor, the wholesaler, and the retailer, so the effective rate is more like 24%.

Regarding the consumption tax being more like 24%, sorry, but this is incorrect. Businesses only remit to the government the total of the consuption taxes that they collect on their sales minus the total that the business pays when it purchases supplies. The tax only accumulates on the value which is added if the compay sells its goods for more than it paid for them... this is why it is called a value added tax. In the end, the consumer is the last person in the chain who cannot claim a refund, so they pay the full 8%. The tax is only ever going to be 8% no matter how you look at it.

0 ( +4 / -4 )

Sangetsu03's post was correct IN ITS ENTIRETY

Other than the part that was entirely wrong.

0 ( +5 / -5 )

There are two salaries in Japan, getting paid on the good side or the "common side", if you are on the common side you get paid 1000 yen an hour, 100,000 a month.... its real.......on the otherside you have fat cats earning a massive salary.

1 ( +3 / -2 )

Tell me which Japanese companies have earned record profits?

The old big kaisha have ceased to be the main employers.... well, no they never were, and you're right, they are not doing great. But you can't say nobody builds fortunes on sweat shops : All the chains in service industries. Like fast-foods that employ mostly (if not exclusively) people paid at the hour at lower rate and conditions possible. The new form of exploitation is not a consequence of the low economy, it started when Japan was super-rich. In bubble area, they were justifying the underpayment as in most families there was a husband/dad/uncle that had a bread-winner income so all the wives and freeter relatives didn't need to be paid enough to pay rent-food-utilities. And nobody complained even they knew that was not normal. Now, look at this lady, the dad with his salary+ bonus has vanished, her other male relatives have forgotten her and she has to live on "pocket money" with a teen.

My point is I dont think its all doom and gloom for Japanese. I was told by a Japanese that the homeless here can get free shelter and job counseling; its just many dont want it

That's why it is gloom. They can't accept the help because they would end in an even deeper misery. In Osaka, they've put the shelters in the middle of nowhere out of the city very far away (like 1 hour of train, and no, you can't cycle) and they have rule like 19th century school dormitory. It's just to clean the streets of the view of homeless. Because all the homeless have their social networks and jobs in town, often at night picking garbage or being giving meal/stuff for helping friends, so when they stay in the shelter they can't work at all, then there are the problems that initially caused their social fall (weird behavior, booze..90% of them !) , that makes life in dorm complicated at best. So they are told to leave after the first incident... And politicians and top civil servants can say "look, we have been nice to them ! "

1 ( +2 / -1 )

Mr Strangerland, you keep saying some part of Mr Sangetsu03's post is incorrect,but you neither indicate which point nor actually rebut which tends to indicate a lack of data or inability to adequately express your position other than a blanket disagreement. Please expound.

-2 ( +2 / -4 )

@Frederic Bastiat

but you neither indicate which point nor actually rebut which tends to indicate a lack of data or inability to adequately express your position

If I may, I don't think the post is entirely incorrect. There are many facts (apart from the description of the consumption tax) which are completely accurate. For example;

First, the corporate tax rate in Japan is 38%. This is the highest tax rate of any developed country in the world.

This is undeniably true, however Sangetsu03 seems to point to this high tax rate to suggest (but not explicitly) that this is why companies do not raise wages. Since corporate taxes are only paid on profits, this explanation fails. Logically, corporate taxes can never be the reason as to why there is not enough money to increase wages or pay for any other expense which would end up reducing profits and therefore tax. Also, the fact that Sangetsu03 claims (probably accurately) that corporations have not been making any profits seems to undermined his claim that corporate taxes are the problem. If corporate taxes in Japan were 0%, it would not help companies who are making huge losses and are therefore not paying taxes anyway. You cannot argue both sides of this point.

Inconsistencies like this seem to undermine Sangetsu03's conclusions in my opinion, even though alot of what he says is factual correct.

5 ( +5 / -0 )

Want to add most Japanese are not upset with me receiving benefits as I got PR and it is due to medical reasons. Actually found them to be very supportive, as it is common for the job I did, and botjy me and son are considered equal.

During the last 2 workgroups I gave info and explanations about my city that surprised locals and also chatted freely with ward officials who approached me.

On the same tentacle I get little support from many expats.

2 ( +3 / -1 )

If more people would read Hazlitt's "Economics In One Lesson"(available as free download in PDF), they would easily learn the many economic fallacies forwarded by the dopes in charge and their lemming economic supporters.

Hazlitt's book is laughable; by dupes for dupes. One doesn't have to get beyond his broken window example to see his economic fallacies.

LDP feels woefully incompetent and has lost the touch with the reality.

The question is which group has the best grip on reality, and can they articulate it well enough to garner the support they need to put it into action. All that requires tremendous involvement by concerned citizens -- too many of whom seem to have resigned themselves to constant incompetence.

0 ( +2 / -2 )

Wow, how times have changed...38% of the labor force is making less than 1.62 Mill Yen a year. This is Japan in 2014. People need to come to grips with this new reality.

-1 ( +1 / -2 )

No one else has commented on this but since the water company turned off service to Ririko Saito abode, she is dependent on the water from the park for cooking, washing and flushing. Unless she is living in a place with a shared non-flushing Japanese style toilet. (I knew a girl during the bubble era who rented a 4.5 mat room with a sink and single burner and shared such a toilet in Yotsuya 3 chome. The landlady was always cleaning so the toilet and hallway was clean and odorless.) I met a few former caregivers (all in their mid-twenties to early 30's who put in at least 3 years on the job) who told me they loved taking care of the elderly and made 850 yen / hour. They all didn't want to leave the job and wanted to return to it but were taking a break to make/save some money for their own future needs. They were all single. If one is relatively young and interested in helping the elderly, stagnant wages for that sector is a given.

0 ( +0 / -0 )

The problem with your definition of 'middle ground' is that you yourself are among those who often scream 'socialism!' if anyone puts forward a 'middle ground' idea. To look at two of the countries who implemented this trickle-down rubbish in the 80s - the UK and the US, the parties on the left are now further right than the conservative parties of the seventies. The economic policies of Nixon or Heath would be dismissed as loony left nowadays.

You mean, the parties on the Left are Ueber-Left. 5 years of Robin Hood like tactics taking from people and spreading the wealth is NOT doing anything for the economy in the U.S. stagnant and not rolling on and in Japan, the idea is to raise taxes and to keep profit margins high and as long as both countries think that the idea to a stable economy is tax the Bejeezus out of people, we are all in serious trouble

-3 ( +0 / -3 )

'On the same token many Japanese don't know what is offered or are afraid to use them as it might reflect bad on them. Ditto for mental health care, etc."

I dont think, especially foriengers, that there are such programs/benefits available to them. People under a certian income can also get public housing, and the yachin is like 10,000 yen a month I guess. Some cities even sort of subsidize housing for low income people, meaning there is no rei kin etc.

@cleo, I beleive Kawasaki offers free showers and bentos to its homeless. As many Japanese have explained to me, the homeless in Japan are mostly dropouts; they just dont want to deal with the job enviroments. granted, I do get this as some of those jobs offered to them are nothing but misery, but hey, he could save some money, attend hello work free training and change up his career. All of us have to hustle some how.

-1 ( +1 / -2 )

many divorced men in Japan pay little or no child support.

Link please.

3 ( +5 / -2 )

'You mean, the parties on the Left are Ueber-Left.'

?????? The point I was making was that Obama's economic policy is well to the right of Nixon's. Take a look at how much tax the rich paid in the 1970s. If a modern Democrat espoused the taxation policies of the Republicans of the 1970s you'd be sprinting down the street with a pitchfork. If the modern Democrats are 'Uber-left', what did the Republicans used to be?

2 ( +4 / -2 )

"...exactly how are these companies going to be able to make more money to pay more wages?"

Easy, use the record amounts of cash currently on their books. I suggest you google a Reuters story from Oct. 2013 titled, "Japan corporations to ‘hoard’ profits from tax cut,"

These companies have more cash than they literally know what to do with. They need to allocate a greater portion of their revenue to their workers.

0 ( +3 / -3 )

“The Abe administration’s stance is more about fixing things, including poverty, with a trickle-down effect from overall economic growth,”

That trickle-down effect is more like you-know-what running down our backsides! Chairman Abe and the Finance Ministry put so much effort into their corporate tax incentives and other various measures to aid the business sector that the government could not find the funds to take measures that would have reduced the burden of there new polices on the lower and middle class. Abe could have amended the consumption tax measures to make various food items and essentials not subject to the tax increase or simple tax free but he said there wasn't enough time to get consensus within the related ministries and the business community thought having various tax rates would be too much of a hassle. He could have done more to make education accessible no matter what the financial circumstances are of the family and instead of taking measures that will allow companies to shift more of the workforce off of full-time status and hire part-timers which will only create more Japanese in-need-of government welfare and generations who won't have contributed to the retirement/pension system putting that more at risk!

Chairman Abe's States Secret legislation, National referendum law, corporate welfare measures and his ambitions of constitutional changes have trumped what little desire he has to help those Japanese who have been less fortunate. The fact is the Finance Ministry is against the idea of lowering the consumption tax because they have to make up for the lost tax revenue due to the corporate tax relief measures and the business sector is against any measures that will benefit workers because it will eat into there profits, those boys at KEIDANREN (Japan Business Federation) must really be liken Abe-chan. He has ignored measures at the expense of the lower and middle class because it's too much of a hassle, and yes, trickle-down has surely found meaning with those who get trickled-on and it ain't pleasant.

2 ( +4 / -2 )

abenomics = trickle up poverty

7 ( +8 / -1 )

yabits, it comes as no surprise to me that you simply don't "get" the importance of Hazlitt's "Economics In One Lesson".

But, other rather accomplished economists have, such as F. A. Hayek. Hayek himself praised the work, as did fellow Nobel Prize laureate Milton Friedman, who said that Hazlitt's description of the price system, for example, was "a true classic: timeless, correct, painlessly instructive." So, excuse me if their opinion overrides yours.

Abe's succession of destructive economic policies benefit the connected elite at the expense and suffering, regressively, on the lower economic rungs.

The lesson:

"The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups."

2 ( +3 / -1 )

Japan’s relative poverty rate - the share of the population living on less than half of the national median income - is already the sixth-worst among the 34 OECD countries

Why isn't poverty defined in terms of... poverty?

It seems to me like nonsense to compare based on income, due to different cost of living in different parts of the country.

The regressive tax puts the biggest burden on the poor and another increase to 10% is planned for October 2015.

Here's me thinking it evenly burdens the population who all consume stuff, whereas income tax burdens the working people (who there are going to be fewer and fewer of in Japan).

government could limit the pain with policies that redistribute wealth better

Japan is the only OECD country where the poverty rate among working households and households with children increased after benefits and taxes

The pension system should be redesigned so that each working cohort pays for it's own retirement, rather than the current scheme where today's workers pay for today's retirees.

It's tough cookies for the retirees. Japan's government can't afford to keep screwing it's shrinking working population forever.

politicians favor introducing preferential tax rates for basic goods and services to ease the pain of the next hike

Terrible idea. Simple tax is the second best tax (after no tax at all). Deal with the genuine poverty class by some other means such as direct income supplements.

1 ( +1 / -0 )

Other than the part that was entirely wrong.

I'm not so sure, I think his point is that if you raise taxes on the rich, who generally own businesses, they just raise prices on goods and services which the poor end up paying and if you raise taxes on the poor they have less money to use and thus you need to raise taxes on the rich in order to help pay for social welfare programs for the poor.

0 ( +2 / -2 )

Cleo, you must not understand how taxes work here. When the child deduction was lost, not only did my federal taxes go up, but my city taxes sky rocketed (I live in a rural area, so the city taxes are pretty high). Just the Fed and city taxes combined to actually a little over an additional ¥200,000 per year. Add to that the increase in pension and health insurance premiums, which are based on the increased taxable income and the actual cost is far higher than the 240,000 per year the government doles out. No, I don't make a lot. Yes, my wife works as much as the busy schedule the kid's schools set allows. So much for the government caring about the low birth rate.

0 ( +1 / -1 )

This guy seems to have it figured out:

http://www.windrockwealth.com/japan-land-of-setting-sun

Something I rearley see mentioned, however, is the vast savings that households and companies are sitting on. I think Japan gov is betting on those savings to b released once things go critical. Many Japanese have told me its all "daijobu" because of these savings.

As usual, you can always get two different sides when it comes to Japan; the forienger observer and the biased Japanese insider. Hard to make sense of it all.

1 ( +2 / -1 )

This is one of those rare occasions where I hit Ctrl-P on a article. With so much sensationalism and paid propaganda written it's a blessing to see the truth in print.

0 ( +1 / -1 )

If it "doesn't garner votes", then it is the fault of the voters not voting or even paying attention. We get what we deserve.

1 ( +1 / -0 )

Login to leave a comment

Facebook users

Use your Facebook account to login or register with JapanToday. By doing so, you will also receive an email inviting you to receive our news alerts.

Facebook Connect

Login with your JapanToday account

User registration

Articles, Offers & Useful Resources

A mix of what's trending on our other sites