politics

Noda struggles to conquer Japan's debt mountain

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And the pollies have been yapping about raising consumption tax for almost a decade.....and they're STILL yapping about it.

"People have long had allergic reactions to the idea of a consumption tax hike,” he said. “But there has been improved understanding for it over the past 10 or 20 years.”

It's only 5% !!!

In the UK, VAT is 20%. Oz 10% China 17% Denmark 25% NZ 15%

Even Albania's sales tax (10%) is higher than Japan's!

5 ( +5 / -0 )

“It’s impossible for young people to believe that things will get better tomorrow in a society where debts resting on future generations continue growing,” he said.

And yet the "solution" is not to cut benefits to the huge cohort of elderly, but instead to further tax consumption just when younger people -- and there are so few of them! -- are at an age when they want to have children, and are thus coming into their highest-consumption years?

How does this work again, Mr. Noda? "Debts resting on future generations"? So it's either debts on future generations or taxes on future generations?

How about some sacrifice from your generation, which benefited tremendously from the peaceful, high-growth postwar world without any of you actually going off to war and being shot at like today's super-elderly, or enduring the lack of material comfort that today's "ordinary" elderly did in the immediate postwar years? You boomers made your fortunes in the bubble era -- and didn't pay any consumption tax at all while doing it.

No, things will not get better "tomorrow", because "tomorrow" we working-age people will see shrinking paychecks and massive increases at the cash registers every time we buy something. It'll get better for you, of course, because your pension will be assured. How about some concern for the day after tomorrow, when the birth rate goes down even further because of the decrease in spending power for today's and tomorrow's parents?

If the government really cared about being fair to the post-1970 generations, they'd institute big cuts in current pension payouts and gut all the useless government projects that have been providing steady paychecks to the pre-1970 crowd but now aren't hiring. They'd cut pensions by a small percentage for what's being paid out based on post-1989 (post-consumption-tax) premiums, and cut them even more for payments based on pre-1989 premiums, when payers were able to make money without paying any consumption tax at all.

"Improved understanding" for your tax? More like "improved resignation" as everyone under about 50 realizes that the oyajis and obaas are circling the wagons and leaving everyone else out in the cold. ”Après nous, le déluge,” huh?

1 ( +4 / -3 )

only way to do this will be for the JP govt to buy more JGBs, unfortunately. If they dont raise consumption tax and refuse to make more expenditure cuts, the only way to keep this country running is to buy more bonds.

Of course, that will lead to inflation, which in a sense is like a tax increase anyways. So this vicious cycle will continue, inflation spikes, real value drops, the people holding these JGBs lose value, banks cut their lending, and back to recession.

so in other words, we are screwed.

-2 ( +0 / -2 )

Looking good...for the future. Earthquakes economic collapse, pathetic corporate governance, pathetic Governance in general Live it up now! Poison building materials, food and water, apathetic public. Besides cheep grog, tobacco and beautiful people what's the attraction? Everyone can see the iceberg! To stay after all that has happened already, knowing what is coming makes no sense! Even Pinokoyo managed to flee boys Island. Get your family out, NOW. Unless there are reasons that are worth the inevitable.

0 ( +0 / -0 )

Fine...you can have my understanding Mr. Noda , but FIRST cut all the bureaucratic govt. waste to the bone....AFTER that is done you will deserve the public,s understanding for your tax increases. Can we have the J government,s understanding on that ?

1 ( +2 / -1 )

Who cares about the younger generation, just keep borrowing lets go for it now!

Lets jst be decadently selfish and lets have it all !

3 ( +3 / -0 )

All over....

Stay, pay more and expect an earthquake that will destroy all hope all work.

Or get out and look back on fond memories.

0 ( +0 / -0 )

Cut spending you moran.

0 ( +1 / -2 )

cut spending and find a new resource to exploit for export in the sparsely populated Hokkaido.

0 ( +0 / -0 )

Too late...can see the train coming but there has to be several meetings before...the train aaaahhhhhh

-1 ( +0 / -1 )

Not one clown has yet to say we will not tax essentials such as food, medicine, children's diapers etc. What is wrong with these people?

1 ( +2 / -1 )

**In the UK, VAT is 20%. Oz 10% China 17% Denmark 25% NZ 15%

Even Albania's sales tax (10%) is higher than Japan's!**

It doesn't matter what tax rates are in other countries - we pay for things out of pocket that the UK and the like don't - like doctor visits! The problem is the wasteful spending by the government. All those roads to nowhere with huge dams and bridges? Needless. Cut that crap before raising the taxes - and diet members can take a nice big pay cut too!

-1 ( +0 / -1 )

Does any of this mean the YEN will be devalued? Here in the UK we have been suffering with over valued Yen for 3 yrs now.

1 ( +1 / -0 )

Japanese government imposed 70% inheritance tax (it was proposed to increase to 90%) arguing that old generation shouldnt support the younger generation. But it burdened the younger generation to support the older generation. Either way the government benefits. The question is, how the government has been spending all this money? For a country without any army to maintain, it should have surplus every year instead of deficit. I could only conclude that the gov is super inefficient, incompetent and inept. Probably be better off without one.

0 ( +1 / -1 )

lincolnlklim

I could only conclude that the gov is super inefficient, incompetent and inept.

Nail on the head ! Thing is everyone knows this except for the Government

0 ( +1 / -1 )

since Japan will avoid making a decision, one will eventually be imposed on Japan by the markets. Or maybe a slow down scaling of economic capacity will just continue until nothing can be paid for.

Given this and the national tendency to look inward, Japan will go back to a self imposed exile. I'm trying to think what can alter this trajectory but I don't see it.

-3 ( +0 / -3 )

japan could always go into the arms market.

-2 ( +0 / -2 )

For a country without any army to maintain Do you think the defense force is voluntary? 3% of the budget gone just like that. I don't mind paying for it. What I mind is paying for the roads to nowhere, the slush-funds, their unrecorded meetings...

-1 ( +0 / -1 )

sunhawk

Japan is America's arms dealer

-1 ( +1 / -2 )

Take bribes and then buy debt. What do you expect...

0 ( +1 / -1 )

The sooner politicians realise that what the country needs is governance and not perpetual party campaigning in the Diet the better it will be for the poorly served electorate of Japan. Who cares what the 3 members who make up the Monster Raving Looney party or whatever silly faction they belong to want to campaign on, unite as a responsible government and get something done. Japan deserves much better than what is being delivered by its politicians.

0 ( +1 / -1 )

Japan has just reported its first trade deficit in 30 years which may be an anomaly due to the earthquake/tsunami last year.. but on the other hand it does raise questions if Japan can just export itself out of this mess. A devalued yen is good for its exports but its population is aging, the birth rate is low and immigration is non-existant. And as the years roll on and on we are left with a smaller working base to support existing retirees... The future is not bright at all

0 ( +0 / -0 )

This is a bunch of crap!! Lies!! How many millions and billions of money are being wasted by corrupt bastards like Ozawa?? All of these parasite politicians need to have their salaries cut by 2/3!! Then we could balance Japan's debt of lies and corruption!! The entire country is full of secret construction sights that nobody ever uses!!!

2 ( +2 / -0 )

First force Japan to also stop sending billions of $$$ to countries like CHINA?? Why in the HELL is Japan still giving $$$$$ to China?? When this country has this huge debt??

0 ( +0 / -0 )

I could only conclude that the gov is super inefficient, incompetent and inept.

I am sure this is what 99.99% of us non Japanese think too.

0 ( +1 / -1 )

Japan is able to finance more and more debt because of its massive hoard of domestic savings and the lack of the need to go overseas to attract buyers for Japanese Govt Bonds. Currently less than 7% of JBG's are owned by non Japanese institutions while the UK, USA, France and Germany average around 35% foreign ownership each. It is like the difference between asking your mother for some money or asking a complete stranger. If Japan were forced to search for funds outside of Japan intrest rates here would double if not triple based on Japan's 211% per capita GDP debt. With a shrinking population and a more competitive worldwide marketplace Japan needs to either cut spending or increase taxes immediately.

0 ( +0 / -0 )

It's just as I had forethought... this country is going down fast. With the ineptitude of Japan Clowns Inc. and the public's inability to demand positive change this beautiful country is doomed to forever wane and finally expire from the list of countries that matter. No, they will not be able to export their way back to economic health as Soth Korea now makes better TVs and caught up in the mass automobile insdustry, undercutting the Japanese exporters, not to mention the ridiculous Yen exchange rate cutting any profits that are made overseas. The only solution is to cut spending and insert the hike tax at 15% like the IMF recommended. Simultaneously they must stop all slush funds and waste and audit the governmentt... no more stealing money by the crooked politicians!! Anew , younger breed of professionals needs to run the govenrment. These are times for drastic measures and huge fiscal reform must be implemented to keep this ship afloat.

1 ( +1 / -0 )

Raise the tax on luxury items to 10 percent right now and I'll gladly accept that but don't mess with my future pension benefits.

0 ( +0 / -0 )

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