politics

Cabinet approves guidelines for ¥100 tril budget for fiscal 2019

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When the governmen spends money on economic growth, the economy shrinks. This is because the vast majority of money spent by the state creates a negative return. For every 100 yen the LDP spends, they get 80 yen worth of “growth.” Rather than increasing growth, they are increasing debt and economic contraction.

This spending bill is just more corporate welfare for Japan Inc.

5 ( +5 / -0 )

This spending bill is just more corporate welfare for Japan Inc.

Then, J Inc. then either hoards the money or invests it overseas.

2 ( +2 / -0 )

Another record budget because the value of yen purchasing power continues to decline as they print more and more of them.

and agree, they just waste the money in the sense that they get less value back than they invest.

road to ruin.

4 ( +4 / -0 )

The guidelines call for discretionary spending to be reduced by 10 percent from the fiscal 2018 budget, while also seeking to cut down on mandatory spending such as personnel costs.

Well, obviously these useless guidelines get ignored by everyone since the govt. is spending record amounts with each consecutive budget. Let the Rome burn attitude ....

4 ( +4 / -0 )

allowing for additional spending on social security and economic growth to set the stage for a record-high initial budget.

Abe's best idea to get nominal GDP up to his 600 trillion yen target is to borrow more money and spend it.

I'd rather we have a sustainable increase in real GDP, than a flash in the pan increase in nominal GDP. And that won't come about by these types of borrow-and-spend policies.

The guidelines allot more than 4 trillion yen to programs aimed at fostering economic growth, such as those that may help increase productivity and human resource development, one of Abe's centerpiece policies.

The best way to boost productivity and human resource development is to massively overhaul Japan's regulatory framework. Make things simple, remove the complexity that hinders everything.

Just get out of the way and the people can do better by virtue of not having to deal with so much bureacractic government nonsense.

Finance Minister Taro Aso said his ministry will compile a budget that serves to "level out" the surge in demand ahead of the tax hike and the subsequent drop-off.

In other words, they will spend a boatload of money they don't have after the tax hike to pretend that GDP is higher, but never offset that boatload of spending with commensurate cuts, ever.

The guidelines call for discretionary spending to be reduced by 10 percent from the fiscal 2018 budget, while also seeking to cut down on mandatory spending such as personnel costs.

The concept of discretionary versus mandatory spending is nonsense. The government can decide how much to spend on what, period. 

With tax revenues expected to come in at a near-record of around 60 trillion yen, it's as clear as day that talk of an annual budget of 100 trillion is insane at worst, and unsustainable at best. 

Spending should be cut by a certain amount every year, until the budget is brought into balance. Even then Japan will still need to service the massive quadrillion of debts already racked up, so ideally should spend less than tax revenues - especially so considering the sad inevitability of natural disasters in this country.

3 ( +3 / -0 )

How many zeros is that?

4 ( +4 / -0 )

Outrageous, it's just more debt for future generations it's achieving nothing. Remove the overly complicated system of complexity that is required to achieve anything. Drastically cut government spending. Make it clear where every tax Yen goes. Every Yen! 3rd biggest economy on the backs of workers who are not paid for their efforts. Smaller countries manage to have great lifestyle and are not in debt. Something is seriously wrong with Japan.

2 ( +2 / -0 )

Japan currently has a public debt to GDP ratio of 236% and it’s only increasing. The bubble has to burst some time and I guess as long as it doesn’t happen on Abe’s watch he doesn’t really care. Maintain the illusion of a healthy economy and pass the buck on to the next generation.

or better still, wait until the opposition get into power and heap the blame on them for decades of self-destructive, irresponsible policy making. Just like Fukushima.

2 ( +2 / -0 )

How many zeros is that?

this many ¥100,000,000,000,000 if ¥1 = 1 second and you started counting now youd reach this total in about 3171 yrs, yep its a shite tonne of money.

0 ( +0 / -0 )

Smaller countries manage to have great lifestyle and are not in debt. Something is seriously wrong with Japan.

Very few countries can mange a relatively high living standard like Japan based largely on generous social spending without an extremely lucrative natural resource such as oil to pay for it. Just about all "wealthy" first world nations are living on mountains of debt. They rationalize that borrowing is cheap because interest rates are low. But with already huge amounts of debt this kind of thinking self-defeating and destructive. When interest rates rise - as they inevitably will - debt payments will balloon adding even more to the already unsustainable debt.

Japan knows it has a ridiculously high amount of debt and they know that their welfare programs will cause this debt to rapidly increase even more due to an aging society. Yet they simply do nothing about it. Why not make smaller relatively less painful changes now rather than being forced into a radical and much more painful restructuring later? The self delusion on the part of government leaders is beyond unconscionable.

1 ( +1 / -0 )

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