politics

Gov't considering ¥20 tril extra budget to spur virus-hit economy

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Great, more money thrown at pork barrel projects, when they should be sending money to hard hit families and businesses. The LDP just can't stop themselves from trying to help their friends even in times of a crisis.

9 ( +13 / -4 )

At long last. But better late than never. The LDP government has proved that pumping money into the economy doesn’t cause inflation as long as there’s a supply-demand gap. Don’t wait till January. Implement the extra budget now.

-11 ( +1 / -12 )

The extra budget for fiscal 2020 through March is also intended to assist companies' efforts to cut carbon dioxide emissions, improve the country's disaster preparedness and help companies maintain employment, the sources said.

This vague description alone seems rich with opportunities for corporate welfare and graft. I wonder how much of this publicly funded largesse will eventually trickle down to the individual taxpayer? And we have already seen in companies receiving government subsidies (like GoTo) companies still turning around and slashing jobs.

12 ( +12 / -0 )

Since this story is about fiscal stimulus for businesses to boost the economy, I'm wondering why it's in the politics section and not the business section.

4 ( +5 / -1 )

Eyeing, Considering, Thinking about, Maybe, Might be, Could happen, Possible, And the list goes on. Where is the real news? I consider things every day. But until its fact, its not news.

4 ( +5 / -1 )

The Diet already passed two supplementary budgets for fiscal 2020 totaling 57.6 trillion yen 

Annual tax revenues before the pandemic were just north of 60 trillion yen, so they spent that all in just the "extra" spending.

The "normal" spending is paid for with 40 trillion of borrowed money in the best of times.

Now they are going to spend another 20 on measures including "companies' efforts to cut carbon dioxide emissions, improve the country's disaster preparedness", which has nothing to do with the coronavirus situation.

 the pandemic kept the output gap, a measure of the supply-demand balance in the economy, at minus 6.2 percent in the July-September quarter.

That's what it's really about - they are from a mickey mouse school of economic management that insists the central government must borrow even more money from nowhere so that they can spray it around somewhere so as to plug a gap they perceive in their numbers.

If the government were running at least a balanced budget in the best of times, then by all means, go ahead with the big spending during the rough economic times and help tide us over.

But the government is running 35-40 trillion yen deficits in the best of times, and has already accumulated 1.1 quadrillion yen in debt.

There are ways that this exploding debt mountain can be dealt with, but unfortunately simple redemption at maturity through sound fiscal management doesn't appear to be one of them.

3 ( +5 / -2 )

Where does all this money come from?

3 ( +3 / -0 )

Tom YoungToday  08:51 am JST

Where does all this money come from?

Don't worry, you'll get your bill. And so will our grandchildren. Just so long as J-Inc gets that pork rolling in, they will always find a way to squeeze the proles.

5 ( +6 / -1 )

Senior lawmakers of Prime Minister Yoshihide Suga's Liberal Democratic Party have been calling for a large-scale auxiliary budget 

Surprise, surprise...election has to come within the next 12 months, Japanese public is beginning to see how pathetic and leaderless it's govt handling of the pandemic is so solution is as usual throw a ton of public money to the cronies to ensure organized votes for Jiminto at election time. How about giving some money directly to the peasants through tax cuts or direct payments ?...Nah, didn't think so.

6 ( +7 / -1 )

how about just an extra budget that focuses on helping small and medium sized businesses keep workers, and an extra stimulus payment for those making less than 5,000,000 a year? That would help a lot more than the other crap that is being added on to the bill.

6 ( +6 / -0 )

I don't expect small businesses like mine to even see a crumb from this largesse but expect

to see taxes in my mailbox to pay for this largesse and even if I didn't make any sales I still

have to pay even if it means borrowing to pay cause the powers that be don't care about

us the small fishes. Time to bury capitalism and experiment it with something else.

4 ( +5 / -1 )

There is a reason Mother and Father never issued me with a credit card.

The action alone distorts/devalue meaning of understanding fiscal and monetary prudence, essentially understanding the past borrowing makes it easier to predict and manage future expenditure.

Pocket money as Dad put it , has to be won and earned. (Dad never realized, I would completed the chores for nothing).

So the gardening, washing and ironing, polishing the family car, etc. etc. became a business opportunity.

The crucial point is there is never sometime for nothing.

Future generations will be held accountable, spending and borrowing today, will be a failure address the need to create policies to halt Japan's chronic depopulation.

2 ( +2 / -0 )

I think investing in Japanese printing press companies would be very profitable

3 ( +3 / -0 )

To do what?

Pump it to Nikkei?

Save Nissan?

Invest on Dentsu to create new unnecessary subsidiary companies or agencies?

7 ( +8 / -1 )

Take it out of the budget for the Olympics...

8 ( +8 / -0 )

If they threw their time and money into eradicating the virus the economy would fix itself, well as fixed as it was before the pandemic anyway.

2 ( +3 / -1 )

just cancel insane idea abt Tokyo olympics...there will be plenty of funds left...and give these money to these in urgent need...people who lost income,jobs,future...

3 ( +3 / -0 )

Where does all this money come from?

Borrowing from the Japanese people (with their own currencies) and the West (for the USD). However, it is mostly domestic denominated in Yens.

The long term consequence of this action is the gradual stagnation of the country into a soft "North Korea" even if there is never ever a balance sheet depression. Foreign investors will gradually see the Yens as useless, and won't ever conduct businesses with any Japanese person again - that day will come when Japan is no longer a world power in net export which is being taken by China and Vietnam. Aside the aging crisis, the heavy competition from China, Vietnam, India and ASEAN is also threatening Japan's status of a world's premiere net exporter.

just cancel insane idea abt Tokyo olympics...there will be plenty of funds left...and give these money to these in urgent need...people who lost income,jobs,future...

Just like the 1990s bubble, Japan once again faced the issues of "too big to fail". Japan was applauded in the 1990s for putting an end towards one of the craziest bubbles in human history, yet they instead kept the zombie companies alive. Something that Westerners didn't like.

The same story now repeats in 2020, the Olympics project is just too big to fail. Japan has no meaningful tool to boost up a new economy, mostly service-based, gearing towards Chinese tourists. The Covid-19 utterly bankrupted Abe's career as his bet for the Olympics now likely won't happen. Recently, Suga hastily went to Vietnam and China to ask both Communist states opening up travels between Japan and them. Because Suga's Japan needs the sweet Chinese tourists and hardworking Vietnamese/Chinese laborers, investors. They still need a huge amount of foreign workforce from both nations to prop up for the probably-not-happening Olympics 2021.

4 ( +4 / -0 )

Another cash grab of taxpayer money by the politicians, as if they hasnt already profited enough this year.

Most of the stimulus will be going to well connected companies such as Dentsu, who in turn kick back a portion to the political families.

2 ( +2 / -0 )

To borrow a Peter Hitchens line, where is the “funny money” coming from?

0 ( +0 / -0 )

“If they threw their time and money into eradicating the virus”

As we have seen again and again, there is no eradication. The moment soil destroying lockdowns end, the virus returns. Ergo, we have to live with it

0 ( +1 / -1 )

Time to bury capitalism and experiment it with something else.

This sure isn’t my idea of capitalism. In my capitalism the private sector is the driver of the economy through the free market system of price signals, rather than central government borrowing and spending in ways that have nothing to do with price signals or supply and demand.

-1 ( +2 / -3 )

A drop in the well! Why not make it ¥40 billion? While we're at it ¥80 Billion!?!?! What's the difference? Money for everyone!

0 ( +0 / -0 )

You mean trillion, not billion :)

But indeed, why not go for one trillion trillion yen?

0 ( +0 / -0 )

People often have no real understanding of just how big these numbers are, to help....

1 million seconds is about 11.5 days

1 trillion seconds is about 31,700 YEARS!

and this is 20 trillion as an EXTRA budget.

Mind boggling.

0 ( +1 / -1 )

If in the best of days, the government runs at least a balanced budget, then by all means, during the tough economic times, go on with the major spending and help tide us over.

2 ( +2 / -0 )

Where does all this money come from?

From the Japanese government and the central bank. That's why the Japanese state does not "borrow" its money -- because it's the one who issues it!

The govt spends yen into existence and the BOJ issues it to commercial banks, from whence it multiplies and flows thru the economy. The govt bonds issued are not really "debt," but surplus yen (not taxed) that the govt converts into bonds. Nearly half these bonds (the national debt) are being held by the BOJ.

Foreign investors will gradually see the Yens as useless, and won't ever conduct businesses with any Japanese person again

That outlook has nothing to do with reality. The yen is a major global safe haven and continues to strengthen against the dollar and many other currencies.

-1 ( +0 / -1 )

How about any future first, instead of a vision of carbon-dioxide free future? A third in education, a third in innovation and the last third for everyone to be capable of buying those new innovations. Then the economy flourishes and then you can continue to dream of cleaner environments. Making the last step first makes us all stumble!

1 ( +1 / -0 )

I like how the budget provides extra funding for Go To Campaign but still nothing for the health care. 40% of nurses and doctors have their salaries cut this year where they are working extra hard, and hospital finances are really suffering. Yet, 0 support from the government, not even a mention.

2 ( +2 / -0 )

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