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2009年8月24日 (月)

成長戦略 本格回復の展望が見えない

Both LDP, DPJ's recipes for growth lack punch
The Yomiuri Shimbun(Aug. 24, 2009)
成長戦略 本格回復の展望が見えない(8月24日付・読売社説)

Although the nation's economy has come out of its worst period, no clear direction for a full-scale recovery can be seen.

Amid such circumstances, attention in the House of Representatives election campaign is focused on political parties' strategies for achieving a steady economic recovery and stable growth.

High economic growth can no longer be expected for the Japanese economy, which is mature. However, economic growth is indispensable for supporting a society in which the majority of people can maintain modestly satisfactory living standards and live without significant anxiety for their future.

Firstly, the economy needs to be righted again in a steady manner.

Secondly, the framework of the nation's economy, which is highly dependent on exports, must be reformed to balance domestic and foreign demand. Structural changes in the economy, including shrinking domestic demand due to a declining population and aging society, and the aggravating factor of international competition resulting from the rise of emerging economies, also need to be dealt with.


LDP policies already on menu

The Liberal Democratic Party has pledged a numerical goal for the economic growth rate and a deadline for achieving it in the party's election campaign platform, promising to achieve 2 percent year-on-year economic growth in the second half of fiscal 2010. The party also said it will create domestic demand worth 40 trillion yen to 60 trillion yen and secure about 2 million jobs over the next three years.

Credit should be given to the LDP as the party has vowed to achieve specific goals. Its stated policies of fostering vitality in the private sector through providing support for research in environmental industries and other growth areas while continuing to implement economic stimulus measures also are laudable.

But specific measures drawn by the LDP are less persuasive, as existing policies are listed in the manifesto, such as expansion of solar power generation and boosting sales of energy-saving home electrical appliances through utilizing the eco point system. They alone do not seem capable of realizing the goals the LDP has set.


DPJ not saying who'll pay bill

Meanwhile, the Democratic Party of Japan has not set target figures for economic growth and other issues. The rate of economic growth will affect how major tasks, such as fiscal reconstruction and social security system reform, are approached. If the DPJ claims it is capable of taking the reins of government, it should spell out goals.

The DPJ's strategies for economic growth mainly consist of measures to directly provide benefits to boost household budgets, such as child-rearing allowances, making public high school education free of charge and scrapping highway tolls. The DPJ's manifesto says its strategies will boost consumption and transform the nation's economy into one led by domestic demand.

While households receiving benefits will increase their consumption, domestic demand will cool off if public works projects are slashed. Reviewing already-formulated budgets also has downsides. In the first place, consumption will not become self-sustaining merely by dint of the government handing out cash to support household budgets.

To expand consumption steadily, it would make more sense to enhance trust in the social security system, thus shifting the excessive amount of savings, which households hoard because of fears about the future, into use for consumption.

Holding off on raising the consumption tax rate for the next four years, which the DPJ has pledged in its campaign platform, will not secure stable financial resources that are vital for strengthening the social security system. A mood of anxiety will spread, dampening consumption.

We hope that DPJ lawmakers will engage in fundamental discussions on strategies for economic growth with an eye toward the future.

(From The Yomiuri Shimbun, Aug. 24, 2009)
(2009年8月24日01時26分  読売新聞)


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