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2011年3月 3日 (木)

予算案衆院通過 関連法案を政争の具にするな

The Yomiuri Shimbun (Mar. 3, 2011)
Budget-related bills not political tools
予算案衆院通過 関連法案を政争の具にするな(3月2日付・読売社説)

The government budget for the next fiscal year has passed the House of Representatives.

The new budget is certain to receive final Diet approval within the current fiscal year on the strength of a constitutional provision concerning the lower house's precedence over the House of Councillors in budgetary decision-making. The Constitution stipulates that if the upper house rejects the fiscal budget or fails to vote on it within 30 days of receiving it from the lower house, the decision of the lower chamber will become the decision of the Diet.

However, it is unclear whether and when a set of budget-related bills--the legislation necessary for implementing specific policies and measures stipulated in the budget--will be enacted. We believe the ruling and opposition parties need to make mutual concessions in dealing with the fiscal 2011 budget. Compromise is essential to prevent people's daily lives from being adversely affected by a failure to pass these bills.


Bond issuance halt a big risk

The most important of these legislative items is a special bill on the issuance of deficit-financing bonds.

Failure to adopt the debt-covering bond bill would lead to a revenue shortfall of somewhat more than 40 trillion yen under the next budget, which anticipates 92.4 trillion yen in annual revenue.

When it comes to executing the budget in the short term, the Democratic Party of Japan-led government may be able to make do with tax revenue to be raised in the coming months plus about 6 trillion yen revenue from construction bond issuance and other revenue-yielding measures. Such stopgap financing would suffice for some months--but not later than the summer.

How market players would react to such a situation is a source of worry. An anomaly of that kind could be regarded as an indication that the government cannot secure necessary financial resources. This could immediately lead to a loss of confidence in government bonds.

A rise in long-term interest rates--the leading indicator of which is the government bond yield rate--caused by a sell-off of government bonds in the market would increase debt-servicing costs to be covered by the government, exacerbating the already serious fiscal straits. It is also feared that housing loan interest rates could soar.

Another bill to be affected by possible legislative paralysis is one aimed at revising the Customs Tariff Law to reduce tariffs on imported goods. Failure to adopt the bill would increase tariffs on 415 import items, including beef, beginning in April. This would be bound to adversely affect consumers and businesses in the form of price hikes.

The failure of tax reform-related bills to pass the Diet also would kill the much-publicized government goal of implementing a five percentage point reduction in corporate tax rates.


Both the ruling and opposition camps should take to heart the possible harmful effects of failure to pass the budget-related legislation.


Don't play the blame game

A number of government and ruling party officials have criticized the opposition parties for their stubborn resistance to the budget-related bills. If their criticism of the opposition bloc's stance is intended as a preliminary move toward laying the blame on the opposition camp if the bills fail to clear the legislature, it would be a total disgrace.

An essential task facing the government and the ruling parties now is to create an environment conducive to bringing the ruling and opposition camps into line over the budget-related bills.

A proposal advanced by the leading opposition Liberal Democratic Party to revamp the new budget incorporates government bond issuance worth 42.5 trillion yen.

We believe the LDP will find it difficult to oppose the government bond issuance bill if the government reconsiders its child-rearing allowances and other lavish handouts, a task that must be part of efforts to ensure any changes in government policies would fit the LDP's proposed budgetary framework.

If the government and ruling parties make appropriate concessions but the LDP demands the lower house be dissolved anyway, blame would then fall on the major opposition party. In that event, the LDP would deserve to be criticized for opposing the government just to create political turmoil that could eventually topple the DPJ from power.

A group of 16 DPJ lower house members seeking to break ranks with a parliamentary voting bloc formed by their own party and several independents refused to attend a lower house plenary session convened to vote on the budget Tuesday.

Their concerted action was tantamount to throwing off their responsibility as members of the ruling party. The incident symbolizes the DPJ as a house in disarray.

The DPJ's top echelon has decided to discipline the 16 dissenters. One of them likely will have his party membership suspended, while the others will likely be reprimanded. However, such lenient punishments could invite yet another revolt by DPJ members.

Prime Minister Naoto Kan must accept the massive weight of his obligation and decide to fundamentally revise his party's 2009 lower house election manifesto as soon as possible.

(From The Yomiuri Shimbun, March 2, 2011)
(2011年3月2日01時41分  読売新聞)


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