The frenetic activity of the government of Japanese Prime Minister Shinzo Abe has prompted optimism that Japan can reverse its economic drift. But activity shouldn't be mistaken for achievement.
Under Abe's second go as prime minister, Japan has initiated an ambitious "three arrows" economic recovery plan, christened "Abenomics." (Recent growth figures are cited as proof of the success of these new policies, despite the fact that they were not in place during the relevant period.)
The first arrow is a 10.3 trillion yen (US$100 billion) fiscal stimulus program to increase public spending. The second arrow is a further easing of monetary policy to increase demand, investment and inflation (to 2%). The third arrow mandates structural reforms to increase incomes and improve Japan's industrial competitiveness and productivity. Japan's total factor productivity in the manufacturing, non-manufacturing and agricultural sectors is the same as in 1991.
The policies have all been tried before, with limited success.
The government's spending program follows 15 stimulus packages between 1990 and 2008. Based on previous experience, it may provide a short-lived jump to economic activity but will not create a sustainable recovery in demand.
Japan stayed bottom among 32 comparable Organization for Economic Cooperation and Development member states in public spending on education for the sixth straight year in 2012, an OECD survey has shown. (Jiji Press)
Tokyo Metropolitan Police have arrested the head of an adult video (AV) label specializing in productions featuring gay men for employing an underage male actor, reports Nippon News Network. (Tokyo Reporter)
Fukuoka Prefectural Police on Wednesday will re-arrest an upper-ranking member of the Kudo-kai organized crime group for participation in two arson attacks, reports the Sankei Shimbun. (Tokyo Reporter)
Three bodies have been retrieved from a boat found floating in the Sea of Japan off the coast of Fukui Prefecture on Sunday, two days after a similar discovery in waters off a neighboring prefecture, reports the Yomiuri Shimbun (Nov. 23). (Tokyo Reporter)