Japan Govt. New Budget: Updated Dec. 17, 2024.

Japan gov't submits draft extra budget to Diet for economic package

Article Source: https://mainichi.jp/english/articles/20241209/p2g/00m/0na/024000c

Ideas:

Any time a government submits a budget proposal, most likely the final draft plan is never the same as the initial draft plan due to political pressures.

The Japanese government should do something, if possible to help Japanese households with the on-going inflation situation, and especially the low-income groups in Japan.

Even though the Japanese government is in debt, with the highest debt to GDP among advanced countries, they need to take care of their citizens.

The ideas mentioned for the new budget are all good and needed, but again, like other cash handouts, will it be enough for low-income families in Japan.

Inflation in Japan, like many countries, has been around since the pandemic and it doesn't to be going away anytime soon.

Probably, unfortunately, by next April, the start of the new fiscal year in Japan, there might be the need for another supplemental budget to help Japanese households.

The idea of new bond issuances has been a common theme of the Japanese government to raise money, when its fiscal health is the worst among major advanced economies.

At the same, most of the bonds, if not all are owned by those in Japan, so the are internal and not external like the situation with Greece in 2010.

Consumer spending in Japan has never been that strong and it seems consumers are not big spenders like they are in the US, so any situation that dampens consumer sentiment to spend will be a challenge.

Again, these are good ideas, such as 3.4 trillion yen for inflation relief and 5.8 trillion to stimulate the economy, but will they be enough, as Japan seems to keep doing the same thing with each new Prime Minister and new budget to fight inflation and help its citizens.

Wages might be flat due to the idea that inflation is not a one-time situation and increases every month or every quarter in Japan. 

Its good to set aside funds or target industries which show promise for growth in Japan, such as the semiconductor industry which Japan has fallen way behind Taiwan and South Korea which have most of the market share.

Public safety in Japan seems to be getting worse every year as Japanese citizens are more stressed out than ever from many things related to modern society, that wasn't a factor some years ago.

The income tax exemption threshold needs to increase to allow part-time workers more hours so they can make a living wage if they need to work two part-time jobs in the future.

Not only that, the Japanese Diet needs to address the idea of helping contract workers and part-time workers who are at the bottom of the Japanese pyramid related to wages.

As mentioned at the beginning, initial budgets usually never go through as planned as they are always changed as different political parties want to change this or that in their favor.

Will the new budget do what is intended to do, to help low-income groups and stimulate the Japanese economy. Past emergency budgets might have helped some, but in the end they do little to help or stimulate the Japanese economy.

Have a nice day!