Searching for figures on just how much Japan’s public debt is dependent on bonds (answer: an unprecedented 49%), I came across this blog on Japan’s economy an dpolitics: Seetell.jp It has one English section and 3 Japanese commentary blogs.
Central planning: Japan to subsidize targeted businesses with more subsidies | Seetell.jp
One of the main areas in which the Japanese government has controlled the economy is in the healthcare and child care industries. It has not been a resounding success story. In fact, the industries are price controlled and regulated to the point that it is difficult to retain a proper workforce (the government is currently looking for low wage workers from SE Asia to fill the demand even as 40% of Japan’s workforce is either unemployed or underemployed). Not content with screwing these industries up in the first place, the government has decided to double down on intervention with a program designed to fix the problem…using taxpayer funds, of course.
The problem with healthcare and child care is that the prices for these services are kept low so that the poorly designed and nearly broke welfare system can not afford the costs and it doesn’t have enough money to expand its child care services to meet the current demand (we would hate to see the system during a time of sustainable birthrate). The government, however, never seems to learn a lesson from the problems that it has created in many areas of the economy and leaves one wondering from where the money for these subsidies will come.
We recognize the acceptable government responsibility to regulate these industries for appropriate safety compliance. However, when the government competes with the private economy in order to provide artificially low service costs to the population, it creates too great a demand on taxpayers while pushing out private competition. Spurring investments in these industries by subsidizing profits with taxpayer funds is not a solution, it is merely creating more problems. It is simply applying short term political solutions to a long-term economic problem, a major cause of Japan’s increasing debt.
