The following is a summary of a talk by Professor John Campbell (University of Michigan) at the Institute of Social Science on May 16, 1995. The Talk was titled: "Is There a Japanese-Style Welfare State?"

(Moderator's Note: Professor Cambell is a member of SSJ-FORUM. He will be on-line over the weekend, away for a bit, then back on Thursday. Comments and questions concerning this talk, as well as others posted on SSJ-FORUM, are most welcome. The next talk summary to be posted is Professor Kenji Hayao's June 5 talk on "The Decline of Political Institutions: The End of LDP Rule and the Future of Japanese Politics." Professor Hayao is also a member of SSJ-FORUM, and so will be available for discussion.)
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"Is There a Japanese-Style Welfare State?"

1) The ageing society problem is perceived, in Japan, as the number one problem. This contrasts with the American focus on trade barriers, deregulation, etc.

2) The ageing society problem has many facets, including health care, employment, housing. The most difficult is long-term care, which is largely delivered by the family in Japan, the US, and most other countries.

3) However, Japan is in the midst of constructing a new Kaigo Hoken (long-term-care insurance) system, which will see individuals pay premiums while they are working (the premiums might not begin until age 40). Individuals will then be entitled to support services in their old age, including hospitalization, rehab. services, and social support services while living at home. The Kaigo Hoken establishes the means of financing the kinds of services that were envisioned in the Gold Plan, and in fact expands the range of services.

4) This change is likely to lead to other changes, such as in health care. There is strong potential for a shake up in the hospital system, which has been delivering an "extraordinarily egalitarian" service. Kaigo Hoken appears set to include "balanced billing," which will allow patient to pay more for better care. This will not make Japan into the United States, where income greatly determines one's access to health care, but Japan is likely to move more towad the average for idustrialized nations.

5) Japanese social policy has been mainly in a catch-up mode with the West since the 1950s. The big move was in the early 1970s, when there was the initiation of the "welfare era." The near-doubling of pensions, great reductions in co-pays for medical bills, and so forth brought the percentage on national income going top welfare from 5-6% to 10-11% in the following seven years. But the welfare regime that was put in place drew very heavily from foreign models, such as the US passage of Medicare in 1965.

6) Following the rush of programme implementation in the early 70s came the era of the "Japanese-Style Welfare Society." One aspect of this was the negative reaction to the spending, which was often depicted as a threat to economic vitality and fiscal prudence.

A second aspect was sensitivity to the neoconservative trend in Anglo-America and Europe. The third was Nihonjinron (Japanese uniqueness) depictions of Japan as a harmonious community, etc. and thus not in need of welfarism. Such notions soon became the official ideology. PM Ohira, for example, urged in his January 1979 Policy Speech to the Diet, "retaining a traditional Japanese spirit of self-respect and self-reliance, human relations which are based upon the spirit of tolerance and the traditional social system of mutual assistance." The concept was formalized in the New Economic and Social Seven Year Plan, which announced rather opaquely that Japan should aim at a "Japanese-type welfare society in which -- while founded on the self-help efforts of individuals and the solidarity of families and neighbourhood communities that the Japanese possess -- an efficient government guarantees appropriate public welfare according to priorities."

7) This was the era of administrative reform, when the air was full of talk of the "English disease" and other welfarist maladies. There were some concrete policy changes in the first half of the 1980s, generally towards a more austere welfare state. Overall government spending was reduced, and there were major reforms in health-care finance, the pension system, and social welfare policy.

8) However, these reforms were more of a consolidation than a cutback. There were curbs to some excessively generous provisions from the early 1970s, and restrictions in eligibility in some areas. But real benefits were not reduced, and it is very hard to find any changes in the social policy area that moved away from "big government"; indeed, if anything, the period saw increasing authority for the Ministry of Health and Welfare.

9) Moreover, the Nihonjinron ideology foundered on its own internal contradictions, as warm family-like dependency relations do not necessarily exclude the state from the community -- quite the opposite, in fact. Moreover, Nakasone leaned heavily towards rugged individualism, and this emphasis also served to undermine the viability of the Japanese-style welfare society ideology.

10) The mid-80s saw a turn towards emphasizing the need to get programmes in place for coping with the ageing society. Giving this policy front further momentum was the need to legitimize the Consumption Tax, as MOF and the LDP (esp. Hashimoto) began emphasizing the role of the Consumption Tax in paying for social supports in an ageing society.

11) This brings us back to the Kaigo Hoken. It is an innovative development, and not imitation. Up until this year, no country had any resembling a large-scale social insurance program for long-term care. In all countries, the major social insurance programmes are unemployment, pensions, health insurance -- all three have been in existence for decades (though the US conspicuously lacks the third). Japan has innovated in the area of long-term-care insurance, though it has not invented the policy itself (Germany has already implemented something similar, though it seems less generous). Hence, Japan is at the forefront of new welfare policymaking, and is not taking its usual approach of implementing what has been tested elsewhere. This contrasts starkly with the US, which is in the process of dismantling its already inadequate provisions for long-term care and social policy in general.

12) As a final note, whether or not one classifies Japan as a full-scale 'welfare state' depends on how the welfare state is defined. Certainly there is not the kind of state guarantee of cradle-to-grave security at middle class living standards that may be the case in Sweden. But in comparative terms, Japan's social policy is certainly much more developed than that of the US and is probably somewhere in the middle of Western Europe. Moreover, it is impressive that Japan's response to the ageing-society problem is to try to put good social programs in place before the problems get too intense.