Was anybody as distressed as I was with the sudden explosion of the issue of future pension finance?
Today and yesterday it was all over the news, with conservative academics chiming in along with the LDP with dire predictions of the cost of the proposed pension reform. All the DPJ's own fault.

The occasion for all this was a report by a party panel set up a year ago, which apparently included a calculation that pension spending would require another 7.1% of shouhizei (on top of the 10% rate now proposed). BUT THIS IS FOR 2075! Why have a party group even make such a meaningless, but politically explosive, calculation? If you need one, have the government do it so you can deny it. Anyway, forecasts of public finance even ten or twenty years ahead are nearly meaningless, and it is silly to assume the money would all be shouhizei anyway. And worse still, why did Okada blurt it out, in an interview at Asahi TV on Jan 22? I think that was the first public mention--first for me, anyway, I was watching and I was astonished.

And then the party leadership makes things worse still. With the headline bad news already out, it decided to keep the report secret, letting the LDP and Koumeitou piously say the public deserves a full explanation. And on Sunday (29th), Azumi the boyish Finance Ministry concedes to an unusually aggressive Fuji-Sankei interviewer that he hadn't been aware of this estimate. But it doesn't matter since it is 2075, he said blandly.

Recently I had been feeling a lot better about the DPJ. On policy, it has been solidifying its position as an essentially social-democratic party, which is what I think Japan needs. On politics, Noda actually seems to have a sense of political tactics and even strategy. I think he has been doing well with the opposition outside and inside his party. But this is a real blunder that was completely self-inflicted. There was no reason to be anything but vague about financing pensions more than five years or so out. The LDP of course has no better plan for pension finance but they now can just throw spears, and actually hit some targets.

Minno Monta said this morning that Japan can't get out from under all this without an Iron Lady.
Presumably some Japanese Mrs. Thatcher would just dismantle the pensions system altogether (which in fact pretty much happened in the UK--its pensions are a shambles). In reality, according to various international experts who have made the calculations (such as the Global Aging Preparedness Index report from CSIS last year), in a long-range sense Japanese pension finance is pretty reasonable and in better shape than several European countries. But get anybody to believe that now.

http://gapindex.csis.org/home.html

John Campbell