Cash back from the government?
Stupid, wasteful and ineffective — and a shameless attempt to woo voters, many Japanese say.
Prime Minister Taro Aso is touting a one-time cash handout of ¥12,000 per person as the centerpiece of a stimulus package to revive the world’s second-largest economy, mired in one of its worst slumps since World War II.
But polls show most Japanese oppose the idea — though many confess they’ll take the money anyway.
They argue that most people will just save the money, not spend it. Others say it’s a shortsighted plan that exacerbates the government’s ballooning budget deficit. Some call it a ploy to boost the plunging popularity of Aso and the ruling Liberal Democratic Party.
“Japanese politicians are so immature in the way they think the economy should be run,” said Atsuko Yamaguchi, 42, of Osaka. “It’s always for-the-moment kind of thinking. It’s so stupid. I’m so ashamed.”
Yamaguchi said she’ll accept the cash because she just lost her job at a consulting firm.
“But will it really be helpful for the economy of Japan?” she asked. “I don’t think so.”
A national telephone poll last month by the Yomiuri Shimbun, the nation’s biggest daily newspaper, found that three-quarters of the 1,087 respondents disapproved of the cash payouts. In a similar survey by the daily Asahi, nearly two-thirds wanted the government to scrap the plan.
The widespread repulsion seems driven largely by disgust with Aso and a perceived lack of leadership at a time of crisis, experts say. Aso ranks among the country’s least popular postwar leaders, with approval ratings edging toward single digits. An election must be called by September.
“The (ruling party) just thought . . . wave the money in front of their noses, and they’ll come running,” said Jeff Kingston, a contemporary Japanese history professor at Temple University in Tokyo. “I think they underestimated the depth of anger from the people about the government’s inability to provide credible leadership and a credible recovery plan.”
Japan can hardly afford another misstep. Jobs are disappearing and companies are seeing deep red as the global financial crisis takes a particularly heavy toll on this export-driven nation. Last quarter, the economy shrank at its fastest pace in 35 years.
Under the ¥2 trillion plan, which was rejected by the opposition-controlled Upper House but approved by a two-thirds majority of the Lower House Wednesday, every resident would receive ¥12,000. People age 18 and under and those 65 and older would get ¥20,000.
A spokesman for Aso acknowledged the public criticism of the handout but reiterated that while many people may not agree with it, that won’t stop them from pocketing the cash.
“We believe that a significant portion of the population will be appreciative once they receive the money,” said Osamu Sakashita, Aso’s deputy Cabinet secretary for public relations.
He added that the chief aim of the measure is to help households meet immediate economic needs. The government expects some macroeconomic impact, though there are no official projections, Sakashita said.
After dancing around the issue for weeks, Aso told reporters Monday that he and his Cabinet will take their share of the payout.
“I will use it immediately to help stimulate consumption,” he said.
Kotaro Otsuka, a 33-year-old sales engineer in Tokyo, sheepishly admitted he’ll accept the handout even though the idea — and its high administrative costs — make him cringe. Cities will be responsible for handing out the money, with the central government footing the ¥82.5 billion in distribution fees.
“The LDP’s strategy of using pork-barrel spending to somehow get through the next election is something I really can’t forgive,” Otsuka said. “They are playing us for fools.”
Experts are doubtful about the economic impact as well.
At best, the cash handout will lift consumption temporarily in the second quarter and boost gross domestic product by a small fraction of a percent, said Masamichi Adachi, senior economist at JP Morgan Securities in Tokyo.
A quarter of the cash will go toward new spending, he estimated, noting the rest will go straight into savings accounts.
However, some Japanese do want the money — now.
Mitsugu Okada, mayor of the village of Kitayama, Wakayama Prefecture, submitted a petition to the central government on behalf of his 509 villagers — nearly half of whom are over 65 — asking officials to disburse the cash as quickly as possible.
“We have no industry, and we’re old,” said Okada. “So they are certainly looking forward to the money. It’s a decision that’s been made, so at this point, they just want to see their cash.”