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Refigure a way to renew Japanese society

by Michael Sutton

In the wake of the catastrophic tsunami, earthquake and nuclear disaster in Tohoku, the ruling Democratic Party of Japan (DPJ) has bowed to pressure and terminated an increase in the child allowance program from ¥13,000 to ¥20,000 per month for children under 3.

The current monthly payment of ¥13,000 for children through the third year of junior high school will be extended temporarily for six months.

This decision raises more questions than answers at a time of national uncertainty. What are the implications of this for Japan? How will Japan reverse its declining birthrate and manage a rapidly aging society?

The natural disasters in Tohoku are appropriate justifications for the bill to be revisited at a more opportune time. Since opposition parties were against the bill before March 11, the demise of the original bill cannot be viewed as being entirely in the “national” interest.

Even though terrible events have become government priorities, the failure of the DPJ to remain committed to one of its most coveted policies — the child allowance — will erode public confidence in future promises. The essential problem is that this recent change creates further uncertainty. The opposition parties controlling the Upper House opposed the increase in the allowance, which is distributed irrespective of income levels, and how it was to be funded.

There was also opposition from local officials unwilling to fund a program that the government promised in 2009 would be entirely funded at the national level. Since 2009, the government has scaled back the payment from the promised ¥26,000 per month to ¥13,000 per month effective from April 2010. The termination of the current bill was replaced by a six-month extension of the current policy beginning April 1. How many further changes will occur in coming months?

Despite a low fertility rate since 1974, it is clear that, even in 2011, there is no national consensus on the policies necessary to arrest, mitigate or reverse low fertility and manage the costs of an aging society. This is deeply troubling, not only for Japan but also for other East Asian countries where demographic dynamics are following a similar path.

As the challenges of an aging society go beyond party politics, policies should enjoy bipartisan support regardless of who is in power. This does not necessarily mean a return to, or a revitalization of, pronatal policies. The efficacy of these policy instruments is unclear.

While viewed as a means to raise the birthrate, the child allowance program’s generous extensions under the DPJ were revised versions of policies implemented by previous governments. Whatever the actual amount, it remains to be seen whether this policy is capable of stimulating a fertility revolution to the extent necessary to return the birthrate to less anxious levels.

The proposal to merge day-care centers and kindergartens to create the kodomo-en is another plank of this flawed pronatal agenda. It is unlikely to survive in its current form. Enthusiasm in some quarters for the adoption of a “work-life balance,” “gender equality” and immigration openness in Japan will likely meet similar obstacles.

Since few options remain, the very notion of demographic renewal should be revisited. Japan’s demographic rethink could take advantage of the new climate in bipartisanship. Any “grand coalition” could be extended beyond reconstruction to aid in reaching a unanimous agreement on a new policy for demographic renewal.

After almost 40 years of low fertility, and decades of failed policies, a new approach can only be positive. Expecting a consensus to emerge is ambitious, but not impossible and would be in Japan’s national interest.

Michael Sutton, Ph.D., is a research fellow at the WTO Research Center in Tokyo (eastasiandemography@gmail.com).