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Sixth in a series

Staff writer

The public should realize that the protracted economic slump is a man-made disaster caused by the economic policy failures of Prime Minister Ryutaro Hashimoto’s administration, stressed Takeshi Noda, secretary general of the Liberal Party.

“We would like voters to know that the current terrible economic situation, the record high unemployment rate, record low economic growth and the fall in the yen and stock prices are the result of clear policy mistakes by the prime minister and his Liberal Democratic Party,” said Noda, who also noted that the LDP stole the Liberal Party’s policy strategies.

Claiming the Liberal Party, led by Ichiro Ozawa, has the greatest expertise in economic policy out of all the political parties in Japan, Noda said it is time for it to play a role in rebuilding the nation’s ailing economy. “We warned the government two years ago that a scheme should be swiftly drafted to dispose of bad loans at financial institutions. We also suggested that the consumption tax be kept at 3 percent, and large-scale tax cuts be carried out to boost domestic consumption. We strongly warned that a fiscal austerity law should not be enacted. “But the LDP totally ignored all our suggestions at that time and brought about the current economic mess,” Noda stressed.

Since late last year, the LDP-led government started implementing economic measures by “stealing” the policy strategies of the Liberal Party, which inherited them from the now-defunct Shinshinto, he said. “But the LDP decided to take the steps too late to produce fruit from the policies,” said Noda, who, like Ozawa, is a former LDP lawmaker.

The Liberal Party was formed in January, a month after Ozawa dissolved Shinshinto, previously the largest opposition force. The Liberal Party will go into the July 12 Upper House elections with a pledge to implement 18 trillion yen in tax cuts to revitalize the economy, including halving the income tax rate and lowering corporate taxes to international standards, said Noda, who added that his party hopes to keep its current Upper House strength of 11 seats.

“The tax cuts can be funded by streamlining the administrative system of the national and local governments,” Noda said. “Besides, our measures will bring about economic recovery, which will lead to increasing tax revenues for the nation’s coffers.”

As part of administrative reforms, the number of central and local government employees should be reduced by 25 percent over the next 10 years and the number of Diet members should be cut by 20 percent over the same period, Noda said, reckoning, “the reduction can be achieved by cutting by half the number of new employees every year.”

To foster domestic demand, the consumption tax should be rolled back to 3 percent from the current 5 percent and kept at 3 percent until the end of this century, he said. The Liberal Party recommends using consumption tax revenues to fund medical and nursing services for the aged and to help finance the national pension scheme.

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