The Keidanren in September released a simulation of the medium- to longer-term prospects for Japan's fiscal policies and social security programs. The simulation made itclear that unless the fiscal structure of the Japanese government is reformed, Japan's outstanding public debt will likely expand to five times its gross domestic product, effectively putting the country in a state of bankruptcy.
Based on this simulation, Keidanren has recently compiled a set of proposals to ensure the nation's fiscal sustainability.
First off, Keidanren proposes streamlining social security and local government expenditures. This proposal includes the goal of keeping any increase in medical and nursing care benefits below growth in nominal GDP, as well as reviewing the salaries of local government workers, who generally earn more than those hired by the central government and private-sector companies.