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?