Pain of unemployment will persist, despite government saying otherwise -- Akahata editorial, May 25, 2001

Economists are concerned about major bankruptcies and unemployment as a consequence of the write-offs of bad loans which the Koizumi Cabinet is proposing as essential to structural reforms.

But the government in the parliament has refused to make clear the size of resultant unemployment and its countermeasures, although the government has publicly stated that reforms entail pain.

Criticizing the irresponsible government attitudes, Akahata's editorial of May 25 stated as follows:

Prime Minister Koizumi Jun'ichiro in reply to a Japanese Communist Party Dietmember said on May 22, "Every company must assume the possibility of going bankrupt."

Write-offs of bad loans which the Koizumi Cabinet calls for as essential for 'structural reforms' actually means driving small-and medium- sized businesses into bankruptcies to the benefit of major banks. Many small businesses are now in the red as the result of the government's economic policy.

Asked by the JCP about the estimated extent of unemployment, Takenaka Heizo, state minister in charge of economic, fiscal and IT policy, tried to make it appear small. He said that every 1 trillion yen (8.3 billion dollars) in write-offs of bad loans would give rise to unemployment ranging from several thousand to ten thousand. He insisted that the unemployment-entailing process is necessary when the economy as a whole moves toward more growth.

In reply to JCP questions, Takenaka gave an optimistic forecast that Japan's worry five years from now will be a labor shortage.

Such a deceptive argument is unacceptable.

A report by the experts of the Economic and Fiscal Advisory Panel predicts that unemployment rates five years from now will be below 4 percent, following the creation of 5 million new jobs. Even this optimistic estimate suggests that a newly unemployed 4 million people will be added to the present 3 million people unemployed.

The government has refused to give candid answers about the advisory panel's report under its supervision. The estimate of creating 5 million new jobs lacks substantiation.

A government that forces so many of its people to endure the pain of unemployment shows itself to be incapable as government. (end)