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Economy’s a big factor in Japan election

Marketplace Staff Aug 18, 2009
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Economy’s a big factor in Japan election

Marketplace Staff Aug 18, 2009
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TEXT OF STORY

Bill Radke: A potentially historic political campaign started today in Japan. The ruling party there is on the verge of losing power after five straight decades of control. The global recession has hit Japan particularly hard, but the country’s been struggling economically for the better part of two decades. With more, here is Marketplace’s Scott Tong.


Scott Tong: All across Japan today, politicians stood atop cars and spoke into megaphones, promising change. Opposition leader Yukio Hatoyama’s coalition is on the verge of toppling the ruling party. The party behind the world-beating Japan Inc. of the 80s, and the economic sclerosis that followed. Hatoyama spoke in Osaka.

Yukio Hatoyama: The ruling party promised to make public life better. Has it? No. Consumer life has gone from bad to worse.

He wants to cut taxes and school fees. The incumbent, prime minister Taro Aso spoke just outside Tokyo. His party trails in the polls by double digits. But he wants to stay the course.

Taro Aso: The economic stimulus we’ve taken is working. We’re halfway there. The LDP will continue this strategy.

The latest numbers show Japan’s economy is growing again. But in downtown Tokyo, many voters speak of economic anxiety. Here’s working parent Yumiko Negishi.

Yumiko Negishi: Nowadays I look at supermarket fliers to find cheaper products. We used to eat out if we were tired. Now we cook at home.

This 31 year-old businessman worries that prices at retail stores are falling. Economists say that makes consumers stop buying as they wait for better deal. Still, Japan remains the world’s second largest economy and per capita income’s over 30 grand.

The problem is it’s aging rapidly. And confidence in government is low, says economist Richard Jerram at Macquarie Securities.

Richard Jerram: The management of the economy has been poor. It’s big, rich country but it’s really not much more than that.

He says on global issues like financial reform, Japan faces a credibility issue. Lots to tackle for whoever wins this election. The voters speak in 12 days.

I’m Scott Tong for Marketplace.

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