Koizumi's reform will give people pains

The governmental Council on Economic and Fiscal Policy on June 21 unveiled a "basic plan" outlining the so-called "structural reform" program.

The "basic plan" says it cannot avoid pain on the part of the people and does not refer to reforms which the general public demands, such as the elimination of wasteful public works projects.

The "basic plan" calls for the write-offs of bad loans held by banks. Many economists are warning that this will mean more bankruptcies and increased unemployment. On the social welfare services, the "plan" enumerates adverse revisions of the medical insurance system to shift a larger financial burden onto patients. The "plan" also hints at a consumption tax rate increase.

Japanese Communist Party Policy Commission Chair Fudesaka Hideyo published a comment on the same day criticizing the "basic plan" for imposing social hardships through increasing bankruptcies and increased unemployment, adversely affecting social welfare services, and increasing taxes.

The need now is to establish programs to support and encourage people's livelihoods exhausted by the prolonged economic recession, Fudesaka said.

The JCP proposes a consumption tax rate cut to boost personal purchasing power, a freeze on adverse revisions of social welfare services, and concrete measures to alleviate the employment crisis. (end)