＜prologue＞
I started a blog called “The Baby Boomer Generation’s Miscellaneous Blog”（Dankai-sedai no garakutatyou:団塊世代の我楽多（がらくた）帳） in July 2018, about a year before I fully retired. More than six years have passed since then, and the number of articles has increased considerably.
So, in order to make them accessible to people who don’t understand Japanese, I decided to translate my past articles into English and publish them.
It may sound a bit exaggerated, but I would like to make this my life’s work.
It should be noted that haiku and waka （Japanese short fixed form poems） are quite difficult to translate into English, so some parts are written in Japanese.
If you are interested in haiku or waka and would like to know more, please read introductory or specialized books on haiku or waka written in English.
I also write many articles about the Japanese language. I would be happy if these inspire more people to want to learn Japanese.
my blog’s URL:団塊世代の我楽多（がらくた）帳 | 団塊世代が雑学や面白い話を発信しています
my X’s URL:団塊世代の我楽多帳（@historia49) on X
1. A “100 Million Middle-Class Society” Until the Bubble Collapse
Until the “bubble collapse” in 1991, Japanese society was known as a “100 Million Middle-Class Society,” and the majority of Japanese citizens seemed to have a moderately affluent, middle-class consciousness.
However, the failure of the Ministry of Finance and the Bank of Japan’s monetary policy led to a tragic, almost crash-like, collapse of the bubble and the subsequent prolonged economic slump and deflation.
The bubble burst in 1991. The Ministry of Finance implemented a monetary tightening measure known as “total limit on land loans” in March 1990, and Bank of Japan Governor Mieno significantly raised the official discount rate to 6% in August 1990, putting a sudden brake on the economy. The “Land Value Tax Act” was enacted in 1991, which solidified the collapse of the bubble and ushered in the “Lost 20 Years.” I believe policy decisions should have been made to allow for a softer landing.
2. “Structural reform and deregulation” by the duo of former Prime Minister Koizumi and Heizo Takenaka
Keio University Professor Heizo Takenaka served as Minister of State for Economic and Fiscal Policy, Minister of Financial Services, and Minister of Internal Affairs and Communications under Prime Minister Junichiro Koizumi (2001-2006), and effectively played a key role in the “Koizumi-Takenaka Structural Reform.”
In the face of unprecedented prolonged deflation, former Prime Minister Koizumi’s propaganda-like slogan, “Japan cannot be revitalized or developed without structural reform,” was well-received by the public desperate for economic recovery. The “Koizumi Theater” garnered widespread support, and the star, former Prime Minister Koizumi, enjoyed enthusiastic popularity.
The original concept of the Koizumi structural reforms, also known as “structural reform without sacred cows,” was based on the “small government” philosophy of the neoliberal economics school. It called for reducing government public services through privatization, such as the privatization of the postal service and the four road-related public corporations, and leaving what the market could do to the market (market fundamentalism). The pillars of the reforms were the so-called “public-private” approach and the trinity reform of national and local governments, also known as “central-local.”
These were threefold:
① Promoting fiscal structural reform to create a simpler and more efficient government and thoroughly reviewing expenditures.
This included cuts in welfare and public services.
② Deregulation to promote new industries and job creation.
This also included promoting competition through new entrants.
③ Accelerating the disposal of non-performing loans.
3. What did structural reform and deregulation bring?
But were these “structural reform and deregulation” policies actually successful?
(1) An economic recovery that was not felt
Although the economic recovery surpassed the Izanagi Boom (1965-1970, 57 months), this was merely because the period of economic expansion measured in terms of real GDP growth was longer. In terms of the actual daily lives of individual citizens, it was truly an “economic recovery without any real sense of reality.”
One reason for this is the “low level of growth.” While the Izanagi Boom averaged over 10%, and the Heisei Bubble Boom averaged approximately 5%, this time it was only around 2%.
Another reason is the difference in income conditions between the corporate and household sectors. Even when companies performed well, wage increases remained low, and the “labor share” remained low.
(2) Progressing polarization and fragmentation of the economy and society (widening and entrenching disparities)
Youth unemployment and the rate of unemployed graduates have risen, and one in three employees are in “non-regular employment”—part-time, casual, and temporary employment.
As a result, the wage gap between regular employees and non-regular employees, said to be as much as 4:1, became fixed, and the cumulative income gap widened, leading to a deterioration in living standards and various other problems, including a decline in marriage and a declining birthrate.
Many cases of employment deterioration or even collapse have emerged, including excessive workloads, an increase in industrial accidents due to overwork, an increase in the working poor, and an increase in depression and sudden deaths.
(3) The Harmful Effects of Deregulation
Deregulation led to new entrants into the taxi industry, leading to excessive competition and excessive workloads for drivers.
(4) Problematic Behavior of Privatized and Split-Up Postal Services
Hopefully, postal privatization would improve things, but the division of the postal service not only made things more complicated, but also led to issues such as inappropriate sales practices at Japan Post Insurance and Japan Post Bank, resulting in disappointment.
(5) Rampant Irresponsible Outsourcing from Government to the Private Sector
The government was supposed to streamline its operations and cut costs by outsourcing tasks that could not be handled by the government alone. However, the negative aspects of the reforms have become increasingly apparent, such as the fact that many tasks that could have been handled by civil servants alone were “outsourced” to the private sector, with little oversight, and the outsourcing fees were not cheap.
Of course, just as (1) “economic recovery” cannot necessarily be said to be the result of the Koizumi reforms, (2) “progressing economic and social polarization and fragmentation” cannot be said to be entirely the fault of the Koizumi reforms. (3) “deregulation,” if interpreted in good faith, may have been based on the idea that “if we leave it to market principles, things will work out by the invisible hand of God.” (4) and (5) may not be directly the responsibility of the Koizumi reforms.
However, the undeniable fact is that the current situation could not be prevented.