Obuchi's Deficit-Spending Program Faces Growing Protest
TOKYO -- When Japan's Economic Planning Agency last month reported a worse-than-expected 1% contraction of third-quarter GDP, it seemed Prime Minister Keizo Obuchi had all the ammunition he needed to keep pumping up this sputtering economy with deficit spending. Of course, this is exactly what he intends to do. Just last week he promised to give the economy "one more push" with a whopping 85 trillion yen ($807 billion) fiscal 2000 budget -- the biggest in Japanese history.
Parliament convened for a 150-day session last Thursday, and the passage of that spending package, with its serious ramifications for Japan's huge bond market, is becoming more complicated than Obuchi had planned.
For starters, fiscal consolidation has returned to the mainstream political debate in Japan. After Ryutaro Hashimoto lost his job as prime minister in 1998 for taking too long to abandon his belt-tightening policies, no sensible lawmaker in the Liberal Democratic Party (the dominant force in the ruling coalition) dared publicly challenge Obuchi's return to massive public works outlays as the best fix for the economy.
At least not until earlier this month, when former LDP Secretary General Koichi Kato began questioning Obuchi's expansionary polices and criticizing him for failing to rapidly implement measures to encourage restructuring. Speaking in his home prefecture on Jan. 8, Kato said that "Throwing money around will not do. I hope Prime Minister Obuchi and the
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