Japan, however, has other expensive needs, even as it tries to cope with massive debt. Rebuilding from the March 2011 earthquake and tsunami, and ensuing nuclear disaster, is diverting attention and resources from such wider issues.

LDP chief Shinzo Abe has made boosting public spending a key platform of his campaign in the Dec. 16 parliamentary election. He accuses current Prime Minister Yoshihiko Noda of not doing enough to stimulate the economy after two decades of stagnation.

But what worked decades ago during an era of fast growth and ample tax revenues may not have the same impact in today's fast-aging Japan, especially when the economy is suffering from the global crisis, says Andrew DeWit, a professor at Tokyo's Rikkyo University.

"Now you have this tunnel that fell apart. That has reignited enthusiasm for construction," he said. "The question is, do they have the money to spend on that?"

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