As the consumption tax hike is set to start from April, will Abenomics work out as planned? It’s one of the biggest concerns this year.
Prime Minister Shinzo Abe sees that its success or failure depends on whether companies will raise wages for employees, and he has repeatedly called for pay raises in his business circles.
Akira Amari, the Minister of State for Economic Revitalization, declared, “I want to create an environment where it’s embarrassing for a company not to raise wages.” He plans on initiating a candy and whip strategy for companies. When they raise their wages to 2~3% and above, the government will reduce their corporate taxes. On the other hand, for companies that show good performances, but don’t give back to their employees, he’d like to announce their company names in public.
The average annual salary of Japanese salarymen has certainly decreased, from 4,670,000 yen in 1997 to 4,080,000 yen in 2012. Now, domestic companies have approximately 280 trillion yen in internal reserves for purposes such as capital investments. In effect, Prime Minister Abe has been targeting this pool, and he’s been asking business leaders to circulate some of the money to their employees.
Prime Minister Abe Has Hit It Off With the Communist Party.
There’s one party that has continuously championed the circulation of internal reserves to employees. Have you ever heard of the Communist Worker’s Party?
In October of last year, a Communist member told Prime Minister Abe at Parliament that he should pressure companies more to reach into their reserves of savings. Prime Minister Abe replied, “We’ve asked leaders in our business circles to make use of their internal reserves. We’ll continue to talk to them.”
Indeed, the prime minister has fared well with the communist party people, which have always claimed that big corporations were evil. In the past, they often directed their attacks at the abundant internal reserves.
A union executive even criticized Prime Minister Abe’s counter-clockwise turn. He noted, “The Japanese government isn’t a socialist system that should intervene in wage raises.”
Wages are obviously the “price” or value of the work that various people offer. They depend upon the marketplace’s supply and demand. If business investments and consumption soar, and job offerings increase as well, then wages will go up. To say raise the wages before the economy improves is to reverse the order of cause and effect.
Internal reserves from businesses are not merely left-overs or some money saved-up out of greed. Business leaders should use the money to start new enterprises. To give the reserves away to employees just because the government asked is really not something that smart economists would do.
Heading Towards Ultra Socialism?
In the 20th century the economist Hayek, who espoused a philosophy of freedom, wrote about the governmental regulation of prices in his prominent work, “The Road to Serfdom.”
“Power, obtained from regulation of production and price, is almost limitless.”
“For (a government official) to set remuneration at the outset is to set an obstacle for entering into an occupation; it’s almost explicitly forbidding entry.”
For instance, a government official sets the monthly salary for a beautician at 300,000 yen. Then let’s say that a certain salon decides to use 1,000,000 yen for personnel expenses for the hiring of new beauticians. However, they can only hire three people, even if they receive many applications. If they could have decided to make the monthly salary 250,000 yen, then they would have been able to hire four people. However, because of the “obstacle” that the government imposed, the salon lost the opportunity. As a result, one additional beautician could not enter the occupation.
If the government intervenes and forces businesses to raise wages throughout the country, unemployment will rise, and it’ll take away the freedom to choose occupations. The Abe regime doesn’t apparently realize what they’re actually doing.
Master Ryuho Okawa of the Happy Science Group spoke on Abenomics and on the consumption tax hike in a sermon that he gave in January of this year titled “The Laws of Perseverance” .
“If they succeed, in spite of enduring two tax hikes during a single cabinet, with their economic strategy to improve the economy through tax hikes, then I would certainly think that it could be called a historical success. It would mean that what socialism couldn’t do, ultra socialism was able to accomplish.”
The Prime Minister must simply be acting in “good faith” as he pushes for wage raises. However, it’s in fact “ultra socialism”, and it has crossed into the domain of the Communist Party. Now it’s indistinguishable.
Abenomics began one year ago. It’d seem that we’re heading in a different direction from economic recovery and from the return to a trajectory for growth.
In 2009, the Happiness Realization Party Shot Off “3 Arrows”.
Abenomics has “3 arrows”. To put it simply, (1) the Bank of Japan buys up a lot of financial assets (quantitative easing), (2) the government takes care of public works such as the repair of infrastructures (which increases public spending), (3) and regulations relax to make it easier for new businesses to start and to produce new products and services (growth strategy).
Most citizens are still unaware of the fact that the Happiness Realization Party (HRP) put forth those economic policies since its party’s inception May 2009.
During the election for that year’s House of Representatives, the HRP pledged and incorporated the following: (1) a daring monetary easing such as a 3% inflation target; (2) massive investments into traffic and urban infrastructures; (3) and drastic deregulation and large tax cuts for agriculture, medicine, and construction.
At the pledge during 2010 upper house elections, the HRP revealed those three policies on an organized, easy-to-understand chart (see photo above). Then, the LDP began to speak of the “3 arrows”; it was around November of 2012, soon after Mr. Abe returned as Prime Minister.
Of course, we don’t mind if they carry out good policies. However, if they don’t clearly understand the hopes and aspirations contained in the policies that the HRP created, they won’t know which direction they ought to go, and they’ll stray off course.
Neither In Japan, Nor In the Rest of the World, Businesses Won’t Borrow Money.
What is the aim of the “3 arrows,” which the Happiness Realization Party espoused?
Since the 2008 subprime shock, businesses in the States and in the EU have owed huge debts, and have been struggling to pay them back. A balance sheet recession, so-called, has enveloped the world, and businesses have stopped taking the initiative to borrow money for the start of new ventures.
Therefore, governments have been resorting to borrowing money for public works, and it’s been done intensely in places like the States and China.
Keynesian economics support the idea that the economy can get help from increased public spending during times of recessive crisis. After the 1929 Great Depression, the Americans with Roosevelt and the Germans with Hitler carried out such policies, and they successfully beat the depression.
In the case of Japan, in the 20 years since the burst of the 90s Bubble, most regimes have continued to use this method.
According to the 2005 data, many of the companies in Japan only have paid back their debts. When they freed themselves from their burden, and were just about to move forward, the subprime shock shook the world. Many of Japan’s companies have found themselves once again paralyzed in the current situation as they hold 280 trillion yen in the internal reserves.
The Happiness Realization Party, in an effort to get domestic companies to invest that money in Japan, put forth a drastic relaxation of regulations or the “3rd arrow” in Abenomics.
Abenomincs Will Stop at “1.5 Arrows”.
In concrete terms, liberate entry into agriculture when restrictive practices make it difficult for people, who were not born into farming families, to take up the occupation. Liberalize medical fields that recognize a wide array of services. Do large-scale makeovers of urban areas where housing standards have been low due to inefficient use of land and space. These measures should include things such as consistently, low rates on income and corporate tax.
This advice accords with the ideas of Hayek and Schumpeter, who along with Keynes, were the top economists of the 20th century. According to Hayek, when governments intervene in the marketplace, human freedom is lost. Schumpeter was the person who put together the famous theory on entrepreneurs, where he described people who produced innovations.
The Abe regime has been trying in part to implement the “3rd arrow”, but trade and bureaucratic organizations have entirely rejected it.
Abenomics has not gotten beyond doing public works for building up a “national resilience” in order to prevent a disaster from occurring. When it comes to infrastructure reinforcement, it’s not likely to produce an explosive economic result as was the case with the Linear Bullet Train. Has Abenomics only shot “1.5 arrows”?
The LDP has a very similar operation to the Chinese Communist Party, which has been printing enormous amounts of money and has been continuously expanding its real estate investments since the subprime incident happened.
The LDP Became “Communist” After the War Ended.
Since the Happiness Realization Party hasn’t entered national politics yet, it’s difficult to compare the LDP with HRP. However, we can certainly discuss a fundamental difference in the aim of the parties, which concerns what human happiness is.
The LDP based its post-war policies on the belief that the underdog is right.
They stubbornly eliminated entry into the agricultural business, as they protected a people’s commune, named the Japan Agricultural Cooperative Society, which was similar to something that Mao Tse Tong started in Communist China .
Public pension has been a strange system where the Ministry of Health, Labor, and Welfare’s pension manager and director have been calculating the amount of an all-citizen effort to support the livelihood of the elderly population. How can a single official be held responsible in public for the future livelihoods of hundreds of millions of people? If a person could accomplish such a job, then people would indeed consider that person to be the greatest genius in the history of humanity.
It might have been with good intentions that the politicians said most citizens are stupid and cannot plan for their futures, and that every citizen should help out.
The LDP has been trying to create a society where members of the public are treated like government workers, and it has been acting like it can freely use the tax money. The LDP has become a sort of society that has been turning its citizens into pets.
The results have been disastrous. The government must pay more than a quadrillion yen in total pension money now, which they will gather through hikes in the consumption tax of about 20 to 40 percent. Moreover, the babies who are born now will lose out on about 30 million yen during their lifetime.
The longer people allow this system to continue, the worse “equality in poverty” will become. The LDP is quite literally moving in the same direction as the Communist Party.
Why Are People Born Into This World to Live?
Although they may espouse the “3 arrows” idea similar to the LDP, the Happiness Realization Party’s goals are completely different.
Master Okawa, who is the President of the Happiness Realization Party as well, emphasized this fact in his speech titled “The Laws of Perseverance”:
Make sure not to forget the spirit of self-help, the spirit of self-becoming and growth, and to consolidate and nurture the power to create economic prosperity.
Why are people born into this world to live? It’s to grow spiritually through experiences on Earth and in the other world.
To accomplish this mission, the spirit of self-reliance, which can overcome any circumstance and pave a way forward, becomes an important skill to acquire.
“We wish to create a nation in which we can change ourselves, change society, and change our futures through effort and strive towards a life of happiness,” and this is the hope of the Happiness Realization Party.
“3 arrows” should truly stand for limitless prosperity dependent on the wisdom and efforts of the individuals and companies, by removing the constraints that impede that progress, and expanding the domain of freedom.
Its success could mean that business leaders and entrepreneurs will look after the people rather than the officials and the Minister at the Ministry of Health, Labor, and Welfare.
The LDP Will Not Be Able to Endure Abenomics.
In the language of the Communist Party, the Happiness Realization Party is trying is to bury Marx’s Communist Manifesto forever .
This does not mean burying the “Communist Party”. It means forever burying away the government operation that is based on ways of thinking that has been blanketed by the “Communist Manifesto”.
When Marx published the manifesto in 1948, he wrote, “In a sense, people can sum up Communist theory in a single sentence: the government should abolish private property.” To attain the result, Marx suggested 10 measures, and post-war Japan has already carried out most of them.
For example, the government introduced a “heavy progressive or graduated income tax” across the board. The combined amount for income and residential tax was 93 percent in the 70s and a little under 80% in the 80s. It was a horrendous tax system where the more you worked, the more you lost.
The “Abolition of all rights of inheritance,” called for a 100% inheritance tax, and for a long time after the war, the maximum inheritance tax remained as high as 75%. It certainly remained close to the Communist ideal of no private property.
There was also a measure for the national bank to centralize credit in the hands of the state. Japan’s postal service’s savings and insurance business, the largest financial institution in the world, had been privatized, but since that time, it has taken huge steps backwards.
With the measure for “Combination of agriculture with manufacturing industries; gradual abolition of all the distinction between town and country,” too, the government carried it out by taking the urban taxpayer’s money to protect the farmers.
On social securities, such as medical, pension, and assisted living, the aforementioned Schumpeter listed several signs that might accompany a transition into socialism in his book, “Capitalism, Socialism and Democracy.” These indicators included all forms of social security, the redistribution of taxable income, and labor market controls. Indeed, the politics of the LDP have aligned with the problems in Schumpeter’s book.
In truth, communism and socialism have taken root in the LDP. In fact, the Abe regime has only been trying to return to its “roots”.
When the Happiness Realization Party spoke of “burying the Communist Manifesto,” it really meant the replacement of a large chunk of the post-war LDP government.
In this way, Abe’s 2014 LDP can’t endure the destructive force of Abenomics, even after his political party thought that it was a good idea to borrow the HRP’s economics policy.
The True “3rd Arrow” Is Education and Enlightenment.
To push forward with the true “3rd arrow” means to bury the “Communist Manifesto”. However, it’s not as easy as it sounds.
The influence of Marxist thought resides inside Japanese education, the mass media, government authority, political parties, and in the hearts of individual citizens. Therefore, in Japan, rather than admire rich and successful people, there’s a climate of envy where people want to bring everyone down if they’re given the chance.
The target of the true “3rd arrow” is to change people’s conscious awareness.
It isn’t only a matter of economic policy, how people think and act in accordance with education and enlightenment also matter.
England’s Prime Minister Thatcher (in office 1979~1990) tried to accomplish the work of combining education and enlightenment.
“My job is to stop Britain from going red.”
Thatcher intended to do it before taking office, and she wanted to end the class society in England, which wasn’t very different from what Marx witnessed in London in the 19th century.
Due to her efforts, people from the poorest classes could own shares in the privatized government enterprises, and they could buy into privatized, public housing ventures. That is, she tried not to create workers but produce many “capitalists”. She tried to introduce a system where a company’s revenue would be connected to the employees’ salaries, and tried to change the worker’s consciousness to that of an “entrepreneur’s”.
She widely liberalized entry into businesses such as the securities industry, real estate transactions, and the bus business, which were privileged to a few people. She thus destroyed the foundation of the class society.
Prime Minister Thatcher Taught a Revolution of the Soul.
People can identify Marxist thought in the following three ways:
1) it contains the victim mentality that affirms, “I’m exploited”; 2) it’s possibly okay to take money from the rich, which validates the experience of envy; and 3) materialism that seeks the reward only in this world.
For citizens of England, who have been immersed in such ways of thinking, Thatcher advocated self-reliance and also the importance of religion.
“The poor will not become rich, even if the rich are made poor.”
“Pennies don’t fall from heaven; you must earn them here on earth.”
“Economics are the method; the object is to change the heart and soul.”
Thatcher’s reformation was very similar to the true “3rd arrow”, wasn’t it?
Yet, England’s economy didn’t truly begin to recover until she retired from her post as prime minister in the 1990s. It took 10 years for the citizens to pick themselves up, to start new businesses, and to make money.
While Thatcher was in office as prime minister, she was constantly in the midst of controversy as she received strong opposition from people who were directly hurt from the budget cuts that limited social security expenditures and privatizations. As a politician, it must have been a tough and rather unrewarding job.
What is Enlightenment and Education on a Global Scale?
Happy Science started its own political party, opened its own middle and high school, and it’ll now open a university in 2015. It’s globally expanding. Happy Science is about to initiate an “enlightenment and educational movement” on a global scale that will surpass even what Thatcher did.
This work has been met with much opposition from the mass media and from some sections of the general public. Therefore, it might not immediately feel as rewarding as it truthfully is.
However, in the States and in the EU, the economic bubble has burst, and they are in need of a true “3rd arrow” because they’ve been lagging about ten years behind Japan in terms of its economic recovery. When that time comes, if enough Japanese have survived the “revolution of the heart and soul,” and they’ve embraced the path of self-reliance, then the Japanese will be in a position to lead the rest of the world.