Press Conference by Shizuka Kamei, Minister for Financial Services

(Excerpt)

(Friday, December 11, 2009, from 11:04 a.m. to 11:10 a.m.)

[Opening Remarks by Minister Kamei]

Today, I do not have anything particular to report to you. As the compilation of the annual budget is set to start soon, the People's New Party began negotiations with the financial authorities yesterday. Although I will not talk about the details, about which I presume party officials have told you, the total amount (that the party advocates) is 95 trillion yen.

As we argued strongly in relation to the compilation of the supplementary budget, the state of the economy and the people's lives is getting very serious, like the situation during the Showa Depression (Japan's depression is subsequent to the Great Depression). Japan is the only country in the world in which deflation is continuing to progress. I believe that this situation cannot be resolved unless we take bold countermeasures, rather than stopgap measures. There is a limit to what we mortals can devise, and Japan has got into a situation that it has never experienced in its economic and fiscal policy management. We are at a very critical junction as we face the challenge of how to survive this situation, which has arisen as a consequence of the economic and fiscal policy management of the Koizumi government.

Therefore, although I expect that the monetary easing by the BOJ (Bank of Japan) will be somewhat effective as a countermeasure against the yen's rise and deflation, we believe that fiscal policy measures must be implemented in conjunction with it. In this sense, the annual budget is crucial. We must prevent a situation in which Japan sinks and the people's lives become miserable while we do the bidding of the Ministry of Finance in fiscal management. When I was a member of the LDP (Liberal Democratic Party), I was often involved in the compilation of budgets as a cabinet minister and as the chairman of the Policy Research Council (of the CDP). There is an emergency budget suited to times of emergency like this. If we are constrained by the idea that the expenditure should be limited by the revenue, just like the Ministry of Finance, which is behaving as if this is a budget compilation in normal times, the situation will become very serious.

I am sure that the Prime Minister is aware of such risk. I have met with him one-on-one many times. The key issue is how to put into practice his ideas under the budget. It is the responsibility of politicians to do away with the bureaucratic thinking of the Ministry of Finance, and by doing so, I will perform my duty to the Prime Minister.

Thus, budget negotiations have just started.

(End)