Shinzo Abes Political Dilemma on Japans Fiscal Consolidation: The Challange of Demographic Crisis in The Persisting Lost Decades

Riwo Ramadani, Usmar Salam

2016 | Skripsi | Ilmu Hubungan Internasional

ABSTRACT Japan as the 3rd largest economy in the world is now facing the massive economic stagnation in their history. Scholars and experts have described this as the ‘lost decades’ judging from their economic growth that has been levelled off at 1 percent annually. Besides, the long-projected issues of aging population and shrinking working force deteriorate the Japan’s economy to maintain its status as third giants. These two massive economic and socio-political pressures put them in difficult positions to achieve economic security. Shizno Abe, the incumbent Prime Minister issuing strategic countermeasures against this crisis, however it is criticized as not sufficient and well targeted. IMF and OECD have suggested several reliable reform options, yet it has been deprioritized. Fist of all, Japan’s demography substantially gives political power to the current dominant political party, and its Prime Minister. The aging population has set them privileges as the controlling groups, compared to other age groups such as young adults. Through democratic means such as elections, silver votes have never been stronger. Therefore, to select unpopular policies among elderlies, namely reducing social welfare benefits is a political suicide. On the other hand, Japan’s economy is not adequate to support its social welfare system. Its debt is skyrocketing to double their national income. With the current demographic crisis and economic development, government deficit would be soaring to fourth times than it has today. Seeing this issue above, this research intends to examine how Shinzo Abe manages this dilemma. This writing will only focus on his administration, referring to IMF and OECD reports and suggestions. Moreover, the writer will also select several policies that have the highest relevancies towards the issue, covering from both socio-political and economic approaches. Keywords: Abenomics, Social Welfare, Aging Population, Silver Votes, Lost Decades, Stagnation, Pensions, Health Care, Reforms, Demographic Crisis. Word Count: 16,361 words

Kata Kunci : Pensiun Usia Lanjut; Jaminan Sosial