Sunday, December 29, 2013

Abenomics will hit the wall in 2014

Since Shinzo Abe returned to the PM's office in 2012, we've enjoyed a gusher of good-news stories about the Japanese economy.

Business mood hits six year high as Abenomics takes hold.

Abenomics fuel Japan economics boom.

That's just two among hundreds that we've seen in the past year. But according to this article at Bloomberg, storm clouds are gathering, and by next summer the Abenomics miracle will be over.

You can't maintain the facade of economic rejuvenation when the cost of living is rising five times as fast as wages. Ironically for a hard-core neo-lib, Abe himself is very well aware of this fact and has been pleading with the private sector to raise wages.

The last twenty years of economic stagnation in Japan seems to have seriously degraded a once-sacrosanct social contract. Japanese employers are now as keen to grind down wages as their counterparts in the US or UK.

Why should we share the wealth when we don't have to?

In Britain, the Director of the Confederation of British Industries is likewise pleading with employers to loosen the purse-strings and share the wealth. Again, the pleas are falling on deaf ears. Why should we provide a living wage when millions of desperate workers are willing to settle for less?

If Shinzo Abe and CBI boss John Cridland can figure out that workers need to make a living wage, why can't the titans of commerce and the captains of industry?

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