Can Japan provide answers to the west’s economic problems?,FT.com,17.8.3 

 Ageing: pensioner suicides reveal shocking levels of poverty


On Tuesday April 24, two women, one aged 77 and the other in her nineties, walked into Kakio station, on the outskirts of Tokyo, and sat down on a platform bench. They looked like sisters, said one witness. They were dressed in their best clothes.

At about 2.30pm, they joined hands and threw themselves in front of an express train. No suicide note was found and the identity of the older woman remains unclear. But it fits a pattern of suicides among the elderly, such as the 2015 death of 71-year-old Haruo Hayashizaki, who set himself on fire aboard a bullet train.

Mr Hayashizaki was in despair at his pension. Such suicides reveal something hidden in Japanese society: a shocking level of poverty, especially among the elderly and single parents, in a country where family is supposed to solve such problems and welfare is stigmatised. As ageing stretches families and public finances, one of the biggest challenges to Japans fairly closed economic model is whether it can even take care of itself.

 More than 6.5m pension households, 27 per cent of the total, live in poverty, says Naoyoshi Karakama, a professor at Ritsumeikan University in Kyoto, as do 16 per cent of children, rising to 55 per cent of those in single-parent families. Japan doesnt really have a system intended to eliminate poverty, says Mr Karakama, just a system of public assistance for subsistence.

State pensions pay full benefits only to those with contributions going back 40 years, so while salaried workers do well, many who were self-employed or worked irregularly get less than $1,000 a month. From that they must pay rent and healthcare costs plus some of the worlds highest food and utility bills.

The only plausible answer is means testing so wealthy pensioners pay for themselves. Such pensioners, however, are Japans dominant voting bloc.

Japan v the west
1. Income

GDP per capita in 2016 (in 2010 $ PPP)
Japan $37,491

$52,066 | UK $38,450 |
Germany $42,898

2. Immigration

Percentage of the population that is foreign born (2015)
Japan 1.76%

13.45% | UK 13.9% |
Germany 14.2%

3. Demographics

Elderly population, % (2014)
Japan 25.06%
US 14.5% | UK 17.3% | Germany 21.4%
Source: OECD

4. Wages

Real average wages, annualised growth rate 2007-2016
Japan 0%

+0.7% | UK -0.3% | Germany +1.1%

% of people who were low paid in 2015
Japan 13.5%

25% | UK 20% | Germany 18.4%

Source: OECD Employment Outlook, 2017









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