ITEM 1 Hasty Plan of Finance - Asahi Shimbun - 6 Dec 45. Translator: M. kawanabe.

Full Translation:

With the stir paused by the Allied apprehension of more war criminal suspects, and with the difficulty in finding a president for the Progressive Party increased by the possibility of another arrest order, the air in the Green Room of the Diet seemed to be tense and complex. Nevertheless, the discussions on the floor were somewhat appealing to us.

The interpellation of Mr. NAKAMURA Sannojo, at the plenary session of the Budget Committee attracted our attention when he stated that in liquidating the huge amount of war expenses, inquiries should not be confined to extraordinary expenditures only. Exactness in the accounts demands the inclusion of contracts other than budget figures and examination of Army and Navy special arsenal accounts. At the same meeting of the Committee Mr. TANAKA, Isaji advocated open procedures with regard to me revision of the constitution, saying that no matter how, democratic the new constitution may be, if procedures are kept secret, as is the case with the Government and other authorities at present, the revised constitution will never reflects public opinions or sentiment. This statement certainly reflects the voice of the people. Answering him, Mr. MATSUMOTO, Minister-without- Portfolio, revealed his convictions about the problem and added that the revision of the constitution should not be made in the haphazard fashion as is going on at present. It is the fundamental code of JAPAN, so it can not be Likened to American ready-made clothes. This speech stressing the importance of the revisions problem was the most outstanding one of the day.

The five year financial plan, starting from 1946, was disclosed, by the Finance Minister. It revealed the stupendous increase in revenues totaling 100,000,000,000 yen which will result from the taxation revision, including the imposition of war profits, etc, but the expenditures for redemption of bonds, food subsidies, reconstruction of damaged areas and social institutions were not at all detailed. It might be called a plan of hasty completion. Though it might be a diligent work, it lacks foresight.

The Farming Land Adjustment Bill was also submitted before the committee. Stressing the importance of the Bill, Mr. NISHIKAWA, Teiichi, inquired whether the Government would prolong the session and added that if the Government would not, the responsibility for not completing business would lie with the Government. We wonder why the words "not completing business" on such an important bill should have come from his lips. Is there a germ lurking therein which threatens our nacent democratization with disease?

EDITORIAL SERIES: 69 (Continued)

ITEM 2 The Five-Year Financial Plan - Nippon Sangyo Keizai - 6 Dec 45. Translator: J. Wada.

Full Translation:

Under the difficult conditions of defeat, the establishment of a financial plan is significant not only in itself but in its influence. Finance Minister SHIBUZAWA published a financial plan for five fiscal years beginning with the fiscal year 1946-1947. It is obvious that the rearrangement of finance which has been in complete disorder throughout the war cannot be attained, in so short a time as one or two years. The Government is justified in aiming to establish a sound finance in the five years after the next fiscal year. But the announced Five-Year Financial Plan is merely a list of what are called "skeleton budgets" for the coming five years and does not include future items of income and expenditure during and after the next fiscal year. Especially in expenditures, the important items regarding reparations, the cost of occupation and the cost of rehabilitation are not included.

By such a financial plan, we cannot know the whole figure of the budget. Of course, many of these items cannot be precisely estimated now, but are nevertheless very important both in their nature and value. The Government should not separate such items from the skeleton budget, but should show the outlines of these items to the nation as unsettled. According to this financial plan of skeleton budgets, there will be deficit of 1,600,000,000 yen in the next, fiscal year and an excess of 1,000,000,000 yen in the 1950-1951 fiscal-year. But if we add about 4,000,000,000 yen to be earned by a reform of the tax system and the higher prices on tobacco, which the Finance ministry is planning to put into effect, to the excess of 1,000,000,000 yen for the 1950-1951 fiscal year, there will be a total excess of about 5,000,000,000 yen for the same fiscal year.

As for expenditures, there will be a decrease of 3,600,000,000 yen in the national bond cost if the Government can redeem 100,000,000 yen of national bonds by the establishment of a property tax and a war-profit tax. There will be an excess of more than 8,000,000,000 yen for the 1945-1946 fiscal year.

For what expenditures are these sums set aside? Apart from the cost of occupation, the way of dealing with such costs as rehabilitation, social works, etc, will greatly affect not only finance but also the skeleton budgets themselves. As for general expenditures, the financial plan shows 7,700,000,000 yen for 1945-46, 4,300,000,000 yen for 1946-47 and 2,700,000,000 yen for 1950-51. Among the items include in general expenditures, not only the cost of price compensation but general subsidies should be reduced as much as possible. The sum of subsidies is liable to increase for various reasons, but the Government should reduce the sum at least to the amount shown in the financial plan.

For the establishment of a healthy post-war finance, the skeleton budget plan is not as important as are the items excluded from it. The revenue to be collected by increases in the property tax will repay 100,000,000,000 yen of the national debt which amounts to 200,000,000,000 yen including indemnities. What should be done with the other half of the national debt? The sale of Government enterprises and properties to the public will redeem the whole or a part of the national debt. That can be one way. The reduction or postponement of indemnities, which constitutes for the most part the future increase

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EDITORIAL SERIES: 69 (Continued)

ITEM 2 (Continued)

in the national debt, can be another way. The cost of occupation and the sum of reparations are still unknown. However, reparations will be paid by an increase in the national debt, and the cost of occupation will be paid in cash. The cost of rehabilitation is in part, the cost of unemployment measures.

Leaving these important items out, a true finance plan cannot be formed. Some index regarding the variation in the currency value should be taken into account. The outlines of these items, which are not included in the skeleton budget, should be presented to the public. For the stabilization of finance, not only the Finance Ministry but the whole Government should make a new start.

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