I'm really shocked no one brought this to the table - All, See the First Line! Collapse of Japan - GULP! -:
Thursday March 8, 9:53 am Eastern Time
Japan Minister Issues Debt Warning
TOKYO (AP) -- Japan's finance minister said Thursday that the burgeoning public debt has pushed the nation's finances to the verge of collapse.
Kiichi Miyazawa's remarks in Parliament amounted to a public admission that the government can no longer afford attempts to spend itself out of an economic slump that is deepening again after some signs of recovery.
Japan's finances are ``very close to collapsing,'' Miyazawa said.
``We need fundamental fiscal restructuring aimed at rebuilding our finances in the 21st century, looking 10, 20 years into the future,'' Miyazawa said.
``Not only measures to deal with reducing debt, but those to deal with taxes, local government finances and social security will be needed,'' Miyazawa said, offering no details.
Analysts and many politicians have long warned that profligate spending to prop up the economy was unsustainable.
But economic planners insisted that injections of funds were needed to boost the economy out of more than a decade of gloom.
Miyazawa's comments reflected a new sense of urgency within the ruling coalition about the need to change course.
Japan's public debt stands at more than $5.4 trillion, equivalent to 130 percent of gross domestic product.
A government council on fiscal and economic policy is looking at ways to dig the government out of debt, Miyazawa said.
Just weeks ago, U.S. credit rating agency Standard & Poor's downgraded Japan's debt rating from its top-notch status.
At the time, Miyazawa criticized the S&P's decision and said he had ``absolutely no intention'' of changing fiscal policy because of it.
Miyazawa's remarks Thursday drove the dollar to 120.02 yen in afternoon trading, up 0.78 yen from late Wednesday in Tokyo.
The benchmark 225-issue Nikkei Stock Average closed down 73.33 points, or 0.57 percent, at 12,650.56.
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