Archive for October, 2011

Doctors afraid new fee will reduce customers … er, patients

Sunday, October 30th, 2011

At the end of September the Ministry of Health Labor and Welfare released figures for medical care expenditures in fiscal 2009. Based on national insurance records, Japanese people spent ¥36.67 trillion on medical care that year, a 3.4 percent increase over 2008. That boils down to ¥282,400 for each man, woman or child, which is a 3.6 percent increase over the previous year. Broken down demographically, patients between the ages of 65 and 74 accounted for 55.4 percent of money spent (¥19.94 trillion) and patients 75 and over 32.6 percent (¥11.73 trillion). Per capita, Japanese under 65 spent ¥163,000 for the year, those between 65 and 74 ¥687,000, and those 75 and older ¥855,800. In terms of sources of revenue, 48.6 percent (¥17.5 trillion) came from premiums for both the Kokumin Kenko Hoken (National Health Insurance) and the Kenko Hoken (Employees Health Insurance) systems; 37.5 percent (¥13. 49 trillion) came from national and local taxes; and the remaining 13.9 percent (¥4.99 trillion) came from patients’ pockets.

The kid stays in the picture: JMA ad against proposed ¥100 fee

These amounts were the highest since MHLW started keeping track. Japan’s Gross Domestic Product went down in 2009, but the portion of GDP accounted for by medical care, 7.6 percent, was higher than the previous year’s portion, which means that not only is more money from premiums being spent, but more people are paying out-of-pocket for medical care, since 10-30 percent of a doctor’s and pharmacist’s bill is paid for by the patient. This portion can be extremely large when hospitalization or special treatments are involved, and in many cases where patients’ expenses are exceedingly high (kogaku iryohi) the government will reimburse them depending on their individual incomes. The MHLW has decided that the current pay schedule for this excessive medical expense system is obsolete, and has restructured it to allow more income brackets and higher reimbursements. The problem is that as the population ages revenues from premiums are going down since people over a certain age pay less, even as they use more insurance. So where are they going to get the money to fund this new excessive medical expense system?

The provisional answer is something called the madoguchi futan (literally, “window burden”), a ¥100 fee that will be added to every doctor’s visit and paid by the patient. The Japan Medical Association has roundly condemned this fee, saying that it penalizes older people and others on fixed incomes, effectively widening the gap between rich and poor. In the long run, it will discourage lower income people from seeking medical help.

Continue reading about bump in doctots' fees →

Are consumers being short-changed by the yen’s appreciation?

Thursday, October 20th, 2011

"Endaka" sale: Limited time only?

An ongoing matter of concern in the Japanese financial pages is the continued appreciation of the yen against almost every other currency. According to the overriding narrative attendant to this concern, Japanese exporters “enjoyed” a lower yen (en-yasu) until the middle of 2007, meaning that because the yen was valued low in relation to the currencies in the countries where these companies’ goods were sold, they made more money. That changed, and especially after the financial crisis of 2008, the yen shot up and continued to rise over the next three years, even after Japan’s economy was pummeled by the earthquake and tsunami last March. The yen is now up about 25 percent over what it was four years ago.

This is generally considered a bad thing since Japan’s economy depends on exports, but a lot of economists are saying the situation isn’t as dire as the media has portrayed it. Major exporters like Toyota and Sony have the ear of the mass media, so their troubles tend to represent all of Japanese industry in the financial press, but exports account for less than 20 percent of Japan’s economy. These companies threaten to move operations overseas if the yen isn’t brought down, but they’ve already moved a huge portion of their manufacturing overseas. In addition, they buy parts and materials from countries where their yen goes much further.

The economists who point this out also explain that the high yen can be considered a good thing for consumers, who should expect to “enjoy” substantially lower prices for imported products and Japanese products that use foreign ingredients. That should go without saying, and we’ve been waiting to see these savings at our local retailers. We’re still waiting. When we ask why the high yen isn’t reflected in prices we get answers like this: Though the yen is appreciating, commodity prices are increasing; many countries are experiencing inflation; since all imports have to be shipped, prices depend on the price of oil. In the end, these answers sound like excuses, because except for some isolated retail areas (Amazon; one particular brand of imported camembert, pictured), almost nothing sold in Japan from overseas has become noticeably cheaper in the last three years.

Continue reading about the high yen not translating to savings →

The rich are getting out while the getting is good

Sunday, October 16th, 2011

Come pick me up

This weekend saw the Occupy Wall Street movement reach Japan, albeit in a more lowkey fashion (for the time being, at least). The income gap is widening in Japan, but because the rich are less prone to showing off their wealth and the media is polite and doesn’t draw attention to them (unless they ask for it), mostly what we know about this gap is at the lower end, with the ranks of the working poor growing by the day.

When it comes to the rich the main difference between Japan and America is that Japan, due to even shakier financial policies and the March 11 disaster, is becoming a riskier place for them to keep their money, and according to the weekly business magazine Diamond an increasing number are taking their assets, as well as themselves, overseas. The number one destination for such high-end economic refugees is Singapore, and not just among the Japanese rich. Chinese millionaires have voted for Singapore with their feet, too, for more obvious reasons. (Sixty percent of Chinese citizens with assets of at least 10 million yuan have applied or plan to apply for exit visas.)

There are three methods for rich people to gain permission to emigrate to Singapore: Be designated as a “retiree” with at least ¥1.2 billion in assets, of which ¥600 million is transferred to a Singapore-based bank account; establish a company in Singapore for ¥7 million and run it for at least 4 years; buy property in Singapore and apply for a resident visa. Some wealthy people may not find any of these methods possible or desirable, and right now Malaysia is moving in on Singapore as the destination of choice, because the conditions for residence are much simpler — and cheaper.

Continue reading about the upper income brackets in Japan →

Politicians hope you don’t notice when their pay goes back to normal

Wednesday, October 12th, 2011

Nice work if you can get it

Six months is a long time, and considering all that has happened since the March 11 earthquake, the past half-year may seem even longer. So it wouldn’t be surprising if a lot of people have forgotten that the Diet passed a law shortly after the disaster to cut their own salaries by 30 percent for a period of six months. This gesture was on top of then Prime Minister Naoto Kan’s forfeiture of his own special prime minister’s allowance, not to mention the 10 percent additional cut in salary for all members of the cabinet as a budget countermeasure, which has been in force since the Yukio Hatayama administration.

Next month things go back to normal, and maybe the lawmakers are hoping the electorate has forgotten, but at least one person, Kenji Eda of Your Party (Minna no To), is determined that people will remember. On Sept. 27, during the budget deliberation talks, he asked Prime Minister Yoshihiko Noda whether or not he would forfeit his prime minister’s allowance, just as Kan did, for the sake of reconstruction. Noda, of course, is expected to ask for a long-delayed increase in the consumption tax as a means to fund reconstruction, which, over the next decade, is estimated to cost ¥11 trillion. As it turns out, while Noda as a Diet lawmaker has had his salary cut 30 percent like everyone else, it seems he’s been receiving his prime minister’s allowance, calculated on a daily basis, in full since he took over from Kan. Noda answered that the cabinet would continue with the 10 percent cut but said nothing about his own pay.

This is notable in that one of the items in the ruling Democratic Party of Japan’s manifesto was a 20 percent cut in all personnel costs, covering pay and expenses of all government employees, politicians and civil servants alike. Had the DPJ actually carried through with that promise, they could easily come up with the ¥11 trillion needed for reconstruction. Of course, at the time the manifesto was made the savings were envisioned to pay off Japan’s debt, so by itself the 20 percent personnel expense cut isn’t enough.

Continue reading about politicians' pay cuts →

Rice market turned upside down by radiation fears

Thursday, October 6th, 2011

Japan’s rice harvest season started at the end of August, and is presently centered on the Tohoku region; or, at least it would be centered there if so much of the crop hadn’t been neutralized by the Mar. 11 tsunami and then what was left wasn’t contaminated by fallout from the stricken Fukushima No. 1 nuclear reactor. Japanese people prize rice grown in the northeastern part of the country more than rice grown anywhere else, and they prefer new rice (shinmai), the newer the better. This is a cultural thing, since in some countries — India and Italy, for instance — older rice is considered something of a delicacy.

What's new? Shinmai from Chiba Prefecture

The earthquake and tsunami hit at around the time of planting, which means a lot of rice didn’t make it into the ground and that which did may have been irradiated. Supposedly, the government checked much of the rice grown in the region when it was immature and decided it was safe, but a lot of people are far from being reassured by such announcements. On Sept. 23, for instance, the government of Fukushima Prefecture said it detected cesium above allowable levels in rice from Nihonmatsu. With more rain and the resultant seepage into soil, the numbers are always changing. Beef from the region became suspect after it was found that the cattle may have eaten irradiated rice straw. All of this has become a familiar pattern: The authorities say there’s no problem only to reveal later something that seems to indicate there is a problem. People react accordingly.

Consequently, the market for rice has been knocked on its head. New rice from the Tohoku region, usually flying off shelves at this time of the year, is being avoided, while old rice from last year’s stocks are in high demand. According to the Mainichi Shimbun, 6 kilograms of 2010 Akita Komachi, a highly valued strain, was selling for ¥12,000 wholesale last January. Now, the same rice from the same harvest is going for ¥20,000. That’s never happened before. Last week, we received a postcard from the consumer food cooperative Daichi saying that they no longer had any 2010 rice in stock. This situation has revived the rice trade, wherein rice futures are traded like stocks, something that hasn’t taken place since before the war when the government started overseeing rice distribution. Moreover, since so many wholesalers sell blends of rice from different regions but don’t necessarily specify which regions on the packaging, people are avoiding cheaper blends that may, in fact, contain no rice from Fukushima Prefecture or even the Tohoku Region. People are even demanding rice grown in the western part of Japan, which is usually scorned as being less flavorful. Normally it isn’t even sold in eastern Japan.

This may be good news for foreign rice, which is only imported because of world trade obligations. Most imported rice is used for processed foods or simply ends up gathering mold in warehouses. What may be gathering mold in warehouses a year from now is rice from the 2011 harvest, which is expected to be a record surplus. According to Bloomberg, this year’s harvest will be in excess of 10 million tons. As of the end of June, there was 3.24 million tons in storage left over from last year’s harvest, most of which will probably be gone before long.

Restaurant chain retains No. 1 position in sales . . . and robberies

Monday, October 3rd, 2011

Hit me: One of two Sukiyas near Kamiyacho Station in Tokyo

Last month, many news outlets reported an attempted robbery of the Asaka, Saitama Prefecture branch of the gyudon (beef bowl) chain Sukiya. Though such crimes are still rare in Japan when compared to other countries, this one received a lot of attention because of what the stickup man said as he brandished a knife at the counter person: “Maido onajimi no Sukiya . . . ,” which basically means he comes to Sukiya often, though it isn’t entirely clear if he meant as a customer or as a thief.

Sukiya is the number one gyudon chain in Japan, owing mainly to the fact that it’s got the most branches: about 1,500 nationwide. The next biggest chain, Yoshinoya, operates about 1,200, with Matsuya a distant third with 800. But if Sukiya has an edge over Yoshinoya in terms of sales, in terms of robberies it’s miles ahead. According to the National Police Agency, between January and August, Sukiya branches were the victims of 90 percent of the robberies perpetrated against gyudon restaurants. That’s an impressive portion, though it should also be pointed out that, altogether, there were only 57 robberies of gyudon restaurants nationwide during this period. Robbery, as a matter of fact, has been on the decrease in recent years, though the targeting of gyudon restaurants has risen.

According to an article in the Tokyo Shimbun, there are a variety of reasons for the increase. The main one is that almost all robberies of commercial businesses take place late at night, and over the past decade most gyudon restaurant chains have extended their business hours and are now open round the clock. A lot of other 24-hour food service businesses use vending machines to collect money; and convenience stores, which are also open all the time, have less cash on the premises thanks to the widespread use of e-money, debit cards and prepaid cards. Two thieves who were caught in August after robbing a Sukiya in Tokyo of ¥200,000 told police they had gotten the idea from discussion groups on the Internet. Apparently, would-be robbers often trade intelligence on good places to hit, and because Sukiya is so well-known and there’s a branch on practically every corner, it’s seen as an easy target.

In any case, the Asaka thief wasn’t a particularly good one. The counter person, a part-timer, managed to hit the alarm button and the police captured the robber shortly after he left. Since most Sukiya branches already have alarm systems installed, the police have suggested they, pardon the pun, beef up their late-night staff, though that would obviously defeat the whole purpose of a chain like Sukiya, which charges rock-bottom prices. It’s why they’re number one, even if in surveys real gyudon fans much prefer Yoshinoya.

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