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When protecting farmers hurts consumers — and farmers

Monday, October 27th, 2014

Sign in dairy case telling shoppers they are limited to only one package of butter per person

Sign in dairy case telling shoppers they are limited to only one package of butter per person

Butter isn’t as essential in Japanese cuisine as it is in certain other countries’ national styles of cooking, but it does have its place, most commonly in white sauces and baking, and anyone here who uses it regularly has had to pay premium prices for it. Lately, they’ve been paying even more.

In a recent Asahi Shimbun feature a housewife shopping in Minato Ward, Tokyo, is tempted to pick up a package of “luxury brand” butter because all the regular butter is sold out, but in the end she leaves the store without it because she just can’t see spending that much money. The article doesn’t say what that price is, but regular butter right now is said to cost “¥400 or more” for 200 grams, and the luxury butter is “twice as expensive.”

The implication is that ¥400 is already too much to pay, but in any case wherever you go, regular butter tends to be sold out, and many supermarkets now limit customers to only one package per trip. More significantly, businesses such as ramen restaurants and bakeries, which rely on butter as an essential ingredient, are also suffering from the price increase. That’s because there is an acute butter shortage.

And the reason there’s a butter shortage is that there’s a milk shortage and butter is the least prioritized of dairy products. Most milk that’s produced in Japan is sold as milk, and only when there is milk left over after being channeled into by-products like cheese and yogurt does butter get made. Unlike most other dairy products, butter can be frozen and stored for a long period of time.

CONTINUE READING about Japan's butter shortage →

Political gift culture refuses to die

Tuesday, October 21st, 2014

Former Justice Minister Midori Matsushima faces the error of her campaigning ways in the Lower House on Oct. 15. | KYODO

Former Justice Minister Midori Matsushima faces the error of her campaigning ways in the Lower House on Oct. 15. | KYODO

With almost breathless speed, two of Prime Minister Shinzo Abe’s most recent cabinet appointments, trade minister Yuko Obuchi and justice minister Midori Matsushima, resigned after it was revealed they violated political funding laws. Matsushima’s downfall, which revolves around her free distribution of uchiwa (round fans) to voters, may have as much to do with political expediency as with breaking rules, but Obuchi’s use of funds earmarked for public use to purchase gifts and supplement recreational outings for supporters was clearly illegal.

Which isn’t to say it’s not common. As one anonymous veteran of the ruling Liberal Democratic Party — to which Obuchi belongs — told Tokyo Shimbun, the Gunma lawmaker’s problematic actions used to be a fairly normal practice in the Diet. Obuchi is accused of using her political funds, which come from taxpayers in the form of seito kofukin (political party subsidies), revenues from tickets sold for fund-raising get-togethers, and donations from individuals and groups, to supplement “theater tours” for her supporters. Obuchi’s supporters each paid ¥10,000-¥12,000 to go to Meiji-za in Tokyo to enjoy a day of stage performances. However, in her required political funds report there was an obvious discrepancy. Since 2007, the amount received from supporters for these excursions totaled ¥11.9 million, and it is deemed they cost more than ¥60 million to carry out, with the difference being ¥53.3 million that came from Obuchi’s funds.

The veteran says that such jaunts for supporters were normally arranged directly by the politician’s staff, but ever since the law became more thoroughly enforced, lawmakers have entrusted the job to travel agencies so as to divert the trail of money.

CONTINUE READING about political gifts →

How employer transportation allowances helped create commuter hell

Tuesday, October 14th, 2014

Rush hour at Yurakucho Station

Rush hour at Yurakucho Station. By nesnad [CC-BY-3.0], via Wikimedia Commons

According to the Ministry of Health, Labor and Welfare, about 86 percent of Japanese companies pay their employees’ tsukin teate, or “commuting allowance.” To many Japanese the high rate will probably be less surprising than the fact that not all companies pay it. It’s a common misconception that the allowance is somehow a legal mandate, but it isn’t.

Employers don’t have to pay their workers’ transportation expenses, but most do. In fact, as the so-called lifetime employment system that was so central to Japan’s postwar economic growth has slowly been abandoned over the past two decades, more companies have opted to either cut back on transportation allowances by limiting the amounts, or eliminating them altogether. The above figure is for regular full-time employees, and the growing trend among employers now is to hire non-regular employees, either as temps or contract workers.

But while transportation expenses are not legally mandated, they are regulated. Companies can write them off as business expenses, but only up to ¥100,000 a month per employee. If an employee’s commuting costs exceed ¥100,000 in a month, the excess is subject to tax as if it were income.

That’s a lot of money to spend on commuting, even in Japan, and, for sure, the vast majority don’t spend that much. But inadvertently or not, the tsukin teate system has contributed directly to the concentration of businesses in major cities, thus exacerbating the problem of long commutes and over-crowded public transportation.

CONTINUE READING about commuting allowances →

Foreign tourists expected to take up (some of) the slack in consumption

Monday, October 6th, 2014

Everyday low prices: Duty Free store at Narita Airport

Everyday low prices: Duty Free store at Narita Airport

According to a survey of 12,000 tourists in 2013 carried out by the Tokyo Metropolitan Government, the Chinese spend more than any other group, which isn’t surprising. What is surprising is by how much they outspend other nationalities.

On average, a Chinese visitor spends ¥191,741 in Tokyo. The average spent by all foreign tourists in Tokyo is only ¥46,546, which means Chinese spend about three times as much.

After China, the most spent is by Singaporeans (¥135,377), and then Spaniards (¥129,558). Another notable aspect of Chinese spending is that the bulk is not spend on accommodations or dining, but rather on souvenirs, about ¥122,000. The most popular area for Chinese shoppers is Ginza, because that’s where all the luxury brand stores are.

The government wants them to spend even more, and is thus expanding the list of items that foreign tourists can buy without having to pay consumption tax. Previously, consumables like food, liquor and cosmetics were not exempt from CT when bought by foreign tourists at stores in Japan, but since Oct. 1 they are.

CONTINUE READING about new duty-free lists →

Rice is nice when the price is right

Wednesday, October 1st, 2014

Early birds: Harvesting rice crop in northern Chiba prefecture in September

Early birds: Harvesting rice crop in northern Chiba Prefecture in September

The main rallying cry of those opposed to the Trans-Pacific Partnership negotations, such as JA (National Federation of Agricultural Cooperative Associations), is that Japan can no long feed itself with the food it produces, since its self-sufficiency rate is a meager 39 percent. But as attorney Colin P.A. Jones recently pointed out in his Japan Times “Law of the Land” column, this figure is misleading since it measures food consumed in calories.

In terms of production, Japan’s self-sufficiency rate is 65 percent. Moreover, in terms of total volume of food produced, Japan is fifth in the world. The point is, Japan produces plenty of food for itself, and it also imports lots of food. It is a wealthy country by any measure. However, its agricultural sector is lopsided in that it doesn’t produce food in a way that matches demand.

Rice is the culprit. Even without American threatening their livelihood with shiploads at the ready of cheap short-grained rice, farmers in Japan are already seeing prices drop precipitously. There is just too much rice being produced, despite the fact that the government still pays farmers not to produce so much.

According to Tokyo Shimbun the problem started in 2011 after the Great East Japan Earthquake destroyed much of the crop in the Tohoku region, a major rice-producing region. Consequently, rice stocks became low and the price skyrocketed. This situation lasted through the 2012 harvest. As a result, restaurants and prepared food makers cut back on the amount of rice they used. But by the middle of 2013, stocks of rice had increased to the point of a surplus, and a bumper crop was produced in the fall. But demand didn’t follow suit and the surplus grew considerably. Again, the situation remained unchanged and the price has been dropping steadily since then to the point where it’s lower than it was before the earthquake.

CONTINUE READING about domestic vs. foreign rice →

Annals of Cheap: Eco Rent-a-car

Monday, September 22nd, 2014

All you need to know: Sign outside Eco Rent-a-car office in Ota advertising prices

All you need to know: Sign outside Eco Rent-a-car office in Ota advertising prices

Since selling our car some years ago we’ve made do with public transportation, bicycles and our own four feet to get around, even after we moved out of the city. It hasn’t been as much of a hassle as you might think, but, then again, we’re easy about such things. Still, once in a while you need a car.

Several weeks ago we had to go to Ota in Gunma Prefecture to do some research. Ota is the home of the manufacturer Fuji Juko, whose most famous product is Subaru automobiles. Our mission in Ota would take us to two locations, and since we don’t have a car we had to play out our itinerary beforehand to make sure we would be able to get around. Getting to Ota from where we live wasn’t a problem at all. From Kita Senju in Tokyo, which is convenient from where we live, we caught the Tobu express train to Ota and got there in about an hour.

Our first destination in the city itself was on another local Tobu train line that connected to Ota Station, but there is only one train an hour. That station is 5 km from Ota Station, so walking was not a desirable option. The bus system also seemed dodgy, which is often the case in towns where large car makers are the main source of employment. Sometimes you can rent bicycles near a station, and they usually cost between ¥1,000 and ¥2,000 for two hours or so, but usually it’s a place that receives a lot of tourists, which doesn’t describe Ota at all.

We considered taking a taxi and estimated that the first leg of our trip would cost at least ¥3,000. When we were finished with our research at that location, we would have to call another taxi to take us to our second destination. Of course, when you order a taxi in Japan by phone they tack on an extra fare segment. We figured it might cost ¥5,000 to get to the next place, so that would already be ¥8,000 even before we found a way to get back to Ota Station for the return trip home.

So we decided to rent a choinori (short drive) car and almost accidently came across Eco Rent-a-car, which we’d never heard of but happened to have an office right at Ota Station. Much more interesting than the location, however, was the price: ¥980 for three hours. Was that right? There had to be some sort of catch, even if it was for the smallest model, a mini-car (k-car, in Japanese). You even got a 5 percent discount if you reserved online, so we did. Naturally, all the cars Eco provides, including an electric model, are made by Subaru.

CONTINUE READING about Eco Rent-a-car →

Mail order scofflaws are the exception that proves the rule

Monday, September 15th, 2014

The gods know if you're honest: An unmanned farm stand in Inzai

The gods know if you’re honest: An unmanned farm stand in Inzai

A recent article in the Asahi Shimbun described a small cross section of consumers who take advantage of a peculiar aspect of mail-order sales in Japan. Some small- and medium-sized sales agents who do their business over the Internet have problems with customers who don’t pay. In most cases, Internet and mail order sales are done on a prepaid basis: The buyer either provides credit/debit card information or makes a bank/post office money transfer prior to the item being shipped. But a few work on what can best be described as the honor system. They send the item to the buyer with a bill that the buyer pays after receiving the item. Sometimes the bill has a handling fee attached and sometimes it doesn’t.

According to the Asahi article, some people don’t pay up, and perhaps never intended to. A non-profit organization called the Mail Order Unpaid Protection Network (MOUPN), which monitors such scofflaws, estimates that mail-order sales companies lose about ¥20 billion a year to such people.

Asahi, in fact, found one, though he seems reluctant to admit it. In the article, a reporter visits an unnamed man “in his 50s living in an apartment in Tokyo.” The man receives an order of green tea by courier, but the reporter notes that the name on the package is that of a woman. “I made the order on behalf of a friend,” the man explains. When asked why he didn’t use his real name, the man doesn’t answer. Other packages arrive addressed to different women. When asked what’s in one of them the man shrugs and says, “Maybe food?” He insists that he will pay for it but usually “just forgets.”

CONTINUE READING about abuse of Japan's honor system

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