On paper, the draft of the fiscal 2012 budget appears to indicate Japan has found a way to trim about ¥2 trillion in spending compared with the current year, but in reality the national debt is snowballing as bond issuance will exceed tax revenues for the third year in a row.
This wasn't how it was supposed to be. Prime Minister Yoshihiko Noda, a fiscal hawk and former finance minister, said earlier this month that it was imperative to get the country's public finances back on track.
"We need to be very aware that the market is examining if we are a nation that can maintain fiscal discipline," Noda said at a meeting earlier this month.
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