If a single big company fails then you have an instant drop in tax receipts and a rise in benefits. The communities in which the business is located instantly suffers which then flows through to supporting businesses also going under. All of which puts immediate pressure on the job market as you have lots of skilled people looking for work.
And nobody is saying that problems associated Japan's shrinking population of working adults are going to manifest immediately. It's a long term macroeconomic trend which when you combine with an ageing population means significant structural risks. Every Western country e.g. UK, US, Australia, Europe all have quite sizeable immigration rates purely to cater for these risks.
Yes. Because you're making the assumption that fewer jobs is a bad thing even though the number of people who actually need jobs is going down.
Is that such a difficult concept to grasp?
>If a single big company fails then you have an instant drop in tax receipts and a rise in benefits.
Not true. Again, Japan has a 3.1% unemployment rate. It's a lot easier to find a job in Japan than it is to find a job in the US, where we've seen between a million and two million immigrants a year for decades.
In terms of tax receipts, again, tax receipts go down but you have less to spend money on. Fewer schools, less road work, fewer prisons. Particularly in a culture where the family takes care of aging relatives, I don't see this as a big budgetary calamity.
>And nobody is saying that problems associated Japan's shrinking population of working adults are going to manifest immediately.
Why not? Why wouldn't we see at least some trending along these lines?
>Every Western country e.g. UK, US, Australia, Europe all have quite sizeable immigration rates purely to cater for these risks.
The risks they're trying to mitigate aren't the ones you think they're trying to mitigate. If you're running a large corporation a shrinking population scares you because it means rising labor costs and a smaller market for your goods. So you use your influence to make sure the government allows a lot of immigration.
Since I'm not running a multinational corporation the national GDP doesn't matter that much to me. What matters is how much I get paid, how high my taxes are, and how much things cost. I'd rather have fewer neighbors who share my culture than a higher GDP.
When enterprise is not so centralized, little firms fail all the time, and are quickly replaced by other little firms. OTOH in the Japan/Korea situation (and with TPP etc., probably USA in the near future), ineffective organizations hide within bigco's indefinitely, consuming resources in inefficient, anticonsumer fashion.
For a country with a ton of Government debt and a society dominated by small number of big companies that's a bad thing.