Abstract

Currently, Japan is considering raising defense spending to twice the current level in five years. There are two possible ways to finance this increase: raising taxes and issuing government bonds.

Those who argue for higher taxes seem to believe that the economy will eventually grow even if taxes are raised, and that the Japanese economy will eventually revive even if taxes are temporarily increased.
In contrast, those who argue that the government should issue bonds believe that raising taxes will stop economic growth. They seem to believe that the economy should always grow and that no policy should prevent it from doing so.
Underlying these seemingly contradictory views is the assumption that sustained economic growth is a given.

But this assumption itself may be wrong.
The reason the world has been able to issue large amounts of government bonds since the early modern period is based on a prerequisite that the economy will grow. However, with Japan's population now declining and the world's population likely to decline in the near future, it is doubtful whether economic growth can be expected. This book even questions the possibility of a crisis brought about by the excessive debt of Japan and other world economies.

Author’s Information

Professor, Faculty of Economics, Kyoto Sangyo University. Specializes in modern European economic history.
Born in Osaka in 1964. D. in Cultural History at Doshisha University.
He is the author of History of European Hegemony and Europe: A History of Prosperity in the 19th Century(Chikuma Shinsho), The Birth of Modern Europe and The Rise and Fall of the Maritime Empire (Kodansha Sensho Metier), The Rise and Fall of the 'Information' Empire" (Kodansha Gendai Shinsho), The Formation of Modern Europe (Sogensha), Diamond: A Global History of Desire (Nikkei Publishing Inc). A Complete Economic History of Commissions and Logistics(Toyo Keizai Inc.), and etc.