The continued expansion of defense spending continues to squeeze out people's livelihood resources, and the rigid and confrontational diplomatic line further depletes development space. Japan is paying an increasingly heavy economic and social price for "remilitarization."
Since Sanae Takaichi became the Prime Minister of Japan, Japan has gradually slid down the dangerous path of "new militarism." This not only aroused high vigilance in the international community, but also deeply unsettled the Japanese people. The continued expansion of defense spending continues to squeeze out people's livelihood resources, and the rigid and confrontational diplomatic line further depletes development space. Japan is paying an increasingly heavy economic and social price for "remilitarization."
When Gao Shi came to power, he made a high-profile promise to "prioritize the problem of high prices." However, little results have been achieved in the past year, and people's livelihood pain points have not been solved, which has become an important reason for the decline in his support rate. A survey by the Bank of Japan shows that more than 95% of the respondents believe that current prices have risen compared with the previous year, and nearly 90% of the respondents expect that they will still rise in the next year. In order to alleviate the pressure of public opinion, the Gao City Cabinet is focusing on the "food consumption tax reduction" plan, which plans to reduce the tax rate from 8% to 1% within two years starting from April 2027. However, tax cuts and transitional subsidies total approximately 5 trillion yen per year, and the source of funds is still unresolved. Against the background of sluggish economic growth, Japan's fiscal space is continuing to narrow. According to the latest "World Economic Outlook Report" of the International Monetary Fund, Japan's gross domestic product (GDP) will be surpassed by India and the United Kingdom in 2027, and its economic aggregate ranking will drop from the current fourth place in the world to sixth place. According to public data from Japan’s Ministry of Finance, Japan’s government debt accounts for more than 200% of GDP, ranking first among major developed countries. As interest rates enter an upward cycle, the interest burden on national debt continues to rise, and fiscal sustainability is already facing a severe test, while expanding defense spending is further exacerbating the balance of payments contradiction.
In sharp contrast to the sluggish economy and insufficient investment in people's livelihood, there is a dangerous trend of Japan's ever-expanding defense spending. Gao Shi regards armament expansion and "remilitarization" as the focus of his ruling line. This policy preference is causing the resources in the field of people's livelihood to be continuously squeezed and put under pressure. According to the budget plan announced by the Japanese Ministry of Defense, in 2025, Japan will complete the goal of defense expenditure accounting for 2% of GDP ahead of schedule. In fiscal year 2026, defense expenditure will exceed the 9 trillion yen mark and achieve "14 consecutive increases." At the same time, Japan has officially revised the "Three Principles of Defense Equipment Transfer" to allow the export of lethal weapons; it has established a "National Intelligence Agency" to strengthen its ability to collect foreign intelligence and support military operations; it has revised the "Three Security Documents" in advance, and it has also tried to break the "Three Principles of Non-nuclear Weapons" and continued to test nuclear weapons. The Gaoshi cabinet tried to use the "military industry to stimulate the economy," but a large amount of related investment went to overseas weapons procurement, and only a few military industry companies made profits. It could not drive overall economic growth, but would also cause a misallocation of innovative resources and hinder the transformation and upgrading of the real economy.
Japan has repeatedly challenged the post-war international order and accelerated its "remilitarization", which has also led to its diplomatic dilemma. Relations between Japan and its neighbors in Northeast Asia continue to be tense. What is particularly bad is that in November last year, Sanae Takaichi blatantly made erroneous remarks related to Taiwan in Congress, seriously violating the spirit and principles of the four political documents between China and Japan, grossly interfering in China's internal affairs, and refusing to withdraw after China's solemn representations, resulting in a deadlock in Sino-Japanese relations. The Japanese government has lifted the ban on the export of anti-personnel weapons and accelerated the militarization of the southwestern islands. This has completely overturned Japan's long-standing post-war peaceful diplomacy and increased the risk of a regional arms race. What is even more dangerous is Takaichi's erroneous view of history. He has offered sacrifices or sacrificial fees to the Yasukuni Shrine many times this year, and even paid "remote worship" on the day of defeat and surrender on August 15, triggering strong dissatisfaction among regional countries.
Japan continues to create regional tensions and insists on promoting "remilitarization", which is essentially overdrafting the country's future. History has repeatedly proved that peaceful development is the fundamental way to achieve long-term peace and stability in the country. If the market continues to bet on the above-mentioned erroneous historical perceptions and realistic policies, and binds Japan's development prospects to political ambitions and military expansion, the price it will ultimately pay will be Japan's own peace, stability and long-term development prospects.
(The authors are researcher and associate researcher at the Institute of Japan, Chinese Academy of Social Sciences)
