Early last month a masked man wearing a lamé cloak and a silver turban, decorated with half-moons and stars, sat down outside the Japanese Ministry of Finance (MoF). He announced that he would set himself on fire to protest the use of ¥685 billion ($6.5 billion) in taxpayers' money to bail out insolvent housing loan corporations (jusen).
The man's bizarre suicide threat is just the most dramatic example of the widespread protests in Japan - including a protracted sit-in by opposition MPs in parliament - over the government's rescue of the jusen.
But such protests miss the bigger picture: Japan's public finances are in general disarray. The one-off bail-out of the jusen represents only a tiny part of the problem. Far more worrying is the total size of Japan's growing public debt. The government will spend ¥16.4 trillion in 1996 alone to service this debt. Because of falling tax revenues and a politically motivated tax cut in 1994, the proportion of revenues raised through bond issues will leap from 17.7% in fiscal year 1995 (ending March 31 1996) to 28% in FY1996.
Economists see disaster looming in the Japanese government bond (JGB) market unless new sources of tax revenue are found.