That generally is what has happened with the tax rebates already granted. Indeed, some critics charge that the merchandise vouchers will do little to spur consumer spending, the economy's lifeblood. They point out that people could use the coupons to buy items that they would have purchased anyway. Unless the government can convince consumers that good times are on the way, the proposed tax cut likely will end up in the bank or under the mattress rather than in merchants' cash drawers. While the cabinet discusses the form of tax breaks, a debate rages over the effectiveness of central government stimulus packages.
Critics argue that the current system needs to be overhauled.
MITI analysts say, however, that the package has done little more than help the economy tread water. Thus, MITI supports putting together a new fiscal package that would dwarf the last one. Critics counter in part, however, that Tokyo relies on local governments to fulfill a major part of stimulus packages and that they have not fully discharged this responsibility. Local governments reportedly have spent less than half of what the plan calls for. Prefectural and municipal authorities are strapped for cash because the recession has eroded tax revenues.