Japan's PM to stay on, focus on trade negotiations

Summary

Marketplace Morning Report: Japan's PM to Stay On, Focus on Trade Negotiations

Release Date: July 21, 2025
Host: Marketplace, Luke Wilson

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Japanese Prime Minister Shigero Ishiba Remains in Power Amid Election Defeat

Overview:
Japanese Prime Minister Shigero Ishiba faced a significant setback as his governing coalition lost its majority in the upper house of parliament. Despite the bruising election results, Ishiba announced his intention to remain in power, citing pressing economic and trade issues that necessitate his continued leadership.

Detailed Insights:
In a recent election, Prime Minister Ishiba's coalition failed to maintain control over the Japanese Senate, following a loss of dominance in the lower House of Representatives last October. This loss is described by Ishiba as a "harsh verdict" on his administration's performance (01:02).

Shaima Khalil of the BBC World Service highlights the challenges ahead for Ishiba, noting his "consistently low approval ratings" and internal party discontent regarding his leadership (01:42). Ishiba emphasized the urgency of addressing rising inflation and navigating Japan's tense trade negotiations with the United States, particularly the looming deadline for a 25% tariff imposition.

Key Quote:

"There are too many pressing issues to resign." – Prime Minister Shigero Ishiba (01:32)

Political Landscape:
The Sansetto Party, appealing to younger voters through social media, has made notable gains. Their hardline stance on immigration and foreigners has resonated with conservative segments, though it has been criticized as xenophobic.

Expert Commentary:
Taro Kono, a member of Ishiba's ruling party and former Foreign and Defense Minister, criticized the government's approach to inflation:

"We have had the wrong policy tackling the inflation. We should have asked the Bank of Japan to raise the interest rate. So yen would be stronger." (02:41)

US-EU Trade Negotiations Approaching Critical Deadline

Overview:
With only ten days remaining before President Trump's pause on reciprocal tariffs expires, the United States and European Union are intensifying efforts to finalize a trade deal. The impending 30% tariff on European goods, set for August 1st, has heightened tensions and prompted retaliatory threats from the EU.

Detailed Insights:
Japanese markets reacted modestly to the election results, with the yen strengthening by 0.2%, while BP's shares saw a slight uptick following the appointment of Albert Manifold as its new chair (03:07). The US Commerce Secretary expressed confidence in securing a trade agreement with the EU before the hard deadline:

"August 1st is the hard deadline." – US Commerce Secretary (03:58)

Suranjana Tiwari from the BBC reported that South Korean negotiators are also in Washington, aiming to negotiate reduced tariffs rather than complete elimination:

"The goal is not to get rid of tariffs, but to lower them." (03:58)

Potential Outcomes:
Failure to reach an agreement could result in the EU imposing its own tariffs on US goods, ranging from Boeing planes to bourbon whiskey, escalating the trade conflict further.

Soaring Childcare Costs Spark Bipartisan Support for Financial Relief

Overview:
Rising childcare expenses in the United States have become a significant burden for families, surpassing inflation rates and leading to bipartisan calls for increased financial assistance. The recent spending package has made strides, but challenges remain substantial.

Detailed Insights:
Monica Miller from the BBC delves into the personal impact of high childcare costs through stories of American families in Pennsylvania. Families like the Harrisons and Dublin Gleckler face monthly childcare expenses upwards of $4,000, forcing difficult decisions between financial strain and professional commitments (04:33).

Elliott Haspel, a senior fellow at the Family Policy Lab, emphasizes the dual-income necessity for many households:

"I like to work, but I also. We're a household that I think relies on two incomes." (06:31)

The Bank of America reports that the average family's childcare costs have increased by more than a third since 2019, driven by inflation and reduced availability of childcare services post-COVID-19.

Policy Landscape:
Unlike many industrialized nations, the US allocates only 0.3% of its GDP to pre-kindergarten childcare, significantly lower than the 0.7% average and far below countries like Iceland and Sweden. However, there are emerging signs of bipartisan support for enhancing financial relief to families. Sarah Ritling from the First Five Years Fund notes glimmers of hope in congressional discussions:

"Once we get on the ground and you're in communities and actually when you're in the halls of Congress, there are really good glimmers of hope." – Elliott Haspel (07:21)

Future Prospects:
Advocates are pushing for expanded paid parental leave and increased public funding to make childcare more affordable and accessible, aiming to alleviate the disproportionate burden on mothers and support dual-income households.

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Conclusion:
Today's Marketplace Morning Report provided a comprehensive overview of critical global and domestic issues, from Japan's political landscape and international trade tensions to the pressing economic concerns facing American families. Through insightful reporting and expert analysis, listeners are equipped with a nuanced understanding of the factors shaping today's economic and political arenas.

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For more detailed discussions and updates, tune into the Marketplace Morning Report on the BBC World Service.

Transcript

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[Luke Wilson]

Lead to a bruising election defeat for Japan's prime minister, but he says he's not going anywhere Live from the BBC World Service, this is the Marketplace Morning Report. I'm Luke Wilson in for Liana Byrne. Good morning. Japanese Prime Minister Shigero Ishiba has described the result as a harsh verdict. His governing coalition lost its majority in the upper house of parliament, their Senate, after losing control of the more powerful lower house of representatives last October. Mr. Ishaba says with the threat of extra US tariffs and rising inflation, there are too many pressing issues to resign. The BBC's Shaima Khalil reports from Tokyo.

[Shaima Khalil]

This is a painful blow to a leader who's now lost control of Japan's legislative process and who's struggled with consistently low approval ratings since he took office in October. While there is discontent within the ruling party itself about his leadership, the prime minister will remain in power, albeit significantly weakened. Mr. Ishiba said. The government faces a tough road ahead with with Japan's tense trade negotiations with the US and the deadline for a 25% tariff fast approaching. Tackling rising prices has been a major concern for voters who've criticized how slow the government has been in dealing with inflation. The populous Sansetto Party, which has been using social media to attract young voters, has made significant gains. The right wing party's Japanese first slogan has struck a chord with many conservatives online, although its hardline stance on foreigners and immigration has been described as xenophobic.

[Luke Wilson]

Shaima Khalil there, Taro Kono, is a member of parliament for Mr. Ishiba's ruling party and a former Japanese foreign minister and defense minister.

[Taro Kono]

We have had the wrong policy tackling the inflation. We should have asked the bank of Japan to raise the interest rate. So yen would be stronger. Right now yen is very weak. So, so weak yen resulted in higher price for whatever we import. We should have stand firm and talk to the bank of Japan, but we didn't do that. So that was a wrong policy.

[Luke Wilson]

Japanese Parliament Member Taro Kono let's do the numbers. Japan's markets are closed today for a holiday, but the yen has strengthened following that election result, up 2/10 of a percent. Meanwhile, shares in BP are up a quarter of a percent after the oil giant named its new chair. Albert Manifold is the former CEO of the New York listed construction company CRH. There's now only 10 days left on President Trump's pause on his so called reciprocal tariffs. And with the prospect of no deal looming, the European Union is ramping up efforts to avoid their goods being hit. A 30% tariff on all European goods is due to come in on August 1st. The EU has threatened to retaliate with their own taxes on US goods from Boeing plains to bourbon whiskey if a deal can't be made. The BBC Suranjana Tiwari has more.

[Suranjana Tiwari]

The US Commerce Secretary over the weekend saying that he was confident that the United States can secure a trade deal with the European Union before the deadline. He also said that August 1st is the hard deadline. They've extended that deadline quite a few times, but it seems that they're sticking to the August 11 deadline. And we also hear that South Korea's team of negotiators has headed over to Washington in order to try and strike a deal, although the chief negotiator says that the goal is not to get rid of tariffs, but to lower them.

[Luke Wilson]

Suranjana Tiwari if you're a parent, you are likely well aware that paying for childcare is expensive. With the costs in the U.S. outpacing inflation, both Republicans and Democrats say more financial help is needed. The spending package did something towards this end, but it's still hard. Here's the BBC's Monica Miller.

[Monica Miller]

It's dinner time at the Harrisons House in the suburbs of Philadelphia, Pennsylvania. Alison and her husband have three baby high chairs lined up in a row for their one year old triplet daughters. She's a primary school teacher at a government funded school and wasn't given much time off before the girls were born. I worked up until the Wednesday and.

[Shaima Khalil]

I had the girls Friday. I was not able to take leave before.

[Monica Miller]

I would have had to take my sick time. Unlike most countries, the US does not have paid parental coverage. There's the family and Medical Leave act, which allows 12 weeks off unpaid after the birth of a child or an adoption. But some states like California and New York have put into effect mandatory paid parental leave programs. And some companies also offer their own programs for new parents.

[Suranjana Tiwari]

Are you gonna see thunder?

[Monica Miller]

A few towns away is Sydney Gleckler. She has a four and a half year old daughter and eight month old twin girl. Her job in the pharmaceutical industry is hybrid, so she works from home a few days a week.

[Elliott Haspel]

We're really lucky that we had the amount of leave that we do.

[Monica Miller]

Both she and her husband's employers offered parental leave which helped. When the babies were young. They considered putting them in full day childcare, but it would have cost roughly $4,000 per month. The bank of America has found that the average family's child care costs more than a third greater than 2019. That's due to inflation and reduced childcare help during the COVID pandemic. Given that the responsibilities traditionally fall disproportionately on mothers, many of them are torn between spending a large portion of their salary on care, cutting back their hours or quitting their jobs.

[Elliott Haspel]

I like to work, but I also. We're a household that I think relies on two incomes.

[Monica Miller]

Since the pandemic, American families pay more than their rent for full time care of a child under the age of five. Elliott Haspel is a senior fellow at the Family Policy Lab at the think tank Capita.

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Different in the US than most other countries is there's very little public funding that comes in to defray those costs.

[Monica Miller]

The US spends roughly 0.3% of its GDP on childcare in pre kindergarten. That's compared to the average 0.7% of other industrialized nations and 1.9% in Iceland and Sweden. But some child care advocates in the US say there are signs of bipartisan support to offer some financial relief to families. Sarah Ritling from the First Five Years Fund.

[Elliott Haspel]

Once we get on the ground and you're in communities and actually when you're in the halls of Congress, there are really good glimmers of hope.

[Monica Miller]

Both Republicans and Democrats have made it clear that they need more support to raise their young children. I'm the BBC's Monica Miller for Marketplace.

[Luke Wilson]

That's all from us this morning. I'm Luke Wilson with the Marketplace morning report from the BBC World Service.

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