Some economists think the USA could be heading the way of Japan, with a "lost decade" and such. There are many financial similarities. Both countries tried to rescue their economies by offering near zero interest rates. It did not work in Japan, and it does not seem to be working in the USA. Both countries have suffered severe trade defecits, and both countries are in deep debt. Real unemployment in Japan is much higher than the misleading statistics the government puts out, and rents are beyond unaffordable. There is intense pressure to perform at university, those with lower marks are doomed for a life of failure. http://factsanddetails.com/japan.php?itemid=640&catid=19&subcatid=120 Suicides: http://www.timesonline.co.uk/tol/news/world/asia/article4170649.ece Homelessness: http://news.bbc.co.uk/2/shared/spl/hi/asia_pac/04/japans_homeless/html/1.stm http://seattletimes.nwsource.com/html/nationworld/2010678268_shelters03.html Even Starvation! http://search.japantimes.co.jp/cgi-bin/nn20090117a6.html http://www.asianoffbeat.com/default.asp?Display=967 Is this Japanese phenomena the future fate of Americans?
Many japanese economist believe that their current economy could have been saved if their government had not tried to solve their deficit problem. When government spending stopped their GDP evaporated.( I am not an economist, so I don't understand their reasoning in detail.) In our current economic political debate conservatives are all about curbing government spending and the idea of increased tax revenue is reviled. It is interesting that Reagan through his economic policies greatly increased tax revenue, and when questioned about the growing deficit showed little concern.
We are worse than Japan: everyone is Japan is educated and economically advantaged, while almost half of America is economically disadvantaged and uneducated. Therefore, we no longer have the ability to bounce back like Japan can, or like we did following the Great Depression.
The japanese economy has lots and lots of other variables and it failed once austerity measures were enacted. Controlling national debt did not help. The GOP at one time considered the national debt a non-issue. It wasn't until a democrat was in office for eight years that it was reduced. Was that a good thing? Will reducing the national debt help us now? Is it more important than the economy at large, is it more important than jobs? I think this is a political strategy that has no basis in real economics.
Inflating the currency to near worthlessness and pushing the country's programs into insolvency is far more of a problem compared to Short Term recessions/depressions that would follow if the Government stepped out of the way of the Marketplace.
Short Term recessions/depressions sounds great. The japanese didn't get that, at least not short term. The market doesn't care about the economy in the USA. What in the end is better- a large retirement fund or living in a country with less poverty and a better quality of life? I guess with enough money we can move.
I don't think you understand the concept of a controlled experiment. How do you know? You just stated that there were lots and lots of other variables, how do you know that keeping the debt down was not counteracted by one of them? In any case, how the debt is controlled is just as important as whether it is controlled at all. And I care because?
Our economy thrived during periods of great national debt. The debt of a country is not necessarily related to its economy. I believe this is a snipe hunt for the opposing party, not a genuine concern.
Is debt the only variable now? Which party is using this issue to the greater advantage? Which party has traditionally ignored this issue?
I think Dick Cheney once said (when escalating his fake war) that "debt doesn't matter". I'm confused. Are the republicans for or against debt?
Actually, there has been plenty of controversy amongst economists over what actually caused Japan's "Lost Decade" and what the government should have done. http://internationalinvest.about.co...ans-Lost-Decade-Brief-History-And-Lessons.htm http://www.fordschool.umich.edu/rsie/workingpapers/Papers476-500/r484.pdf It appears that the "Lost Decade" was never just a decade at all, as the problem continues even to this day! America and China should be very concerned about avoiding a repeat of this poorly understood phenomena. That is why so many economists have tried to study in detail what happened in Japan.
Japan tried "quantitative easing" too. There's intense pressure to perform academically. This girl is breaking down crying because she doesn't believe she'll have a future. Her name is Ishizuka Akari, when she had been a been a little bit younger she was somewhat of a minor celebrity, appearing in an all-female singer idol group.
