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Obama- Look to Japan's "Lost Decade" before you stimulate

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Posted

All the stimulus pork aside, I wanted to expand on the thread Jase started about the U.S. making the same mistake Japan made in the 90's. This Wall Street Journal article gives a nice recount of Japan's attempt to stimulate the economy through public works investment.

In the Age of Obama, we seem fated to re-explain these eternal lessons. So for today we thought we'd recount the history of the last major country that tried to spend its way to "stimulus" -- Japan during its "lost decade" of the 1990s. In 1992, Japanese Prime Minister Kiichi Miyazawa faced falling property prices and a stock market that had sunk 60% in three years. Mr. Miyazawa's Liberal Democratic Party won re-election promising that Japan would spend its way to becoming a "lifestyle superpower." The country embarked on a great Keynesian experiment:

http://online.wsj.com/article/SB122938932478509075.html

If President Obama wants to avoid being the next Japan, then don't make the same mistakes Japan made.

(On a personal note) Have you ever heard a President say "uh" so much during a speech/press conference?

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Posted

Lets invest in a highway project five years down the road instead of giving a payroll tax break to every American tomorrow. Don't know about you, but I'd rather see my payroll tax go down 8% for good than receive a check for $1K.

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Posted

I am pretty sure the best economic minds in the country tops your google power. I could be wrong.

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Posted

so Dems went from feeling the need to challenge and investigate every word said by the federal govt. to telling people to sit back and listen to their every word without questioning. how sensible

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Posted

I am pretty sure the best economic minds in the country tops your google power. I could be wrong.

I don't doubt their minds, I doubt their intent :( (not Obama I think he means well)

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Posted

I doubt their intent...

Yes, it's called "hands in the till" syndrome... many politicians suffer from it.

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Posted

I am pretty sure the best economic minds in the country (who tell Obama what he wants to hear) tops your google power. I could be wrong.

Fixed it

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Posted

I am pretty sure the best economic minds in the country tops your google power. I could be wrong.

Can't argue with the facts from a situation very similiar to what we are going through. But please, keep the wise cracks coming about google.

And by the best economic minds in the world, you mean Senators and Congressman, I think you are in fact wrong and naive. Economists are split on the idea that this stimulus is the way to resurrect the economy.

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Posted

I think Sweden would be the better model.

Japan's biggest problem was propping up the "zombie" banks due to the complex innerworkings of Japanese banking and culture and a strong good ol' boy network, not bridges and highways.

If they just try to pump in money without fixing any of the problems, yes it will look an awful lot like Japan.

You got to fix the leak before you can successfully bail out all the water.

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Posted

Sweden has better looking models. Yes.

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Posted

If they just try to pump in money without fixing any of the problems, yes it will look an awful lot like Japan.

Sounds kind of like what Pelosi and Pals were trying to do. At least Obama called them on it. His biggest mistake was giving this bill to Pelosi to author.

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Posted

I often look at Japanese before stimulating my package.

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