Lunch with the FT: Paul Krugman

The conversation turns to the Japanese crisis of the 1990s. In retrospect, I suggest, the Japanese seem to have managed the aftermath of their crisis quite well.

He agrees. “What we thought was that Japan was a cautionary tale. It has turned into Japan as almost a role model. They never had as big a slump as we have had. They managed to have growing per capita income through most of what we call their ‘lost decade’. My running joke is that the group of us who were worried about Japan a dozen years ago ought to go to Tokyo and apologise to the emperor. We’ve done worse than they ever did. When people ask: might we become Japan? I say: I wish we could become Japan.”

Read the whole story by Martin Wolf via FT

Krugman Update: Here’s the employment-population ratio of men 15-64 in Japan and the United States since 1991, when Japan’s woes are often considered to have begun. Why men as opposed to both sexes, and why the age limitation? Basically, to abstract from social change and demography — Japan has lagged the US in terms of women in paid labor, and also of course has a rapidly aging population. I don’t mean to suggest that only prime-age men matter; this is just a relatively clean indicator. And here’s what it looks like:

Source: OECD i-Library

For all its woes, Japan has never experienced the kind of employment collapse we’ve suffered. That’s the sense in which we’re doing far worse than the Japanese ever did.

So as I said, in a way Japan is no longer a cautionary tale; it’s still a lousy story, but compared to us it almost looks like a role model.

Advertisements

About James Crist

How do we stop America's decline? The country is in trouble and we can all feel it. Where did we go wrong? How do we fix it? We now have an auction-based government, for sale to the highest bidder. Politicians have become nothing more than corporate whores and pawns for the rich. If we want our representatives to represent us, let them get their campaign money from us, their constituents. We have to amend the constitution to get the big money out of politics.
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s