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International News Title: Why Stimulus Fail- Japan Lot's of talk on LF about needing more stimulus. Many Obama supporters keep saying,"Well, what do you propose?". Sorry, if stimuli worked Japan would be the richest nation on earth. Consider the following: http://www.businessandmedia.org/articles/2009/20090107152856.aspx Repeating Japan’s Mistakes The media should be showing how government stimulus doesn’t work, as Japan found out in the 1990s. At the end of the 1980s, the Japanese economy experienced an asset bubble, which resulted in the crashing of their economy. To remedy the situation, the Japanese government employed a Keynesian strategy to stimulate their economy. “Between 1992 and 1995, Japan tried six spending programs totaling 65.5 trillion yen and cut income tax rates during 1994,” Benjamin Powell wrote for the Ludwig von Mises Institute. “In January 1998, Japan temporarily cut taxes again by 2 trillion yen. Then, in April of that year, the government unveiled a fiscal stimulus package worth more than 16.7 trillion yen, almost half of which was for public works. Again, in November 1998, another fiscal stimulus package worth 23.9 trillion yen was announced. A year later (November 1999), yet another fiscal stimulus package of 18 trillion yen was tried.” As Powell explained, the Japanese remained persistent with their repeated efforts to stimulate their ailing economy. “Finally, in October 2000, Japan announced yet another fiscal stimulus package of 11 trillion yen. Overall during the 1990s, Japan tried 10 fiscal stimulus packages totaling more than 100 trillion yen, and each failed to cure the recession.” It didn’t work, as former senior vice president and director of research for the Federal Reserve Bank of San Francisco Michael Keran explained in a release issued by House Minority Leader John Boehner’s office on Jan. 7. “Japan in the early and mid-1990s engaged in major fiscal stimulus focused on infrastructure projects with deficits equal to 7-8% of GDP and a cumulative Debt/GDP of almost 150%. None of this led to economic recovery until the late-1990s when the Bank of Japan engaged in quantitative easing of monetary policy and the Government of Japan finally introduced a taxpayer bailout of the banks. The Fed and Treasury in the US have already taken such actions. The Japanese experience suggests that additional fiscal stimulus will only add to the Debt without helping the economy.” This has gotten very little attention from the broadcast network media, with exception of former Bush adviser, Fox News Channel’s Karl Rove, who appeared in an interview on NBC’s Dec. 2, 2008 “Today.” “Today” co-host Matt Lauer referenced a Nov. 28, 2008 Wall Street Journal piece Rove wrote that used the Japan example and asked him if he thought Obama’s stimulus was destined to fail. “He [Obama] laid some broad outlines, giving money to states in infrastructure spending and couple of other items,” Rove said. “And look, federal highway dollars, one out of every four federal highway dollars are spent in the year that they’re appropriated. Three out of four are spent years and years later. Japan put a half a trillion dollars into infrastructure spending in the decade of the ‘90s and it didn’t work in stimulating their economy.” It didn't work for Japan, it hasn't worked for the US. Enacting more stimuli and expecting different results is, by definition, insanity. It's wrong to rob from future generations and that is all you are doing.
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#1. To: Nebuchadnezzar (#0)
We actually created modern day Japan by buying and importing it's mostly worthless products after WWII after we helped set up the factories, as a form of reparations. The biggest stimulus in the world and the model the neocons still want to emulate.
"See in my line of work, you got to keep repeating things over and over and over again for the truth to sink in, to kind of catapult the propaganda." --- George W. Bush (Rochester NY, 5-24-2005)
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