public debt

[Doug Henwood]

[Bounced bec of an address oddity. Enrique's right; Japanese gross 
debt levels are very high, but much of that debt is held by the 
postal savings system. Debt in public hands is 39% of GDP, a hair 
greater than the U.S., which has the lowest net debt of the G-7 
countries. Net interest payments are just 1.4% of GDP, the lowest in 
the G-7; the U.S. is 1.5%, Germany is 3.2%, and Italy 7.0%.]

Date: Sat, 11 Dec 1999 12:03:28 -0500
From: Enrique Diaz-Alvarez <enrique at ee.cornell.edu>

Michael Pollak wrote:


>  On Tue, 7 Dec 1999, Daniel Davies wrote:
>
>  > >Gross debt is already 130 per cent of
>  > >gross domestic product, the worst in the Organisation for Economic
>  > >Cooperation and Development, and rising fast.
>  >
>  > AAAAAAAARRRGHHH!!!!  If I see one more repetition of this meaningless damn
>  > statistic, I swear I'll eat my own trousers in frustration.  The Gross debt
>  > of Japan, compared to the flow of GDP, is a number which is utterly
>  > uninformative about Japan's ability to pay its debts.
>
>  It isn't?  How come?  And be gentle, it's my first time hearing this.
>  But I'm eager to learn.

If I understand it correctly, a huge chunk of that 130% is made up of "pension
liabilities" and such. In other words, IOUs that the Japanese government(s) and
government entities write to themselves and each other. Publicly held debt is
more like 40% or so.


>
>
>  BTW, what would be a good measure of an OECD country's (in)ability to pay
>  its debts?  Do you mean all that guff about 130 percent being such a bad
>  thing for Italy and Belgium and Greece is just that, guff?

I think _publicly held_ debt is the key measure.


>
>
>  Michael
>
>  __________________________________________________________________________
>  Michael Pollak................New York City..............mpollak at panix.com

________________________________________________________

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