Krugman sad

[Brad De Long]

>> The trouble with Japan, in other words, is that while key policymakers now
>> understand the nature of their problems, they still lack the intellectual
>> courage to act on that understanding.
>
>Good for Japan. Krugman's argument is, frankly, a bunch of neoliberal
>crap. Japan has a net surplus of 800 billion euros vis-a-vis the USA,
>has cash reserves of 2.7 trillion euros, is successfully bailing out its
>banks and granting its industrial base plenty of time and credit to
>restructure for the Long Boom...
>
>-- Dennis

Back in 1993 I would have agreed with you. But it has been a decade since
there crash: that is a long, long time for "restructuring," and it has
largely been a lost decade.

I agree that when the Japanese economy takes off it is likely to take off
like a rocket. But I'm afraid I don't believe in the magical
equilibrium-restoring virtues of the Japanese market without more
government action...

Brad DeLong