> in Japan. However, private borrowing for the purposes of capital expansion
> is drying up in Japan as indebted firms try to pay down their debt;
> consequently, domestic demand remains weak (though presently stimulated by
> the huge infusion money into the banks lent back to the govt for the
> purposes of the artificial stimulus of deficit spending--when it
> dissipates, the yen could go into a nosedive). Japan must export to the US
> market and thus must park yen in US denominated assets just to balance the
> books
They're not paying down their debt, because Japan Inc. is so hyperleveraged they could never, ever possibly pay it off (private sector debt is something like over 200% of GDP); even trying to do this would result in a 1931-style GDP collapse. That hasn't happened, and will not happen, because Japan is *refinancing* their high-interest debt with low-interest debt. Also, Japan doesn't really need US markets as much as you might think; Asia is the biggest trading region for Japanese firms, and the EU is significant, too (though not as significant as the US).
> You continue to raise the specter of some evil Japanese plot to buy up and
> control the American economy
Japan didn't plan to become a superpower any more than the EC-turned-EU. It just happened, for good historical reasons we Leftists should pay close attention to.
> not be counting up the balance of power correctly. The international
> financial structure favors the US whose finance industry, along the with
> the UK's, enjoys intl hegemony.
The USA has the Bubble; the EU and Japan have the banking assets. We'll see which is a better long-term strategy, won't we?
> In our previous debate, I don't think you were able to show that Japan
> enjoys any kind of overall monopoly over leading edge technological inputs
> (James Galbraith's innovative capital goods) into the production process.
This confuses technology with accumulation structures here, i.e. an innovative product (say, Intel's Coppermine chip) with larger processes of technological innovation (science, R & D, education etc.). Leading edge tech in the US is still closely tied to the military-industrial complex, which is a long-term problem for US capital; East Asia and the EU have state-industrial complexes and refined industrial policies, which made a mint by "learning from the best and exporting to the rest". In the Seventies, EC firms didn't even have digital telecom technology, if I recall aright; East Asian firms produced only basic electronics components. But they had structures which enabled them to catch up and surpass the US on a number of levels. Sure, former metropoles can continue to excel in specific niches: a hundred years after the height of its Empire, Britain still produced the world's leading jet engines, pharmaceuticals and luxury cars. But UK capital is clearly second fiddle these days to the power, might and glory that is Eurocapital, n'est-ce pas?
-- Dennis