> Japan isn't an autarky. Don't you think that the problem of
> over-production is behind the Asian woes, of which currency problems,
> Japan's liquidity trap, etc. are merely symptoms? As for the worldwide
> deflationary pressures, I'm thinking of the dead weight of debt,
> neoliberal > policies, & commodity prices.
The short answer to the first question is no. First, by 1997, the region's economies were different enough that there was no single fundamental model that would explain all or even most of their situations. Second, the "currency problems" were not merely symptoms of over-production. The appreciation of the dollar against the yen precipitated a fall in export growth around the region in 1996. If anything, at that moment, problems of overproduction were a symptom of monetary problems. The crisis--at least as it landed in Korea and Thailand--had to due with the maturity structure of debt, not with the so-called "fundamentals," much as the IMF tried to assert this opinion during the clean-up phase.
I'm curious as to why you think of debt as "dead weight." Debt is a social relation, and a pretty dynamic one at that. The fact that the U.S. has taken on the amount of public debt (in the 80's) and private debt (in the late 90's) is probably not a sign of its weakness, in this context, but its strength (something Susan Strange argues), albeit in different ways at different times. That it also might come to bite the US in the ass is no doubt true, but this debt tells you as much about the US' ability to inspire speculation as it does about its economic fundamentals. Now, whether or not you think that Japan's debt is a sign of strength or not, the fact is that they have had no trouble selling trillions of yen worth of bonds with a return of 1.8%. Could be a sign of desperation. That wouldn't also preclude it from "working" in some way or another.
> The Old Guard LDP machine politicians like Kamei have lost hegemony (over
> national economic policy, I mean), as far as I can see. Rural
> conservatives are now expendable when there is no Red menace. Leftists
> (such as they are) seem clueless. A new settlement has yet to emerge.
> Isn't that why the Japanese fiscal stimuli are a sputtering, on-and-off
> affair? What the ruling class -- who, unlike machine politicians, are no
> fan of public works -- now want is to use the present problem to
> restructure the labor market.
Undoubtedly true, in some sense. The Ministry of Finance may indeed want to appear to be doing something in the short run, but by publicizing public works projects that don't take place, they also seem to want to eliminate fiscal policy in the long run. Are they genuinely concerned about the hardship that debt will mean for older Japanese? Or do you also get the sense that Japan's ruling class is genuinely in disarray, in a way that the U.S.' hasn't been for decades?
Christian