The good folks at the Reason Foundation, the non-profit that publishes Reason magazine, have been tracking the progress of serious yellow fever in the U.S. No, not that kind. Or that kind. The kind where we slavishly imitate the economic policies of Japan's Lost Decade. The kind that Paul Krugman has diagnosed:
We shouldn't kid ourselves. Japan is us.
Or, as The Vapors put it:
Anthony Randazzo digs into the nitty gritty of this comparison:
The Japanese Lost Decade was preceded by an asset boom, an over-leveraged financial system, and excessively optimistic expectations of future economic growth. Sound familiar? Then their stock market crashed, asset values plummeted, and the economy rapidly dropped into a recession with heavy unemployment. To fight back the Japanese government spent years trying to spend and borrow their way back to economic health--all to dismal results….
Despite 10 fiscal stimulus packages totaling more than $1.4 trillion (in today's dollars) and dropping their interest rates to virtually zero, all Japan got in return was debt that exceeds 200 percent of GDP.
In fact, the Reason Foundation did a big fat study[PDF] on this very issue.
For more (and more fun), check out Tim Cavanaugh's excellent round-up of Westerners rocking out in Eastern style.