dagblog - Comments for "white death encircles the Donald"

The Donald was encircled by

Oxy Mora — Tue, 22 Mar 2016 23:08:01 +0000

In reply to white death encircles the Donald

The Donald was encircled by Wapo editorial staff and the entire interview can be accessed on the Wapo site. His lack of knowledge is really astounding. Reminds me of Couric's interview with Palin.

Krugman used to discuss this

PeraclesPlease — Mon, 21 Mar 2016 22:46:49 +0000

In reply to Yes, the story is more

Krugman used to discuss this quite a bit,

The other reason that Japan does not look like a country in the midst of a depression is that the government has found a concrete solution to the problem of mass unemployment. By ''concrete,'' I don't mean serious, hardheaded, substantial. I mean concrete, as in roads, dams and bridges.

Think of it as the W.P.A. on steroids. Over the past decade Japan has used enormous public works projects as a way to create jobs and pump money into the economy. The statistics are awesome. In 1996 Japan's public works spending, as a share of G.D.P., was more than four times that of the United States. Japan poured as much concrete as we did, though it has a little less than half our population and 4 percent of our land area. One Japanese worker in 10 was employed in the construction industry, far more than in other advanced countries.

Without those public works programs, things might have been much worse. For there is no question that enormous public spending has helped keep the economy from sliding into a true, unambiguous depression. As one Japan expert, Adam Posen of the Institute for International Economics, points out, the record of the 1990's is unmistakable. Every time the government tries to scale back its spending, as it did under Prime Minster Ryutaro Hashimoto back in 1997, the economy goes into a recession. Every time the government goes back to its free-spending ways, as it did after Hashimoto resigned in disgrace, the economy perks up a bit.

Now for the bad news: deficit spending has slowed the Japanese economy's slide, but it has not reversed it. That is, the public works programs provide only temporary, symptomatic economic relief. The favorable effects last only as long as the spending itself. They don't seem to lay the basis for a permanent turnaround.

And meanwhile, though Japan has thus far avoided mass unemployment, its policy of massive public works spending has produced many nasty side effects. One is the vast environmental damage that has been inflicted in the name of job creation. Another is pervasive corruption, as rakeoffs and kickbacks have become a way of life, distorting the whole economic and political system.

Furthermore, a decade of huge deficit spending has left Japan with an enormous public debt. Japan last ran a budget surplus in 1992. In that year, the nation's public debt was about 60 percent of G.D.P., about the average for advanced countries and slightly less than the figure for the United States. The years of deficit spending since then have pushed Japan's debt above 130 percent of G.D.P. That's the highest ratio among advanced nations, considerably worse than either Belgium or Italy, the traditional champions. It's almost twice the advanced-country average and 2.5 times the figure for the United States.

but here's someone else's article from 2008:

Here at The Daily Reckoning we’ve never met a tax cut we didn’t like. But we smell sushi. No country ever tried as much fiscal stimulus as Japan. After cutting rates down to “effectively zero,” the Japanese embarked on the biggest program of unnecessary government spending in history. With no military to waste money, it had to turn to public works. New highways to nowhere…new bridges… new rail lines, by the late ’90s, the little island of Japan was pouring more concrete than all the fifty states. It was very stimulating to cement sellers. But as to the economy…it did nothing. Here we are, 18 years later…and the Nikkei index is still down by two thirds.

Interestingly, on the way I ran across this from Financial Times:

Any discussion has to start with China, which poured more concrete between 2010 and 2013 than the US did in the entire 20th century. A reading of the recent history of investment-driven economies — whether in Japan before the oil shock of the 1970s and 1980s or the Asian tigers in the late 1990s — tells us that growth does not fall off gently.

A board manufacturer in Europe was telling me the need to go to China for what he produces is fading - automation removes Chinese advantages, and the long distances and poor communications complicate things. Is a shift nearing for Asian production?

Yes, the story is more

ocean-kat — Mon, 21 Mar 2016 21:51:04 +0000

In reply to I was more referring to Japan

Yes, the story is more complex than my brief summary. I focused on the national furor when democrats spun it to attack Palin. When you use Bridge to Nowhere it calls to mind that furor. Reasonable people can disagree whether the Gravina Bridge was a wise investment to service a rural community or made economic sense for rural development and tourism. But the hyped up language of Bridge to Nowhere was demagoguing instead of having a rational discussion of those issues.

I haven't read about Japan's infrastructure spending so I can't comment. But I agree that the money can be misspent or wasted.

I was more referring to Japan

PeraclesPlease — Mon, 21 Mar 2016 21:23:36 +0000

In reply to The whole Bridge to Nowhere

I was more referring to Japan's multiple bridges and highways to nowhere - almost every infrastructure project will have its critics, but en masse theirs were simply a way to try to futilely stimulate the economy while paving the outback. Agree that with Palin there was enough easy fruit without sexist or overblown out-of-context attacks.

[I think the Alaskan bridge was more seen as Murkowski's patronage, and it looks like Palin cancelled Alaska's smaller share of the payment but Alaska kept the federal funds anyway. In the context of Katrina, it was a lot of money. In the context of the Iraq War, it was a drop in the bucket.]

The whole Bridge to Nowhere

ocean-kat — Mon, 21 Mar 2016 20:59:57 +0000

In reply to Well, the Japanese poured

The whole Bridge to Nowhere meme is an example of democratic political bullshitting. It was a bridge to somewhere, to Gravina Island with small community that serviced not just that community but significant numbers of tourists every year. In addition the bridge would have spurred developement and increased the tourism to the island. There are roads and bridges to "nowhere" all over the US in areas with low population density. A 6 mile road in a high pop. area might serve 1,000 homes while a 20 mile stretch in a low density area might serve only 10. Without roads and bridges to these low density areas millions of rural residents would be stuck traveling on dirt roads often unpassable due to rains. Dirt roads aren't free either. They need to be periodically maintained.

We don't just have bridges and roads to nowhere. We have electric wires to nowhere and water pipes to nowhere. We've decided as a nation that people living in rural areas with low density populations should get bridges and paved roads, and electricity, and water. The costs of running wire and pipe to these rural areas was too expensive for private companies to find profitable so governments subsidized them.

The Gravina Island bridge was an effective democratic attack on Sarah Palin but it was bullshit. I, as a democrat, supported the bridge and thought it was a good project, a wise investment. People can disagree with that opinion but the conversation was never about the real issue, where and how much should the government invest in infrastructure in low density rural areas. it was hyped up political bullshit designed to make Palin look like a fool. There was so much actual stupid shit that came out of her mouth that I didn't think we needed to spin the bridge to make her look foolish.

I was thinking of capital

Oxy Mora — Mon, 21 Mar 2016 18:58:23 +0000

In reply to Well, the Japanese poured

I was thinking of capital expenditures which would solve problems. For example, impossible traffic and high housing costs in the most high paying job areas either prevent workers from accessing the jobs, or if they manage to find a place to live, become trapped in a defeating cycle of increasing rents.

Peter, you remind me of that

Oxy Mora — Mon, 21 Mar 2016 18:50:47 +0000

In reply to Existing infrastructure

Peter, you remind me of that Vermont joke where the flatlanders stop a farmer and ask directions to a town. After some deliberation and back and forth, he can't give any directions, he says to the city folks, "Nope, you can't get there from here".

Now your town is a case in point. It's not that there aren't solutions, but they have to be conceptualized and implemented. There are no local solutions to anything, no way up?

I was focusing on necessary

rmrd0000 — Mon, 21 Mar 2016 18:38:35 +0000

In reply to Well, the Japanese poured

I was focusing on necessary road, bridge, etc repairs.

Well, the Japanese poured

PeraclesPlease — Mon, 21 Mar 2016 18:30:04 +0000

In reply to There is no data to support

Well, the Japanese poured concrete for.2 decades without budging the needle. "Needed infrastructure" means needed. Bridges to nowhere help no one. But old roads that damage trucks and cause accidents burn money and lower competitiveness.

There is no data to support

rmrd0000 — Mon, 21 Mar 2016 18:25:30 +0000

In reply to Existing infrastructure

There is no data to support your opinion that infrastructure repair will not boost the economy.