Geography Archives: Japan

Our friends at the Economic Policy Institute have already done a pretty good job burying the claim from Reinhart-Rogoff that high ratios of debt to GDP will lead to lower growth, but in DC, no bad theory stays dead for long.  With that in mind, let’s throw a little more dirt on the grave. The […]

Where is this elusive recovery?  The banks, some say, have “recovered.”  Yet they remain dependent on Washington, they do not make the loans needed for a general recovery, and many medium and small banks keep collapsing.  The stock market shows no recovery.  The Dow index was 14,000 in late 2007 when capitalism hit the fan, […]

  Excerpt: [T]he conventional growth accounting based on the national income identity does not provide an adequate framework for assessing the contribution of components of demand to growth.  The standard exports/GDP ratio overestimates the income (value-added) generated by exports because it ignores the foreign (import) contents of exports, which tend to be particularly high in […]

  Excerpt: Importantly, the initial collapse and following standstill in economic activity and nominal levels of GDP is also extremely bad news for the strategy of fiscal consolidation itself.  On the one hand, to keep on servicing interest payments (see above), nominal debt will continue to go up.  On the other hand, nominal GDP goes […]

In much of the world, including the United States and Europe, a debate is taking place about whether the government’s first responsibility should be to reduce unemployment — which is at elevated levels — or to reduce government deficits and debt.  Many of the arguments for deficit reduction are simplistic, based on ignorance, or ideologically-based. […]

Executive Summary: This paper looks at the planned austerity measures in Spain, the rationale for the spending cuts and tax increases, likely outcomes for future debt-to-GDP ratios, and the probable results of alternative policies. It is widely believed that Spain got into trouble because of the over-expansion of government spending.  However, during the economic expansion […]

The NYT portrayed the Fed as facing a serious dilemma in dealing with its portfolio of mortgage-backed securities (MBS).  It argued that it can either start selling them now and risk slowing the economy or wait until the economy has recovered more and risk losing money by selling them in a higher inflation environment. There […]

The issue of “blood diamonds” has once again made the news: Farai Maguwu, Director of Zimbabwe’s Mutare-based Centre for Research and Development (CRD), languishes under the long arm of Zimbabwe’s laws on alleged charges related to his research on Zimbabwe’s Marange mines.  According to a confidential 44-page report produced by investigators mandated by the Kimberley […]

The European public debt crisis, artificially created by the puritan obtuseness of German Chancellor Angela Merkel, has spread to even Japan.  In fact, Naoto Kan, the new prime minister, mentioned Greece in a speech in which he claimed to fear the collapse of the Japanese economy under a heavy public debt equal to 230 percent […]

The system under which offshore drilling rigs, and now oil tankers, operate was set up at the end of the second world war to ensure that the US was supplied with the cheapest possible oil without having to consider, or pay for, the consequences. The offshore drilling company Transocean celebrated the explosion on the Deepwater […]

  The global crisis has led some to question the dollar’s place as the dominant currency.  This column discusses three camps in the literature: those advocating a new synthetic global currency, those arguing that a new reserve currency will emerge, and those suggesting a return to sharing the role.  It concludes that talk of the […]

In his History of the Peloponnesian War, Thucydides relates how Pericles, in the fifth century BC, imposed economic sanctions against the city of Megara, which had allied itself with Sparta.  Athens prohibited trade with this city state and sent a message: if Megara did not break its alliance with Sparta, it would be punished.  Megara […]

Under the Gold Standard the values of different currencies were fixed in terms of gold, which meant that the exchange rates between those currencies were fixed.  Exchange rate movements therefore could not be used to enlarge net exports and hence domestic employment.  At the same time governments were committed to the principle of “sound finance”, […]

  Martin Wolf described it as “a bloodbath.”  The Financial Times editorial called it a “chilling read.”  Britain’s budget is one of austerity, the likes of which has not been seen in generations.  A 25 per cent cut in public spending; a quarter of a million or more public sector jobs to be slashed.  It […]

That seems to be the main point of Robert Samuelson’s column today.  It might be a bit easier with a bit more careful thought. For example, Samuelson tells readers that the debt burdens of major countries are rapidly approaching “financial and psychological limits” that prevent further fiscal stimulus.  He then cites the 92 percent debt […]

Everyone is talking about China’s currency, it seems.  Amidst months of building tension, there is an apparent consensus among most economists, the financial press, and leading economic policy makers in the West that the renminbi is hugely undervalued, making China’s exports unfairly competitive.  The global imbalances created by such ‘mercantilist’ and ‘protectionist’ exchange rate strategies, […]

The global financial crisis that began in 2007 was clearly about money, credit, and finance.  For mainstream economists and politicians — from neoliberals like John B. Taylor at Stanford and Tony Abbott, through pragmatists like Barack Obama and Australian prime minister Kevin Rudd, to Keynesians and social democrats like Paul Krugman at Princeton and John […]

To: Business Editor The New York Times I appreciate your detailed reporting on Chinese unions and workers vs. Japanese employers, but I write to ask whether that use of your resources is the cause of your ignoring similar union stories here at home. For example, I can find no coverage in the Times of the […]

The interview with Giovanni Arrighi below was conducted on 12 November 2005, at the “Kapitalismus Reloaded” international conference held in Berlin.  It is published in English here today to commemorate the one-year anniversary of Arrighi’s death. A. Fathollah-Nejad (AFN): Does the West have to fear China? G. Arrighi (GA): I don’t think so.  I mean […]

  Translator’s note: “Regarding the present upsurge of worker action in China, liberals have used their discursive power in the overseas media to frame the strike wave as a tale of workers’ struggle for ‘independent unions,’ as if this were a repetition of Solidarnosc.  What do Chinese workers want?  What is the direction of the […]