First of all, I would like to say thanks to all of you who read my post! I am pleasantly surprised with the number of intelligent remarks and excellent questions (especially in regards to Japan).
Currently, I am stationed in Japan and have had the wonderful privilege of discussing the nation’s economic strategy and challenges with some very influential Japanese economists here. It is truly a great country, but I for one am still quite grateful to be an American (due both to my unwavering patriotism and optimistic view of our current worldly economic stature and acumen).
As I am not one to ramble, I will get straight to the point:
Sdouglas3: A fellow Sooner! You indeed ask some great questions. I will attempt to answer them, please let me know if I fail to do so sufficiently:
In regards to a resolution, I do not see that there even needs to be one, as I stated earlier, I do not even see a “situation”. You mention very astutely the point that you have to invest money to stimulate growth. Our government is doing just that! We are applying the “debt” as an investment to the Capital of this country (as opposed to China’s investment in Labor or Japan’s investment in Land; as both coutries lack those specific factors of production). Any economist will tell you that Capital investment (the investment of human capital that is), produces by far the best returns! Growth does indeed promote jobs and stimulate the economy, and nothing promotes growth like innovation (both technological and entrepreneurship). I guess the best measure that could be used would be to look at past ND percentages of the GNP, and then compare that to future Growth rates (returns on human capital as an investment are not seen for 5-7 years; as an example, look at what the simple creation of the internet has done to boost profit margins to both virtual and brick-and-mortar companies… It did not happen overnight, and required vast initial investment). Hope that provokes some thought Sdouglas3.
Bullitt: China is a sore spot for me, as I see it as a great opportunity to learn Economic Development of a previously LDC (Lesser Developed Country) into a giant! I will be writing a new thread, and will be sure to answer your questions as well as create some even more debatable analysis that I hope will spur further discussion! Sorry that I did not answer your question here and now, but it is a very complex question that is masked by a short sentence…
Lacaprup: I will answer your questions as well as I can (some in the form of a rhetorical question; mirroring the old teaching methods of Socrates):
You say: Japanese dept is held, by and large, by the Japanese. American dept is help by asians and arabs.
I propose: In an increasingly globalized world, it is imperative to spread the risk. America has done so by creating ownership for other countries… More amply put, think of it like a company and its shareholders (but with one major difference) in that after the investor buys the stock, the company has no obligation to share any profits with the investor, though some due through dividends, with the major difference being that no matter what, the other countries get no say in how the company runs… Seems like a good deal to me! Hope that analogy illustrates my point, as I must admit that analogies are my weak point.
You say: Personal saving in Japan is far higher than in the U.S.
I say: What must be remember with this, however, like any equations, is that there are other variables. Most importantly, are consumption and investment. With consumption being roughly equal (when per capita comparisons are made and distribution of goods taken into account), the true difference lies in investment, and it is true that American invest more and save less (there is a difference). Over the long term, which method usually produces greater returns?
2Easy: Ignoring the obvious inhumanity of inaction in the face of disaster, there are indeed many reasons that aid should not only be given, but I submit that it be increased (though allocated differently). To advocate my point, I will refer to the works of Dr. Muhammad Yunus. His use of direct aid (through small business loans) not only increased the living standards of countless individuals, but proved to be a successful business in itself (with, if I am not mistaken, a 97% repay rate)! Imagine such a venture on a larger scale, and you will have a true economist’s solution to many problems facing LDC’s. This is often debated, and I am amazed at the lack of thought that is offered in contradiction to the statement “Let’s stop giving to others and focus on us…”. Thank you for giving me the fuel to begin what will be my third thread on these boards. I may indeed become a regular! Thanks!
Ummm… Wow, I have read the rest of the posts and I guess that threads are often reduced to reciprocating arguments and insults. Oh well, perhaps this post will realign the comments back to the relevant topics.
Please let me know what you all think!
and probably that poisonous Chinese stuff at that; that has ruined a good many post-hurricaine families in Florida & where-ever else... That may answer a few questions...! :blink:
