Thursday, January 10, 2002

ANALYSIS: From The American Prospect on why Japan isn't coming out of recession anytime soon. Here's a troubling excerpt:

As depicted in Richard Katz's book Japan: The System That Soured, Japan is composed of two economies: an extraordinarily advanced one that can compete against any other, and a backward one, sustained by government subsidies and political interests, that resembles Indonesia at its worst. In the late 1980s, the sheer superiority of top Japanese firms, along with the bubble created by bank lending, sustained the whole. But in the 1990s, as Japan's bubble burst and its most powerful firms moved offshore and acquired strong competitors, the inefficient, insolvent economy increasingly overshadowed the high-tech advanced economy.

The article is not so hot on the Bush administration's approach to Japan, or to Argentina for that matter.

There's also a review in this month's Prospect of James P. Gray's book, who was one of the "battlefield conversions" in the Reason drug issue.

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