This Blogger has seen Japan first hand. This is a country that went from being an impoverished nation after World War II to an industrial power house in the 1980's and 90's. I remember a cover of a business magazine predicting that Japan would take over the world; much as they are saying about China today. That was then and this is now. Today, Japan is in a death spiral because what helped them grow rapidly, Socialist Collective behaviors, at the expense of rugged individualism, which made America great, is now killing them and will soon kill us if we continue to go down the same Socialist road.
In the process of growing their economy, big companies in Japan and their senior management, as is happening in China today, became rich. But the average citizen in Japan is far worse off than the average American, even with our declining Middle Class, though we too are heading in the same direction because of failed Socialist Schemes in the United States. Working and living conditions in Japan, for the average Japanese citizen, are far worse than in the United States.
And, when the stock and property bubbles burst, in an attempt to maintain high employment, the Japanese government stepped in borrowing billions of Yen to spend on government projects, some of which were wasteful spending and infrastructure. Sound familiar. There has been so much borrowing that the National Debt of Japan is now at 200% of their GDP. The US National Debt is now at about 110% of our GDP, but we are heading in the Japanese direction. The difference is however, that most of Japan's Debt is owed to Japanese citizens that have very high savings rates; but that does not make the Debt any less due at some point. Much of our Debt is owed to foreign countries. Japan has experienced deflation for more than 20 years, which has been very bad for their economy. To try to deal with all of this rather than cutting taxes and regulations dramatically, Japan's taxes are among the highest in the world and stifling regulations control all aspects of life.
The end result is a very weak economy and young people graduating from college that cannot find jobs. The old notion of employment for life in Japan is beginning to fade because big companies are leaving the Japanese market to manufacture products in other countries at less cost. Japan is facing a vicious cycle of their own making. They need more government spending to protect jobs, which results in more borrowing and prevents tax cuts to grow the private sector. Obama's Socialist Schemes are following Japan's road to fiscal Armageddon. Japan does not have a way out of this mess at at this point. This will be the American story if we allow Socialists in America to pursue their big government Socialist Schemes. We can't let that happen.