Heizo Takenaka, fixer of the Japanese "lost decade"
I’ll admit that I’m at a total loss for explanation on all this bailout talk. I have no strong opinion, other than the belief that it’s wrong for executives to be overpaying themselves at times like this. Why do I lack an opinion? I think it’s because I have trouble conceptualizing $800 billion, plus I have no idea what will ever restore future confidence in the American consumer.
For those who have a strong opinion, here is a piece from the NY Times about Japan’s bank crisis for the 90′s. People who have studied Japan say that even though the U.S. is spending like crazy, we should be spending and doing even more.
“I think they know how big it is, but they don’t want to say how big it is. It’s so big they can’t acknowledge it,” said John H. Makin, an economist at the American Enterprise Institute, referring to administration officials. “The lesson from Japan in the 1990s was that they should have stepped up and nationalized the banks.”
Instead, the Japanese first tried many of the same remedies that the Bush administration tried and the Obama administration is trying — ultra-low interest rates, fiscal stimulus and ineffective cash infusions, among other things. The Japanese even tried to tap private capital to buy some of the bad assets from banks, as Mr. Geithner proposed.
One reason Japan’s leaders were so ineffectual for so long was their fear of stoking public outrage. With each act of the bailout, anger grew, making politicians more reluctant to force real reform, which only delayed the day of reckoning and increased the ultimate price tag. Japanese taxpayers are estimated to have recouped less than half what it cost the government to bail out the banks.
If another country has faced a similar crisis in the past, I think it best that we learn from them.
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I agree with everything you said. About #1…I think...
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