Friday, March 20, 2009

Aso's Economic Policies Trail the G-20's

It's a shame, but the rest of the world looks at the current Japanese government and sees a dismal bunch. The "anti-recessionary measures" these politicians talk about are just words with nothing to accompany them. The March 11 edition of Newsweek Japan ran an article entitled "The World is Amazed" that focused on the sorry state of Japanese politics. This is truly miserable. I've been getting a lot of requests for interviews with foreign journalists, but they're all asking the same thing: "Is Japan really OK?" I can't really answer, "No, it's not OK," so I say something like, "We have to do something. Japan will rise again." It pains me to speak this way. I'm beginning to worry that Japan will trigger a global crisis at the rate that it's going.

On March 14, the finance ministers and central bankers from the Group of 20 industrialized countries gathered in London. Just before the meeting, Finance Minister Kaoru Yosano announced a turning point in Japan's economic policy, but all it amounted to was some increased public spending that had been requested by the American government. Without a request from the Americans, the Japanese government wouldn't have made the change. That's the miserable situation were in. Yet moving toward a policy of more public spending is a good thing. Despite the route taken, the result is good.

There were reports about the US and the Europeans being unable to resolve their differences at the G-20, but the mutual agreement that came out of the meeting put the group ahead of Japan on the path to recovery. Japan should have used the leverage provided by the G-20 agreement to unveil some aggressive anti-recessionary policies. The government should project an attitude that says, "We'll do whatever it takes."

The G-20 statement says that the countries will take action until the world economy starts to recover. The countries pledged to make sure banks are lending again. They said a financial expansion that promotes growth and employment will be treated with the utmost care and urgency. The Japanese government should faithfully execute this sort of action plan.