Re: [Pen-l] Democrats to placate Republicans on recovery plan

[raghu <mraghu01@xxxxxxxxx>]

On Wed, Feb 4, 2009 at 11:55 AM, Doug Henwood <dhenwood@xxxxxxxxx> wrote:
>
> On Feb 4, 2009, at 2:44 PM, Martin Hart-Landsberg wrote:
>
>> Regarding the Japanese experience--it is my impression that while the
>> growth collapse was contained--average incomes plummeted and never recovered
>> and that work became far more insecure with an ever growing percentage of
>> irregular work, also more homelessness etc. In other words, that there was a
>> qualitative decline in quality of life for the average person.
>
> You mean that Japan in crisis became more like the U.S. in "normal" times?
>
> Yes, I think your impression is correct, but considering the magnitude of
> the financial bust, that real-world fallout was relatively mild.


Exactly! I agree with Jim that the best-case scenario that is at least
a little plausible looks like 1990s Japan. But a decline in living
standards from the generally prosperous levels of 1980's Japan does
not exactly qualify as Doom.

In contrast the Great Depression does qualify as Doom, but since we
have Ben "Great Depression scholar" Bernanke running the Fed, we will
definitely avoid that particular form of Doom (deflation) at all
costs.

So what other forms of Doom does that leave? Hyperinflation? Run on
the dollar? Hyperstagflation (i.e. high unemployment + high
inflation)?

What about the rest of the world? Is China headed for war?
-raghu.

--
The meek shall inherit the earth, if that's OK with you.
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