Two decades of stimulus and cheap money haven’t worked in Japan, but hey, why not give it another shot? Maybe it will work this time.
NYT: In the package announced Tuesday, which comes to about 1.5 per cent of Japanese gross domestic product, the government will spend $39 billion to prop up regional economies and pay for public works projects.
Environmental programs like incentives to purchase energy-efficient gadgets will receive $9 billion, and measures to increase employment will get $6.8 billion.
The government will also offer loan guarantees for small companies to ease the credit crunch, the cabinet said in a statement.
All very familiar sounding, no. Only the part about gadgets seems particularly Japanese. The rest could be announced here on any day.
Of course, this move is being undertaken by newly-eledted, but unpopular prime minister Yukio Hatoyama, who will again face the voters soon, showing that, in the end, all politicians running for office are Keynesians.
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