Re: Japan’s Recovery Is Complicated by a Decline in Household Savings, by Jonathan Soble
Dear Sirs:
Mr. Soble (and your editorial board, I’m sure) can’t seem to make up his mind whether Japan should spend its way to prosperity or adopt policies that will return it to the savings culture that financed its post WWII economic miracle. Mr. Soble comes very close to breaking with what I am sure is NY Times policy and Keynesian dogma that increasing aggregate demand will do the trick. Japanese households spend every last yen as it is, and the government’s debt to GDP is the highest in the industrialized world. So just where will this increased demand originate? Please don’t bet too heavily on the BOJ’s all-in QE program, which has done zip-a-dee-doo-dah so far, unless you count adding even more zeroes to the government’s debt. This is the time for an editorial board reassessment. Does the Times continue with Paul Krugman and his mindless “print money until it’s worthless” mantra, or does it open its mind to other explanations? The Austrian school has the answers, and you have one of the world’s primary Austrian school monetary scholars right in Manhattan–Dr. Joseph Salerno at Pace University. I’m sure he would be happy to take Krugman’s place. Does the Times want to lead the world away from the monetary abyss or does it want to follow the lemmings? Time for a change.
