Mar 13, 2011 3:05 pm


I cannot imagine anything more absurd and mean spirited than the one expressed by Fareed Zakaria on GPS this morning:

I think that what this reveals shows fault lines in the earth that create tremendous stress in a society as you noted in haiti or in japan, often show fault lines in that society.

And in japanese society, second only to zimbabwe in its national debt, it's got to figure out how it's going to reinvent itself and rebuild itself, but it's one of the oldest populations in the world.

Comparing Japan, one of the richest countries in the world, not to mention a stable liberal democracy, to Zimbabwe, one of the purest and worst governed one, is absurd at all times. To drive the knife even deeper he suggests that the quack would cause Japan"to be the argentina of asia and slowly slip away into nothing." UGLY!

But is it true?

Yes, Japan carries a large public debt. But, unlike the US, it is not indebted to its rivals and, of course, has huge assets at its disposal:

On the surface, Japan's huge level of public debt, at $12.2 trillion, will be an anchor around the country's neck as it tackles a huge rebuilding task.

And Japan's credit rating, which is already under pressure, might slip even further from the third or fourth highest level.

Yet the positive for Japan is that it is nobody's debtor, with huge domestic savings more than equal to the task of buying further government bonds.

It's probable the yen will even strengthen, as it usually does during disasters, because Japan runs a current account surplus and may repatriate investments from other countries to deal with the disaster.

Japan's economic output will likely shrink in the coming months as it deals with the huge rebuilding task, but you would then expect a catch-up surge in the GDP numbers as the stimulus of rebuilding flows through.

But what does Zakaria and his fellow traveler Steve clemons of the New America Foundation have against Japan?

The answer is simple: their immigration policy. Indeed, Zakaria and Clemons would like to use the tragedy to convince Japan to change course:

When japan has been hit hard in the past, it's been remarkably resilient society, and it's overcome enormous challenges.

But this is a staggering challenge for it.

And it needs to begin looking at how it's going to figure out how to bring back a young workforce into the nation and begin to assimilate other people and reinvent what it means to be japan and japanese.

Japanese supra-nationalists attitudes may be jarring to a former Indian Muslim living in America. It is also jarring to a wondering Jew like me. I even agree that japan pays a significant economic price for adhering to it as Junenrein Muslim countries should have realized by now.

Still, Fareed Zakaria's timing makes my stomach churn.

comments powered by Disqus