Japan’s enduring challenge

Clyde Prestowitz Seventy years ago this week, hundreds of Japanese fighters and dive bombers unexpectedly appeared on a clear Sunday morning over the North Shore of the main Hawaiian island of Oahu and prepared to drop their bomb loads on Pearl Harbor. Within minutes the U.S. Pacific fleet was decimated and the door appeared open … Continue reading

Is Spring coming to Japan?

Clyde Prestowitz After achieving its post war economic miracle in the 1960s, Japan emerged in the quarter century after 1965 as the main economic challenger to the United States. Indeed, it played a role somewhat similar to that now being played by China. Then, in 1992, its bubble collapsed and since then commentary on Japan … Continue reading

Rise of the TIMBIs

Forget the BRICs. The real economies that will shake up the world over the next few decades need a new acronym. JACK A. GOLDSTONE Nov. 30 marked the 10th anniversary of Goldman Sachs economist Jim O’Neill’s anointing of the BRIC economies — Brazil, Russia, India, and China — as the future leaders of the global … Continue reading

The Shadow Superpower

Forget China: the $10 trillion global black market is the world’s fastest growing economy — and its future. ROBERT NEUWIRTH With only a mobile phone and a promise of money from his uncle, David Obi did something the Nigerian government has been trying to do for decades: He figured out how to bring electricity to … Continue reading

The Amerislump Is Upon Us

Just how fast is the United States sinking? A cautionary tale of declinism — and the political bloviation it inspires. SUSAN GLASSER Conservative agitator Pat Buchanan’s new book says America might not survive until 2025. "The Suicide of a Superpower," it’s called. Even the less alarmist are suddenly sounding a lot like him as economists … Continue reading

Why the Rich Are Getting Richer

Increasing inequality in the United States has long been attributed to unstoppable market forces. In fact, as Jacob Hacker and Paul Pierson show, it is the direct result of congressional policies that have consciously — and sometimes inadvertently — skewed the playing field toward the rich. Robert C. Lieberman The U.S. economy appears to be … Continue reading

Germany’s Not That Sorry Anymore

And its newfound assertiveness is tearing Europe apart. YASCHA MOUNK With market confidence in Greece and Italy further eroding, Germany’s cash reserves are now the last best hope for the euro. Without a bold, continentwide rescue effort led by Germany, the single currency is likely to disintegrate. Yet it now seems clear, as indeed it … Continue reading

Chasing the dragon

Comparing India and China How the Asian superpowers compare on various measures of development IN THE recent Singapore Grand Prix, a car belonging to the Force India team reached the finish line just 111 seconds after the leader. Today’s chart uses a stopwatch to compare India’s progress in development against another pace-setter, China. The chart … Continue reading

Paycheck to No Paycheck

Share your Great Recession survival strategies for getting by on next to nothing. Emily Yoffe During the Great Depression, thousands of the suddenly jobless found themselves a new line of work: selling apples on street corners. These fruit sellers, with their heart-tugging signs–“Unemployed Buy Apples 5 c Each”—are an enduring image of bad times. There … Continue reading

Charles Darwin, Economist

Robert Frank I was born in 1945. When someone my age forecasts something that will happen fifty or a hundred years from now, he needn’t worry about being teased by friends if it doesn’t pan out. Without trepidation, then, I offer the following prediction: One century hence, if a roster of professional economists is asked … Continue reading

China’s investing woes

Phil Levy For those who believe it is just a matter of time before China rides its commercial success to global hegemony, this week offered some compelling imagery: Europe, on its knees, reeling from political discord, rising bond yields, and bank downgrades; China, sitting atop its $3.2 trillion hoard of foreign exchange reserves, condescending to … Continue reading

China’s ‘system-friendly’ response

A step toward global rebalancing? Ian Bremmer Nick Consonery Beijing seems strangely unconcerned about the global market turmoil caused by fears of a second global recession. U.S. economic data over the past month has been disappointing, to say the least. The sharp sell-off in European markets at the beginning of the week hints that the … Continue reading

Red Dawn

Why the United States should embrace, not fear, China’s economic rise. CHARLES KENNY Henry Kissinger’s 2001 book Does America Need a Foreign Policy? opens with the observation that "[a]t the dawn of the new millennium, the United States is enjoying a preeminence unrivaled by even the greatest empires of the past. From weaponry to entrepreneurship, … Continue reading

What if Japan really is No. 1?

Clyde Prestowitz In 1979, Harvard professor and East Asia expert Ezra Vogel published Japan as Number One, a book that not only became an influential bestseller in the United States but also raced to the top of the all-time nonfiction bestseller list in Japan. Appearing at a moment when Japan’s economy was surging with a … Continue reading

Is Capitalism Doomed?

Karl Marx was right that globalization, financial intermediation, and income redistribution could lead capitalism to self-destruct. Nouriel Roubini Is capitalism on the verge of self-destructing? NEW YORK—The massive volatility and sharp equity-price correction now hitting global financial markets signal that most advanced economies are on the brink of a double-dip recession. A financial and economic … Continue reading

‘The US Is Holding the Whole World Hostage’

 AP Grasping for a solution: Obama is making little progress on the debt-ceiling dispute. With no solution to the US debt crisis in sight, the rest of the world is starting to get nervous. German commentators urge congressional leaders to get their act together. A US default would have catastrophic consequences, they warn. Both Moody’s … Continue reading

China to Trounce U.S. in Next Decade

Martin Jacques The Western financial crisis heralded a significant shift in the balance of power between the United States and China. Most starkly, it brought forward the date when the Chinese economy will overtake the US economy in size from 2027 (the Goldman Sachs projection in 2005) to 2020. The reason is simple: while the … Continue reading

The new Rome is not the new Greece yet, but the US must look to its laurels

It’s encouraging to see Americans acknowledge the hole they are in. Pity they can’t agree how to get out of it Timothy Garton Ash We are approaching the anniversary of America’s Independence Day. As we all know, 15 years ago an alien invasion, deploying giant saucer-shaped warships hovering over earth, was repulsed by the ingenuity, … Continue reading

Clash of the Titans — the United States and China

By Eneas de Souza On one side, we have a state weak in conducting economic policy but extremely friendly to capitalists — the American state — and on the other, a state that commands and directs the economy towards development — the Chinese state. Translated By Elizabeth Woolley Edited by Michelle Harris Brazil – Sul … Continue reading

Hollowing out the ivory tower

Alison Wolf tells Tim Black that the now orthodox view of universities as engines of economic growth is making us lose sight of their primary purpose: the pursuit of knowledge. Tim Black ‘The idea – which I have to say has affected large numbers of politicians – that you can just give people at university … Continue reading

Don’t go changing, Belarus

Daniel W. Drezner With all the doings in the Middle East, it’s easy to miss developments elsewhere.  Let’s take a look at Eastern Europe, shall we?  Like Belarus, in which the latest developments suggest a uniquely Belarusian path to misery.  The Financial Times’ Jan Cienski notes that Greece and Portugal aren’t the only European countries … Continue reading

One field’s technical wizardry is another field’s hidebound scholasticism

By Daniel W. Drezner I’m starting to read Dani Rodrik‘s provocative book The Globalization Paradox, which is well-written, accessible, and (so far, at least) quite fair-minded with respect to the various economic debates over the costs and benefits of globalization.  It’s also, really, a book of political economy, so it’s nice to see that, based … Continue reading

The Island Nation

Japan will rebuild, but not how you think. And 20 years of misread history holds the clues. BY PETER TASKER "When my mother was 10, she was evacuated to Sendai and saw the whole town get bombed flat. My father experienced the big air-raids on Yokohama. Their generation started out when there was nothing left … Continue reading

Will the crisis create a new Japan?

KYODO/ REUTERS – Smoke rises among buildings destroyed by a tsunami and earthquake in northeastern Japan on March 12. By Marcus Noland On Sept. 1, 1923, a 7.9-magnitude temblor struck Tokyo. More than 100,000 people lost their lives and more than 3 million were left homeless in the Great Kanto Earthquake. Fueled by rumors that … Continue reading

Stimulus Spending

Harry Reid says prostitution is bad for Nevada’s economy. Is he right? By Annie Lowrey Is legalized prostitution harming Nevada’s economy?They call Las Vegas "Sin City," but not everyone in Nevada is happy about it. Among them is Senate Majority Leader Harry Reid, who called for Nevada to outlaw brothels in a speech to the … Continue reading

Poland Is Europe’s New High-Flyer

Poland, once a backward agricultural country, is quickly becoming an economic powerhouse in Central Europe. The Poles are strongly pro-European, and even their relationship with the Germans is no longer as tense as it was just a few years ago. Nowhere is the transformation easier to see than in Wroclaw. By Jan Puhl Photo Gallery: … Continue reading

Wake up, Americans. Your economic dream is a nightmare

Jeffrey Simpson Our southern friends are living the American dream these days, a dream that’s removing them from reality. Their federal legislators, including the President, are imagining a brilliant future that cannot be. None of them, it would appear, wants to awaken Americans from this dream. The dream? Economic recovery followed by the return of … Continue reading

Crude reality

Will a Middle Eastern oil disruption crush the economy? New research suggests the answer is no — and that a major tenet of American foreign policy may be fundamentally wrong. By Jeremy Kahn  For more than a month, the world has been riveted by scenes of protest in the Middle East, with demonstrators flooding streets … Continue reading

Fear is a mediocre reason to support the US

Source: Global Times As the Chinese flag lowered with President Hu Jintao’s departure from the US on Friday, $45 billion in deals as well as China’s image advertisements were left behind. The visually appealing images were perhaps designed to help make a difficult mission easier to complete and ease the fears of Americans still fearful … Continue reading

U.S. Is the Biggest Beneficiary of China’s Economic Growth

By Zhou ShiJian The modernization of China will promote America’s economic growth. Translated By Alice Cwern 13 January 2011 Edited by Gillian Palmer China – Xinhua – Original Article (Chinese) Since President Obama entered the White House, the trade tension between China and the United States has obviously increased on topics such as the value … Continue reading

Suicide for a Cause

What’s behind the Middle East’s new trend of self-immolation? BY ADAM LANKFORD On Dec. 17, 2010, a 26-year-old unemployed college graduate named Mohamed Bouazizi stood in front of a government office in the Tunisian town of Sidi Bouzid, poured gasoline over his body, and lit himself on fire. In doing so, he seems to have … Continue reading

Milton Friedman And Economic Moralism

Jonathan Chait   Paul Krugman notices that the new right-wing hard money view is ideological and anti-empirical, as opposed to Milton Friedman’s monetarist views: What did I mean here when I said that Milton Friedman was on the same side of the divide as Keynes, and the other side from people like Ron Paul? I … Continue reading

China frustrates the world

By Ian Bremmer By Ian Bremmer and David Gordon Amid a sluggish global recovery, China’s return to go-go growth will generate plenty of resentment in 2011 — and not just in Washington. Though China has become the world’s second-largest economy, its leadership insists it must continue to manage the country’s development at a measured pace. … Continue reading

Singapore and the U.S.: a tale of two economies

By Stephen M. Walt I’m back in Singapore for the first time in nearly two years, and what a difference two years can make. Back in 2009, Singapore was reeling from the after-effects of the global recession, which hit its trade-dependent economy particularly hard. The island nation has regrouped quickly, however, and its economy reportedly … Continue reading

The Rise of the New Global Elite

F. Scott Fitzgerald was right when he declared the rich different from you and me. But today’s super-rich are also different from yesterday’s: more hardworking and meritocratic, but less connected to the nations that granted them opportunity—and the countrymen they are leaving ever further behind. By Chrystia Freeland  Image credit: Stephen Webster/Wonderful Machine If you … Continue reading

Vietnam’s muddled economy and ‘meddlesome priest’

By Will Inboden Two news items emanating from Vietnam in the past few days show the considerable challenges this promising nation still faces. The stories at first glance would seem to have little in common. The first, from the Washington Post, relates an appalling incident in which Vietnamese security thugs attacked a U.S. diplomat attempting … Continue reading

10 Percent Unemployment Forever?

Why the good news about the economy doesn’t necessarily mean that jobs are coming back anytime soon. BY TYLER COWEN, JAYME LEMKE The U.S. economy finally appears to be picking up steam and headed toward recovery: several economic indicators — including manufacturing and services output, and sales of cars and consumer goods — have shown … Continue reading

The Fourth Wave

Can the world avoid a fresh crisis? BY IAN BREMMER The global economy looks to be headed toward what Mohamed El-Erian has called a "new normal" after the market meltdown and financial upheaval of the last two years. But along the way, we’re in for a bumpy ride. So far, the crisis has come in … Continue reading

Empire of schmucks

David Rothkopf With the news this week that the Fed pumped money into European institutions during the darkest hours of the recent and continuing economic crisis without so much as a press release or a demand for better cheese prices, it is clear that even with all those big geopolitical shifts we have been hearing … Continue reading

India or China?

Jagdish N. Bhagwati, Senior Fellow for International Economics November 30, 2010 Project Syndicate When US President Barack Obama visited India in November and complimented its leaders on the growing success and prowess of their economy, a tacit question returned to center stage: Will China grow faster than India indefinitely, or will India shortly overtake it? … Continue reading

The Four Horsemen of the Teapocalypse

Meet the dead thinkers who defined 2010. BRAD DELONG John Maynard Keynes once famously observed, "Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist." During the crisis years of 2007, 2008, and 2009, it was the great British economist himself, along with three … Continue reading

Bumbliners

How Ireland’s economic miracle went bust. BY CAMERON ABADI Ireland was traditionally one of Western Europe’s poorest countries, a rural and intensely Catholic country from which the best and brightest left in search of opportunity elsewhere. Recessions were a routine occurrence, and high unemployment was endemic through much of the 20th century. Ireland may have … Continue reading

Theo Paphitis defends Lord Young’s recession comments

Dragons’ Den star Theo Paphitis has said Lord Young’s comments that most people have "never had it so good" were "technically correct". Lord Young resigned from his position of enterprise adviser to the government over his remarks about the recession. Mr Paphitis also told BBC Radio 5 Live’s Stephen Nolan programme he was concerned that … Continue reading

Older but Not Wiser? The Psychology Behind Seniors’ Susceptibility to Scams

New studies help explain why, despite having more experience, senior citizens often make unprofitable financial choices Valerie Ross SENIOR MOMENT: When deciding how to handle their money, older people often make less profitable decisions. Image: partie traumatic, courtesy Flickr The invitations come in the mail, covered in large print: "Investment Workshop—Free Gourmet Lunch!" "Avoid the … Continue reading

U.S. Wields Less Clout at Summit

Obama Sees Diminished Heft in Seoul Due to Slow Economy, Election Setback By JONATHAN WEISMAN and DAMIAN PALETTA SEOUL—President Barack Obama headed toward the close of the Group of 20 summit, weakened by an anemic economic recovery and an election drubbing that have left world leaders questioning U.S. authority. In private meetings with Mr. Obama … Continue reading

Emerged Economies

In the post-recession era, developing countries have come out on top. And they’re going to stay there. OTAVIANO CANUTO, MARCELO GIUGALE This week’s G-20 summit, which begins today in Seoul, will have to acknowledge that the old conventional wisdom no longer holds true — in the post-recession era, developing countries will steer the global economy, … Continue reading

The return of capital controls

By Daniel W. Drezner The unholy trinity in open economy macroeconomics is pretty simple. It’s impossible for a country to do the following three things at the same time: 1) Maintain a fixed exchange rate 2) Maintain an open capital market 3) Run an independent monetary policy One of the issues with macroeconomic policy coordination … Continue reading

Weak Ties

For all the excitement about India’s rise, its economic relationship with the United States remains anemic. Why? On the surface, all the elements are in place for an economic love affair between the United States and India. In the last decade, three American presidents — including Obama — have visited New Delhi with the explicit … Continue reading

India’s Unfinished Business

Nobody jokes about the "Hindu rate of growth" anymore. But with hopes for further reform fading in New Delhi, will the Indian economic miracle come to an early end? BY ARVIND PANAGARIYA When U.S. President Barack Obama arrives in Mumbai Saturday, he’ll be landing in what remains one of the poorest countries in the world, … Continue reading

Thinking Outside the Borders

For better or worse, Congress is getting a makeover. As for the president’s economic team, why can’t Obama look beyond the usual suspects — way beyond? BY CHARLES FERGUSON The day after the U.S. midterm elections, the Federal Reserve is yet again buying securities (it has bought more than $2 trillion of them since 2008), … Continue reading