Japan from the inside out

Takenaka’s warning: The zombies are back!

Posted by ampontan on Monday, June 16, 2008

THE PERPETUAL DEBATE over the ideal form of government can be boiled down to the question of which is better: a large central government with substantial powers, or a small central government with limited powers offset by the power of local governments and plenty of room for citizen initiative.

The side that people support in this debate might well have been determined by something hard-wired into us before birth. After all, many people still prefer the big government solution, despite the clear success of the policies implemented by Ronald Reagan and Margaret Thatcher and the failures symbolized by the fall of the Berlin Wall.

Among the advanced industrialized countries today, nowhere is this debate being conducted with more vigor than in Japan. Though few in the West give him the credit accorded to the American President and British Prime Minister, former Prime Minister Koizumi Jun’ichiro demonstrated that he belongs in their company through his quest for reform and deregulation, capped off by the privatization of Japan Post. The Japanese post office and its affiliated financial institutions once accounted for one-third of all government employees. Now the bank is the largest financial institution in the world, with one-fourth of all deposits in Japan. When the process is complete, the scale of this privatization step will exceed that of the Deutsche Postbank more than a decade ago.

Mr. Koizumi provided the political will and expertise, but the brains behind the operation was Keio University professor Takenaka Heizo (first photo). Throughout the 65 months of the Koizumi Administration, Prof. Takenaka never left the Cabinet, serving as the Minister for IT Policy, the Minister for Economic and Fiscal Policy, the Minister for Financial Services, and the Minister for Privatization of the Postal Services.

The Koizumi reform policy is still a winner with most voters, but it should be no surprise that the entrenched interests among politicians and the bureaucracy would make every effort to stymie or roll back those reforms. Thus, the process has ground to a near-halt in the administration of Fukuda Yasuo, even though it consists of people who, with Mr. Koizumi, are members of the Liberal Democratic Party.

Alarmed at the course events have taken, Prof. Takenaka was the first to draw attention to the anti-reform efforts abetted by the current Cabinet by writing an article last December for the influential monthly magazine Bungei Shunju called Halt the Fukuda Administration’s Politics of Restoration. Despite being seven months old, the article is still valid as an expression of the need for governmental reform, a warning of the efforts that people are making to stop those reforms, and a description of the steps that remain to be taken. The following is a condensation of that article, which summarizes the challenges facing Japan and its government while transcending the petty political maneuvering that distracts the attention and deflects the focus of the broadcast and print media.


The intensification of global competition and the decline and aging of the domestic population has placed Japan at a crossroads. What must be done to improve the lives of the people in these circumstances?

The answer is the structural reform conducted under the five years of the Koizumi administration. The implementation of various measures under the banner of “no growth without reform” brought the Japanese economy back to life. The Liberal Democratic Party’s defeat in last summer’s upper house election, however, seems to have brought those reforms to a halt. With the prime minister’s leadership under a cloud, the zombie of reactionary politics has returned to life.

Some thought that Prime Minister Fukuda would understand and work for reform because he served as chief cabinet secretary in the Koizumi Administration. The potential for reform has been limited, however, because the Fukuda Administration was saddled with three onerous conditions.

The first was the Democratic Party of Japan’s victory in the upper house election, which prevents the government from smoothly implementing important legislation and passing bills on its own. The election results made the passage of major reform measures a hopeless proposition.

The second is that Prime Minister Fukuda was supported for election by eight LDP factions. Some of them support reform, but one is opposed. This forces him to try to please everyone and anticipate the mood of his support base in the party, making reform difficult.

The third is the return of the financial bureaucracy to a position of influence. Cooperation between the LDP and DPJ is essential for passing legislation. That places greater responsibility on the people in party leadership positions, as well as the Policy Deliberation Commission, which is responsible for negotiating policy within the party.

But the leadership positions are held by party Secretary General Ibuki Bunmei (Faction leader), whose career started in the Finance Ministry bureaucracy, and Tanigaki Sadakazu (Koga faction), a former finance minister. They have a reputation of being well-versed in policy, which means they have a deep understanding of the bureaucracy. That in turn creates the danger that the MOF will hold sway over policy.

If we were to compare this situation to a ship, the Fukuda-maru is charting a course in rough waters, the crew is scattered, and MOF allies are at the tiller.

Despite the important issues facing the Diet, the opposition DPJ does not introduce legislation of its own. It merely opposes what the LDP offers, as we saw with the anti-terrorism bill.

With attention focused on the anti-terror legislation and the pension problem, including the scandal at the Social Insurance Agency, the important debate on economic policy has been hollowed out.

In addition, the Japanese economy is decelerating despite the overall tone of recovery. There was negative growth in the second quarter of 2007, and the promise to end deflation has not been kept. Growth was maintained at 2% during the four years from 2003 to 2007, so economic fundamentals are not the problem. Nevertheless, prices haven’t risen. Japan was the only one of the advanced industrialized countries where this abnormality occurred. This is clearly due to the Bank of Japan’s monetary policy of abandoning the zero interest rate. It was done too quickly, which had a negative impact on corporate investment and consumption. Tax revenues were down 1.4 trillion from the total projected for 2006.

Japan now needs economic policies to strengthen its capacity for high growth. This was the policy of the Abe Cabinet, but Prime Minister Fukuda merely says that “stable growth” is necessary. According to the logic of the bureaucrats, stable growth means giving precedence to fiscal soundness while growth takes a back seat.

The Council on Fiscal and Economic Policy

The Council on Fiscal and Economic Policy was the engine of reform during the Koizumi Administration. Discussion of every one of the prime minister’s policy initiatives began here. As the Minister for Economic and Fiscal Policy, I debated policy with the four other members, who were academics and business leaders, and we submitted papers to the prime minister’s advisory council. Most of the reform plans at the advisory council originated from papers at the CFEP. It was independent of the bureaucracy because it intended to neuter the bureaucracy’s power.

The bureaucracy uses its position to provide official recognition to the vested interests and expand its power, which is why it is opposed to reform. The so-called zokugiin, those Diet members allied with specific ministries, have been complicit in expanding vested interests. Most cabinet ministers, positioned at the top of the bureaucratic structure, have served as their mouthpieces. These interests were also represented in the CFEP, but I was able to overcome them and get reform measures passed by the ruling party in the Diet, compromising when necessary.

With the opposition in control of the upper house, those measures won’t get passed. That means new policy initiatives originate in the LDP Policy Research Council, which in turn means the ruling party must deliberate those initiatives beforehand. It is no longer a case of the government vs. the bureaucracy, but rather a case of the government vs. the government.

Therefore, the CFEP can longer be the engine of reform. It can, however, be the “car navigation system” for reform, switching to a strategy of carrying the banner for multiple proposals. Liberated from the need for compromise, it can make many sound arguments. One would be the privatization of the University of Tokyo, symbolic of educational reform. Another would be the creation of a government-affiliated public corporation for the investment of foreign currency reserves.

The CFEP could still fulfill the car navigation function. It could generate ideas that might produce areas of agreement between the government and opposition parties, and even provide a compass for political reform. For example, converting the road surtax revenues to the general fund was debated here during the Koizumi administration. The idea was killed by those MPs in league with road construction interests in the bureaucracy, though the DPJ approves of the idea.

Aso Opposition

Reform was achieved due to Prime Minister Koizumi’s powerful leadership and the efforts of a few cabinet members. But not everyone in the Cabinet was a reformer. Directly opposing my proposals for postal privatization was Aso Taro (Faction leader), who presented the arguments of those in favor of retaining the old system. We achieved reform because the prime minister made a choice.

The same sort of method was debated by Abe Shinzo and his advisors when he became prime minister. Reportedly, their strategy choice was to give priority to prolonging the life of their administration. The result was the formulation of policies that would not create waves.

That is not to say Prime Minister Abe himself was opposed to reform. There are many positive achievements to his credit, including education and civil service reform and elevating the Defense Agency to the level of a Cabinet ministry. Bureaucratic opposition to his civil service reform was even more intense than that during the postal privatization debate. That reform was achieved with no compromises, which was due entirely to the efforts of Watanabe Yoshimi (second photo), the Minister for Administrative and Regulatory Reform. There was no input from advisory bodies.

Watanabe Yoshimi

Watanabe Yoshimi

Also worthy of praise was his aviation reform that enhanced Japan’s position and its international competitiveness. The three most important supporters of reform in his Cabinet were Watanabe, Chief Cabinet Secretary Shiozaki Yasuhisa (Koga faction), and Minister of Internal Affairs and Communications Suga Yoshihide (Koga faction).

Continuing Reforms

There are two types of structural reform: reactive and proactive. About 80% of the reactive reform, such as disposing of the non-performing debt held by financial institutions, has been taken care of. But many proactive measures remain, such as privatizing government financial institutions.

I think the continuation of reform is endangered for two reasons. First, the political process for determining reform policy has been downgraded, and second, the strength of reactionary political forces is growing. I am specifically referring to the zokugiin, the influence of the bureaucracy, and public works projects.

The 10 lost years after the collapse of Japan’s economic bubble not only brought the economy to a standstill, it also prevented changes in the country’s social systems, including politics. Japan became dysfunctional as a country. Those three elements are responsible for the 10 lost years.

First, the standard for the political activity of the zokugiin is their gain or loss in regard to issues of immediate concern. Dreams or passion do not factor into their political philosophy.

Second, the bureaucracy-driven determination of policy only protects the vested interests. That makes reform impossible, because reform has to be led by politicians.

Third, public works projects are a symbol of expedient political compromises. They are not an Aladdin’s lamp providing an inexhaustible supply of solutions. This type of populism always fails, expands the fiscal deficit, and weakens the country.

I can think of no one today who could fulfill the leadership role for tackling these three problems as did Prime Minister Koizumi. I also think it is unlikely he will make a comeback, though some people would like him to.

Response to Criticism of the Gaps

There has been criticism that the reforms have left the weaker members of society behind. I will answer that charge by discussing two kinds of gaps: the regional gap and the income gap.

First, some say that the regions are growing weaker at the expense of the center. But it is a fundamental error to say that the weakened regional economies are the fault of reform. Would they have thrived by failing to deal with the bad loans, not privatizing the post office, and spreading the pork through public works projects? Reform and the weakening of the regional economies are unrelated.

The weakening of the regional economies is the result of globalization. In most cases, small and medium-sized businesses in regional areas are suffering because they’re losing out in competition with China, where labor costs are cheap. Those companies need to get stronger to compete internationally.

Two steps are required to strengthen regional economies. The first is a sweeping reappraisal of agricultural policy. By that I do not mean the protectionist or regulatory policies of subsidy distribution, but structural reform of the agricultural cooperatives and the use of agricultural land to increase competitiveness.

The second is to take devolution a step further. Establishing the sanmi ittai system will give regional governments access to funding sources. Public works projects, such as those for the regional infrastructure, will be handled by new regional governments rather than the Ministry of Land, Infrastructure, and Transport. That will benefit local companies.

Sanmi ittai refers to three reforms of the administrative and financial system for national and local governments. They are:
1. Eliminating or reducing supplementary allocations from the national treasury
2. Transferring tax revenue resources
3. Integrating the allocation of central government tax revenues to local governments

The term in Japanese is identical to that used to express the concept of the Holy Trinity in Christianity.

Recent fiscal reform has reduced public investment by nearly 7 trillion yen (about $US 65 billion), which has caused hardship for the regional general contractors, the backbone of the local economies. But public works expenditures are still about 3.5% of GDP, which is high compared to other advanced industrial countries. The problem could be resolved if it were explained to the citizens that public works investment is not inexhaustible.

For example, this point could be made: We will have to raise the consumption tax to secure 7 trillion yen in funds. Which would you prefer? Maintaining the consumption tax at 5% and reducing public works expenditures? Or raising the consumption tax to 8.5% and maintaining public works expenditures? I think the public would choose the former.

The second gap is the one in personal income. Some people think structural reform, including deregulation, is widening the gap between the rich and the poor.

But it’s dangerous to discuss income gaps without organizing the points of debate. There are only two ways to close the gap. The first is by reducing high incomes, and the second is by increasing low incomes.

It is more important to deal with the lower income levels, but the prerequisite is gaining an understanding of the reasons for financial hardship, which Japan cannot do yet. Policies have to be determined after understanding the causes of poverty, such as ill health, the lack of skills, or low wage levels.

The other way, lowering high income, is tantamount to socialism. I believe that is not an option in Japan’s free economy. It would cause serious problems, both by stunting economic growth and by lowering the morale of the people. Japan should take heed of the experience and the lesson of Great Britain, where former Prime Minister Thatcher observed that you can’t make the poor rich by making the rich poor.

Many people in postwar Japan strongly believed that we were a nation with 100 million people in the middle class, and that belief still remains. Perhaps we are overly sensitive to the relative income differentials that have arisen recently, but I think that tendency is abnormal.

The zombie zokugiin and the bureaucrats

When people do not establish their own self-sufficiency, a country is doomed to ruin. We must not blame the nation for all individual business failures or the failures of the regions, much less shift the blame to structural reform.

Both Prime Minister Abe and Prime Minister Fukuda have talked about using kindness and warmth to deal with these problems, but those words are too emotional. Regardless of what the prime minister thinks, the old politicians and bureaucrats who want to expand the politics of yesteryear have returned like zombies to protect their vested interests.

Pleasant slogans are not the answer. Putting off the resolution of the basic problems only makes the problems worse. There must be a complete cure before the wounds become fatal. Shouldn’t we already have learned that from dealing with the disposition of the bad debt of the financial institutions, which caused us to lose those 10 years?

In the end, each individual must bear the responsibility. Populist policies based the politics of the past will lead only to Japan’s destruction.



Some people see Japanese politics today in black and white: The Liberal Democratic Party bad; the Democratic Party of Japan good. In their view, the only hope for reform is to throw the LDP out and have the DPJ form a government.

But as this article demonstrates, accepting that view requires one to ignore Prime Minister Koizumi’s successes during his five-plus years in office, as well as the efforts of his successor, Abe Shinzo. The reformers with a track record so far in the 21st century have come from the LDP.

In contrast, one reason the DPJ took control of the upper house of the Diet in last summer’s election was the promises made by party leader Ozawa Ichiro to small farmers that their party would restore the subsidies lost in the LDP reforms.

Immediately after that election, the DPJ said they would introduce two pieces of legislation. One of them was to be a bill postponing the privatization of Japan Post (probably with the intent to kill or weaken it). Whether due to a change of mind or the party’s congenital inability to offer concrete legislative proposals of their own, they never did follow through. But the pattern is clear.

Can the DPJ, as presently constituted, and based on its past performance, be counted on to roll up its sleeves and do the dirty work required to continue real reform?

I think not.

16 Responses to “Takenaka’s warning: The zombies are back!”

  1. Bender said

    “Recent fiscal reform has reduced public investment by nearly 7 trillion yen (about $US 65 billion), which has caused hardship for the regional general contractors, the backbone of the local economies. But public works expenditures are still about 3.5% of GDP, which is high compared to other advanced industrial countries. The problem could be resolved if it were explained to the citizens that public works investment is not inexhaustible.”

    What’s you take on the theory that since Japanese consumers won’t spend, the government has to spend for them to keep the money circulating lest the economy become stagnant?

    If this be true…

    “We will have to raise the consumption tax to secure 7 trillion yen in funds. Which would you prefer? Maintaining the consumption tax at 5% and reducing public works expenditures? Or raising the consumption tax to 8.5% and maintaining public works expenditures? I think the public would choose the former.”

    …maintaining tax will not cause Japanese consumers to spend, so status quo on tax and lessening gov’t spending might have adverse effects on the economy?

  2. Ken said

    I have been interested in your lavorious work but let me supplement or object a little.

    It was right that Mr. Takenaka promoted de-regulation but wrong that he brought in global std as is.
    Current global std is for the establishment of state by financial biz such as the US, which is giving up manufacturing.
    Japan is mfg centre of the world and I predict this tendency gets more apparent from non-price-wise factors such as reliability, punctual delivery, etc.
    For ex, assuming there are country A producing 1% defective parts and country B producing 2% defective parts with 1% cheaper price than A.
    Once failure is found after sales, the countermeasure cost blows off the deficit of the price.
    Besides the buyers must inspect all parts even 1 cent/piece at arrival but they are picking up at random at best or not inspecting usually with relying because the inspection labor cost is much expensive than the parts.
    So the production of not only critical goods but also comodities are returning to Japan.
    Japanese traditional employment such as seniority system works better for mfg than current global std.
    Therefore Japan should set up Japanese way of de-regulation unlike the UK.

    “Some of them support reform, but one is opposed.”

    In my opinion, most of them are reluctant to reform except Mr. Nakagawa group.
    As I wrote before, Mr. Aso tends to ally with Mr. Hiranuma who is the boss of anti-privatization of Post Office and Mr. Abe has debt to Mr. Aso at the resignation from PM.
    Japanese politics is good not to be influenced by specific private group but not good to be inevitable to rely on beauraucrats because there are not mighty Think-tanks unlike the US.
    Democratic Party is out of the question because Mr. Ozawa is public works promoter and the party is supported by labor union which wants large gov.

    “There are only two ways to close the gap.”

    It is sure that internal demand by all middle class mind brought up Japanese manufacturers to top brand and is needed to keep so even now.
    There would be one more modified way, which is to give high income and levy high tax.
    Japanese people think heavier of honor than money.
    Being listed in high tax payer ranking is one of honor and most of Japanese rich do not get away with the money unlike neighboring country.
    Samurai was respected for the refinement though they were poorer than merchants.
    I suppose excessive liquidity created by financial technology like alchemy is the root of all evils but the US, etc do not take measures to it because it would be essential to hold leadership in the world.

  3. Bender said

    My take of the situation is that the Japanese have tons of money in their accounts, but it’s just sitting there “doing nothing” (as a matter or expression), and is not creating demand- which is what drives the economy. Low interest rates were not working, so the government had to spend in order to boost demand. But since people weren’t generating money (no demand, no income, no tax revenues), the government had to borrow. Thus the fiscal problem.

    So I’m, wondering whether a status quo on taxation combined with lesser government spending will work, or will have adverse effects. It’s a big dilemma, I think.

  4. ampontan said

    Bender: I fixed it. Take a look and if you still want to delete something, let me know.

    To do blockquote, you have to do the left angle symbol followed by blockquote followed by right angle symbol, then at the end left angle symbol followed by right backslash followed by blockquote followed by right angle symbol. I don’t understand the xhtml stuff above the box either.

    I don’t think it’s the government’s responsibility to prime the spending pump. First, it’s not their money, and they can’t be trusted to spend it on the right things.

    Maybe private citizens don’t always spend their money wisely either, but they worked for it. They should get to choose.

    Second, if people don’t spend it, they’re putting it in the bank, and the bank will invest it. The money’s not just sitting there. It’s circulating.

    Ken: Thanks for the compliment. You can object all you like. I decided that it was pointless to read any more English-language newspapers about Japan. (I just skim through them now.)

    But this is a fascinating time for domestic Japanese politics now, with plenty to talk about. I’ve stopped reading the meta-commentary on English-language blogs, too. None of it is very interesting (or well-written) and most of it is tied to the daily papers. But that’s not where the good stuff is.

    There’s plenty of good material out there, so I decided to present it myself. Anyone who wants to disagree can, but at least there’s a basis for discussion.

    For me, it’s much better than people talking when they don’t have anything to say.

  5. Bender said

    I don’t think it’s the government’s responsibility to prime the spending pump. First, it’s not their money, and they can’t be trusted to spend it on the right things.

    I agree, but it’s also true that money wasn’t circulating during Japan’s long recession. Here’s an interesting article about Japan’s recent fiscal policy:

    Second, if people don’t spend it, they’re putting it in the bank, and the bank will invest it. The money’s not just sitting there. It’s circulating.

    It wasn’t. First, there was the zero-interest rate policy and Japanese banks didn’t have to invest and generate revenue (they weren’t paying taxes!). Second, Japanese banks were aggressively withdrawing their funds from Japanese companies (so-called kashi-hagashi), and bankruptcy was in boom. The economy could have slumped further, but the only thing that was stopping it from complete failure was government spending, says some economists (like Koo). I think this might be true.

    Anyways, Koo’s story focuses on Japan’s recent recession that ended a couple of years ago (although there seems to be another one coming up), and it may not be relevant now. I do believe one of the ideas behind privatization of Japan Post was to release excess savings into the market.

    I also see rather convincing discussions about how there’s only so much a country can borrow, and Japan’s almost reaching that critical level. This might be relevant now.

  6. Bender said

    Believe it or not, it seems that the majority of Americans now support Democrats. So it may be the end for the neo-con conspiracy you seem to talk about (good news?), but also bad news for Japan because Democrats seem to be leaning towards protectionism.

  7. I like what Koizumi attempted to do. What I don’t understand is why he only served 6 years. Six years is hardly enough time to accomplish many things. Is it in the Japanese Constitution to serve as PM for max of 6 years? Why do PM’s in England serve much longer, 10 or more years? The PM in Japan changes to often.

  8. Ken said

    “I decided that it was pointless to read any more English-language newspapers about Japan.”

    It cannot be helped because they are basing on Anglo-saxon way of thinking.
    There used to be the view that Japan was heterogeneous when her economy adjusted though exchange rate rose rapidly from 360 JY/$ to 240 JY/$ and years later to 120 JY/$.
    The limitless-like absorption beyond economic theory was said even ghastly and she objected it was just the difference in economic phase.
    But I think she is surely heterogeneous in the long run.

    “But this is a fascinating time for domestic Japanese politics now, with plenty to talk about.”

    Japan should set up unique economy-driven politics accordingly unlike already established ideology-driven or security-driven politics like her unique economy itself.
    Prtof. Huntington defined Japan separately from neighboring Confucianism counrries but was not clearly state the core maybe because he could not approach from economy.

  9. Bender said

    Is it in the Japanese Constitution to serve as PM for max of 6 years?

    No. A PM is appointed by the legislative branch. A PM can serve indefinitely if the legislature so chooses, and that the PM does not lose his seat in the legislature because that’s a precondition to being appointed PM. But that never happens. It’s the political culture that is preventing Japanese PMs to serve longer.

  10. Ken said


    Probably you are right but I am not talking about presidential election of the US.
    As for it, I do not like either of religion-fundamentalism leading Republicans and int’l affair deafness laborer leading Democrats as I wrote anywhere else before.
    Anyway, protectionistic policy such as UD devaluation would accelerate stagflation and fail in current economic condition.

  11. Ken said

    Use this code (it will work if you type the actual symbols. I’ve used escape characters to make the symbols appear and not be considered as HTML by your server).

    <blockquote>Put what you want in blockquotes here</blockquote>

  12. Ken said

    It’s the political culture that is preventing Japanese PMs to serve longer.

    LDP party rules allow a party president (who would be the PM) to serve two 3-year terms, thus Koizumi’s term came to its end. As the rules were changed for Koizumi, they could possibly be said to be part of the political culture, but more correctly, they are part of individual party rules.

    Should the Kokumin Shinto somehow gain control of the Lower House, does anyone know their rule on how long party presidents may serve?

  13. Ken said


    I am back. Did you watch the film that Yomiuri TV was denouncing Mainichi Shimbun?

    Well, I found an article related to above topic in Nikkei Shimbun’s magazine as follows.
    It says the Democrats are turning to former Japanese policy to have brought up middle class.
    I stated above that domestic demand by middle class had raised top industries such as automobile, home-appliances, etc. in Japan but I wonder what industry revives by the creation in the US now.

    Anyway, there are unexpectedly many cases that Japanese policy which had been criticized at that time was proved better in the long run.
    Public money add-in to financial institutes, which was blamed as against global std capitalism, has been anounced to adopt in the US.
    Likewise,most of the countries of float system are adopting controlled float, which was called ‘dirty float’ ever before when Japan interfered currency market.

  14. ampontan said

    Ken: Hope you had a nice trip.

    1. Yomiuri made YouTube take the film down for copyright violations.

    2. I thought about writing about WaiWai but didn’t. I think the people who got upset that WaiWai was discontinued because they thought it showed an important part of Japanese culture are next door to brainless.

    3. This article you talk about today is very interesting. I thought it was OK to about page 3. I didn’t understand what he wanted to say about the Japanese military. After that I didn’t agree at all. I don’t think he understands fully just how strange Hillary is, nor does he understand that her talk about the middle class is just that–talk.

    4. I’m fine with globalization and rationalization.

  15. Ken said

    Thanks, Bill. I had a good time with opera, etc. though I could not have time to drink enough.

    1′, That is a pity.

    2′, An Australian editor seemed in charge of WaiWai as follows.

    3′, I also doubt fired soldiers may disclose confidential technology to private biz.
    Well, Mr. Obama is said shifting the position closer to Hillary to get her supporters, isn’t he?

    4′, I believe rationalization but lately not globalization by case.
    For eg, merger by stock interchange such as ‘triangle merger’ is an evil alchemy.
    It can generate more reserve profit than the total of before merged company with no value addition.
    Vertual credit created in above way leads to surplus liquidity and causes today’s problems of money game.

  16. ampontan said

    Obama isn’t really shifting his position. He said things in the primary because the people who choose the Democratic party candidate are more leftist than the general population. Now he has to win the general election, and to do that he has to say things that the general population will swallow. If not, he will lose.

    If he gets elected, he goes back to being the leftist that he is whenever he has the chance.

    He and Hillary are socialists of one type or another, and if you were on good terms with them, they’d probably both admit it.

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