The Economy Will Definitely Get Better
In response to the once-in-a-century global
economic crisis, countries around the world
are making national efforts to tackle the challenges.
In the United States, the Congress has approved
an economic stimulus bill, which President Barack
Obama has signed into law so that it takes effect
immediately.
The US economic stimulus package has a total
value of $787 billion (\72.5 trillion), of which
about 64% is expenditure increases and about
36% tax cuts. A “Buy American” clause
is included, though it will be applied in a
manner consistent with America’s obligations
under international agreements. Jobs for 3.5
million people will be created.
I have no doubt that this package is going to
have the effect of supporting the economy from
the second half of this year. Of the expenditure
increases, which account for 64% of the package,
$120 billion goes to the improvement of bridges,
roads, and the electricity grid; $38 billion
goes to the “Green New Deal” and
so on; and $193 billion goes to establishing
a safety net, including the expansion of health
insurance and unemployment insurance. Of the
tax cuts, which account for 36% of the package,
measures center on tax relief for workers, but
there are also tax reductions for the purchase
of new cars and homes, tax relief enabling companies
to immediately write off more of their investments
in equipment, and tax credit for education expenses.
At last this package is going to be implemented.
At the same time, the finance ministers and
central bank governors of the G7 major industrial
countries gathered in Rome on February 13 14
and issued a joint statement pledging that their
countries would actively adopt fiscal measures
to expand domestic demand and create employment;
confirming that their countries were taking
steps, including exceptional measures, to stabilize
the financial market; expressing concern about
the emergence of protectionism, which only exacerbates
the downturn and prevents economic recovery;
and stressing that appreciation of the Chinese
renminbi was desirable.
The G7 finance ministers and central bank governors
showed their stance of seeking to contain the
economic crisis, and from now on each country
will take urgent steps to enforce measures and
achieve results. They also stated clearly that
the global economic stagnation would continue
through 2009, so the situation remains unpredictable.
However, if the major countries unite and act
swiftly to overcome the global economic crisis,
I am sure that results will definitely be achieved.
In the crisis that occurred last century, countries
did not act in unison, and the result was a
world war.
The United States has begun to act resolutely,
too. For this article I referred to the Asahi,
Yomiuri, Nikkei, Sankei, and Tokyo Shimbun newspapers.
Although their commentaries all welcomed the
US stimulus package, they never failed to add
some negative remarks as well, like “The
package does not offer prospects for effectively
overcoming the crisis,” “America’s
traditional dole-out policy,” or “Obama’s
fiscal policy is walking a tightrope.”
When an otherwise good article turns negative
toward the end, in many cases the reader understands
it to be a total denial. With regard to the
latest economic crisis, the style of newspapers
in reporting economic and corporate information
typically has pushed the public to the depths
of despair. This has led consumer behavior into
the negative zone. It is a very serious matter.
I firmly believe that as countries begin to
address the real economy, the effects in supporting
the economy will definitely begin to appear
in the second half of next year, and the economy
will start moving toward recovery. The US economic
stimulus bill, the actions and statements of
President Obama, the meetings of the G7 and
G20, and so on should go down in history as
epochal events. At the same time, we should
never forget the evil of the vulture funds and
so on, and we should always remember that neither
states nor companies must be allowed to have
dominance.
All the same, the lack of tension in Japanese
politics is deplorable . . . .
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