Yes, and? In Asia in 1997-98 that is exactly what happened. The governments did not have welfare states to fund, and they did not have enough money to bail out the banks. So the banks basically went bust en masse. By 1999 the economy was rebounding rapidly and by 2000 the economies were back to normal, they then grew for a whole decade before the 2008 recession, and in 2009 and this year they are growing normally again. In other words, the economy had 18 bad months as the market cleared and badly-managed businesses went broke, then without any government interference it rebounded as the stronger surviving companies picked up the slack, hired the cheap unemployed workers, and started delivering products and services at lower prices that people could afford. Governments did not take on debt of 100%+ of GDP to cripple future generations. Meanwhile Japan did exactly as you said and endured 20 years of stagnation. The relative performance of Asia vs Japan, and nowadays Asia vs the west, shows that a big government that "helps" the economy during recession is a terrible disaster that spells long-term societal bankruptcy and ruin. Keynesian policies didn't work in the 1930s (where unemployment was 10-20% for the whole decade), they didn't work in Japan for 20 years, they didn't work in the 1970s, and they won't work now.
Exactly. I know a kid who's in school full time but still made over $100K last year through a part time business he started, cleaning out foreclosed houses and selling what people leave behind. But I disagree with your last point. Right now the government is rewarding those sitting on their asses and whining with 2+ years of welfare.
"Social Support" at taxpayer expense should be 3 meals a day and a cot in a shelter. No money for cigarettes, alcohol, gambling, cell phones. If they want better than that in their, they'll find a job and work their way up. Grandpa always used to say, "the world doesn't owe you a living.. make something of yourself". Still true.
If I were in charge we would be at full employment within 1 year, because I would give everyone without a job 1 year to get one. Anyone unemployed after that I would have executed. There may just be too many people. Hey, I'm a problem solver what can I say?
Great post. The same could be said for the U.S. depression in 1920-1921...and basically all other depressions the U.S. had before the "Great" one. It was only then that Keynesian madness took over.
The one AND only positive I can take out of this is that finally there is some attention paid towards the fact that this is a monetary "idelogy" (i.e. Keynesian), 2 years ago you had the feeling as if there were no history outside the previous 20-30 years in this country. That it was written in stone that any and all recessions be met with ever increasing government spending and stimulus.