TOKYO (AP) - Japan's finance minister said
Thursday that rising government debt has
pushed the nation's finances to the verge of
collapse.

Kiichi Miyazawa's remarks in Parliament
amounted to a public admission that the
government can no longer afford attempts to
spend itself out of an economic slump that
is deepening again after some signs of
recovery.

Japan's finances are "very close to
collapsing," Miyazawa said.

Tampa Bay Online

-- spider (spider0@usa.net), March 08, 2001

Answers

At some point in time this is going to have a major impact on us. If there collapse means that they stop supporting our deficit spending then the dollar will collapse. Whatever the case, it would be unprecedented (or are there historical parallels?).

I'm not sure what the ramifications would be but I'm sure its not good to have the 2nd largest economy collapse. There would be at least one lesson that we can learn from Japan and that is we CANNOT allow government to attempt to spend itself out of a recession. Only private enterprise spending and commitant job creation can pull us out of a recession.

Government attempted to deficit spend itself out of the great depression but now our national debt is so large, that that trick won't work again.

-- Guy Daley (guydaley@altavista.com), March 08, 2001.

Miyazawa explained away his statement the day after he made it. Meanwhile, the prime minister, Mori, has announced he will resign.

Nando Times

-- Rachel Gibson (rgibson@hotmail.com), March 10, 2001.