Noilly Prattle: the only game in town

Wednesday, July 18, 2012

the only game in town

In a rather eerie echo of my previous post there are some very telling reactions to Fed Chairman, Ben Bernanke's recent appearance before the Senate Banking committee as reported in the New York Times. The issue, of course, is government stimulation of an economy in the doldrums—to do or not to do it.

Mr. Bernanke, playing it coy, talks of a looming “fiscal cliff”. “The combination of higher taxes and cuts in federal spending set for the end of the year 'would probably knock the economy back into a recession and cost a lot of jobs',” Mr. Bernanke said. This, it seems to me, is a rather off handed way of saying, as Richard Duncan suggests, that the economy is, in fact, on government life support. 

As you would expect the senators reactions are purely party line. One example each:

Republicans pressed Mr. Bernanke to forswear additional action, warning that new measures would eventually lead to higher inflation and suggesting that the Fed’s policies were allowing Congress to delay a reckoning with the federal debt. Mr. Bernanke rejected both arguments.

Democrats put countervailing pressure on Mr. Bernanke to agree that he should do more. “I’m afraid the Fed is the only game in town,” said Senator Charles E. Schumer, Democrat of New York. “And I would urge you to take whatever actions you think would be appropriate.”

Does that sound like government life support or what?


Anonymous said...


I find it interesting that you are, often, commenting on American politics.

Is it because you feel kin to it, being from this country, originally, or is it because the United States' issues affect the world?

Are you just as interested in the Japanese economy and follow it as intently?


Noilly Prattle said...

Probably both. You can take the American out of the country, but you can't take the country out of the American. Of course, US issues do affect the world, so they affects me wherever I am. Certainly, economic issues are inter-connected so they affect us all as well. Japan is mostly run by its large bureaucracy no matter who is the PM or what party controls the Diet. It mostly lumbers along and Japanese politics are, by and large, boring. Except, of course, when a Fukushima happens. Other than that it's just fun observing global events and trying to figure what's really going on. I guess its the globetrotter and historian in me. Besides, it's the only game in town. ;-)