>that is the question: is unused capacity in Japan due to inadequate demand
>for the product -- or is it due to excessive investment in the past? in the
>former case, simple Keynesian policies (like those I suggested) might work,
>while in the latter case, they wouldn't.
Speaking of overcapacity, I urge PEN-L'ers to look at today's Wall Street
Journal which is very upfront about the problem of overcapacity facing the
USA, particularly in the high tech arena. The reason that the Fed is
anxious not to go too far with interest rate cuts is that it does not want
credit to become too freely available. This would cut across the need to
liquidate inventories, since loans usually serve only one purpose: to
expand production. One front-page article deals with the issue of the Fed
and rate cuts. The other deals with high technology infrastructure
spending, an area that I am intimately familiar with. Trust me, the WSJ
article is right on the money. Columbia spent a huge amount of money in the
1990s to set up a campus network that would make client-server computing a
reality. The next big development effort will revolve around making
web-based clients available. For that, no new hardware investment is
necessary. Furthermore, the language used to develop applications--java--is
virtually free.
Louis Proyect
Marxism mailing list: http://www.marxmail.org/
