Posted by: Spacehamster74 | 02/06/2009

Lessons we can learn from the Land of the Rising Sun

We're constantly being told by those of a Leftist persuasion (ie. President Obama and Prime Minister Kevin Rudd) that infrastructure spending is one of the best approaches to ameliorating the impacts of a recession. But is that true? Hopefully this article will help you come to your own conclusions –

Still, local officials in Hamada warn that their city’s economy will
collapse without public works, though they recognize the spending
cannot continue forever. They offered their own lesson to American
communities in the Obama era: when you choose public works projects, be
sure to get ones with lasting economic impact.

Among Hamada’s
many public works projects, the biggest benefits had come from the
prison, the university and the Aquas aquarium, with its popular whales,
they said. These had created hundreds of permanent jobs and attracted
students and families with children to live in a city where nearly a
third of residents were over 65.

“Roads and bridges are attractive, but they create jobs only during
construction,” said Shunji Nakamura, chief of the city’s industrial
policy section. “You need projects with good jobs that will last
through a bad economy.”

The conclusion I've come to is that infrastructure spending is fine, providing the end result is actually useful. It's a positive sign that US Treasury Secretary Timothy Geitner understands this point. Hopefully the Rudd Government will understand this point as well.

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