[OPE-L:1266] Re: Re: monetary inflows versus capital accumulation

From: Rakesh Bhandari (bhandari@phoenix.Princeton.EDU)
Date: Fri Sep 17 1999 - 07:18:20 EDT


Jerry argued:

>As you acknowledge, this example is not about Japan and is, therefore,
>irrelevant to the matter at hand.

The example (German cooperation with the US in late 60s-early 70s) is
hardly trivial or irrelevant; it shows how the US has parlayed military
hegemony into financial resources in the past. It sheds light on how such a
process can and has worked.

>Moreover, I have no doubt whatsoever that had Japan refused to reimburse
>the US for military expenses, the war would have been fought the same.

Then, Jerry, why did Japan reimburse the US for its efforts in the Persian
Gulf? Why does it pay for US soldiers to occupy its territory? You then
suggest that Japan does so to ward off US protectionism--which seems to
underline my point, no?

>Yes, but there is no reason at present to believe in a Russian military
>effort there. Nor a Chinese military effort.

You believe that there is no reason to take seriously any threat of Chinese
or Russian aggression in the modern world?!

>> Thus, a
>> >demand that the Japanese government pay for the US military lacks muscle
>> >(this is even more the case today since Japan has little reason to believe
>> >that China or Russia is a threat to them militarily).

Yet Japan still pays for troops on its own soil; it still paid for the Gulf
War. It still relies on the US keeping, e.g., S Korea and Indonesia
friendly to Japanese FDI and imports since the US exerts influence (and
control in the case of S Korea) over the military.

>And Japan is no more Thailand than a potato is a tomato.

But Japan is not the king kong that it is imagined to be in the orientalist
US. Not only is Japan military dependent, it cannot compete with the US on
the cutting edge of high tech industries (microprocessors,software,
biotech, aerospace, etc). For example, its electronics business is top
heavy with standard memory chip production and computer games while the US
dominates the most advanced and application specific microprocessor
business. Japan obviously lags far behind the US in software. The yen seems
now even less of a threat to the dollar in its function as a reserve
currency. But if the pyramid scheme built out of the public infusion of
money into the banks comes down, Japan is quite big enough to catapult the
world economy into depression.

Yours, Rakesh



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