Apart from its recent interest rate cut, whichwas designed less to stimulate domestic consumption than it wasto decrease the pressure on business firms very close to theline, Japan has done nothing to restructure fundamentally itseconomy. For reasons we have discussed extensively in the past,Japan cannot carry out a fundamental restructuring. The gridlockis not political but structural. Between a crisis now and a worsecrisis later, Japan has chosen a worse crisis later. This issensible, simply because the crisis now would be devastating and,after all, something unforeseen could still occur to save Japan.
Miracles do happen.
And so, with the Russians marginalized and the Chinese notinvited, it was back to business as usual for the G-7. Thismeans, in a way, that Asia has now passed from a crisis to a wayof life. It also means that the Japanese and Chinese areofficially on their own. Since there is no crisis, there is noneed for concerted international help. Moreover, since the onlyimmediate problem is a general deterioration in internationaleconomic growth, attributable as much to the general businesscycles as to secular shifts in Asia's economy, in other words nota crisis, the expectation is that normal economic policy measureswill be sufficient to cope with the problem.