THIS IS VERY LIKELY OUR FUTURE

From DailyFinance.com courtesy of Paul Krugman's blog Conscience of a Liberal:

Japan's Economic Stagnation Is Creating a Nation of Lost Youths

What happens to a generation of young people when:

* They are told to work hard and go to college, yet after graduating they find few permanent job opportunities?
* Many of the jobs that are available are part-time, temporary or contract labor?
* These insecure jobs pay one-third of what their fathers earned?
* The low pay makes living at home the only viable option?
* Poor economic conditions persist for 10, 15 and 20 years in a row?

For an answer, turn to Japan. The world's second-largest economy has stagnated in just this fashion for almost 20 years, and the consequences for the "lost generations" that have come of age in the "lost decades" have been dire. In many ways, Japan's social conventions are fraying under the relentless pressure of an economy in seemingly permanent decline.

And

Even more extreme is hikikomori, or "acute social withdrawal," a condition in which the young live-at-home person nearly walls himself off from the world by never leaving his room. Though acute social withdrawal in Japan affect both genders, impossibly high expectations for males from middle- and upper-middle-class families has led many sons, typically the eldest, to refuse to leave home. The trigger for this complete withdrawal from social interaction is often one or more traumatic episodes of social or academic failure. That is, the inability to meet standards of conduct and success that can no longer be met in diminished-opportunity Japan.

The unraveling of Japan's social fabric as a result of eroding economic conditions for young people offers Americans a troubling glimpse of the high costs of long-term economic stagnation.

More here.

So for several years now Krugman has been looking to Japan's recent past as a possible future for the US. In short, when Japan's enormous economic bubble burst back in the early 90s, they responded in much the same way the US establishment appears to be wanting to respond to our economic crisis right now, with budget-cutting austerity measures, and with anti-inflationary measures, even though the real enemy then, as now in the United States, was deflation: as a result, the Rising Sun's economy has been stagnant, sluggish growth alternating with recessions, for nearly two decades.

And it is adversely affecting their culture.

My gut instinct, too, is that something similar will happen here, if our leaders don't pull their heads out of their asses and throw off the neoliberal orthodoxy that makes them ignore economic reality. I mean, it probably won't be as bad as Japan, culturally speaking. Social roles and conventions play a much more absolute role in the island nation than in our gutter mongrel country. If there's one thing at which we Americans excel, it's flouting social convention. But it won't be particularly good, either. This shit is real. I have no idea how we will adapt to a reality where job prospects for most people range from totally shitty to non-existent, but I suspect it'll feel very much like the third world does.

After all, what we're looking at is enormous numbers of Americans who were raised with middle class values and expectations faced with real poverty for the rest of their lives. My personal hope is that our culture positively adapts, abandoning the notion of consumption-as-supreme-value in favor of human relationships, cooperation, and homegrown art and entertainment. In some ways it might not be so bad. On the other hand, most of us will be in poverty, or always on the verge.

One thing's for sure. It won't be very pleasant getting there.

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