The other day, I quoted Howard Davies explaining the big macroeconomic advantage of a country like Latvia over a country like Greece:
Latvia could make austerity work because they’d been in the USSR for 50 years, they were used to unpleasant and dramatic things happening. The population would accept incredible privation.
As a sort of followup, here’s a letter from one Mr. Zachary Pessin, in yesterday’s FT:
I have often thought that acclimatisation to a depressed economic environment is a state of mind that the Japanese have adjusted to… I first went to Japan in 1995 to live for a semester, then lived there full-time from 1999 to 2002. I have been every year since, save the last two. So, for 15 years I have seen how a generation of Japanese lost pride in their country, lost hope of an inspiring life and came to terms with the drudgery.
“Yikes,” you’re probably thinking, “Lost pride, lost hope and drudgery? That sounds awful — we’d better figure out fast how to avoid it.” Well, if that is what you’re thinking, then you’d better think again. Losing hope is the whole point. The Japanese, Pessin says, are
a decade ahead of us in dealing with the world we now live in. … Perhaps you know the Japanese term gaman, which is effectively translated as “to persevere valiantly through pain or difficulty; stoic determination”. This too will be another import from Japan, because they have been living in the House of Gaman for almost 20 years now, and we Americans are just arriving. And make no mistake, the deleveraging that must continue across the US economy for at least another five to eight years at best will keep us walking the precipice of deflation for at least that long. There will be a need for gaman.
I don’t know how much pain or drudgery is in store for Zac Pessin personally, given that he is President and Chief Executive of the Distributed Capital Group; you can find him here crowing about double-digit returns on his investments in sub-Saharan Africa. But it’s nice of our masters to let us know about the sacrifices we will be expected to make on their behalf.
Those who take the meat from the table
Those for whom the taxes are destined
Those who eat their fill speak to the hungry
Of wonderful times to come.
Those who lead the country into the abyss
Call ruling too difficult
For ordinary men.