The Lost Decade

Why the last 10 years have been an economic disappointment for most Americans.

By Daniel Gross
Posted Wednesday, Nov. 11, 2009, at 3:36 PM ET

---

As we dig out from the rubble of the financial sector's collapse, it's common to hear analysts fret that the United States may now be facing a Japan-style "lost decade." Throughout the 1990s, after its real estate and stock bubble burst, Japan struggled with low growth for more than 10 years. It emerged from the decade shrunken and sapped of confidence, with very little to show for a large amount of government spending and near-zero interest rates.

I'm not particularly concerned that the United States is in for a lost decade. Our political and financial leadership reacted much more quickly than Japan's did, and the U.S. system, for all its faults, processes failure quickly.

More importantly, we've already had our lost decade. When 2010 dawns in several weeks, it will bring down the curtain on a decade—the oughts—in which a great deal and not much at all happened, economically and financially speaking. In fact, a startling number of contemporary indicators are at or below the levels at which they stood 10 years ago.