Recession Watch

Japan's Shrinking Economy

Japan's economy, the world's second largest, had its worst performance in more than three decades last year, The Washington Post reports. The economy shrank by 13.9 percent during the last quarter of 2008, and 12.7 percent for the year overall—the steepest slide since the 1974 oil crisis. Japan's dependency on exports contributed to the dip, as sales of cars, electronics, and capital goods have tanked in recent months. The news is doubly bad for Prime Minister Taro Aso, who has been in power less than six months and whose approval rating is below 10 percent, according to the most recent national poll. His stimulus plan, to give $130 to $220 in cash to each citizen, has been questioned by former Prime Minister Junichiro Koizumi, who called some of Aso's comments "laughable." No wonder Finance Minister Shoichi Nakagawa appeared drunk at a press conference in Rome over the weekend.