Page 13 - Accelerating out of the Great Recession

INTRODUCTION

while the economy faltered. And, although there were a few
quarters when things seemed to be improving, the Lost Decade
actually extended considerably beyond 10 years.
Are we saying that the United States of 2009 is comparable
with the Japan of 1991? Not exactly. The economies of the two
countries are very different, as are the cultures and (critically)
the demographics of the two populations. Also, the U.S. gov-
ernment responded faster and more aggressively to the financial
crisis than Japan’s government did nearly 20 years ago.
But the real issue is not what has happened, but what happens
next. Will the United States experience its own version of Japan’s
Lost Decade? Many experts seem to assume that history, albeit
displaced by a few time zones, will not repeat itself. But what if
the present recovery were to resemble the experience in Japan?
In a survey of top executives we conducted in the fall of 2009,
nearly half the respondents said that they expected postreces-
sion growth to be anemic for an extended period. Thus, given
the high risk that history may be repeating itself, companies
should be acting as if it could. They should be figuring out—
now—how to thrive in what many believe will be an economy
operating in a damaged state for years to come. They should be
acclimatizing to what has become known as the “new normal.”
There are, of course, many voices arguing that nothing has
really changed, that things will soon return to the “old normal.”
As evidence that not so much is different, they point to the
apparent recovery in the banking system and some green shoots
of global growth as 2009 drew to a close. But, as we describe in
the first two chapters of this book, we believe that such com-
placency is ill-founded.
This is not a book about economics in general or any econ-
omy in particular. This is a book about strategy and manage-

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