The government is also present in the banking industry, controlling almost every major bank rationing credit by political fiat rather than by market forces.

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When credit worthiness is the rationing mechanism then a positive feedback is set up.

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We are again in the regime where credit worthiness is the rationing mechanism.

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This raises the specter that the United States is doomed to many long, gray Japan-like years of economic twilight, with growth in the private sector being choked off through a rationing of credit so that the government and its Big Business cronies can hog low-interest credit while would-be new businesses that are the engine of job creation are left to fend for themselves.

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