Sheldon Garon pens an ode to high-saving foreign countries, and certainly in today's depressed global economy running a trade surplus and a sky-high savings rate is all the rage. But while there are aspects of high-saving practices that are worth emulating, I think it bears pointing out that not everything done in this name is such a great idea.
It's fairly well understood, for example, that China's extremely high household savings rate is essentially a way of forcing China's still quite poor working class households to subsidize the activities of the Chinese export sector. That's the kind of thing that happens when your citizens can't vote to choose their leaders, but it's not a great idea. Garon mentions that "in German cities, one cannot turn the corner without coming upon one of the immensely popular savings banks, called Sparkassen." This is true. But the flipside of over-borrowing abroad during the aughts was precisely that poorly managed German banks—many of them state-owned—blew a lot of German households' money on buying things that American subprime mortgage bonds, lending to Spanish banks, and Greek government debt. This, like China's policies, has worked out great for export-oriented German firms and the minority of Germans who work for them but it's not clear to me that all things considered the Germans have benefitted from this arrangement rather than a more balanced growth pattern. High-saving Japanese households have financed that country's staggering debt:GDP ratio, a debt burden so large it's almost certain to be inflated away some day by the Bank of Japan. When that's done, Japan's savings promotion will turn out to have been a roundabout way of channeling money from thrifty households to politically influential construction companies getting contracts to build bridges to nowhere.
To make a long story short, saving money turns out to be a lot like borrowing money—it really depends what your money goes to. Taking out a loan to get a useful degree from a reputable college is a great investment in your future and for all the same reasons saving up to pay college tuition to get a useful degree from a reputable college without borrowing is a great investment in your future. But a worthless project is still a worthless project, and financing it with saving is no better than financing it with borrowing. If going into debt to build exurbs outside of Las Vegas is a dumb idea, so is lending the money to the guy whose building the exurbs. The saver and the borrower are two sides of the same coin, with the financial system standing as an intermediary. If the system as a whole is doing a bad job of channeling funds from savers to worthwhile projects, then that's the problem—not "too much borrowing."