politics

Abenomics failed to deliver as Japan braces for post-Abe era

80 Comments
By Leika Kihara and Takaya Yamaguchi

The requested article has expired, and is no longer available. Any related articles, and user comments are shown below.

© Thomson Reuters 2020.

©2020 GPlusMedia Inc.

80 Comments
Login to comment

Well, at least he didn't start a war. Could you imagine having to be PM of Japan?

I mean, for heaven's sake... where do you start and how convoluted the nonsense of the LDP factions must be. It's like a Rube Goldberg machine. How in the world could you get anything accomplished at all?

What would you do?

10 ( +14 / -4 )

As head of the largest party and faction within, he had a lot of power not put to use. He could have pushed for the reforms - equalized vote values, halved national politician count, stopped propping up whaling and rice farming - both simply vote buying operations, supported better social support for women with children, stopped living in the 1950s - Abe mask, etc.

21 ( +24 / -3 )

All he did was waste time and money.

26 ( +31 / -5 )

Failed to deliver? I would have just said, “Failed!” and been done with it.

His economic policies are fraught with lies. He should be facing charges of fraud. Here’s a short-list of his lies.

First sakes tax increase was plugged to pay off the public debt. Never happened!

Second sales tax increase plugged to support the pension and the public debt. Never happened!

Women in the workforce on equal pay. Never happened!

Tax cuts given to corporations to be passed on as salary increases. Never happened!

Free child care. Never happened!

Free secondary education. Never happened!

These are just a few off the top of my head. There are many more! He’s just a lying politician. However, he’s just going to be replaced with another liar full of false promises and delusions of grandeur.

35 ( +38 / -3 )

And here come the excuses...

Nippon Kaigi never had ANY intention of bringing about the long overdue reform needed to free the Japanese people (and residents) from servitude. 'Forced' overtime, for example. It would affect their mass profits.

Bye, bye Abe. You milked it well. Welcome to the next chosen muppet.

39 ( +41 / -2 )

He did have an excellent exit strategy. Standing ovation for that Abe San!

-9 ( +2 / -11 )

"He had various diplomatic negotiations overseas and there were pros and cons, but I think there were many merits.

Where are the examples here?

Heres one...

When Abe was in Iran to ostensibly mediate,

a Japanese tanker was attacked by Iranians.

He left Iran shortly after having wasted time and money doing JS!

He went halfway around the world to become severely embarrassed.

It was a cringeworthy spectacle!

> "He was working hard on (measures to deal with) the coronavirus. But he seemed worn out lately, and I was worried.(His resignation) is very unfortunate."

Working hard to waste taxpayers‘ money on worthless masks and watching Japan endure a State of Emergency that resulted in more infections, not fewer-a massive fail if ever there was one!

The measly payments given as GDP shrunk 30% must really assure people in Japan that Abe was a caring PM.

15 ( +16 / -1 )

Legacy? I can think of a few, increase in children living in poverty, workers on dodgy contracts, watering down of labour laws. Souring of relations with neighbors. Economy in a spiral before the virus. A financial focus on profitable international companies over had to mouth tax payers...it's going to get worse as the LDP decide who's bloodline is next to have the honour of the position of PM. Skills not a prerequisite, a vision of a future not a prerequisite, wanting to improve the lives of Japanese......who?

25 ( +27 / -2 )

a massive fail if ever there was one!

In his mind, and for his cronies, it's not a failure at all. He walks away a far more wealthy business man. And the groundwork for Nippon Kaigi's future warlords is laid.

He didn't fail at all. You assume his/their intentions are good...

15 ( +18 / -3 )

He did deliver the tiny little bitty masks.

6 ( +10 / -4 )

Gotta love those Reactions from public that pretty much show the mindset of a Japanese non-voting, never cared about politics citizen. " He Worked hard" "I think he worked hard" " I wish he worked harder..." etc.

Its aslo the usual empty phrase used when you dont know what to say or there is nothing else you can praise.

26 ( +28 / -2 )

He wasn't actually bad, and he certainly wasn't good. He did nothing outstanding, nothing he will be remembered for. He is a pathetic little man. Mediocre.

24 ( +27 / -3 )

A corrupt, lying, criminal failure whose catastrophic policies have impoverished millions of ordinary working people in Japan.

Sadly, he will almost certainly never face justice for his crimes.

https://www.japantimes.co.jp/news/2020/07/15/national/crime-legal/toshio-akagi-suicides-damages/

25 ( +29 / -4 )

Alfie Noakes, very well said!

11 ( +14 / -3 )

windfall profits that trickled down to wages and new jobs

In which universe is this true???

17 ( +19 / -2 )

Alfie Noakes, very well said!

Agreed.

5 ( +10 / -5 )

Also this summarizes very well how much the average Tanakas of this country know or even care about results because:

I think he worked hard...

...said all the Tanakas and Taros who were interviewed.

But who cares if he worked hard? It boggles the mind how people in this country simply have no clue what productivity means. People also cannot dissociate busy work from effective work and results.

14 ( +16 / -2 )

The first time he resigned was because of the same medical issue and stress because of the defeat of the LDP in the house of councillors. He couldn't stand up to the stress and wimped out. Then after getting better, he should have stayed out of the PM game but me thinks his family wanted him to continue with the Abe family legacy and to redeem himself after the humiliating exit. Then he becomes the longest serving PM with the longest serving nothing done PM. This time he quits at at time when Japan faces its most dire crisis since WW 2. Wimp. People shed tears over how hard he worked. Duh, it's a friggin' crisis. The frontline medical workers don't have the luxury of resigning because they have stress. Abenomics was doomed from the start because it was nothing more than an economical abenomask. The pandemic has only reinforced industry and consumers' thoughts about holding onto cash, thus throttling the economy. Absolutely no leadership during this crisis proved to everyone that the only way that they're going to survive is to look out for themselves because the government won't and in its incompetency, can't. And the corruption? He has blood on his hands. Don't forget the Finance Ministry official who committed suicide because of Sagawa and the Moritomo scandal. Abe's legacy will be his masks and hyping the Olympics when over 100,000 people were still displaced from the tsunami. He and his government effectively diverted attention and funds away from the nukes and the displaced.

16 ( +18 / -2 )

Can anyone say ONE good thing of his 8 years tenure?

11 ( +14 / -3 )

How typical jump on the bandwagon AFTER the fact! If these people, and the rest, had complained sooner, Abe would never have lasted this long.

4 ( +9 / -5 )

Can anyone say ONE good thing of his 8 years tenure?

He left before it got to nine years?

14 ( +15 / -1 )

The past, fiscally/monetarily has little or no relevance.

I was told yesterday by colleagues and investors; the future influences the present just as much as the past.

Japanese Prime Minister Shinzo Abe is history, his short-term replacement, will influence whether medium sized businesses will risk capital investment, impacting directly to growth potential and access to loan capital. Or fundamentally review a program of offshoring.

It is now of little consequence what Shinzo Abe did or didn’t do, should or failed to do.

The economy stumbled to a record contraction in the second quarter that shrank nominal gross domestic product (GDP) to 507 trillion yen ($4.8 trillion), around levels marked in 2013 and far distant from Abe's 600-trillion-yen target.

Milton Friedman magic money printer Helicopter drop, is a myth, an accountancy/finance first term lecture. All the debts will have to be serviced.

Confidence that Shinzo Abe replacement can deliver and at the very least maintain a semblance of economic stability is key.

-4 ( +1 / -5 )

Can anyone say ONE good thing of his 8 years tenure?

Its over?

8 ( +11 / -3 )

Katsumi Abiko - well said

0 ( +3 / -3 )

Wow, I got a stack of votes down yesterday for calling him an “over-privileged, out of touch dinosaur flake”!!

you guys are much harsher on him and all votes up!

bye bye Abe, I hope you can deal with your illness, while the country deals with its.

4 ( +7 / -3 )

Sadly, he will almost certainly never face justice for his crimes.

The sad fact is that most people outside Japan and not familiar with the country have absolutely no clue as to how ineffective and xenophobic this guy is. I've seen comments on other sites, and I've seen words like honourable, good guy, etc. The difference is, most of us at JT actually live in Japan and know what he's like and know all about his scandals.

Bye, Felicia.

12 ( +15 / -3 )

Remember the way the western MSM lauded Abenomics when it kicked off and through the years? I remember just one older economist interviewed on the BBC who said, “Its smoke and mirrors. Theres no chance it will succeed.” He was never invited back.

10 ( +12 / -2 )

The biggest setbacks to the economy - COVID-19 and the consumption tax hike -- had nothing to do with Abenomics.

People have short memories, but the Japanese economy was in really dire shape before 2012. Falling wages thru bonus cuts, negative growth, etc. The economy improved fairly steadily after that until the tax hike and covid.

-6 ( +5 / -11 )

New leadership will make Japan stronger, more ethical . . . . Japan can meet the challenge.

-10 ( +1 / -11 )

@JeffLee

and before 2012 it was the LDP under Fukuoka and Aso that sent the economy into those dire straits. (Followed by Kan and Noda dithering briefly and incompetently from the DPJ)

1 ( +2 / -1 )

(Followed by Kan and Noda dithering briefly and incompetently from the DPJ)

These two were doomed from the start, as while they may have had the PM position, the LDP still controlled the country, prefecture by prefecture, and anything they tried was going to be a fight all along the way.

Same as when Murayama was PM, when the LDP was forced to form a coalition government, the LDP back then, and for a large part today, still control the internal politics of the prefectures.

4 ( +6 / -2 )

One failure of this LDP Government, is the continuing negligent and betrayal to fully recognize and reward Part time and Non-Regular workers with a living wage.  Will the next incumbent, just continue to shamefully allow this travesty to continue?

Overview of Non-regular Employment in Japan

https://www.jil.go.jp/english/reports/documents/jilpt-reports/no.10_japan.pdf

9 ( +10 / -1 )

Abenomics failed, as predicted, because it's based on fraudulent Keynesian economics.

4 ( +8 / -4 )

Though there were many problems in his policy, the fact that Japan still remains the third largest economy in the world points out that he still did a good job. What matters that most is the post-Abe position, that person will be the key to Japan's future.

-11 ( +1 / -12 )

Abe's blind incompetence stood out during the 2015 hostage crisis.

He didn't use Ramallah or Amman to broadcast Japan's position from, but contested Jerusalem, flanked by an Israeli flag.

6 ( +7 / -1 )

"I think he worked hard. As head of the ruling party, he worked hard on Abenomics for eight years. There were various problems, but if someone else had been leader, it's questionable whether they could have maintained a stable government for as long as he did.

Doncha just love circular logic?

He was great because he stayed in power for such a long time.

He stayed in power for a long time because he was so great.

8 ( +10 / -2 )

He won’t be missed,his revisionist and xenophobic rule made it hard to live for expats in Japan and made even the local population poorer.

He will remembered for his increasing of taxes and his scandals.

Saying that,we all know that little will change with his successor,because it will be just another member of his same right wing revisionist faction.

13 ( +14 / -1 )

He wasn't actually bad, and he certainly wasn't good.

Try and explain that to 1 in 6 Osaka children who live in poverty in the worlds second biggest economy. Oops I forgot, we were no 2 before Abe, now number 3, about to become number 4. Thanx Abe.

10 ( +11 / -1 )

Increasing the cost of living in Tokyo while wages for most low paid workers were not increased, Borrowed billions to decrease the yen, but eventually it went back to 2012 levels, but now with increased national debt.

Introduced free child care for three year olds, but discounted new born babies from free child care.

Gave everyone a mask too small to be safe from covid and no one wants to wear for fear of being ridiculed.

Are we really better off? We won’t judge his legacy until the dust has settled, but didn’t abe make so many mistakes?

The good? The Olympics-most people in Tokyo don’t want it, I struggle to remember any good things he did since 2012-a change is long overdue, close the door on the way out abe..

8 ( +9 / -1 )

Too presumptuous, too arrogant and to narrow minded he was and is still. If anything there’s more government corruption today and it was before, there’s more bribery And more deceit.

8 ( +9 / -1 )

Abe San failed as he continued the failed right wing ideological trickle down economic theory of quantitative easing which funnels central bank created money to banks and the bond markets.

The next leader should try trickle up economic theory instead whereby the created money is spent into the economy on needed infrastructure projects(not vanity projects) education and training and programs of social improvement. This creates demand in the real economy, inflation and allows the government to collect more in tax revenue to balance the books.

5 ( +6 / -1 )

Success and failure go in hands, that is my quick evaluation for Abe's policy strategy as well as outcomes. It's still mixed and equivocal as more time may be necessary to assess impacts.

The Abe administration has successfully consolidated power at Kantei (PM's work office) countervailing against the die-hard bureaucracy controlled by non-elected officials and LDP's tribal politics led by non-retired senior members and cliques. Terrible red-tapes have been removed in many fronts. Abe was reformist in this regard. Yet this achievement cut both ways as corruptions and abuse of power have emerged around Kantei.

The same is true for economics, foreign and security issues. What he has achieved (and how) already predicts or end up co-existing with shortcomings alongside his "Abeno-" style under both praise and criticism. It's exactly the flip side of a coin and largely a matter of interpretations.

-1 ( +2 / -3 )

KATSUMI ABIKO, 79, SHOPKEEPER

"I've been wanting him to resign for a long time."

KATSUMI ABIKO, 79, SHOPKEEPER

"Everything he did was wrong. Especially (trying to) amend the constitution. He is not protecting our constitution but wanted to change it. I can't forgive him."

Is this the matrix? I guess 79 years old and still working hard as a shopkeeper would make anyone bitter. And I assure you dear readers that when we try to get a pension in this country it will be even less than Katsumi Abiko, 79, Shopkeeper is getting now.

-2 ( +5 / -7 )

Quite ironic it may be, what people initially expected most from Abe has not been fulfilled although what they expected the least turned out to be fairly good results.

-4 ( +1 / -5 )

It was never anything but window dressing. Kedanren, backed by Japan, Inc are never going to allow workers a fair wage, a fair stake or a fair shake. Most people lead a life that is little different to one spent in a 19th century workhouse.

7 ( +9 / -2 )

"If these people, and the rest, had complained sooner, Abe would never have lasted this long."

How long did you say you've lived here?

4 ( +5 / -1 )

RecklessToday  10:49 am JST

And I assure you dear readers that when we try to get a pension in this country it will be even less than Katsumi Abiko, 79, Shopkeeper is getting now.

Abe had eight years to try and do something about that. We'll just chalk that one up as another of his many failures, shall we?

7 ( +8 / -1 )

@Simon Foston, okay but nothing anyone can do about the demographic cliff. Be prepared to work until 80 or longer.

3 ( +5 / -2 )

Abe had no idea how to run a country smaller than the state of California.

0 ( +2 / -2 )

The man is a complete failure and a fraud..The next PM will be much of the same! Cronyism! Bribes! Scandals!

10 ( +12 / -2 )

The only thing that concerns me is the reentry restriction and Abe failed on that.

1 ( +2 / -1 )

Thank you former Prime Minister Abe for your long and dedicated service to Japan. With it came failures and successes and people will always criticize because they can at least for the moment. Some good and some bad came out of your tenure for Japan, now its up to your replacement to see what direction Japan heads towards. Rest well and best to you with health issues.

-11 ( +2 / -13 )

Abe was the most corrupt P.M. in Japanese history bar none.How some people up on here fawn over him is outrageous.But I guess, if you put your blinkers on you'll see only the so-called good he did. Allowing you to skip over the scandals,missteps,cronyism,suicides of bureaucrats etc. Add his much vaunted Damenomics,blunted arrows policy and general decline in people's pay and work conditions. The ultimate silver spooner who achieved nothing of note as PM.Low expectations are good for some people.

8 ( +10 / -2 )

Though there were many problems in his policy, the fact that Japan still remains the third largest economy in the world points out that he still did a good job.

That shows nothing of the kind. Millions here living in poverty because of him and the LDP. Many millions more donate their lives to corporations, that's why the GDP is where it's at. It's based on indentured slavery.

6 ( +7 / -1 )

NAOHITO KOJIMA, 55, BROKERAGE EMPLOYEE

"I think he worked hard. As head of the ruling party, he worked hard on Abenomics for eight years. There were various problems, but if someone else had been leader, it's questionable whether they could have maintained a stable government for as long as he did.

"He had various diplomatic negotiations overseas and there were pros and cons, but I think there were many merits.

REIJI IWATA, 24, ACTOR

"I think he's been working the whole time, and we've also had the coronavirus pandemic. He's faced various criticism, I think, but he's worked hard for the country so I feel kind of sad that he's resigning."

This is how some people see him? Amazing. Working hard...? Gimme a break. Some Japanese don't hold him under any scrutiny whatsoever. Who cares about working hard when you've barely delivered and have even deceived the public many times. Did they conveniently forget this?

5 ( +6 / -1 )

"The sad fact is that most people outside Japan and not familiar with the country have absolutely no clue as to how ineffective and xenophobic this guy is. I've seen comments on other sites, and I've seen words like honorable, good guy, etc. The difference is, most of us at JT actually live in Japan and know what he's like and know all about his scandals."

"Abe was the most corrupt P.M. in Japanese history bar none.How some people up on here fawn over him is outrageous. But I guess, if you put your blinkers on you'll see only the so-called good he did."

"That shows nothing of the kind. Millions here living in poverty because of him and the LDP. Many millions more donate their lives to corporations, that's why the GDP is where it's at. It's based on indentured slavery."

If you the above posters think they can do a much better job why not run for office and show the rest of us what you can do? Walk the talk or quit whining. Have some dignity and respect for the office and leader of what I still say is 2nd Economy in the world unlike the paper China who sells junk to the world that breaks after 1 use and bullies its neighbors. Even Russia has some class come on. IF you don't like it, no one is keeping you back from leaving. So again put your money where your mouth is and walk the talk or at least at minimum show some honor, respect and self restraint at a time like this.

-10 ( +3 / -13 )

Arrows to save the fax machine.

4 ( +5 / -1 )

Abe gave political stability. I’ll give him that. But his political views were always on the wrong side of history. The Japanese people are for the most part against amending the constitution. Who cares if the Americans drafted it? I think it’s served Japan pretty well for the past 75 years

1 ( +6 / -5 )

What is there to brace for? As if anything is going to change under new LDP leadership.

1 ( +5 / -4 )

Its not a bipolar world this one of 2020

-2 ( +0 / -2 )

KATSUMI ABIKO, 79, SHOPKEEPER

"I've been wanting him to resign for a long time."

KATSUMI ABIKO, 79, SHOPKEEPER

"Everything he did was wrong. Especially (trying to) amend the constitution. He is not protecting our constitution but wanted to change it. I can't forgive him."

These people are the true backbones of Japanese economy - SME and shop-owners. Not some Yes-salarymen and host-club actors/actresses.

Abenomics brutalized these people in a free market economy with insane tax hikes in the last 8 years.

4 ( +6 / -2 )

Posters here are asking for one positive;Abe looked great as Mario the plumber-there you go!

3 ( +5 / -2 )

Blue blood politician, what to expect ?

Future for Japan ?

Women at work, part-time jobs and no change in the will to have kids.

Senior citizens to work until the end with temporary jobs and halved salary.

Children unhelped financially or socially, with karoshi position like expected when they start working (remember Dentsu).

Taxes increasing forever (I remember paying from my salary when working in Japan a tiny % for tsunami event repairs planned til 2032...).

SDF to turn into war not peace machine.

More censorship.

Use of under slavery workers for foreign trainees.

Nationalistic stance against foreigners (Goshn's case handcuffed as omotenashi for his past contribution while Japanese bow).

Staying as PM for 8 years brought indeed some stability but for the worse.

I expect no change in view of the interviews at end of article. Change can only come from Japanese indeed or it will take a forced foreign push.

7 ( +7 / -0 )

rgcivilian1Today  01:36 pm JST

Have some dignity and respect for the office and leader of what...

Abe would have to earn some respect first.

6 ( +6 / -0 )

I still wish him the best health recovery.

But I can't comprehend that he will still go for local elections, and that is both a personal and political mistake not to leave it to a younger generation.

Thanks JT for allowing our speeches which are unfortunately negative although most of us can see all the greatness in many fields of Japanese culture.

1 ( +3 / -2 )

If you the above posters think they can do a much better job why not run for office and show the rest of us what you can do? Walk the talk or quit whining.

Citizens and residents are allowed the freedom to express their concerns about the leadership and governance of the countries they live in.

They are the country, not the politicians.

Have some dignity and respect for the office

Have some respect for the people.

9 ( +10 / -1 )

Cabinet Government has to bear responsibility for past failures as much as Leadership.

The belief some sort of inherent failure must be bestowed on a single person, so becoming a subject for derision and outright belligerent hostility on the loss of that responsibility and position is an injustice.

Is this really the face of liberal democracy, of social justice?

1 ( +2 / -1 )

Former Prime Minister Abe perceived failures in office are the also the collect responsibility of his cabinet and ruling government.

0 ( +1 / -1 )

When Abe san steps down from his post, who will be the best candidate to fill his position? are all politicians from both sides just as bad as each other? is there any one credible enough to bring Japan back up to where it should be?

0 ( +1 / -1 )

Abe did plenty of pump priming but failed utterly in the economic reform area. As a result, we had feeble, now negative growth due to COVID AND humongous debt loads (albeit almost interest free.).

Thanks Shinzo. Thanks a lot.

0 ( +3 / -3 )

It really doesn't matter now whether abenomics worked or not ...now that Japan along with the rest of the world is falling into the Covid depression.

0 ( +4 / -4 )

It really doesn't matter now whether abenomics worked or not ...now that Japan along with the rest of the world is falling into the Covid depression.

It certainly needs more women leaders, joined-up, automated government to streamline bureaucracy, and stronger consumer protections so that (and this might seem counterintuitive) Japanese companies can become more competitive and become less emptorphobic.

1 ( +1 / -0 )

Look, Abe has failed economy, failed Olympics, failed Covid-19 testing, failed neighboring relationships, failed majority support (only 500 Japanese voted for him, out of 127 million), failed education (he never got science degree at university level).

Yet, he is the longest surviving PM ! What is going on ?

0 ( +1 / -1 )

AkieToday  01:59 am JST

Look, Abe has failed economy, failed Olympics, failed Covid-19 testing, failed neighboring relationships, failed majority support (only 500 Japanese voted for him, out of 127 million), failed education (he never got science degree at university level).

Yet, he is the longest surviving PM ! What is going on ?

There were never any effective challenges to his leadership, either from within the LDP or from the fragmented, disorganised opposition. If someone like Junichiro Koizumi had ever taken him on he wouldn't have lasted six months in the job.

0 ( +1 / -1 )

There is one Abe failure we can be thankful for. He failed to revise (ruin) Article 9. The antiwar diamond of the Japanese Constitution Is still there for the Japanese people and the world to be proud of.

But Abe's last major act, conditionally halting permanent foreign residents from coming home, was not simply a failure--it was a disaster. Thousands permanent foreign residents were put jeopardy and Japan lost face internationally. Not an elegant exist.

When September rolls around permanent residents will be returning to an Abe-less Japan. Why does the end of summer feel a bit like the beginning of spring?

2 ( +3 / -1 )

The Legacy of Shinzo Abe, Japan’s Departing Prime Minister - on balance, he was unable to achieve much on the domestic policy front, and relations with the neighbors are more strained now than when he took office:

https://www.nytimes.com/2020/08/28/world/asia/who-is-shinzo-abe.html

1 ( +1 / -0 )

I'd be curious to know what the age and backgrounds of most posters are. Yes, Abe is a blue-blood--and hardly the sharpest knife in the drawer. But he's not at all the authoritarian "xenophobe" he's portrayed as being. Japan is a vastly more open and "International" land than it was decades ago. The fact is, however, that Japan has enemies as well as friends and needs to defend itself. Japan suffers from statism, from an entrenched bureaucracy. I don't know how and why those foreigners with permanent resident now stuck abroad have been prevented from returning; in any case, that's certainly regrettable. But would any other government be any different? Whenever Japan's opposition parties have gained power, they have made an utter hash of things.

-1 ( +1 / -2 )

@Khuniri

Maybe you have not noticed but Japan has been going nowhere for 30 years!

Talk to any older Japanese (60+) and they have stories that the youngsters of today cannot even begin to imagine.

The young generation is poorer than the last-there’s progress ?

1 ( +1 / -0 )

In regards of Abenomics, I have a few things to add.

Just as the Japanese experiment with balance sheet expansion was getting going, around the mid-90s sometime, I recall the former BoJ Chairman Yasushi Mieno musing that this was perhaps not the right policy choice. He wondered whether the best way to get money moving in the economy, in a world of 1) capital-constrained banks, 2) huge economy-wide debts, 3) vast excess capacity and 4) a rapidly aging demographic with a massive propensity to save, was actually to raise deposit rates. That way, the real incomes of consumers would be boosted with active money, rather than building up inactive money on the balance sheets of banks. It would be, in effect, a monetary donation which would in time enable a recovery in consumption, even if it held back investment.

He was, of course, correct, but such a counter-intuitive way of thinking was anathema to Neo-Keynesians and to mainstream economics. He had instinctively grasped that in the quantum weirdness of the ELB and the Liquidity Trap, policy required doing the opposite of the common orthodoxy, because he had understood the existence of the reversal rate of interest. He grasped what other Central Bankers still don't get - that QE is deflationary. 

The alternative, liquidation of the banks' bad debts, was hotly proposed by the US consensus and the big international institutions, but the resulting depression would have been too painful to invoke in a modern democracy, so the Japanese chose chronic deflation. Naturally, when the US found itself in a similar bind after 2008, the Fed chose the same orthodox but supine course of action, but had the chutzpah to describe their cowardice as 'The Courage to Act'. 

Meanwhile Mieno's insight has been forgotten and too much political and professional capital has been shed blindly following the Neo-Keynesian playbook for the policy damage now ever to be reversed. And so with every dollar of QE spewed out by Central Banks, the pull of the Black Hole gets stronger and the inevitability of Armageddon increases. Abenomics simply made things worse. You can guarantee it will continue.

0 ( +0 / -0 )

@kurisupisu

"Maybe you [directed at me] have not noticed but Japan has been going nowhere for 30 years!

Talk to any older Japanese (60+) and they have stories that the youngsters of today cannot even begin to imagine.

The young generation is poorer than the last-there’s progress?"

Well, I've been here a lot longer than that--and i'm old...

The young generation is not poorer than the last--except perhaps in education.

Technology has made most all of us all materially richer. Years ago the only way to get through the heat of th summer was with watermelon and a wind-bell (風鈴). Now we have air-conditioning.

It's not Abe's fault that Japan now has fierce international competitors. It's not Abe's fault that many young Japanese prefer owning a fancy car and a poodle to rearing children. In that respect, Japan is indeed poorer.

0 ( +0 / -0 )

Login to leave a comment

Facebook users

Use your Facebook account to login or register with JapanToday. By doing so, you will also receive an email inviting you to receive our news alerts.

Facebook Connect

Login with your JapanToday account

User registration

Articles, Offers & Useful Resources

A mix of what's trending on our other sites