As I observe Team Abe in action at the helm of the Bank of Japan and elsewhere, a rather terrifying passage from a poem by William Hughes Mearns comes to mind:
“Yesterday, upon the stair, I met a man who wasn’t there. He wasn’t there again today. I wish, I wish he’d go away . . .”
There were no surprises in the BOJ’s announcement last week about the new monetary policy package formed at its Policy Board meeting. Quantitative easing will be carried out on an unprecedented scale. Buying up of Japanese government bonds will also take place at record-breaking levels. That buying will find new focus on the longer end of the yield curve spectrum.
For all intents and purposes this is no longer a central bank. This is an agent of the government studiously intent on securing its master’s approval.
An additional worry in this context is that the BOJ Policy Board’s decision to go for Team Abe’s gung-ho approach to monetary management was apparently unanimous. Was there not one person among the policymaking body who felt inclined to contest the Team Abe approach? We do indeed live in sad and strange times if that was the case.
The more we discover about Team Abe’s approach to economic management, the stronger my image grows of the man on the stairs who wasn’t there. For there is a curious touch of unreality in all of the measures and pronouncements that emanate from these people. They seem to have no feel for what is actually happening on the economic ground.
All that they are concerned about is how to “regain” Japan.
This is very backward-looking of them. The Japan that they seem to want to regain belongs in the 1960s. Thus preoccupied with the past, they are incapable of placing themselves in the here and now. Hence, they are the people on the stair who are not there. The “there” they occupy is not the same as ours.
Because the people who are not there are out of touch with real people, their only partner in dialogue is the markets. No wonder the not-there people are so intent on appeasement. They seem to be confusing market-pleasing with policymaking. The markets know this and will always be clamoring for more. The more you give them, the greedier they get. The not-there people have allowed themselves to be taken hostage by the gluttonous.
It is a frightening thing to have to place economic management in the hands of people who are not there. Not being there, they cannot know what people are really feeling, what their real problems are and how they are trying to deal with them. Not being there, they cannot feel other people’s pain. There is something altogether heartless in what they say and seem to want to do.
Mindlessness has always been a problem with Japanese politics, and there is no reason to assume otherwise about this government. The almost automatic resort to Rip van Winkle economics testifies to that effect. To this great tradition has now been added the element of heartless unconcern that exhorts self-help and looks coldly on a caring society.
Mindlessness is a misfortune but heartlessness is sin. To be saddled with a government that is equipped with both is sheer disaster for a nation. Yet what else can one expect from people who are not there? If only we could wish them away.
William Hughes Mearns received inspiration for his piece from a reputedly haunted house where the man who wasn’t there was supposed to make his nonappearance. Japan is now that haunted house.
Noriko Hama is an economist and a professor at Doshisha University Graduate School of Business.
IN FIVE EASY PIECES WITH TAKE 5