Of all the rhetorical battles Donald Trump is engaged in at the moment, the one with central bankers may be the dumbest. They, after all, got the U.S. president elected.

Trump fans may love his verbal assaults against women, civil rights leaders, Chinese officials and offending CEOs. But his broadsides against the Federal Reserve ignore the central role that quantitative easing in Frankfurt, London, Tokyo and Washington played in delivering him into the White House. QE is arguably exacerbating the conditions fueling populist backlashes around the globe.

Consider the original monetary sinner, the Bank of Japan. Granted, as I recently wrote, Japan is that rare developed nation that’s so far avoided a Brexit moment. Hyper-polite Japanese tend to favor harmony over political rancor. The nation’s relative egalitarianism also acts as a social-backlash cushion. But even here, polls suggest tensions rising as Prime Minister Shinzo Abe’s pledges to restore healthy growth for four years now prove hollow.

Japan’s problem? An overreliance on ultra-loose monetary policy and underperformance by policymakers who should be creating jobs, increasing productivity and incentivizing new wealth drivers. It’s a turn of events of which noted economists like Paul Krugman and Kenneth Rogoff have warned for years now. Perhaps the most damning case, though, comes from French economist Thomas Piketty, author of “Capital in the Twenty-First Century.”

Since 2013, when the BOJ launched a historic monetary assault on deflation, Piketty has been warning additional QE might backfire. While his critique applies to officials in Frankfurt, London and Washington too, Piketty seemed particularly dubious about how the BOJ’s epic purchases of bonds, real estate, stocks and other assets were enriching only the wealthy. At the same time, Abenomics set out to devalue the yen, at times by more than 30 percent. That disappeared bank interest and meant Japan was importing inflation via energy and food sectors. Such policies widened the gulf between the haves and have-nots.

This phenomenon, as much as anything, explains why populist anger traveled from fringe factor in British, European and U.S. elections to the overriding issue. In a 2014 paper titled “How Does Unconventional Monetary Policy Affect Inequality?” Netherlands central bank economists Ayako Saiki and Jon Frost concluded that “the BOJ’s unconventional policies have increased income inequality.” They argued that “structural reforms can play a role to offset widened income inequality” that monetary policy can’t.

Because Japan invented QE, it’s a financial laboratory of sorts. And by doing tons of monetary easing since the 2008 “Lehman shock” and negligible structural reform, it may be setting itself up for the next populist shock. In a Nov. 29 column, I looked at young, charismatic Toru Hashimoto, the former Osaka mayor. Many here wonder if the Twitter enthusiast and longtime Trump admirer could deliver the Brexit moment Japan has so far avoided, toppling Abe.

There’s ample blame to go around. If elected officials had done their jobs, reforming economies to make them more vibrant, competitive and fair, central banks might not have taken the lead. Then again, there’s a valid counterargument about enabling complacency. By slashing rates to zero and beyond, did central banks deaden the urgency for remaking financial systems?

This question maddens economists. What if, for example, the BOJ hiked rates instead, thus communicating confidence in the outlook and leveling the financial playing field a bit? There’s no doubting that ultra-low rates distribute the greatest benefits to those with paper wealth — capital, in other words — not to laborers. Here’s how Mark Carney, Bank of England governor, put it in October: “Every monetary policy action has distributional consequences. It is not for the central bank to address these consequences. It is for the government to offset them if they choose to do so as part of an agenda of more inclusive growth.”

Governments’ failure to offset those distributional effects created openings for Brexit, Trump’s election and the ouster of Italian Prime Minister Matteo Renzi. The basic argument for such events — that middle-class families are being left behind — is gaining increasing traction. And central bankers, the BOJ’s Haruhiko Kuroda especially, need to look in the mirror.

Again, blame is shared by timid governments that should rethink the fiscal austerity obsession leaving monetary policymakers in the driver’s seat. But the shocking events of 2016, a year in which the impossible had a way of happening, show how disillusioned voters are with efforts to restore prosperity since 2008. It also suggests Abe should think twice about pressing the BOJ to double down on the policies that got Trump elected. Lest Abe, too, fall victim to a populist tsunami that, at least in part, bears the BOJ’s fingerprints.

Based in Tokyo, William Pesek is executive editor of Barron’s Asia and writes on Asian economics, markets and politics. www.barronsasia.com

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