Shinzo Abe: killed for being a Keynesian

Shinzo Abe: killed for being a Keynesian

July 10, 2022 0 By Michel Santi


He lifted his country out of the pacifist dogma adopted following World War Two. He contributed massively to Japan’s transformation into a country careful with its geopolitical and strategic interests so it could it take up the seat it deserved at the table of global security operations. He was called a fascist by certain under-developed minds. But in reality, Shinzo Abe was a civic activist who loved his country, a staunchly democratic man, and fully dedicated to strengthening Japan.

He had, however, inherited a country in the midst of a deep crisis, that was economic and financial of course, but also existential. He therefore had to handle an insidious deflationary spiral with no end in sight, the implosion of the credit market, a completely unprecedented collapse in real estate, the almost total decimation of his stock market, productivity in permanent decline, the loss of competitiveness of what were once Japan’s legendary enterprises, a severe demographic decline, and the aftermath of a tsunami that devastated Fukushima, killing 16,000 people. Many articles I have penned on Shinzo Abe, on his exceptional voluntarism and his original eponymous programme (“Abenomics”) based on the famous “three arrows” that ultimately allowed the country to rise above the ashes of its double lost decade, to reinstate growth and to stabilise its public debt to GDP ratio.

In If only we were all Japanese, I explained how he had had the courage to implement a fundamentally Keynesian programme to increase public spending, and to set in motion via his central bank a policy of massive monetary creation while also decreeing structural reforms aimed at cleaning up the economy in the long term. In Japan: a sleeping beauty, I highlighted the determination of Prime Minister Abe upon his appointment, making no half-measures or balking in the face of any decision aimed at lifting his country from the lethargy it had been wallowing in for thirty years. Thanks to Abe, Japan was able to face its destiny, and even to force it through by conjuring up a veritable revolution of culture and values that revitalised the labour market by bringing women, the aged and foreigners into the fold. In This Japan that won’t stop surprising us, I outlined the measures taken under his custodianship to literally harass Japanese companies into employing more and more women and to develop creche systems in order to facilitate women in the workplace, measures that have now led to Japan displaying a higher rate of employment among women than the US. Having found himself with a closed-off, even xenophobic country, Abe revolutionised his country’s shape and form by turning its immigration policy on its head. In 2017, the processes to gain resident status in Japan were famously made easier and faster, allowing foreign workers to arrive in almost exponential droves. The country was given a burst of youth at a time that it was in desperate need of it, with nearly 20% of under-20 year olds in Tokyo now having been born outside of Japan.

Faced with Japan’s decline that had been judged to be inevitable by many observers and foreign leaders, and confronted with disastrous demographic statistics, Shinzo Abe focused all of his determination on maintaining his country’s status. His conviction was largely inspired by Keynes who believed that, until proven otherwise, we can count only on governments to save the economy, by ensuring a strong and high-performing public sector, decisive public spending, and the proactive use of monetary policy. In Japan, mirror of the world, I show how Japan was a testing lab, but also a cemetery where economists and theorists could bury their certainties. This country was effectively a teller of truths hard to hear for any orthodox economist as it challenged all the commonly accepted ideals.

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