Shinzō Abe is the prime minister of Japan. He was elected with promises to stimulate the Japanese economy using standard Keynesian economics. Basically, he’s trying to bring the New Deal to Japan. And since he was elected in late 2012, the Japanese economy has done pretty well. But from the very start, mainstream reporters in the United States have had little but derision for Abe. It reminds me of Eric Alterman’s classic book, What Liberal Media? When it comes to economics, American reporters push the interests of their publishers. And for the better known reports — the ones clearly inside the upper class — they push the interests of their class. (And let’s be honest: there is no columnist or pundit who you’ve ever heard of who isn’t at least in the upper middle class.)
Thus, after 2014 showed basically no economic growth for Japan, we get articles such as Japan Emerges From Recession but Growth Subdued and Japan’s Economy Expands, but Less Than Expected. But Dean Baker responded with the obvious, Confusion on Japan’s Economy. He noted that the short Japanese recession in 2014 was due to a hike in the sales tax that was approved before Abe took power. And Abe has killed a second scheduled increase in the sales tax.
Jonathan Soble at The New York Times provided this amazingly biased assessment, “A long-planned increase in the national sales tax, carried out in April, hit consumers harder than the government and most economists had expected, calling the effectiveness of Mr Abe’s approach into question.” Baker responded, “While it says that the resulting downturn was a surprise to economists, this is exactly what standard economics would predict.” But not, of course, what the heterodox economics of expansionary austerity predicts. And this is what the mainstream media want to push: economic theories that have no theoretical or empirical evidence. And they want to push it because this is what the power elite want to hear.
This brings me back to my days as a libertarian. At that time, I made a lot of arguments about how consumers would rebel against companies that didn’t behave properly. Even at the time, I wasn’t too sanguine about this theory. The problem that I came to see was that the vast majority of people don’t have the time, energy, or power to do something about every injustice in their lives. If a chemical company is polluting their ground water, they may be very upset. But it isn’t going to kill them as fast as not eating will kill them, so they continue to go to work. But the rich have the time, energy, and power to do something about every injustice that they see in their lives. That’s because they can hire people to protect their interests.
This is how it is that the liberal readership of The New York Times can put up with reporting that takes it as granted that of course economic policy that is bad for a nation but good for its power elites is good economic policy. Personally, I think that Jonathan Soble should be thrown in jail for a few years for writing that one “news” article. But he should at least lose his job because he clearly isn’t doing the work that the readers of The New York Times expect. But most readers of The Times don’t even know that they are being deceived. Reporters like Soble have been shilling for the power elite for so long that it is now seen as “objective reporting.”
Instead, we have to read Dean Baker who has a far smaller profile. (Dean Baker Is Must Reading!) But as usual, he smashes the subtext of most of the reporting on Japan, which claims that the economy is not doing well under Shinzō Abe:
In comparing economic growth rates in the United States and Japan it is important to note that the U.S. population is increasing at an annual rate of 0.7 percent while Japan’s is shrinking at a 0.2 percent rate. This means that Japan’s 2.2 percent growth rate in the fourth quarter would look to its people like a 3.1 percent growth rate in the United States.
So we continue to be told that traditional Keynesian economics isn’t working in Japan — or even worse: that it can’t work. This has nothing to do with Japan, of course. It is all about what is acceptable to discuss here in the United States. And the power elite do not want us discussing economic stimulus. They want to focus on “out of control debt” and the need for the Federal Reserve to raise interest rates. Because the health of the economy doesn’t matter to the power elite — only controlling what they already have. And reporters all over America are there to shill for them. But without ever admitting it. They are just being “objective.”