Photo/Illutration Kazuo Ueda, the government’s nominee for the next Bank of Japan governor, right, speaks at the Lower House Rules and Administration Committee on Feb. 24. (Koichi Ueda)

Yanosuke Iwasaki (1851-1908), who headed the Mitsubishi “zaibatsu” conglomerate and then became the Bank of Japan governor, resigned as the central banker 125 years ago after locking horns with the government, which put pressure on the bank over its interest rate policy.

“The clash (with the government) has been published. … I was advised by various quarters to remain in the post but refused to accept the advice,” he was quoted as saying in a book about successive BOJ governors written by Toshihiko Yoshino (1915-2005), a former BOJ executive director.

I can picture Iwasaki’s expression of strong indignation. Iwasaki was not the only BOJ chief who stepped down after fighting with the prime minister or the finance minister during the prewar period.

Hisato Ichimada, who became the central banker shortly after World War II and negotiated with Gen. Douglas MacArthur during the Allied occupation, gained greater influence than any politician, earning him the nickname of “pope.”

The history of the central bankers’ resistance and compromise was driven by pride and power.

How things have changed from those days. There have been no BOJ chiefs with strong character in recent years.

Haruhiko Kuroda, the incumbent who is set to retire in April, worked in tandem with former Prime Minister Shinzo Abe in pushing Abe’s signature Abenomics economic policy program. The two appeared to be of a single mind.

I watched a Lower House Rules and Administration Committee session on Feb. 24 in which Kazuo Ueda described what he would do if approved to replace Kuroda. I wanted to assess whether he is also willing to work in close cooperation with the government.

However, when asked whether he is ready to resist political pressure, Ueda gave a safe, noncommittal answer.

As he would be the first academic to lead the central bank in the postwar period, foreign media were paying attention to his remarks at the session to see whether he is a “monetary dove” who will maintain the BOJ’s super-loose monetary policy or a “hawk” ready to tighten. Ueda gave no clue.

Being the BOJ governor comes with many serious responsibilities--the job does not allow the holder to use stopgap measures. That is how Makoto Usami (1901-1983) described the post he held.

He struggled with tough policy challenges related to the first postwar issuance of debt-financing government bonds.

“The BOJ governor can never be free from concerns,” he once said. “You can sleep better after you worry about all the things that could happen.”

It would take a work of God to predict all that will happen in the world and take appropriate steps to deal with them.

There is no doubt that predicting how things will turn out is now more difficult as the world is being shaken by the COVID-19 pandemic and the crisis in Ukraine.

There is no god who can protect the BOJ from pressure, nor a magic wand to control complicated moves in the markets.

--The Asahi Shimbun, Feb. 26

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Vox Populi, Vox Dei is a popular daily column that takes up a wide range of topics, including culture, arts and social trends and developments. Written by veteran Asahi Shimbun writers, the column provides useful perspectives on and insights into contemporary Japan and its culture.

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