The Enigma of Japanese Power (48 page)
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Authors: Karel van Wolferen
Tags: #Japan - Economic Policy - 1945-1989, #Japan - Politics and Government - 1945, #Japan, #Political Culture - Japan, #Political Culture, #Business & Economics, #International, #General, #Political Science, #International Relations, #Public Policy, #Economic Policy, #Social Science, #Anthropology, #Cultural, #Political culture—Japan, #Japan—Politics and government—1945–, #Japan—Economic policy—1945–
How the bureaucrats view their own place in the System is highlighted by the way they perceive the very rare lawsuits initiated against them. As one Japanese specialist aptly points out, such lawsuits are considered to represent an unwarranted use of force.
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Legal entanglements hamper official duties, but the bureaucrats dislike litigation mainly because they feel that to give court-room explanations of official actions conflicts with the highly treasured ‘confidentiality of the administration’. Court scrutiny, forcing disclosures from bureaucrats, undermines their dignity and, consequently, the settled benevolent state of affairs of the Japanese nation.
Intimidation can thus work both ways. Although the supposed servants of the people have the advantage, and the possibilities for court action against them are so limited as to be almost non-existent, the very possibility that some group or other may attempt to put bureaucrats in the dock has an intimidating effect. Public officials consider such resistance a ‘red light’, and modify their attitudes in an attempt to keep things from getting out of hand. There is no doubt that they fear public dissatisfaction once this manifests itself in powerful resistance.
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Japanese policy patterns are nearly always inflexible until a catastrophe occurs or until those who consider themselves victimised manage a veritable chorus of protest.
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A movement of opposition or complaint is at first usually ignored or suppressed. But when the realisation dawns that further suppression will only make the movement stronger, officialdom changes its attitude. Those in charge tend to become more flexible and ready to overlook illegal action. In cases where a problem suddenly threatens to become acute, the metamorphosis of the officials concerned, from a stubborn and uncompromising attitude to an accommodating stance, is generally very dramatic.
The intimidation we find in the Japanese System may be called ‘structural intimidation’. Without it, the System as we know it would grind to a halt, since it furnishes the power-holders with power. Ritual and hierarchy help preserve order, but do not guarantee security. Only power provides security in Japan. In the absence of law and universal values, power is indispensable for protection. Guarding one’s power is best accomplished by subtly displaying and enlarging it. And because this can be done only through informal means, intimidation is an unavoidable and omnipresent characteristic of Japanese society.
A major hindrance to an accurate assessment of the Japanese System is the still very common view that the jolt of defeat in the Pacific War, and the ministrations of the Supreme Commander of the Allied Powers (SCAP), brought into being a Japan that had made a definitive break with its own immediate past. According to this view, the society that emerged in just a few years after 1945 was committed to different principles of governing itself and led by men themselves committed to these principles. Japan’s traditional political culture, though of course an influence still to be considered, was seen as somehow having undergone a major metamorphosis.
Acceptance of this view was made easy for many by an influential school of thought that presented the years between the late 1920s and 1945 as an aberration in Japanese history. Until shortly before the Manchurian Incident,
1
according to this theory, Japan followed a historically determined course of ‘modernisation’. All the elements that would have turned it into a respectable modern democratic society, such as a parliament and political parties, were in place when the country was temporarily derailed by nationalist fanatics.
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This viewpoint has been greatly undermined by recent scholarship, mainly of American historians, which shows how Japan’s efforts at empire building and domestic repression can be seen as a logical development growing out of dominant trends in the Meiji period. Yet only in the 1980s have some scholars begun to point out that 1945 was not the watershed it was supposed to have been, and that authoritarian institutions and techniques dating from the first half of the twentieth century have been crucial in shaping present-day Japan.
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With the benefit of hindsight we can go one step further and see the Japanese System of the late 1980s as a product of the consolidation of certain bureaucratic and political forces that have been evolving since before the turn of the century, a consolidation that was accelerated by the war.
There is no gainsaying that post-war Japan is a new Japan in many respects. The idea that military adventurism was a great mistake and that the nation should devote itself to peaceful pursuits has undoubtedly been very strong among the general populace, especially from the 1950s to the 1970s. Standards of living, especially in rural Japan, cannot be compared with the poverty that prevailed before the war. Japanese today enjoy much personal freedom, and need not worry about being arrested for what they say. The Japanese public is looked after in a way it has never been before. Nevertheless, in the context of our theme – how power is exercised in Japan – the continuities appear to be of more consequence than the changes; continuities not only in the motivations of the ruling élite, but also in the institutions it has shaped.
Japan rose phoenix-like from the rubble of its bombed cities to become the second most powerful economy in the world, challenging the older industrial countries. However, the mainsprings of this rebirth are not to be found in the economic and political restructuring measures of US-occupation-inspired
demokurashii
, but in the socio-political world and the disavowed ‘feudal’ practices of a Japan at war. We will examine the details of the astounding history of the Japanese political economy in Chapter 15. First, I must demonstrate more concretely that it is fair to speak of the System as a consolidation of pre-1945 bureaucratic institutions.
The most momentous decision the occupation authorities made when they set about transforming Japan’s political leadership was to leave practically the entire bureaucracy intact.
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The usual explanation for this is that SCAP had no choice but to work through the existing organs of state. But as a specialist on Japanese politics points out, this overstressing of United States dependence ignores the realities of power.
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The vast majority of those involved in occupation policies were not even aware that any significant decision had been made. The Americans in charge simply assumed that bureaucrats everywhere behaved as they did in the USA, that is to say, as apolitical technicians. The official in charge of labour affairs in SCAP’s grand ‘democratisation’ programme describes how the nerve-centre of operations to reform defeated Japan’s officialdom consisted of a single young lieutenant in the Transportation Corps, Milton J. Esman.
Esman’s desk was an oasis of quiet in a tumult of bustling reform activities, for he was in charge of the civil service under Kades, and it seemed that no one else was interested in the subject. No paragraph in the Joint Chiefs’ directive JCS 1380/15 even mentioned the bureaucracy. Esman really had no official mission.
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The lieutenant was, in a sense, succeeded in his task of ‘defeudalising’ the bureaucracy by the Hoover Mission, a group of specialists that came at the request of the Japanese government to teach modern administrative methods. But the mission failed even to perceive the significance of the fact that practically all higher civil servants were Tokyo University graduates. Whatever it may have accomplished, it had nothing to do with overhauling the bureaucracy.
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The occupation purge eliminated the defeated military organisations, removed fifteen hundred highly placed businessmen,
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barred a few party politicians from holding public office and dissolved ultra-nationalist organisations. It did not go beyond this to tackle the mainspring of Japan’s governing system. The aims of the purge, to some extent contradictory, were neither clearly outlined nor attainable under the circumstances.
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Moreover the strong incentive to preserve, for political reasons, the ‘tranquillity’ of the occupation led the US reformers to keep to a minimum interference in areas outside the military and ultra-nationalist organisations.
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Thus the purge of the bureaucracy was, in its details, left to the bureaucrats themselves, who soon realised that they were free to use a large variety of loopholes; they often simply ignored SCAP instructions.
By 1950, when the return to public life of depurged bureaucrats coincided with the ‘Red Purge’ (in which more than one thousand government officials and almost eleven thousand company employees suspected of communism or ‘communistic-type’ thinking lost their jobs), the effects of the occupation purge on Japan’s officialdom had been reduced to almost nil. The first major post-war prime minister, Yoshida Shigeru, summed it up: ’The occupation, with all the power and authority behind its operation, was hampered by its lack of knowledge of the people it had come to govern, and even more so, perhaps, by its generally happy ignorance of the amount of requisite knowledge it lacked.
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SCAP’s ignorance of the true power of Japanese bureaucrats gave the latter the opportunity to develop and integrate further economic institutions they had experimented with, in the context of the wartime industrial effort, from the early 1930s until 1945. This post-war effort was better organised; the bureaucrats had learned from experience and, more important, had been given powers by SCAP that they never had before.
Many of the most prominent figures associated with post-war industrial policy had been known in pre-war and wartime Japan as ‘reform bureaucrats’, strongly influenced by the ideas of Hitler’s Germany and by Mussolini’s corporatism. This does not mean that they were converts to Nazism, but that they sponsored the application of German methods to problems of the economy and social control in Japan.
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Nazi and fascist theory are not generally associated in the Western mind with the Japanese ‘economic miracle’, but it is doubtful whether this could have occurred without the inspiration of these theories supporting totalitarian state control. In fact, the reform bureaucrats and their apprentices dominated the post-war leadership of the economic ministries, the central bank and the large business federations.
Given their post-war importance, the reform bureaucrats deserve a closer look. The way had been paved for them by earlier reformers, the so-called ‘new bureaucrats’ who made their appearance after the Manchurian Incident of 1931. These were considered ‘new’ because they helped reorganise domestic politics and gained prominence through a shift in power-sharing, accompanied by the gradual smothering of the Minseito and Seiyukai parties. Instead of working through these two major (largely bureaucratic) parties, they helped undermine and eliminate party-political influence and revitalised their own alliance with the military. Based mainly in the Naimusho, the bastion of the social-control bureaucrats, they introduced new institutions and established stricter control over local governments and the population via the neighbourhood associations of towns and villages. The actual reform bureaucrats, also known as ‘new new bureaucrats’, began to draw attention after the fateful coup attempt of 26 February 1936 and the outbreak of full-scale hostilities in China a year later.
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They had become aware of the crucial role played by economic processes in the social order, and were eager to introduce economic controls.
The reform bureaucrats responded emotionally as well as intellectually to the social confusion and dissatisfaction created by economic uncertainty and rising expectations among the public. Searching for total solutions to these social problems, they were, in their early idealistic phase, influenced by a mishmash of European notions that had emerged in response to tensions and problems of governability. A number of reform bureaucrats had started out as Marxists, or had socialist convictions. Some, in fact, had retained a ‘red’ tinge, which caused a major scandal and arrests among top officials in early 1941. In their later phase, however, the reform bureaucrats were bound together by Nazi notions, Italian fascism, vigorous Japanism, a thorough aversion to liberal party politics and a belief in strong state control. At crucial junctures in their careers the prominent reform bureaucrats all served in the puppet state of Manchukuo, which had been set up by Japan’s Kwantung Army. Indeed, the standard advice of senior bureaucrats to their juniors was ‘If you want to call yourself a reformist, you must train yourself in Manchuria’.
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In Manchuria they learned how to work with military bosses, and how to exploit the economic possibilities of a regimentation far more rigid than anything the home islands had been amenable to. Military planners, partly inspired by the Five-Year Plan in the Soviet Union, had long dreamed of coordinating plans for military and civilian economic mobilisation. Preeminent among them. General Nagata Tetsuzan first articulated the idea of a ‘national defence state’, which had a powerful effect on the bureaucrats’ imagination.
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The notions of the reform bureaucrats found their most articulate expression among the members – bureaucrats, intellectuals and journalists – of a ‘research society’ called the Showa Kenkyukai. It was founded by a close friend of Konoe Fumimaro, the most important civilian government leader in the years leading up to the Pacific War.
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Known as Konoe’s ‘brains trust’, the Showa Kenkyukai was a source of inspiration for the New National Structure Movement (also known as the New Order Movement, or Shin Taisei Undo), which aimed to overhaul the political system, to purge Japan of conflicting interests and to promote a totalitarian national unity. The Imperial Rule Assistance Association (IRAA or Taisei Yokusankai), intended as the controlling organisation of the ‘new order’, was launched in October 1940 in the hope of liberating Japan once and for all from the perennial ‘sectionalism’ that deprived the empire of its full potential. This effort failed, but the ‘economic new order’ part of it helped inspire the post-war programme of unlimited industrial expansion.
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The institutional centre of operations for the reform bureaucrats was the Cabinet Planning Board (CPB). This central organ for national mobilisation was created in 1937 through a merger of the Cabinet Research Bureau (established two years previously) and the Resources Bureau, a military-economic planning unit. The Army had pushed for the merger, and in the CPB, later nicknamed the ‘economic general staff,’
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the military-bureaucrat economic planners shifted their focus from a five-year plan for Japanese-Manchurian industrial development to general mobilisation programmes.
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The CPB never succeeded in its intended task of meshing the military and civilian sides of the wartime industrial effort. Only after it was merged in 1943 with the then Ministry of Commerce and Industry (MCI) to form the Ministry of Munitions did it become half-way effective.
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But the CPB may be considered the predecessor of the highly effective post-war Economic Stabilisation Board,
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while the major functions of the Munitions Ministry were inherited by MITI. We will come back to the IRAA and its legacy later in this chapter.
Bureaucratic institutions and personnel fitted smoothly into the new Japan that was being ‘defeudalised’. One of the closest associates of Tojo Hideki, reform bureaucrat Kishi Nobusuke, who as the most powerful official in the wartime Ministry of Munitions was the central figure among executors of Japan’s wartime industrial policy, became the dominant figure of post-war industrial policy.
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We have noted how Kishi, after a stint in Sugamo prison as a war criminal suspect (never brought to trial), became first one of Japan’s best-known prime ministers, then, until his death in 1987, Japan’s most influential
éminence grise
.
Second only to Kishi as a shaper of post-war industrial policy was Shiina Etsusaburo, a Manchurian reform bureaucrat, who had the timely idea, between the surrender and the arrival of the first United States troops, of re-baptising the Ministry of Munitions so that it became the Ministry of Commerce and Industry once more.
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He himself became MITI minister after the war, and remained a powerful force behind the scenes at the ministry, as well as one of the most prominent leaders of the LDP, until his death in 1979.
The leader of the Ministry of Finance group in Manchuria was Hoshino Naoki, who was president of the wartime CPB. After the war he became a prominent member of the Keizai Kenkyukai, the study group established to re-examine post-war economic policy, which produced the blueprint for policies of economic high growth in the shape of Prime Minister Ikeda’s ‘income doubling plan’.
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He was also chairman of the Tokyu Hotel and Trading Group, and of Diamond Publishing, a firm specialising in business publications.
The main architects of wartime financial controls had originally come from the foreign exchange section, established in 1933, of the Ministry of Finance, and were found in its secretariat and the Finance Bureau, an extraordinary ministerial group with great discretionary powers in designing state policy.
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Pre-eminent among them was the reform bureaucrat Sakomizu Hisatsune, who became head of the Economic Planning Agency and postal minister after the war.
Another prominent Ministry of Finance official associated with this wartime planning, Morinaga Teiichiro, was to become vice-minister of finance in 1957–9 and governor of the Bank of Japan during the second half of the 1970s. A third, Shimomura Osamu, determined the pricing policies of the crucial post-war Economic Stabilisation Board, and was later one of the main brains behind Prime Minister Ikeda’s ‘income doubling plan’.
Many of the crucial wartime controls over lending were co-ordinated in a bureau whose chief, Ichimanda Hisato, was to become governor of the Bank of Japan in 1946, a position he held for eight and a half crucial years before being appointed finance minister. Under his governorship the central bank was popularly known as ‘the Vatican’.
The bureaucrats survived the purges with the added advantage of being freed from their sometimes troublesome military associates. Moreover, the occupation authorities, believing that big business had been ‘active exponents of militant nationalism and aggression’, ordered the dissolution of the
zaibatsu
conglomerates and disbanded the holding companies, which meant that the bureaucrats no longer faced troublesome rivals for power in the business world. The bureau chiefs of each ministry began to attend cabinet meetings, a practice unknown before the war. They became go-betweens between MacArthur’s headquarters and government ministers,
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and their utterances gained significantly in weight.
When, after the war, Japanese intellectuals and commentators began to refer to the bureaucrats as ‘subcontractors of the occupation’, they missed the essential fact that the tail was wagging the dog. As Chalmers Johnson puts it: ‘the occupation era, 1945–52, witnessed the highest levels of government control over the economy ever encountered in modern Japan before or since, levels that were decidedly higher than the levels attained during the Pacific War’.
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Perhaps the biggest present bestowed on the post-war MITI bureaucrats by SCAP was the power to form cartels, an essential instrument of Japanese industrial policy that had earlier been the monopoly of the wartime ‘control associations’. These associations, created in 1941 after much friction among the various bureaucratic cliques involved and much business opposition, were meant to co-ordinate activities, production targets and the allocation of materials in the various sectors of wartime industry.
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But the bureaucrats never gained an effective grip on them, since business had made sure that they were headed by the top executive of the largest firm in each sector, thus putting them under effective control of the
zaibatsu
. In disbanding the
zaibatsu
, SCAP forbade any further private cartelisation. To the economic officials of what was to become MITI it suddenly seemed ‘as if they had arrived in the bureaucratic promised land’.
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Talkative officials have publicly acknowledged that, whereas, formally, Japan underwent a great transformation after the war, the economic system and especially the institutional base for financial controls were retained in the forms they had taken during the war. Two former Ministry of Finance bureaucrats have contrasted the two ‘realities’, the formal and the substantial, and asserted that this duality was essential in the shaping of the post-war ‘miracle’. As they put it, the ideology of democratic equal opportunity caused an explosion of energy in favour of economic growth, while the high growth itself was actually achieved through the reality of strict financial controls.
30
Writing thirty-two years after the war, they noted that the basic law governing the activities of the central bank was still the same as the original law that had reflected the totalitarian economic purposes of the Nazi Reichsbank.
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They also argued that the creation of the post-war Japan Development Bank, Export-Import Bank and Long-Term Credit Bank can be viewed as a strengthening of the role the Industrial Bank of Japan (which survived) played during the war.
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