Chalmers Johnson - MITI and the Japanese miracle

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tem of 1885 continues unchanged in its essentials to the present. He concludes, "Bureaucrats are officials of the various ministries first and only second are they servants of the nation."

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The postwar expansion of the bureaucracy followed by efforts to reduce its size reinforced this tradition. A bureaucrat's security and livelihood became dependent on maintaining or expanding his ministry's jurisdiction. Shrinking jurisdictions threaten not only the bureaucrats' active-duty positions but also their amakudari prospects, since a ministry needs clients and captive organizations to hire those of its retired members who do not have readily marketable skills. Tradition and circumstances thus produce an intense "territorial consciousness" (

nawabari ishiki

), punctuatedin Sakakibara's wordsby "gangster-like struggles over jurisdiction" (

yakuza no nawabari arasoi

) throughout the state bureaucracy.

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Whatever the issue, bureaucrats' willingness to fight to defend the interests of their service has a marked delaying and distorting effect on Japanese governmental policy. Many decisions of the Japanese government are incomprehensible to the outside observer unless he or she understands the bureaucratic interests at stake and the compromises that these interests necessitate. In 1974, for example, when Prime Minister Tanaka proposed the creation of an overseas economic cooperation ministry, warfare among the existing ministries burst into the open. MITI had already tried to get written into the 1974 budget a proposal for a "mining and manufacturing overseas trade development corporation," and Agriculture wanted an "overseas agriculture and forestry development corporation." They were actively competing with each other for a share of what looked like an expansion of Japan's economic aid activities. Foreign Affairs promptly objected that it already had two agencies under its jurisdiction that had purposes similar to the proposed ministry. Prime Minister Tanaka ultimately decided on a ministry that would incorporate the two Foreign Affairs agencies but include MITI and Agriculture in their management. Foreign Affairs fought on and finally accepted the new International Cooperation Agency of August 1974 only when it was agreed that it would

not

be a ministry and that a foreign office official would head it.

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When Tanaka was prime minister he also promised in his reelection campaign to create a Medium and Smaller Enterprises Ministry, just as a few years later Prime Minister Fukuda promised to create an Energy Ministry and a Housing Ministry. Regardless of whether this proliferation of ministries would have been a good idea, the reason that none of them ever saw the light of day was not substantive objections but ministerial resistance. MITI mobilized the Agriculture and

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Welfare ministries to stop the medium and smaller enterprises proposal by arguing that they, too, would lose some jurisdiction, to say nothing of MITI itself. MITI and the Ministry of Construction stopped the energy and housing ideas by utilizing their old boy networks, since neither ministry wanted to lose the petroleum and housing businesses as places for their officials to retire.

The longest continuing struggle in the Japanese government, dating from well before the war, has been over the attempt to take control of the budget away from the Ministry of Finance in order to lodge it in the cabinet or some supraministerial coordinating agency. In 1955 Kono * Ichiro* conceived of an independent budget bureau; in 1963 the Temporary Administrative Investigation Council recommended creation of a system of cabinet assistants to oversee the budget; and in 1970 Kawashima Shojiro* called for the establishment of an Overall Planning Agency (Sogo* Kikaku-cho*). The Ministry of Finance successfully beat back all these proposals. Regardless of what the constitution says, the coordinating power of the Japanese executive branch is exercised through the three annual budgets (general account, special accounts, and government investment), and control over them is in the hands of the Budget Bureau and the Financial Bureau of the Ministry of Finance.

The

Asahi

argues that, because of ministerial rivalry, in foreign affairs Japan can never create a monolithic negotiating positionwhich is not necessarily a bad thing. Contention often develops among Foreign Affairs, Finance, and MITI during any major international negotiations. Each of them maintains its own overseas communications networkForeign Affairs through the regular foreign office cable system, Finance through the telex system of the Bank of Tokyo, and MITI through the telex system of JETRO. According to the

Asahi

, Japan actually has three foreign services, each of them with different policies and each represented overseas. The Ministry of Foreign Affairs is the most internationalist, MITI has historically been protectionist, and the Finance Ministry is fairly internationalist but stingy about spending money for defense or foreign aid. Policy is a result of compromises among these positions, and the compromises change as the power positions of the three ministries shift with political developments.

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The headquarters of a ministry engaged in interministerial struggles is, of course, its home office in the Kasumigaseki district of Tokyo. But in addition to its home office staff and its various old boy networks, client organizations, deliberation councils, and public corporations, each ministry has "assets" (

kabu

) spread throughout the government in the form of transferees, or what the French call

dé

-

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tachés

. The old-line ministries engage in a relentless contest to capture and control the more vulnerable agencies of the government through the sending of

détachés

. Their primary targets are the independent agencies attached to the prime minister's office, each of which is headed by an appointed minister of state (

kokumu daijin

): The Defense Agency, the Economic Planning Agency, the Science and Technology Agency, the Environment Agency, the National Land Agency, and a few others. The transferees who staff these agencies make up what the press calls expeditionary armies, which are quite regularly committed by their ministries to the "battles for the outposts" that are a serious part of the Japanese policy-making process.

The case of the Economic Planning Agency (EPA) has been the most widely studied and reported.

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Suffice it to say that MITI and the Ministry of Finance both hold strong positions at the EPAMITI controls its vice-ministership (since the 1960's a prestigious terminal appointment within the MITI personnel hierarchy) and the head of its Coordination Bureau, together with several section chief positions; Finance names its chief secretary and some important section chiefs. The positions MITI controls are valuable to it because through them it is able to place its own representatives on the Bank of Japan's Policy Board and on the deliberation council that supervises the Ministry of Finance's trust fund accounts, which are used to fund the investment budget.

As for the EPA itself, it has come to be known as a "colony agency," or a "branch store of MITI." It has no operating functions, but only writes reportshence its other nickname of the "composition agency."

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EPA's forecasts and indicative plans are read not so much for their accuracy or econometric sophistication as for official statements of what industries the government is prepared to finance or guarantee for the immediate future. Some Japanese economists believe that it is precisely this EPA function of indicating the government's intentions regarding the economy that gives rise to the "typically Japanese phenomenon" of excessive competition: excessive competition does not exist in all industries but only in those industries in which the government has expressed an interestand in which, as a result, the risks are greatly reduced.