Chalmers Johnson - MITI and the Japanese miracle

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Muto himself was shot to death at North Kamakura station on March 9, 1934, by an unemployed worker. Two ministersNakajima of MCI and Hatoyama of educationalong with a former vice-minister of finance and top business leaders were arrested and subjected to a sensational public trial that lasted from June 1935 to October 1937. All were ultimately acquitted. Three prominent businessmen who were arrested went on to hold positions as ministers in postwar cabinets (Kawai Yoshinari in the first Yoshida cabinet, Nagano Mamoru in the second Kishi cabinet, and Mitsuchi Chuzo* in the Shidehara cabinet).

The role of Yoshino Shinji in the Teijin case deserves mention here. The interesting point is that he never said a word about the case even though many of the defendants were his close personal and professional associatesNakajima as his minister and former TIRB colleague; Mitsuchi as a former counselor of the old MAC; Kawai as a former MAC bureaucrat (he resigned at the time of the rice riots); and Nagano as a director of the Tokyo Rice Exchange. Moreover, although the disposition of shares of stock put up as collateral by the Bank of Taiwan was the responsibility of the Finance Ministry's bank inspectors, the supervision of the stock exchanges was still under the jurisdíction of MCI. Yoshino did not have to know directly about the disposition of Teijin shares, but the manipulation of prices on the Tokyo and Osaka stock exchanges had to be of interest to MCI.

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When Nakajima resigned as minister on February 9, 1934, he was succeeded for the remainder of the Saito * cabinet by Matsumoto Joji*, the famous legal scholar who later figured as an adviser on the constitution in 1946, and whose draft SCAP rejected in favor of its own. In 1934 Matsumoto favored vigorous prosecution of the Teijin defendants and made life difficult for Yoshino over the matter. Yoshino, however, never said a word on the subject of the Teijin case. He may have felt, along with many others at the time, that the case was a frame-up by the militarists and rightists to destroy ''liberal" elements in politics. If so, his silence can be explained by the fact that it was extremely dangerous in the mid-1930's to contradict the nationalists on any subject. The Teijin case appears in retrospect to have been the equivalent in party politics of the Minobe casethe ouster of Minobe Tatsukichi from Tokyo University on charges of lèse majestéin academic life.

After the Teijin incident the cabinet of Admiral Okada Keisuke (July 1934 to March 1936) sought to dispel the public's (and the military's) doubts about economic administration by establishing a Cabinet Deliberation Council (Naikaku Shingikai)what the press called its "supplementary cabinet"to advise it on economic policies. However, when the prime minister declared that his council was intended "to remove technical economic matters from political interference," the Seiyukai* vigorously opposed the council as a bureaucratic and militaristic device. Partly because of this Seiyukai boycott, the president of the Minseito* and one of Japan's most accomplished political manipulators, Machida Chuji* (18631946), entered the cabinet as MCI minister even though most party politicians shunned Okada's "nonparty" government. Machida retained Yoshino as vice-minister for political reasons of his own, but in retrospect Yoshino believed that he should have resigned at the time. Okada's council was composed of fifteen members from among the "senior statesmen" (

jushin

*, the successors to the Meiji-era

genro

*), peers, political party leaders, and representatives of big business.

In order to service this brain trust, the Okada government also set up a Cabinet Research Bureau (Naikaku Chosa* Kyoku, established by Imperial ordinance 119 of May 11, 1935). This was not the older military-oriented Resources Bureau of 1927, also attached to the cabinet, but a new organ made up of bureaucrats detached on temporary duty from the main ministries to serve in this elite body. Two years later the Cabinet Planning Boardknown at the time as the "economic general staff"came into being by combining the Cabinet Research Bureau and the Resources Bureau.

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In 1935 the Cabinet Research Bureau was the stronghold of the variously termed "new bureaucrats" (

shinkanryo

*), "reform bureaucrats" (

kakushin

kanryo

*)or, in Nakamura Takafusa's description, civilian bureaucrats who were attracted by Nazi ideology.

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Ide and Ishida bluntly define the reform bureaucrats as "anti-liberal, anti-parties, nationalistic, pro-military, pro-fascist, and above all in favor of strengthening governmental control."

13

They were found in all ministries and rose to influence after the assassination of Inukai as part of the vigorous intrabureaucratic competition to fill the vacuum left by the political parties. By cooperating with the military, whether for ideological reasons or just because that was the way the wind was blowing, some bureaucrats rapidly advanced their own careers.

In old-line ministries such as Finance and Foreign Affairs, the mainstream of bureaucratic leadership tried to resist the growing influence of the military, but these ministries tended to lose power over the decade to the ministries that cooperated, such as MCI. Within MCI Yoshino was critical of the reform bureaucrats as "flatterers of the military," even though his protégé Kishi was a model reform bureaucrat and Yoshino himself was in good favor with the military because of his essentially technocratic political stance.

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Yoshino also recognized that the admission of military officers on detached service into MCI, a practice he had authorized for the Fuel Bureau and several other new units, affected the ministry's personnel affairs. The militarists regularly used their political power to block promotions of young officials whom they considered insufficiently "reformist." Most of the officials working in industrial administration, as distinct from commercial administration, became reform bureaucrats to some extent, and this led to a factional alignment under Yoshino's successors and under Kishi that would affect the ministry for decades to come.

The military equivalent of the reform bureaucratsthe

kakushin

bakuryo

*, or "reform staff officers"looked on the reform bureaucrats as possible civilian replacements for the old political party leaders, whom they held to be corrupt and to constitute prime obstacles to the building of a "national defense state" in Japan. In October 1934 the Army Ministry published an inflammatory pamphlet calling for national mobilization, opposition to "classes that live by unearned profit," and the expansion of production and trade under state control. To implement this program the army advocated that its cadres make alliances with ''new bureaucrats," and the term thereby entered popular parlance.

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One important source of reform bureaucrats was officials who had served in Manchuria as transferees after the proclamation in March

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1932 of the new state of Manchukuo. Since the army actually ran Manchukuo, those who were invited to work there had to be in sympathy with the military's ideas for the renovation of Japan itself. The MCI contingent that served in Manchuria is particularly important for postwar industrial policy because, as Shiina Etsusaburo * wrote in 1976, Manchuria was "the great proving ground" for Japanese industry.

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We shall identify them and describe their activities below.

Some important reform bureaucrats in MCI and in closely related economic bureaucracies were Kishi Nobusuke, Shiina Etsusaburo, Uemura Kogoro*, Kogane Yoshiteru (director of the Fuel Bureau in 1941 and a postwar Diet member), Hashii Makoto (who served in the postwar Economic Stabilization Board and then became president of Tokyo Gauge Company), Minobe Yoji* (Minobe Tatsukichi's nephew, chief of the Munitions Ministry's Machinery Bureau and postwar vice-president of Japan Hydrogen Industries), Wada Hiroo (from the Agriculture Ministry and postwar minister of agriculture in the first Yoshida cabinet), Sakomizu Hisatsune (from the Finance Ministry and postwar director-general of the Economic Planning Agency and postal minister in the Ikeda cabinets), Aoki Kazuo (from the Finance Ministry, president of the Cabinet Planning Board, and postwar member of the House of Councillors of the Diet), and Hoshino Naoki (from the Finance Ministry, president of the Cabinet Planning Board, and postwar chairman of the Tokyu* hotel chain and the Diamond Publishing Company). Not surprisingly, a few of the reform bureaucrats turned out to be not rightists but left socialists and cryptocommunists; their presence on the "economic general staff" produced a major scandal in 1941, as we shall see later in this chapter.