Many voyagers have navigated these waters before me, and a survey of their soundings is a necessary introduction to this study and to my particular point of view. The task of explaining Japanese economic growthand its repeated renewals after one or another set of temporary advantages had been exhausted or removedis not easy, as the frequent use of the term "miracle" suggests; and the term cannot be isolated and applied only to the high-speed growth that began in 1955. As early as 1937 a much younger Prof. Arisawa Hiromi (b. 1896), one of the people who must be included on any list of the two or three dozen leading formulators of postwar industrial policy, used the phrase "Japanese miracle" to describe the increase of 81.5 percent in Japanese industrial output from 1931 to 1934.
3
Today we know why that particular miracle occurred: it resulted from the reflationary deficit financing of Finance Minister Takahashi Korekiyo, who at 81 was assassinated by young military officers on the morning of February 26, 1936, for trying to apply the brakes to the process he had started.
This earlier miracle is nonetheless problematic for scholars because of what Charles Kindleberger refers to as "the riddle" of how Japan "produced Keynesian policies as early as 1932 without a Keynes."
4
Some Japanese have not been overly exercised by this riddle; they have simply settled for calling Takahashi the "Keynes of Japan."
5
As I hope to make clear in this book, this kind of sleight of hand will not do; there was more to state intervention in the thirties than Keynesianism, and Arisawa and his colleagues in the government learned lessons in their formative years that are quite different from those that make up what has come to be known in the West as mainstream governmental fiscal policy.
Kindleberger's "riddle" does serve to draw attention to the projec-
Page 7
tionists, one major category among modern explorers of the Japanese economic miracle. These are writers who project onto the Japanese case Westernchiefly Anglo-Americanconcepts, problems, and norms of economic behavior. Whatever the value of such studies for the countries in which they were written, they need not detain us long here. This type of work is not so much aimed at explaining the Japanese case (although it may abstract a few principles of Japanese political economy) as it is at revealing home-country failings in light of Japan's achievements, or at issuing warnings about the possible effects of Japan's growth on other parts of the world. Even the
Economist
's brilliant little tract of 1962 might better have been called
Consider Britain in Light of What the Japanese Are Doing
, which was in any case its true purpose. Successors to the
Economist
include Ralph Hewins,
The Japanese Miracle Men
(1967), P. B. Stone,
Japan Surges Ahead: The Story of an Economic Miracle
(1969), Robert Guillain,
The Japanese Challenge
(1970), Herman Kahn,
The Emerging Japanese Superstate
(1970), and Hakan Hedberg,
Japan's Revenge
(1972). Perhaps the most prominent work in this genre, because it is so clearly hortatory about what Americans might learn from Japan rather than analytical about what has caused the phenomenal Japanese growth, is Ezra Vogel's
Japan as Number One: Lessons for Americans
(1979). My study does not follow these earlier works in advocating the adoption of Japanese institutions outside of Japan. It does, however, try to lay out in their full complexity some of the main Japanese institutions in the economic field so that those who are interested in adopting them will have an idea of what they are buying in terms of the Japanese system's consequencesintended, unintended, and even unwanted.
A second and entirely different set of explanations of the Japanese miracle belongs to the socioeconomic school, or what I have sometimes called the "anything-but-politics" approach to "miracle" research. This broad school includes four major types of analysis that often overlap with each other but that are clearly isolable for purposes of identification, although they rarely appear in pure form. These are the "national character-basic values-consensus" analysis favored by humanists in general and the anthropologically oriented in particular; the "no-miracle-occurred'' analysis, chiefly the work of economists; the "unique-structural-features" analysis promoted by students of labor relations, the savings ratio, corporate management, the banking system, the welfare system, general trading corporations, and other institutions of modern Japan; and the various forms of the "free-ride" analysis, that is, the approach that stresses Japan's real but transitory advantages in launching high-speed growth in the postwar world.
Page 8
Before proceeding to sketch the qualities of these types of analysis, let me say that to a certain extent I can agree with all of them. My interest is not in disputing the facts that they have revealed nor in questioning their relevance to the miracle. However, I believe it can be shown that many of them should be reduced to more basic categories of analysis, particularly to the effects of state policy, and that they need to be weighed according to standards different from those used in the past, thereby giving greater weight to the state and its industrial policy.
The national-character explanation argues that the economic miracle occurred because the Japanese possess a unique, culturally derived capacity to cooperate with each other. This capacity to cooperate reveals itself in many wayslower crime rates than in other, less homogeneous societies; subordination of the individual to the group; intense group loyalties and patriotism; and, last but not least, economic performance. The most important contribution of the culture to economic life is said to be Japan's famous "consensus," meaning virtual agreement among government, ruling political party, leaders of industry, and people on the primacy of economic objectives for the society as a wholeand on the means to obtain those objectives. Some of the terms invented to refer to this cultural capability of the Japanese are "rolling consensus,"
6
''private collectivism,"
7
"inbred collectivism,"
8
"spiderless cobweb,"
9
and "Japan, Inc."
10
My reservations about the value of this explanation are basically that it is overgeneralized and tends to cut off rather than advance serious research. Consensus and group solidarity have been important in Japan's economic growth, but they are less likely to derive from the basic values of the Japanese than from what Ruth Benedict once called Japan's "situational" motivations: late development, lack of resources, the need to trade, balance of payments constraints, and so forth.
11
Positing some "special capacity to cooperate" as an irreducible Japanese cultural trait leads inquiry away from the question of
why
Japanese cooperate when they do (they did not cooperate during almost half of the period under study here), and away from the probability that this cooperation can be, and on occasion has been, quite deliberately engineered by the government and others. David Titus's research into the use of the Imperial institution in prewar Japan to "privatize" rather than to "socialize" societal conflict is one creative way to look at this problem of consensus.
12
Many instances to be discussed later in this study illustrate how the government has consciously induced cooperation among its clientswith much better results than during the Pacific War, when it sought to control them. In the final analysis it is indeed probable that Jap-