MITI and the Japanese miracle

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with the public, but it led to organized protests by the bureaucrats. Within MCI Kishi, then an assistant section chief in the Documents Section, led the opposition.

Kishi obtained about 50 signed letters of resignation from a few higher officials and from several noncareer officials. He threatened to present these to the minister if the pay cuts were not rescinded. Kishi's motives do not appear to have been primarily monetary; he was also concerned about the welfare of the noncareer employees and about the government's austerity measures as they applied to the military. During 1930 Yoshino and the minister worked out a compromise to paper over the dispute, and Yoshino used his first opportunity to get Kishi out of the country in order to let tempers cool. Kishi spent seven months (MayNovember 1930) in Berlin reporting on the industrial rationalization movement, and his reports directly influenced the path it took in Japan. One of Kishi's reports, that of July 13, 1930, was addressed to Kido Koichi * as one of the two department chiefs in the TIRB; it is of such interest in relation to the history of industrial policy that it was reprinted in

Chuo

*

koron

* in September 1979, almost fifty years after it was written.

⁴²

Kishi said that German industrial rationalization, like the movement elsewhere, was devoted to technological innovation in industries, to the installation of the most up-to-date machines and equipment, and to generally increasing efficiency. What distinguished the German movement was its emphasis on government-sponsored trusts and cartels as the main means of implementing reforms. The Japanese translated this to mean that rationalization implied a lessening of economic competition, an approach that seemed plausible to them given the cutthroat competition and dumping of exports that existed in the medium and small enterprises sector.

In Japan rationalization came increasingly to emphasize that competition among enterprises should be replaced by "cooperation" (

kyocho

*), and that the purpose of business activities should be the attempt to lower costs, not make profits. Yoshino himself has written,

Modern industries attained their present development primarily through free competition. However, various evils [of the capitalist order] are gradually becoming apparent. Holding to absolute freedom will not rescue the industrial world from its present disturbances. Industry needs a plan of comprehensive development and a measure of control. Concerning the idea of control, there are many complex explanations of it in terms of logical principles, but all one really needs to understand it is common sense.

⁴³

This view of economic competition has been characteristic of Japan's