MITI and the Japanese miracle

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cess, but its special characteristics and the environment in which it works arise from the special interaction of the Japanese state and society. The Japanese built on known strengths: their bureaucracy, their zaibatsu, their banking system, their homogeneous society, and the markets available to them. Such postwar reforms as the elimination of the military from political life, the rationalization of the zaibatsu, the strengthening of the Diet, and the equalization of social classes were all important, but the institutions of the Japanese developmental state are products of Japanese innovation and experience.

This suggests that other nations seeking to emulate Japan's achievements might be better advised to fabricate the institutions of their own developmental states from local materials. It might suggest, for example, that what a country like the United States needs is not what Japan has but, rather, less regulation and more incentives by the government for people to save, invest, work, and compete internationally. The Japanese learned to cooperate effectively with each other as a matter of national survival; the wars and economic miseries of the 1940's compelled them to maintain what were essentially wartime degrees of social and economic mobilization well into the 1960's. Lacking a comparable consensus on goals, the United States might be better advised to build on its own strengths and to unleash the private, competitive impulses of its citizens rather than add still another layer to its already burdensome regulatory bureaucracy.

Such an American policy may, however, be unrealistic for the longer term. Given the need for the United States to maintain the military balance among the nuclear powers; to reinvigorate its economy; to achieve coordination among its environmental, energy, welfare, educational, and productive policies; and to stop living off its capital; Americans should perhaps also be thinking seriously about their own "pilot agency." Above all the United States must learn to forecast and to coordinate the effects of its governmental policies. Agricultural policy has for too long been left outside any integrated economic strategy; commercial and economic representatives have for too long endured second-class status in the State Department's hierarchy; domestic regulatory actions have for too long been taken without a prior cost-benefit analysis of their economic impact; and a growing legal thicket has for too long replaced goal-oriented, strategic thought in economic affairs. These are some of the things that an economic pilot agency might tackle in the United States. It is not clear that the United States could ever free such an apparatus from the constraints imposed by congress, the courts, and special interest groups; but if economic