MITI and the Japanese miracle

Page 76

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.

¹⁰⁰

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."

¹⁰¹

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.

¹⁰²

However, the quality of the EPA's main product, the annual Economic White Paper, has been affected by its colony status: in 1970 MITI prevented it from saying that the Yawata-Fuji steel merger (which produced New Japan Steel) could lead to monopolistic price increases, and in 1971 the Finance Ministry stopped any mention of the inflationary effects of the Bank of Japan's dollar buying following the Nixon shocks.

¹⁰³