MITI and the Japanese miracle

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The stand-off over policy between the government and the business community still had to be resolved. MCI therefore came up with a compromise that retained many CPB ideas but that more than met the business community's objections. Instead of going to the Diet with a new law, as the CPB wanted to do, MCI proposed amending the mobilization law and then implementing industrial control through Imperial ordinances. This would avoid any further public debate on the subject. The result was the Important Industries Association Ordinance (Juyo * Sangyo* Dantai Rei, Imperial ordinance 831 of August 30, 1941). It created control organs for each industry but assigned the management functions originally sought by the bureaucrats to civilian industrial leaders. All enterprises in an industry became members of a "control association" (

toseikai

*), which was a special legal entity comparable to a government-authorized cartel; control associations were empowered to allocate materials, set production targets, and distribute products of the member firms. This approach was very similar to Yoshino's in the Important Industries Control Law of 1931. Business had won a major point: the president of each control association was invariably the chief executive officer of the largest enterprise in an industry, and as a result the control associations were utterly dominated by the zaibatsu.

⁵⁹

As relations with the United States deteriorated, the throne in October 1941 turned to General Tojo* and asked him to form a government. He chose as minister of commerce and industry his colleague and friend from Manchurian days, Kishi; and Kishi in turn cleansed his old ministry of people who had not supported him against Kobayashi. Kishi also appointed Shiina as vice-minister. Some of the strains within the ministry were revealed by a unique event. Higashi Eiji, the first head of the General Affairs Bureau in 1939 and director of the Fuel Bureau when the Tojo cabinet was installed, resigned in protest. According to Shiroyama, Higashi sought to protest the recklessness of the movement toward war; as the official responsible for the supply of petroleum, he knew that the war would inevitably be lost.

⁶⁰

Although the "control bureaucrats" finally came to power, they did not change Japanese industrial policy significantly. They were always hampered by the structure of industrial control that they had inherited. As T. A. Bisson noted from the perspective of 1945, during the Pacific War Japan operated essentially a private enterprise economy with surprisingly little governmental interference.

⁶¹

One result is pointed out by Mark Peattie: "The myriad of controls, under which