MITI and the Japanese miracle

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since the established ministries were hostile to it and boycotted it as a threat to their territories.

The new organization, called the Economic Stabilization Board (ESB; Keizai Antei Honbu), came into being on August 12, 1946. It was the successor institution to the old CPB and the predecessor of the contemporary Economic Planning Agency. Like both of them, it was a planning and coordinating organ, not an operating unit; MCI was charged with executing its plans. Some of the staff of the new board was drawn from old CPB cadresnotably from among those who had been arrested as "reds" in the Cabinet Planning Board incident of 1941, since they now qualified as civilians. According to its charter, the ESB president was the prime minister, but its actual director was a civilian appointee with cabinet rank.

The Yoshida government had a hard time finding the first ESB director-general. Yoshida offered the job to Arisawa Hiromi, a Todai * economics professor who had been fired from the university in 1938 for antimilitarist sentiments, but he turned it down, although he agreed to become a personal adviser to Yoshida on economic policy. Yoshida next approached Takahashi Masao, another academic economist and an adviser to SCAP's Economic and Scientific Section, but he too refused. Yoshida then gave up on professors and offered the job to Yanagida Seijiro*, vice-governor of the Bank of Japan (and later president of Japan Air Lines), but SCAP purged him before he could take office. Finally, Yoshida settled on Zen Keinosuke, an ex-bureaucrat of MAC and MCI, a member of the House of Peers, and the man whom Yoshino had helped in the early 1930's to found the Japan Mutual Life Insurance Company. The problem was that no one knew what the ESB was supposed to do, and until that was clarified, the ministries and their clients looked on it as a pure SCAP invention.

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During the autumn of 1946, when the subsidies finally ground to a halt, the economy virtually collapsed. Yamamoto Takayuki and Tokunaga Hisatsugu of MCI, together with Inaba Hidezo* of the ESB, put forward their famous thesis of a "March crisis"their prediction that by March of 1947 the Japanese economy would no longer be producing anything due to an exhaustion of stockpiles, a lack of imports, and an acute coal shortage. On November 5,1946, in order to forestall this, Prime Minister Yoshida established a personal brain trust known as the "Coal Committee" to tell him what to do. Its chairman was Arisawa Hiromi, and its members included Inaba Hidezo (formerly of the CPB), Okita* Saburo* (foreign minister in the Ohira* cabinet of 197980), Tsuru Shigeto (Harvard-trained economist and author in