MITI and the Japanese miracle

Page 205

to develop a close working relationship with a particular bank; it did not necessarily get all the money it needed or preferential terms from its primary bank, but it did get the one thing it could not do withoutaccess to capital in the first place because it was an established customer. The banks in turn became dependent upon the financial health of their heavily indebted priority industries and therefore took responsibility for them. The resulting cooperative arrangements looked very much like the old German banking groups, such as those of the Deutsche or Dresdner banks, with cross-shareholding between banks and affiliated industries (such shareholding is illegal in the United States).

^*

The difference from the German pattern was that the Japanese government exercised much greater control over the "financial lineages" (

kin'yu

*

keiretsu

), as they came to be called, than the German government ever did over its bank groups and syndicates. The "big six" among the Japanese conglomerates that came into being during the 1950's were those based on the Fuji, Sanwa, Dai Ichi, Mitsui, Mitsubishi, and Sumitomo banks. The Fuji Bank, for example, established financial ties with the old Yasuda zaibatsu, the old Asano zaibatsu (which contributed the Fuji group's steel company, Nippon Kokan*), and Ayukawa Gisuke's old Nissan companiesand after 1955 with its own trading company, Marubeni-Iida, formed by the merger of Marubeni and Takashimaya-Iida.

A typical Japanese group includes a big bank, several industrial firms, and a general trading company. The bank plays the critical role during expanding business conditions by supplying capital to the members, and the trading company plays the critical role during contracting business conditions by importing raw materials on credit and fiercely promoting exports of products that cannot be sold domestically. SCAP broke up the old zaibatsu trading companies, but as soon as the occupation was over, MITI busily rebuilt them. Mitsui Bussan and Mitsubishi Shoji* were dissolved on November 30, 1947, and their liquidation completed on August 31, 1950. The largest and most successful Mitsui offshoots were the Dai Ichi, Sanshin, and Kyo-kuto* trading companies, while the leading Mitsubishi splinters were the Tozai*, Fuji, and Toyo* trading companies. By the end of 1952, the successor Mitsubishi companies had already recombined, but Mitsui took until the end of 1955 to come back together.

¹⁵

^*

Ralf Dahrendorf's observation is to the point: "One of the decisive differences between industrialization in Germany and in the Anglo-Saxon countries lies in the role of banks, which themselves combined into mammoth financial empires at an early stage, carried by their credits and investments a considerable part of the weight of German industrialization, and at the same time facilitated the rapid growth of large industrial units."

Society and Democracy in Germany

(Garden City, N.Y.: Doubleday, 1967), p. 37.