MITI and the Japanese miracle

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most of the people Sahashi dealt with were either his ministerial seniors or industrialists he had known since his wartime work in the Iron and Steel Section of the Munitions Ministry. They included Ojima Arakazu, Kishi's successor as vice-minister in 1941 and subsequently president of Yawata Steel, one of the two successor companies to Japan Steel after SCAP had broken it up; Inayama Yoshihiro, who had entered MCI in 1927 as an official at the then state-owned Yawata works and who in 1962 followed Ojima as president of Yawata Steel; Nagano Shigeo, president of Fuji Steel, the other successor of old Japan Steel, and a man who had worked with Sahashi in the wartime Iron and Steel Control Association; Fujii Heigo, a Yawata vice-president and a man who came to Sahashi's aid in his clash a few years later with the non-state-oriented Sumitomo Metals Company; and Hirai Tomisaburo *, a Yawata director and the vice-minister who had appointed Sahashi to the Secretarial Section in 1954. Ojima would soon be playing a key role in MITI's affairs as head of the new Industrial Structure Investigation Council, the ministry's blue-ribbon committee for thinking of ways to counter the effects of liberalization. Sahashi's relations with the Yawata and Fuji steel companies were cordialso cordial that when he was vice-minister, leaders of Sumitomo Metals would charge that MITI had become the "Kasumigaseki office of Yawata Steel."

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Not so cordial were Sahashi's relations with the International Business Machines Corporation. The IBM case did, however, afford him one of his first opportunities to appear as a samurai warding off the "invasion of American capital." MITI already had various policies intended to exclude foreign enterprises from the Japanese domestic marketinformal rules such as not allowing foreigners more than a 50 percent share in a joint venture, restricting the number and voting rights of foreigners on the boards of directors of Japanese firms, stopping foreigners from buying Japanese firms without the firm's consentand, ultimately, excluding all foreign participation in the Japanese economy without MITI's permission. In a sensational case of the late 1950's, the Heavy Industries Bureau had done everything in its power to obstruct a proposed joint venture between Singer Sewing Machines of the United States and Pine Sewing Machines of Japan. Singer, the prewar leader, was attempting to recapture its old markets, but MITI was fostering a domestic sewing-machine industry, and so it slapped production limitations on the Singer-Pine collaboration.

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IBM, however, posed special problems. Since it had organized itself in Japan as a yen-based company, MITI's controls over the use or repatriation of foreign exchange did not apply. More important, IBM