MITI and the Japanese miracle

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crude oil. In the wake of the closing of the Suez Canal in 1956, Maruzen's president, Wada Kanji, had signed long-term shipping contracts that during the recession of 1962 turned unfavorable and threatened the company's financial viability. President Wada proposed accepting a very large loan from Union Oil to keep his company afloat, and he applied to MITI for approval of the loan under the terms of the Foreign Capital Law.

Sahashi turned him down cold, arguing that the company's own mismanagement had caused its problems, and that the introduction of foreign capital in an industry already thoroughly dominated by foreign companies was contrary to the national interest. Wada was not without political influence, which he began to mobilize to put pressure on MITI, but this pressure only caused Sahashi to become more combative. However, in the end Sahashi agreed to organize a five-man committee to try to salvage the Maruzen Oil Company. Chaired by Uemura Kogoro *, it recommended that Wada retire and that MITI negotiate the terms of the loan directly with Union Oil in order to ensure that Union did not gain control of the company. MITI accepted these recommendations: Sahashi struck a deal with Union, Miyamori Kazuo of the Sanwa Bank replaced Wada as Maruzen's new president, and the company was successfully rebuilt. But several Osaka legislators made speeches in the Diet accusing "the bureaucrat Sahashi" of throwing their local business leader Wada out into the streets.

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Meanwhile, on July 18, 1962, Sato* Eisaku resigned as MITI minister, and Prime Minister Ikeda appointed Fukuda Hajime to replace him. Fukuda was a classic politician of the party-men's factions, a former war correspondent (Singapore) and chief of the political department of the Domei News Agency, a five-times-elected member of the House of Representatives from Fukui prefectureand a stalwart of the Ono* faction. Ikeda named him on the recommendation of Ono, whose support he needed to hold off the political challenges coming from both Sato and Kono* Ichiro*. Fukuda was exactly the type of man whom the elite bureaucrats of MITI wouldand didderide as a "small-time politician," but he will never be forgotten within the ministry as the cause of the "Fukuda typhoon" of July 1963.

During June 1963 Vice-Minister Matsuo Kinzo* was preparing for his amakudari as director (later vice-president) of Nippon Kokan*. He recommended to Minister Fukuda that Sahashi be named as his successora change of command that had been long and carefully planned. However, on July 1, 1963, Fukuda was involved in a wide-ranging discussion with a group of journalists, during which one of them said, "Various personnel matters are pending within MITI.