MITI and the Japanese miracle

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into one powerful unit. (Appendix B includes a chart of MITI's "new structure," or "face lift," as some critical journalists put it.)

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Morozumi retired on the day the new structure was enacted and turned over its implementation to Yamashita Eimei (class of 1943, former first secretary in the Canadian embassy, deputy director of the Heavy Industries Bureau, and chief of the Chemical, International Trade, and Enterprises bureaus). On October 6, 1973, the "Fourth Middle Eastern War" (as the Japanese call it) erupted. Ten days later six countries of the Organization of Petroleum Exporting Countries raised their oil prices by 21 percent, and on October 20 six Middle Eastern nations suspended shipments of oil to nations supporting Israel. The "oil shock"a considerably more important event than what the Japanese press had called the "Nixon shocks"hit Japan and the world with stunning force. On November 16, 1973, the cabinet enacted its "Emergency Petroleum Countermeasures Policy," which ordered crash conservation programs; and Japanese political leaders, including MITI Minister Nakasone, set out on trips to the Middle East to try to win friends among nations they had not paid much attention to in the past. Japan was the world's largest petroleum importer and totally dependent on the Middle East. (One of the projects that Nakasone agreed to build in the area in order to cement relations was a $3 billion petrochemical complex at Bandar ShahpurBandar Khomeini after the 1979 revolutionin Iran. Ironically enough, Vice-Minister Yamashita Eimei, who became an executive of the Mitsui Trading Company after his retirement, ended up being in charge of building it. Cost overruns, the turmoil of the revolution, and damage done during the war between Iran and Iraq may have turned it into one of the most expensive foreign-aid efforts the Japanese have ever undertaken.)

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The significance of the oil shock for purposes of this study lies in the fact that it once again reminded the Japanese people that they need their official bureaucracy. The country had had a governmental energy policy in one form or another ever since the Meiji Restoration, and the energy problems of the 1970's provided MITI, in the words of the

Mainichi

, with a "once in a lifetime opportunity" to regain its previous authoritya challenge that it met with great skill and ingenuity.

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The ministry's immediate problem was the impact of the oil crisis on the already "crazy" prices. First heating oil began to rise in price and then to disappear altogether from the market. Then toilet paper and next household detergents became scarce. The public became