MITI and the Japanese miracle

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trons, Yoshino was one of Kishi's most important patrons, and Kishi was destined to become prime minister of Japan at the time of high-speed growth. Yoshino and Kishi together would establish Japan's first genuine industrial policy. The two younger men would also rise not just to the highest bureaucratic post in their service, vice-minister, but to the ministry's highest political post, minister of commerce and industry. But in 1924 none of them could have had the slightest suspicion of what was to come; all they were doing was arranging their rather untaxing bureaucratic lives to suit themselveshelping their friends, getting rid of people who irritated them, and taking advantage of a political change that did not affect them personally much at all.

The break-up of the Ministry of Agriculture and Commerce had been long in coming. Petitions calling for a separate agriculture ministry had been introduced in the Diet every year since 1918; and after the "rice riots" of the same year the issue had assumed major political significance. Equally important, with the emergence of the governments based on political parties that followed the passing of most of the Meiji oligarchs, genuine pressure groups were beginning to have a profound effect on Japanese governmental policy. Although in essence agricultural interests and their political allies were kicking commerce out of the Ministry of Agriculture and Commerce, the leaders of commercial administration were quite pleased to see this happen, particularly since they were in a position to execute the details of the split. The situation was somewhat comparable to the division in 1913 in the United States of the old Department of Commerce and Labor into two separate departmentsat the insistence of the American Federation of Labor and not of business interests.

¹

The old Japanese ministry that was being divided had itself developed out of a basic change in Meiji economic policy that took place in 1880. After a decade of direct governmental investment in mines, railroads, arsenals, and factories, the Meiji leaders had had to confront the unpleasant fact that the new government of Japan could not afford to continue what it had been doing. The side effects of its policies were inflation, trade deficits, corruption, and looming bankruptcy. Liberal economists of the time such as Taguchi Ukichi, who wrote for the

Tokyo

*

keizai zasshi

(Tokyo economic journal), urged the government to control inflation by selling off its state enterprises and turn instead to the sponsorship of private capitalism.

Within the government the new minister of finance, Matsukata Masayoshi, agreed; and on November 5, 1880, he issued his famous "Outline Regulations for the Sale of Government-operated Facto-