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Japan Readings Notes

Harry Truman appointed Douglas MacArthur as Supreme Commander for the

Allied Powers (SCAP) to supervise the occupation of Japan on August 14 1945.
Attempt to distill democracy, liberalism and Christianity. To a large extent the
Societs were left out of the equation.
The goals of Occupation
Had in 1945 a limited democratic parliament but legacy of authoritarianism
There was opposition the Japanese got along remarkably well with the US
and this facilitated the smooth implementation of polic
- Demobilisation of the armed forces was largely compelted by 1948
- Dismantling munitions factories
- Distribution of overseas territories
Phase one was remarkably successful
Phase two was referred to as reverse course which came about due to a the
Korean war and the emergence of communism as a perceived threat. It allied
conservative Japanese and the US who wished to enhance Japans strength
By 1947 US policymakers were viewing Japans potential as a power in Asia
favourably. Shigeru Yoshida was one of these conservative businessmen.
- The Dodge plan introduced in 1948 called for deflation and austerity
measures. Big business was back in favour.
- To Promote economic expansion the Ministry of International Trade and
Industry was created in 1949. The austerity measures hit small business
hard and Japan began sliding into depression in 1949.
- Eventually the program produced a shakeout of the economy and
provided the basis for later growth.

The occupation encouraged a strong labour movement that had been

quashed during the occupation
October 5 1945 SCAP issued a directive removing restrictions on freedom
of labor organisations.
October 11 1945 MacArthur stated publically that he expected action to
encourage the unionisations of labor This was followed in 1946 by the
Trade Unions Act
Labor Standards act in 1947 gave them the right to strike and bargain.
Because it was so successful the growing militancy of the labor movement
prompted a re-examination by both the occupation authoritaes and
Japanese because they were scared of the left.
Labor movements seemed to promote the far left wing.
To prevent this the labor movement was weakened by the
discouragement of of industry wide unions. This led to a permanent
weakness in the labor movement.

Land reform
The most successful reform measure implemented by SCAP was land reform.
- Increased the percentage of farmers who were landowners as opposed to
a feudalistic tenant system.
- It was balanced didnt crush elites but encouraged private ownership
-1947 basic law on education and School Education law made education less
rigid and afforded greater opportunities for a larger number of people.
Emphasis placed on analysis and problem solving.
Shintoism banned
Unfortunately the education system was politically divided and destabilized
the efficacy of these reforms
Zaibatsu was ordered disbanded by Truman and the business community
and government delayed for as long as possible. MacArthur intervened to
effect this breakup.
- Yasuda plan which called for the 4 largest clan dominated combines to be
broken up.
- Pauley plan which said give Japanese industry to those affected by war
- The zaibatsu plan didnt work because the Japanese refused to cooperate

The American style constitution was only accepted because it was sold as
the logical continuation from the Meiji one.
There was a number of issues to be resolved with the current state of

Yoshida Shigeru was a leading conservative, prime minister for most of the first
decade of the postwar period and a driving figure in postwar politics.
On the surface party politics seemed new and libera with April 1946 elections
bring in 200 parties and 2700 candidates for the lower hours.
- Japanese Socialist party became a player but was split between
moderate and liberal wings. Japan Communist Party showed new
strength gaining almost 10 per cent in first postwar elections
- Much sympathy for progressive causes
- Postwar years were finest hour for left-wing parties

Progressives embraced the Occupation and believed japan had a mission

to introduce a new world order
Conservatives however were able to cling to power. The key was an
alliance with the bureaucracy which provided strong basis for
conservatives staying power.
Purge that occurred left the bureaucracy intact
Pre war the bureaucracy was competing with zaibatsu and military for
power but postwar it was the only one left standing
Liberal Party emerged as the dominant conservative party led by
Yoshida Shigeru who was a veteran bureaucrat of the prewar foreign
ministry. He served as prime minister from 1946-1954. He is one of the
most important figures in post war Japanese history.
Yoshida installed his closest followers in the bureaucracy these
followers became known as the Yoshida School.
In 1954 the Liberal Party lost power to another conservative party called
the Democratic party. In 1955 the progressive parties combined to form
the JSP. It was racked with divisions however, but also in 1955 the
Democratic and Liberal Party joined forces to form the LDP the
substantial combined forces of this party succeeded in staving off political
opposition for 4 decades.
The left cosumed their energies in ideological struggles that nobody cared
As a result of this fracturing the socialists were always in opposition
while most power was held by the LDP.
The maintenance of power depended on close ties with business and
agriculture it needed the rural vote and financial backing of the business
Bureacracy was the highest level of authority, not the Diet.

Yoshida Doctrine
- Main themes re-establishment of bureaucratic and business leadership
of the nation, pursuit of economic growth and a passive role in
international politics.
- After the war yoshida gradually put together a sense of national purpose
that guided the country for four decades. Effective because he installed a
powerful group of followers in his own party.
- Yoshida realized that it was important to restore Japans international
reputation, he determined that japan should ally itself with the US closely.
- He negotiated an end to the occupation and a military agreement with the
US to provide Japanese security after It regained independence. He
worked a strategy over the course of these negotiations referred to as the
Yoshida Doctrine.
- -1950 The cold war made japan strategically important to the US and
Yoshida had suddenly bargaining power. Japan, therefore, could make
minimal concessions of passive cooperation with the US in return for an
early end to the occupation.
- With regional communist revolutions the US sought to bring Japan into it
s military defense system and remilitarize it.

Yoshida refused the US urges to join an Asian equivalent of NATO or to

rearm saying that it would impoverish japan and create social unrest.
It spared military involvement in Korean War and instead allowed
Japanese business to profit from procurement orders
Yoshida agreed to US military bases on Japanese soil in return for a
guarantee of Japenese security

Yoshida Doctrine

Japanese economic rehabilitation must be the prime national goal.

Japan should remain lightly armed but avoid international issues

involving warfare. This saves money and avoid domestic dischord

Japan would provide bases for US Army navy and air force

Dulles exacted a heavy price from Yoshida as it gave the US substantial

control in JAPAN

There was a period between 1954-1960 where anti-yoshida

conservatives held sway where they attempted a nationistic approach
that placed emphasis on rearmament andnew security treaties. This was
met with heavy protests and thus a return to the Yoshida School.

Ideka Hayato (1960-1964) was a yoshida ascriber and was the most
important figure in japans rapid growth.


The structure of the economy during war years lay the groundwork for
successful industrialization in the 1950s and 1960s
Newly expanded workforce
Munitions factories converted to sewing factories for example
High economic growth 1950-1973

1945 peace provided a liberal international economic order in which to

take refuge
Japan was spared participating in international politics
Until the late 1960s Japan benefitted from a relationship with the US
where the US market was kept open to Japanese goods while japan
severely limited imports
Creation of the IMF and General Agreement on Tariffs and Trade
permitted a vigorous expansion of Japanese manufactured goods.
Had new, efficient western technology
Productivity increased exponentially (9.1 percent growth 1955-1960, 9.8
percent 1960-1965).

No longer fishery, agriculture based industries but construction and

Productivity rose rapidly because of tech innovation
High rate of investment large share of the GNP was plowed back into
new plants and equipment for MOAR GROWTH
High saving achieved by the Japanese at home
3rd factor motivated and well educated labor
millions return to swell labor ranks
wages didnt rise rapidly and overtake productivity
4th growth of international trade. Postwar reduction of trade restrictions
caused a rapid expansion of world trade
1953-1965 japanese exports grew by 17 percent a year.
Government encouraged growth with tax concessions, loans and guidance
from the new Ministry of International Trade and Industry.
MITI encouraged mergers and collusive arrangments
Small defense budget
Korean war created a textile boom
The high growth system worked because of politicans and bureaucracy
steeped in the knowledge of prewar and wartime manufacturing
industrial experience
Facilitated by the reverse course and the dodge plan in 1949
Foreign Capital Law 1950 enabled MITI to restrict and limit foreign
ownership and investment
High tariffs protected industries, sheltered japans market from the rest of
the world
When the occupation ended 1953 MITI developed the Anti-Monopoly Law
to relax restrictions on cartels and mergers.
Competition between a few huge companies
Many economists argue that it was the market that saw the huge levels of
growth rather than the role of the developmental state
This refers to access and development of technology, level of skkills and
education in japan and the unparalleled export opportunities
MITI was sometimes an obstacle (public government group as opposed to
private) in its obstruction of growth
Those of this view stress that it is companies not governments of societies
trade and in the end its companies that prosper or not
Organisation of big business was distinctive enterprise groups known as
keiretsu emerged in the 1950s to replace the zaibatsu.
They took different forms several including Mitsubishi included a main
bank, financial institutions, manufacturing firms and trading companies
Horizontal keiretsu helped provide long term stabilitiy and reduced risk
Vertical Keiretsu organise in automobile, technology and other industrie
organised subcontractors and services.
They provided efficient long term reciprocal nbenefits of the parent

Controversy emerges between two schools of thought state

development of market development
No easy answer the state was intergral to high growth period and the
bureaucrats facilitated varying levels of growth. Some scholars take a
complex approach and say that neither government not the business
sector but BOTH working together in an interactive relationship made
growth possible.
Reciprocal consent between business and government made growth
MITI responds to business interests and tries to help industries develop
High growth period from 1950-1973 was facilitated by a variety of factors
Strong political consensus supported growth as the overriding goal of the
Business and government worked hand in hand
Labor had littlee authority and was due to the prevention of formation of
large union movements

1955-1987 exports achieved a 114 fold increase

- government policies directed capital to the lead industries to develop

Holdcombe Reading

Article 9 asserted that the Japanese must forever renounce was as a

sovereign right of the nation and that the military will never be
San Francisco Peace Treaty signed in 1951 September
Recovery had scarcely begun by the end of the occupation. GNP didnt
regain its pre wwII levels until 1953.
End of the 1950s that Japanese Economy took off
From 1955-1973 annual growth in Japans GNP exceeded 10 per cent
1968 japan exceeded west Germany to become third largest world
Industrial sectory become one of the earths most developed
Japan moved away from textile manufacturing to electronics
Transistor created a new generation of lightweight portable radios
1981 Japan had become the largest automaker
Technology transfer from the state was hugely beneficial

End of the prosperity

- 1985 plaza accord saw the exchange value of the yen increased
- real estate and stock market bubbles eventually burst in 1990.
Commercial real estate prices fell by almost 85 per cnt
- left japan with enormous bad debts
- trillians of yen in debt by 21st century
- Rise of manufacturing powers such as china led to this

Japanese population is aging

Workforce peaked in 1998 and there are predictions that the population
may half over the next century