The dragon that analyst of Japanese public policy spend most of their time slaying is widely familiar as "Japan Inc." It has three heads: The Japanese bureaucracy, the ruling Liberal Democratic Party (LDP), and the business community. The model is one of countervailing sanctions within a decidedly consensual environment.
The interlocking directorate of Japan Inc., is said to operate in a triangle of power. At one vertex stands the formidable Japanese bureaucracy. Before World War II more than 90 percent of all upper-level civil servants were graduates of the Law Faculty of Tokyo Imperial University. Today that figure is , at least by US standards, not much changed.
More than 70 percent of the fast track "elite course" officials are still products of Tokyo University. Like the old military, there is a small officer corps commanding a very large number of troops. These bureaucrats freshly graduated from university enjoy a rapid rotation of positions, reflecting the Japanese preference for generalists who can assume varied responsibilities of leadership.These men (and invariably they arem men) work until retirement at about age 50, when they become available for a second career, usually as either advisers to industry or as LDP diet politicians -- the other two vertices of this power triangle.
The recirculation of formerly powerful government officials to positions in industry is referred to as "amakudari" in Japanese. Literally translated this is "descent from heaven," but to many overworked and underpaid government bureaucrats it is the opportunity for an extremely lucrative "afterlife." They remain highly influential, and are for the first time remunerated in more than the currency of power alone. Ascent tom heaven may be more appropriate.
The government-industry relationship is itself extremely complex. If industry holds the carrot of "amakudari" sincecures, government enjoys the stick of "administrative guidance." This generic term masks a very wide variety of ways in which the bureaucracy can influence the private sector, even without promulgating new legal requirements. Notifications and guidelines without the force of law are frequently acted upon as if they were legally binding, and therein lies as key to the ability of the Japanese state to influence private industry.
I do not dispute those who point to norms such as administrative guidance as evidence of a close business-government relationship, but there are simply too many widely known cases of administrative guidance gone unheeded (automobiles, for one) and too many cases of multiple, conflicting ministerial directives to sustain incautious monolithic formulations.
The third vertex of the Japan Inc. power triangle is the ruling Liberal Democratic Party. Less a coherent ideological unit than a federation of loose factions based upon personal loyalties and the cash nexus, the conservative LDP has governed Japan continuously since 1955. Some one-fourth to one-third of LDP Dietmen are former government officials, and many others have a variety of close connections to the business community upon which they depend for campaign funds. Such is grist for the Japan Inc. mill.
But the federative nature of the LDP suggests an alternative reality. The LDP enjoys the support of the potent combination of big business and rural interests. We need to be reminded that farmers as well as managers, that agricultural as well as industrial interests have kept the LDP in power. Rural landowners have consistently frustrated big business, rice producers have continued to drain government coffers with their politically sustained subsidies , and it is hard to imagine that Japanese industrial and farm interests were ever as contiguous as the harmonious, consensual model would lead us to believe.
In fact, it is mildly surprising that the LDP has remained as cohesive as it has over time. This is a tribute to the politicians' capacity for compromise and survival -- not to their inherent commonality of world views.
These, then, are three elements of Japan's "interlocking directorate." There are, I agree, a great many reasons why Japanese industry, bureaucracy, and political leadership should have a greater unity of purpose and should more easily be able to act in pursuit of truly common interests.
But, when we discuss Japan, too often we refer to plural pronouns instead of to particular actors with particular interests. Too often we hear that "they" have a strategy for this, of that "they" are planning to do that. Our mistaken image of Japan is that of a unitary actor, as if there were some sort of politburo in Tokyo. This monolith is a myth.