GODZILLA, that megamonster of the movies, will return to the silver screen for his 17th sequel soon and, as usual, he will stomp all over the mega-city of Tokyo, an act always pleasing to audiences in Japan.This time Godzilla's target is the new city hall, the loftiest skyscraper in the nation and a symbol of what many people think is both right and wrong about the capital region. Opened in April, the municipal complex has been tagged a "tower of frustration" because of its conspicuous extravagance and $1.2 billion price tag amid the city's poverty of housing and the daily crush of commuters packed like cattle on the trains. But despite common complaints about Tokyoites living in "rabbit hutches" and scrambling to ever-more-distant offices, the debut of the grand, 802-foot-high city hall also marked a crowning moment in a campaign to turn Tokyo into the world's first "technopolis." "Over the past century, Japan has developed Tokyo into a huge metropolis out of the design to create a centralized society," says Hisatake Togo, managing director of the Tokyo Institute for Municipal Research. By concentrating much of the nation's industry, finance, culture, higher education, trade, science, media, and political authority in one city, Japan has not only been able to catch up with the West, but Tokyo is now poised to become the global manager of new "knowledge-based" industries, guiding new technologies and world finance. "Tokyo has already become a post-industrial society," says Kiyoji Murata, a Chuo University economics professor. With its cozy triangle of business, bureaucrats, and politicians, Tokyo serves as the mother of all Japanese industry. About two-thirds of Japan's "information" workers and its big corporate headquarters are located in the city. Tokyo is home to 34 percent of the nation's university students, 40 percent of its bank loans, and 93 percent of its research institutes. With only 3.6 percent of the nation's land, Tokyo commands 20 percent of Japan's gross national product. Its city budget exceeds China's, even though the population of Tokyo proper is only 11.85 million. One-quarter of Japan's 123 million people live within 35 miles of the emperor's palace. "Such concentration has done much for Japan," says Akio Maekawa, the city's deputy planner. "But we are afraid that it might start to weaken our country. Tokyo is too big in the economy and is creating big gaps in income." Since 1980, government has made various efforts to disperse business from central Tokyo and into seven urban "sub-centers" and eight satellite cities. But these efforts have only acted like "a cup saucer," says Dr. Togo, drawing in more business and helping to boost land prices to the highest in the world. Building one mile of road in Tokyo costs about $300 million, with 94 percent of that going just to buy land. Polls show most Tokyoites are satisfied with their city life - until the topics of housing and transport are raised. Then, the discrepancy between the nation's wealth and the people's feelings of affluence becomes apparent. On paper, Tokyoites have the highest average yearly incomes in the world ($29,251 in 1989), but have mediocre living standards, according to the government. As one example, 12 percent of homes in the city are not connected to sewer lines. And the city will run out of garbage dump sites in 1995. Its electricity and water capacities are often stretched. Despite Tokyo's reputation as an urban paradise because of its safety, cleanliness, and efficiency, the maladies of a rich nation's megalopolis are all too real to the people living in it. Skyrocketing housing costs have pushed people to live farther and farther away. Condominiums cost 10 times an average annual salary, according to the Urban Development Association. "It's pretty well impossible for young people to get married and buy a house in Tokyo," says Michihiro Okuda, a sociologist at Rikkyo University. Average commuting time has risen to 45 minutes each way, compared to 25 minutes in Osaka. Many workers commute several hours a day, sapping their productivity, family life, and, in the crush of bodies, their humanity. An estimated 20,000 commuters take the bullet train every day, traveling hundreds of miles at high speed and great expense. Trains and subways carry twice the planned capacity. While two-thirds of commuters ride the rails, a recent boom in car ownership has clogged Tokyo's highways. Many of the city's youth find the future almost hopeless. "This is one of the most detrimental problems for the well-being of Japan in the future," states Masahiko Honjo, director of the International Development Center of Japan. The demographic shape of Tokyo resembles a doughnut as high property prices have pushed more residents to the outskirts, drying up inner neighborhoods in what is called a "decentralized concentration." By day, the downtown population is 2.5 million, but at night it drops to one-eighth of that. Many city politicians worry that they have lost more than one-quarter of their voters. Last March, Japan's oldest primary school had to close its doors in the city because it had only 57 pupils. "Tokyo is a super-industrial city divorced from the community," says sociologist Michihiro Okuda. For more than a decade, a political tug-of-war has been fought between those who want to keep a centralized Tokyo for the sake of national economic strength and those who want to disperse business and give priority to residents. "There are so many disputes in government, that controls over growth in Tokyo barely exist," Togo says. "We tried to paralyze business growth in the center, but couldn't." Only Godzilla, it appears, could do that, and only in the movies.