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Japan - Bureaucrats
The Budget Process
Despite the increasingly apparent limits of bureaucratic power, the Budget Bureau of the Ministry of Finance is at the heart of the political process because it drows up the national budget each year. This responsibility makes it the ultimate focus of interest groups and of other ministries that competed for limited funds. The budgetary process generally begins soon after the start of a new fiscal year on April 1. Ministries and government agencies prepare budget requests in consultation with the Policy Research Council. In the fall of each year, Budget Bureau examiners reviews these requests in great detail, while top Ministry of Finance officials work out the general contours of the new budget and the distribution of tax revenues. During the winter, after the release of the ministry's draft budget, campaigning by individual Diet members for their constituents and different ministries for revisions and supplementary allocations becomes intense. The coalition leaders and Ministry of Finance officials consult on a final draft budget, which is generally passed by the Diet in late winter.
In broad outline, the process reveals a basic characteristic of Japanese political dynamics: that despite the oft-stated ideals of "harmony" and "consensus," interests, including bureaucratic interests, are in strong competition for resources. Political leaders and Budget Bureau officials need great skill to reach mutually acceptable compromises. The image of "Japan Incorporated," in which harmony and unanimity are virtually automatic, belie the reality of intense rivalry. The late-twentieth-century system is successful insofar as superior political skills and appreciation of common interests minimize antagonisms and maintain an acceptable balance of power among groups. It is unclear, however, whether this system will continue as Japan faces such problems as growing social inequality, an aging society, and the challenge of "internationalization" of its society and economy.
The Civil Service
In trying to discover "who's in charge here," many analysts have pointed to the elite bureaucracy as the people who really govern Japan, although they composed only a tiny fraction of the country's more than 1 million national government employees. Several hundred of the elite are employed at each national ministry or agency. Although entry into the elite through open examinations does not require a college degree, the majority of its members are alumni of Japan's most prestigious universities. The University of Tokyo Law Faculty is the single most important source of elite bureaucrats. After graduation from college and, increasingly, some graduate-level study, applicants take a series of extremely difficult higher civil service examinations: in 1988, for example, 28,833 took the tests, but only 1,814, or 6.3 percent, were successful. Of those who were successful, only 721 were actually hired. Like the scholar-officials of imperial China, successful candidates were hardy survivors of a grueling education and testing process that necessarily began in early childhood and demanded total concentration. The typical young bureaucrat, who is in most cases male, is an intelligent, hardworking, and dedicated individual. Some bureaucrats lack imagination and, perhaps, compassion for people whose way of life is different from their own.
The public's attitude toward the elite is ambivalent. The elite enjoy tremendous social prestige, but members are also resented. They live in a realm that is at least partly public yet far removed from the lives of ordinary people. Compared with politicians, they are generally viewed as honest. Involvement of top officials in scandals such as the Recruit affair, however, had, to some extent, tarnished their image.
Japan's elite bureaucrats are insulated from direct political pressure because there are very few political appointments in the civil service. Cabinet ministers are usually career politicians, but they are moved in and out of their posts quite frequently (with an average tenure of under a year), and usually have little opportunity to develop a power base within a ministry or force their civil service subordinates to adopt reforms. Below the cabinet minister is the administrative vice minister. Administrative vice ministers and their subordinates are career civil servants whose appointments are determined in accordance with an internally established principle of seniority.
In a 1975 article, political scientist Chalmers Johnson quotes a retired vice minister of the Ministry of International Trade and Industry (MITI) who said that the Diet was merely "an extension of the bureaucracy." The official claimed that "the bureaucracy drafts all the laws.... All the legislature does is to use its powers of investigation, which for about half the year keeps most of the senior officials cooped up in the Diet."
In the years since this official made his proud boast, however, it became apparent that there were limits to the bureaucrats' power. The most important was the LDP's growing role in policy formation. Political scientist B.C. Koh suggested that in many cases members of the LDP policy-oriented tribes (zoku) had greater expertise in their fields than elite bureaucrats. Before the latter drafted legislation, they had to consult and follow the initiatives of the party's Policy Research Council. Many analysts consider the role of the bureaucracy in drafting legislation to be no greater than that of its counterparts in France, Germany, and other countries. Also, the decision of many retired bureaucrats to run as LDP candidates for the Diet might not reflect, as had been previously assumed, the power of the officials but rather the impatience of ambitious men who wanted to locate themselves, politically, "where the action is."
An intense rivalry among the ministries came into play whenever major policy decisions were formulated. Elite civil servants were recruited by and spent their entire careers in a single ministry. As a result, they developed a strong sectional solidarity and zealously defended their turf. Nonbureaucratic actors--the politicians and interest groups--could use this rivalry to their own advantage.
The Ministry of Finance is generally considered the most powerful and prestigious of the ministries. Its top officials are regarded as the cream of the elite. Although it was relatively unsuccessful in the 1970s when the deficit rose, the ministry was very successful in the 1980s in constraining government spending and raising taxes, including a twelve-year battle to get a consumption tax passed. The huge national debt in the early 1990s, however, may be evidence that this budget-minded body had been unsuccessful in the previous decade in curbing demands for popular policies such as health insurance, rice price supports, and the unprofitable nationwide network of the privatized Japan Railways Group. MITI frequently encountered obstacles in its early postoccupation plans to reconsolidate the economy. It has not always been successful in imposing its will on private interests, politicians, or other ministries. According to law professor John Owen Haley, writing in the late 1980s, MITI's practice of gyosei shido, or administrative guidance, often described as evidence of the bureaucracy's hidden power, was in fact a second-best alternative to "express statutory authority that would have legitimated its exercise of authority." Administrative reform policies in the 1980s imposed ceilings on civil service staff and spending that probably contributed to a deterioration of morale and working conditions.
Still another factor limiting bureaucratic power was the emergence of an affluent society. In the early postwar period, the scarcity of capital made it possible for the Ministry of Finance and MITI to exert considerable influence over the economy through control of the banking system. To a decreasing extent, this scarcity remained until the 1980s because most major companies had high debt-equity ratios and depended on the banks for infusions of capital. Their huge profits and increasing reliance on securities markets in the late 1980s, however, meant that the Ministry of Finance had less influence. The wealth, technical sophistication, and new confidence of the companies also made it difficult for MITI to exercise administrative guidance. The ministry could not restrain aggressive and often politically controversial purchases by Japanese corporate investors in the United States, such as Mitsubishi Estate's October 1989 purchase of Rockefeller Center in New York City, which, along with the Sony Corporation's acquisition of Columbia Pictures several weeks earlier, heated up trade friction between the two countries.
The whole issue of trade friction and foreign pressure tended to politicize the bureaucracy and promote unprecedented divisiveness in the late 1980s and early 1990s. During the Structural Impediments Initiative talks held by Japan and the United States in early 1990, basic changes in Japan's economy were discussed: reforms of the distribution and pricing systems, improvement of the infrastructure, and elimination of official procedures that limited foreign participation in the economy. Although foreign pressure of this sort is resented by many Japanese as an intrusion on national sovereignty, it also provides an opportunity for certain ministries to make gains at the expense of others. There is hardly a bureaucratic jurisdiction in the economic sphere that is not in some sense affected.
Repeatedly, internationally minded political and bureaucratic elites found their market-opening reforms, designed to placate United States demands, sabotaged by other interests, especially agriculture. Such reactions intensified United States pressure, which in turn created a sense of crisis and a siege mentality within Japan. The "internationalization" of Japan's society in other ways also divided the bureaucratic elite. MITI, the Ministry of Labor, and the Ministry of Justice had divergent views on how to respond to the influx of unskilled, usually South Asian and Southeast Asian, laborers into the labor-starved Japanese economy. An estimated 300,000 to 400,000 of them worked illegally for small Japanese firms in the late 1980s. Ministry of Education, Science, and Culture revision of guidelines on the writing of history textbooks, ostensibly a domestic matter, aroused the indignation of Japan's Asian neighbors because the changes tended to soften accounts of wartime atrocities.
Formal Policy Development
After a largely informal process within elite circles in which ideas were discussed and developed, steps might be taken to institute more formal policy development. This process often took place in deliberation councils (shingikai). There were about 200 shingikai, each attached to a ministry; their members were both officials and prominent private individuals in business, education, and other fields. The shingikai played a large role in facilitating communication among those who ordinarily might not meet. Given the tendency for real negotiations in Japan to be conducted privately (in the nemawashi, or root binding, process of consensus building), the shingikai often represented a fairly advanced stage in policy formulation in which relatively minor differences could be thrashed out and the resulting decisions couched in language acceptable to all. These bodies were legally established but had no authority to oblige governments to adopt their recommendations.
The most important deliberation council during the 1980s was the Provisional Commission for Administrative Reform, established in March 1981 by Prime Minister Suzuki Zenko. The commission had nine members, assisted in their deliberations by six advisers, twenty-one "expert members," and around fifty "councillors" representing a wide range of groups. Its head, Keidanren president Doko Toshio, insisted that government agree to take its recommendations seriously and commit itself to reforming the administrative structure and the tax system. In 1982 the commission had arrived at several recommendations that by the end of the decade had been actualized. These implementations included tax reform; a policy to limit government growth; the establishment, in 1984, of the Management and Coordination Agency to replace the Administrative Management Agency in the Office of the Prime Minister; and privatization of the state-owned railroad and telephone systems. In April 1990, another deliberation council, the Election Systems Research Council, submitted proposals that included the establishment of single-seat constituencies in place of the multiple-seat system.
Another significant policy-making institution in the early 1990s was the LDP's Policy Research Council. It consisted of a number of committees, composed of LDP Diet members, with the committees corresponding to the different executive agencies. Committee members worked closely with their official counterparts, advancing the requests of their constituents, in one of the most effective means through which interest groups could state their case to the bureaucracy through the channel of the ruling party.
The Japanese had been exposed to bureaucratic institutions at least by the early seventh century A.D., when the imperial court adopted the laws and government structure of Tang China. However, the distinctive Chinese institution of civil service examinations never took root, and the imported system was never successfully imposed on the country at large. But by the middle of the Tokugawa period (1600- 1867), the samurai class functions had evolved from warrior to clerical and administrative functions. Following the Meiji Restoration (1868), the new elite, which came from the lower ranks of the samurai, established a Western-style civil service.
Although the United States occupation dismantled both the military and zaibatsu establishments, it did little, outside of abolishing the prewar Home Ministry, to challenge the power of the bureaucracy. There was considerable continuity--in institutions, operating style, and personnel-- between the civil service before and after the occupation, partly because MacArthur's staff ruled indirectly and depended largely on the cooperation of civil servants. A process of mutual co-optation occurred. Also, United States policy planners never regarded the civil service with the same opprobrium as the military or economic elites. The civil service's role in Japan's militarism was generally downplayed. Many of the occupation figures themselves were products of President Franklin D. Roosevelt's New Deal and had strong faith in the merits of civil service professionalism. Finally, the perceived threat of the Soviet Union in the late 1940s created a community of interests for the occupiers and for conservative, social order-conscious administrators.
The Human Factor
The most important human factor in the policy-making process is the homogeneity of the political and business elites. They tend to be graduates of a relatively small number of top-ranked universities. Regardless of these individuals' regional or class origins, their similar educational backgrounds encourage their feeling of community, as is reflected in the finely meshed network of marriage alliances between top official and financial circle (zaikai) families. The institution of early retirement also foster homogeneity. In the practice of amakudari, or descent from heaven, as it is popularly known, bureaucrats retiring in their fifties often assume top positions in public corporations and private enterprise. They also become politicians. By the late 1980s, most postwar prime ministers had had civil service backgrounds.
This homogeneity facilitates the free flow of ideas among members of the elite in informal settings. Bureaucrats and business people that are associated with a single industry, such as electronics, often hold regular informal meetings in Tokyo hotels and restaurants. Political scientist T.J. Pempel has pointed out that the concentration of political and economic power in Tokyo-- particularly the small geographic area of its central wards--makes it easy for leaders, who are almost without exception denizens of the capital, to have repeated personal contact. Another often overlooked factor is the tendency of elite males not to be family men. Late night work and bar-hopping schedules give them ample opportunity to hash and rehash policy matters and engage in haragei (literally, belly art), or intimate, often nonverbal communication. Like the warriors of ancient Sparta, who lived in barracks apart from their families during much of their adulthood, the business and bureaucratic elites are expected to sacrifice their private lives for the national good.
Despite an increasingly unpredictable domestic and international environment, policy making conforms to wellestablished postwar patterns. The close collaboration of the ruling party, the elite bureaucracy, and important interest groups often make it difficult to tell who exactly is responsible for specific policy decisions. The tendency for insiders to guard information on such matters compounds the difficulty, especially for foreigners wishing to understand how domestic decision making can be influenced to reduce trade problems.
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