A New Japan? Political, Economic, and Social Aspects of Postwar Japan



DEFEAT in a major war usually results in a basic transformation of a society. Such was to bo expected for the Japan of 1945, the more so since her participation in the last war, a war which she was bound to lose, was the culmination of reckless attempts to solve her internal problems by resort to increasingly ambitious aggression abroad. Her defeat did not remove the internal strains in Japanese society; but at least it cleared the stage for a moment and gave us an opportunity to rebuild a new Japan.

The occupying authorities, dominated by the United States, were apparently aware of the close connection which existed between Japan’s militaristic adventures and the underlying social and economic tensions which kept mounting, especially after the Great Depression of 1929. Thus, although the war crimes trial, at which a few scores of prewar and wartime leaders were indicted, seemed to have its own independent philosophy and logic, the over-all policy of the Occupation stood clearly on the premise of the necessity of reforming the structure and patterns of our society in order that Japan might never again become a menace in the community of nations. The energy and steadfastness with which such reforms were planned and initiated are certainly noteworthy, and here it may suffice to recall several of the more important steps in this direction.

A New Constitution Renouncing War: The new Constitution, drafted under the guidance of the occupying authorities and inaugurated on May 3, 1947, contained, inter alia, the unique Article IX:

“Aspiring sincerely to an international peace based on justice and order, the Japanese people forever renounce war as a sovereign right of the nation and the threat or use of force as means of settling international disputes.

“ In order to accomplish the aim of the preceding paragraph, land, sea, and air forces, as well as other war potential, will never be maintained. The right of belligerency of the state will not he recognized.”

Deconcentration: On the assumption that the Zaibatsu, monopoly organizations peculiar to Japan, played, willy-nilly, a role of accomplice in military aggression, the occupying authorities directed the Japanese government to carry out measures of thoroughgoing deconcentration of economic power. The enabling act was passed in December, 1947.

Land Reform: Common throughout Asia has been the challenge of land reform. In prewar Japan the extreme poverty of landless peasants formed the economic basis for various internal strains within the society; this had the effect of channeling the nation’s energy into external adventures. Thus a fairly drastic land reform had high priority on the agenda of the Occupation directives and became a law in October, 1946.

Democratic Development of Trade Unions and Improvement in the Conditions of Workers: Before the war Japan was not without a fairly large trade union movement and some advance had been made in the direction of improving the conditions of workers. But America brought with her the mature experience of the New Deal period in her own country and guided Japan to enact a number of progressive labor laws, such as the Labor Relations Act of 1916 and the Labor Standards Act of 1947.

Democratization of the Police System: Prewar Japan was notorious for her oppressive police system. And the point was duly noted in the Potsdam Declaration, defining terms for Japanese surrender, that “the Japanese Government shall remove all obstacles to the revival and strengthening of democratic tendencies among the Japanese people.”One of the first acts of the occupying authorities was to abolish the Peace Preservation Law, the National Security Law, the bureau of special police in charge of thought control, and to release political prisoners. In time an entirely new, decentralized police system was set up.

Purges of Wartime Leaders and Disbanding of Ultra-nationalistic Organizations: Men are often products of circumstances; but it was wisely recognized by the occupying authorities that the lingering of old faces at the top of Japan’s web-like society would stifle the unfledged forces of democracy which needed encouragement. Purges of leaders in various activities related to warmaking were, on the whole, carried out successfully and prepared the ground for a younger generation to follow up the democratic reforms initiated by the occupying authorities.

As a country in defeat, Japan had its share of destitution and hunger, intensified by vicious inflation which, within a few years after the war, diminished the purchasing power of our currency to less than one one-hundredth of what it had been. During that period the special aid from the United States, which flowed into Japan mainly in the form of foodstuffs, was a godsend. It enabled the nation to survive the worst period of rehabilitation and to move toward recovery. When the inflationary spiral was arrested around 1948-49, and the exchange rate was stabilized (at 360 yen to a dollar) in April, 1949, industrial production began to pick up at an accelerated rate. Its over-all index went above the prewar (1934-36 average) level in the autumn of 1950, and it has since been growing at an average rate of 20 per cent each year. Gross national production in real terms, a better index for the total economic activities of the nation, has also kept pace. Its annual rate of growth has been 10 per cent or higher each year since 1949. In 1953, per capita income went above the fairly prosperous prewar average of 1934-36.

Capital investment for production has nearly doubled in the past four years — a record perhaps unequaled in the history of industrial nations. The over-all productivity of labor has risen pari passu with this investment. Taking the level of 1949 as 100, the index of labor productivity was 125 in 1950, 165 in 1951, 186 in 1952, and 225 in 1953 — an increase which has astounded economic analysts. A foreign traveler who had visited Japan in 1946 and then returned in 1954 could easily verify these statistics. The construction of big buildings which seems to be going on everywhere, the marked improvement in the clothing of people in the street, the abundance of food and household goods which fill the shops — these outward signs are unmistakable. Queues are now seldom seem except in front of theaters and ball parks, and a city like Tokyo is filled with sight-seeing buses loaded with visitors from the country who seem to have more money and leisure than ever before. Certainly few people expected that Japan could recover so quickly. It might seem that Japan has nothing to worry about, that the basis has been firmly laid for the healthy development of the country and for the gradual ironing out of the strains and stresses consequent to catastrophic defeat in war.


ON closer examination, however, what appears to be a remarkable success proves to rest on extremely precarious ground. Worse still, many of the most significant legislative reforms of the Occupation period have already been swept away. How this came about is a long story which has to be told in the context of changes in American policy and the lack of integrity of Japanese political leaders. But one by one, the reform measures, which although initiated by Americans did inspire the democratic zeal of younger Japanese, have either been strangled directly or nullified by counter-measures. And by the summer of 1954 there was little left of the scaffolding erected to help build a new Japan.

To begin with, the unique clause in the new Constitution which renounced war — universally acclaimed at the time on both sides of the Pacific — is now a dead letter. Japan’s rearmament started in July, 1950, within two weeks after the Korean war broke out, in the form of a “Police Reserve,”75,000 strong. This force was apparently intended by the occupying authorities to fill the gap vacated by American soldiers who had to be sent from Japan to Korea. Once given birth, the “Police Reserve” started on its independent career. Its name was changed to the “National Security Force” and it was equipped with tanks (though, officially, they were called “special cars”), trench mortars, and other instruments of war. It became quite patent that such a creature, so clearly an army except in name, could not be consistent with Article IX of the Constitution which said that “land, sea, and air forces, as well as other war potential, will never be maintained.”

The Japanese government, however, refused to face the issue, fearing, no doubt, almost certain defeat in a referendum if they were to propose a revision of Article IX. Finally, on May 1, 1954, the nomenclature was again changed to “Defense Force” and, symbolically enough, the emblem on the uniform underwent a metamorphosis from dove to eagle. Now there are three services of “ defense”: land, sea and air; and it is no longer denied that Japan possesses “armed forces.” But government spokesmen still resort to childish sophistry, insisting that the “Defense Force” is not a “war potential” in the sense meant in the Constitution because it is not intended for aggressive purposes and is not equipped with jet planes and atomic weapons. Apart from the question of whether an independent Japan should have its own defense forces or not, the manner in which rearmament has been carried out was anything but democratic. It is quite natural, therefore, that the present “Defense Force,” no matter how well equipped it may be with weapons leased from America, tends to be regarded by many Japanese with distrust. In their eyes, the substitution of eagle for dove cannot be passed over as accidental.

And many of the other reform measures did not survive this period of reaction. The most dramatic about-face was on the question of the purges. The original purge order which was intended, according to the Potsdam Declaration, to “eliminate for all time the authority and influence of those who have deceived and misled the people of Japan into embarking on world conquest” covered a large number of people and no doubt caused some inequities here and there. But within a few years personal appeals for exoneration mounted, and one by one the specific purge orders were lifted and many old-timers were again permitted to hold public office. On the other hand, a new type of purge was initiated by the occupying authorities after the Korean war started, the so-called “Red purge” which forced the separation of many workers and intellectuals from employment with practically no means of redress. It was a kind of mass ostracism which was not known even at the height of prewar police oppression. Paradoxically enough, one effect of this “Red purge” was to solidify the core of Communist influence in Japan.

The clock has also been turned back in the police system. The postwar innovation of a decentralized police system has been scrapped and an organizational setup quite similar to the prewar pattern is being restored. Legislative instruments which smack of thought control have also been railroaded through the Diet. The word “railroaded” is here used advisedly, for in both cases, “The Prevention of Subversive Activities Bill” (1952) and the so-called “Educational Civil Service Bill” (1954) were passed in the face of almost unanimous editorial opposition by major metropolitan newspapers and over nationwide protests from most of the democratic organizations.

Deconcentration of economic powers, or the breaking up of monopolies, which in 1947 was so inflexibly imposed upon Japan by a Far Eastern Commission directive, is also almost a dead letter now. Old Zaibatsu names such as Mitsui, Mitsubishi, and Sumitomo have been resuscitated, and horizontal and vertical integrations of various kinds are reappearing in big business. The legislative framework for improving the position of employed workers, which functioned effectively in the early years of the Occupation, has also been placed on the defensive in the past few years. Certain laws have been revised in the direction of restricting, even prohibiting in some cases, the right to strike or the right, to picket, giving precedence to the nebulous concept of “public welfare” over the constitutional guarantee of “the right of workers to organize and to bargain and act collectively.” The strict observance of the Labor Standards Act has also become secondary to the philosophy of economic necessity which, it is claimed, is essential to maintaining the competitive position of Japanese industries abroad.

The Land Reform, another major contribution of the Occupation “New Deal,” undoubtedly brought a measure of success in the transfer of land to the landless and the decrease in land rent to a fraction of what it was before the war. But a large concentration of forest land in the hands of a few has still been left untouched; and the cruel logic of economics has again deprived many subsistence farmers of their land. In any case, the failure to solve the employment problem in the country as a whole has crowded about 20 per cent more of the population into rural areas than before the war, and as a consequence, the average size of areas under cultivation has become smaller by the equivalent percentage. It has become evident that Japan’s farm problem cannot be solved independently of the general framework of economic policy as a whole.


AS we look back upon such vicissitudes of reform and counter-reform in the short span of nine postwar years in Japan, we cannot help commenting on one characteristic feature which could be a lesson for other countries as well: reform measures which are not executed with the initiative of the people concerned do not endure. In the immediate postwar period, when people in general lived in dazed confusion, there was a chance of channeling the energy and resourcefulness of those Japanese who had opposed or doubted the war policy into an indigenous social force for building a new Japan. The original purge order, though negative in character, was, in this sense, a step in the right direction. But the crucial point was whether or not the execution of necessary reforms could be delegated to the Japanese themselves. Apparently the occupying authorities felt it could not. The Katayama Socialist government volunteered to assume responsibility in planning and carrying out economic deconcentration, backed by the sustaining will of the people, but General MacArthur replied that “your government’s offer to assume full responsibility for enforcement of one of the major objectives of the Occupation is commendable as a gesture of support, but again the current policy provides specifically otherwise.” In other words, MacArthur did not trust even a Socialist government to be able to plan an effective program for reforming monopoly capitalism in Japan.

The fate of those reforms in which the Japanese were not permitted to do the job themselves is now patent. But such failure was clearly foreseen by many of us at the time and warnings were repeatedly given. In any case, it is no use “counting the age of a dead child.” We must now face up to the hard fact that this first effort to remake our society has not succeeded; we must re-examine our problems and get on with the task in full awareness of its difficulties.

In the task of reconstruction which remains to be done the problem of economic stability is, of course, central. I suggested earlier that Japan’s phenomenal postwar recovery might perhaps be more apparent than real. Let us now look more closely at the nature of this recovery. There is, first of all, no mistaking the intimate connection between the Korean war and Japan’s economic boom. It is an ill wind that blows nobody good. But the implication of this connection for Japan is not all on the propitious side. For one thing, the extraordinary expansion in demand for Japanese products subsequent to the outbreak of conflict in Korea was along the line of war and semi-war goods; that is, precisely that category of goods to which Japan should have given little, if any, priority in the process of sound recovery. True, this extraordinary demand was a windfall in a number of ways; it gave employment to scores of thousands of people and unexpectedly brought in a large volume of dollar income. The very fact, however, that it caused prosperity and appeared to solve the problem of dollar shortage made the economy greedy, so to speak, stimulating the growth of those branches of production which supplied the temporary needs of the Korean war. This was only natural under the capitalist form of production; where there is profit, more capital flows in. As a consequence, before the Japanese economy had achieved balance after the disasters of war, it was forced into a deformed expansion. Now that the temporary stimulus of the Korean war is gone, it will be necessary but difficult to reverse the process and convert many plants from war production to consumer goods suitable for export.

The windfall of dollar income from Korean war procurement appeared to solve for a few years the problem of balance of payments inherent in the Japanese economy. It enabled Japan to accumulate foreign exchange totaling a billion dollars in little more than two years, and this in spite of the fact that normal current transactions were running at an annual deficit of around half a billion dollars. At the same time, however, it helped conceal the urgent need for measures which might solve the long-term balance of payments problem, while rendering the solution of that problem still more difficult by concurrently raising the general standard of living. This meant a greater demand for imported goods. Thus in the fiscal year of 1953 the deficit in ordinary current transactions shot up to one billion dollars and could not be offset even by the large (760 million) dollar income due to the Korean aftermath.


THE lack of balance in normal transactions in recent years may be partially explained in terms of the temporary dislocation of trade routes geographically natural to the country. But basically it is a necessary consequence of the paucity of Japan’s natural resources in relation to her population and her industrial structure. It is not generally known and appreciated, for example, that Japan depends at present on other countries for 87 per cent of her essential industrial raw materials, such as: coking coal, iron ore, crude oil, raw cotton, wool, crude rubber, zinc ore, industrial salt, phosphate rock, soya beans, bauxite, etc. Unfortunately, there seems little prospect of making this dependence less in the future. As for food, Japan can now supply only 80 per cent of her own needs, and it is doubtful if her annual increment in food production will cover the additional needs arising out of the increase in population each year. This inflexible need for imports, estimated at the minimum, amounts at present to approximately 1.3 billion dollars, for which the foreign exchange has to be earned. In order to balance her trade, Japan’s exports will have to be increased by a minimum of 40 per cent. This is a formidable task in the face of the increasingly severe competition which Japanese exports are encountering in markets abroad.

If the problem had been squarely faced several years ago while the general standard of living was much lower than it is today, the solution would have been easier. The execution of any economic policy is smoother when the standard of living is rising than when it is going down. And the inertia of the last nine years, during which Japan never lacked either the sizable support of American aid or the stimulus of defense procurement, is so strong that the present Japanese government appears tempted to rely less on the necessary reorientation of the internal program than on the hope of increased external aid.

It is likely that Japan’s viability in the near future can be attained only through an austerity program which would minimize essential import needs. Needless to say, everything possible should be done to lift the political restrictions on trade under which Japan now suffers. And no effort should be spared in finding ways for more rational utilization of indigenous resources. These goals, in themselves, are not easy to achieve under the present regime which has, on the one hand, signed a treaty with the United States to restrict trade with “the countries which threaten the peace of the world,”and, on the other, refuses to countenance even a mild degree of planning after the pattern of America’s TVA to harness the water resources of Japan, But even these barriers seem easier to overcome than the probable reluctance of the toiling masses to accept a program of austerity for the sake of economic viability. The crucial problem, in other words, reduces itself to this question: Can a government commanding the confidence of the people emerge in time to lift the Japanese economy by its bootstraps?

The economic health of a country can be diagnosed more or less in quantitative terms, but the political health is difficult to gauge: there are too many imponderables. Besides, in times like these, it is almost impossible to make a political appraisal without oneself taking some sort of a political position. Regardless of partisanship, however, one could select in the day-to-day happenings of the past year in Japan many symptoms of the poor health of the body politic.

When a government, on the strength of a parliamentary majority, tries to rush through the Diet an important measure restricting freedom of thought, or strengthens the police system against the unanimous editorial opposition of major metropolitan newspapers, is that not already a sign of essential weakness in that government? The last, six months, in particular, have witnessed a series of mutually related events which cannot be dismissed as mere eccentricities of the political game. A storm broke out when the so-called “shipping scandal,” was bared early this year. And the unprecedented violence which took place on the floor of the Diet at the close of the last session, whatever its immediate motivation, was another warning of troubles to come. 1 If such situations are typical of what we must expect in the future of the democracy which Japan is supposed to have developed under America’s tutelage, there is clearly no justification for optimism. Political disillusionment is a dangerous thing, especially when the expectation which preceded it was high. It has been proved more than once in prewar Japan that radicalism, of right or left, thrives on that kind of disillusionment.

It is not that Japan does not require any radical changes today. She needs them in many spheres. But they are of a constructive nature and can only be accomplished through orderly democratic processes. What is feared is that, the degenerating atmosphere of the present political situation may become a breeding ground for the kind of extremism which once before upset the slow parliamentary progress of Japan in the 1920’s. I believe I am not indulging in chauvinistic pride when I say that the Japanese are a diligent people who desire nothing more strongly than to pursue a peaceful life, even if poor, in a social and political atmosphere in which they can be certain that they are the masters. We stand at the crossroads. Much of real value was accomplished in the first. years of reform that followed the war, especially in terms of political education of the masses. Millions of Japanese who had never played a part in their own government were shown the vision of what their role might be in a democracy. It is now the task of our leaders to give them the kind of leadership which will enlist their unreserved participation in the work and sacrifice necessary to achieve economic viability. Domestic problems must be solved before our country can make its full contribution to the common ideal of enduring peace and the progress of mankind. Until then we cannot say that a new Japan has really been born.

  1. Editors’ note: A riot in the House of Representatives in the early part of June, engineered by the two wings of the split Japanese Socialist Party in an attempt to prevent passage of the police reform bill. Many Japanese observers would consider the tactics used a threat to the parliamentary system as serious as the passage of the conservative measures which Dr. Tsuru criticizes.