necessary. The key characteristics of MITI are its small size (the smallest of any of the economic ministries), its indirect control of government funds (thereby freeing it of subservience to the Finance Ministry's Bureau of the Budget), its ''think tank' functions, its vertical bureaus for the implementation of industrial policy at the micro level, and its internal democracy. It has no precise equivalent in any other advanced industrial democracy.
These four elements constitute only a model, and a sketchy one at that. There are obviously numerous social and political consequences of this structure, including normative and philosophical ones, that any society considering adopting it should ponder carefully. As has been said repeatedly, the Japanese did not so much adopt this system of political economy as inherit it. Among its various implications, one in particular should be mentioned; the capitalist developmental state generates a pattern of conflict that differs in many ways from that in other democracies.
Japan's is a system of bureaucratic rule. As S. N. Eisenstadt pointed out more than a generation ago, all known bureaucratic regimes generate two kinds of conflict: struggles within the bureaucracy, and struggles between the bureaucracy and the central political authorities.
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This case study of MITI offers numerous illustrations of each. Jurisdictional disputes among agencies over policy, appropriations, and priorities are the very lifeblood of the Japanese bureaucracy. MCI came into being in part because of a struggle between the agricultural and the industrial bureaucrats. During the 1930's MCI's reform bu-
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reaucrats allied themselves with the military against old-line ministries such as Finance and Foreign Affairs to advance their industrial development schemes. However, during the war MCI and MM civilians clashed constantly with the military bureaucrats. MITI was born of a struggle between the Foreign Affairs and industrial bureaucrats. High-speed growth saw MITI constantly pitted against the Fair Trade Commission and, to a lesser but probably more important extent, the Ministry of Finance. All the established ministries compete with each other to extend their influence over the smaller agencies (Economic Planning, Defense, Environment, and the others) and to place their transferees in positions of influence throughout the government.
This kind of conflict fulfills important functions for the developmental state; not least of all, it invigorates the bureaucracy, giving it a strong esprit de corps and providing competitive checks to complacency, bureaucratic rigidity, and arrogance. The greatest threat to a bureaucrat's security comes not from the political world or private-interest groups but from other bureaucrats. On the other hand, conflicts among bureaucrats can also cause slow decision-making, distortions in policy to accommodate competing bureaucratic interests, and avoidance of high-risk problems. There is no way to avoid these drawbacks entirely, and coordination (
*) of the bureaucracy is easily the most frustrating and time-consuming, yet critical, task of the leaders of the state.
The Japanese have developed several innovative practices to try to mitigate bureaucratic competition. One is to give the jobs of initial policy formation and coordination to younger, not-so- exposed officials, a tactic that leaves their seniors in the position of appearing only to approve policies coming from below. Senior officials can thus help make and coordinate decisions without being constrained by attributions of personal authorship. Another useful practice is the recruitment of ministers and other senior political leaders from among former senior bureaucrats, thereby giving powers of coordination to leaders with expert knowledge of the bureaucracy, 'old boy' connections, and hierarchical relations with serving bureaucrats. (This practice can, of course, merely raise the bureaucratic infighting to a higher level, as occurred in the case of Yoshida versus MITI). Still another Japanese practice is the use of the budgetary process to effect coordination, which requires that budget-making be kept in bureaucratic hands and greatly elevates the influence of the Ministry of Finance. A fourth innovation is the use of bureaucratic proxies to try to effect coordination, as in the deliberation councils. Other practices of bu-
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reaucratic competition and coordination common to all state systems occur prominently in Japan, including leaks to and bureaucratic manipulation of the press, selective briefing of favored politicians, the maintenance of secrecy concerning the actual norms of bureaucratic life, and so forth.
The other kind of conflictthat between the bureaucracy and political authoritiesis equally common. The effective functioning of the developmental system requires a separation between reigning and ruling, but the separation itself is never formally acknowledged (it is ura, not omote; implicit, not explicit). As a result, boundary problems are inevitable, and serious conflict occurs when the political leaders believe the bureaucracy is exceeding its powers (as during the 1930's) or when the bureaucracy believes the politicians are exceeding theirs (as during the 'Fukuda typhoon' or under the regime of Prime Minister Tanaka Kakuei). MITI's history reveals numerous examples of this type of conflict: the fight between MCI Minister Ogawa and Yoshino and Kishi; the fight between zaibatsu-connected ministers and the reform bureaucrats; the fight between MCI Minister Kobayashi and Kishi and the 'reds' of the Cabinet Planning Board; the fight between Tojo * and Kishi during 1944 (although perhaps this is a better example of intrabureaucratic conflict); the fight between Yoshida and Shirasu on the one hand and the leaders of MCI on the other at the time of the creation of MITI; and the involvement of politicians in the Imai-Sahashi dispute.
Most of the practices used to mitigate struggles among bureaucrats are also suitable for mitigating struggles between bureaucrats and politicians. The norm is the attempt to avoid or to privatize conflict. This is often achieved by combining the perspectives of each side in one leader. Japan's most important postwar politiciansYoshida, Kishi, Ikeda, Sato*, Fukuda Takeo, and Ohira*were all former senior bureaucrats. Although it is natural that political leaders would be found among such an intrinsic elite as the Japanese higher bureaucracy, their utilization in postwar Japan has certainly contributed to the effective operation and coordination of the Japanese developmental state.
This exercise in model building is not intended either to detract from Japanese achievements or to recommend the Japanese model to others. The history of MITI actually reveals a harder lesson than either of these; for all of Japan's alleged borrowing from abroad, the Japanese political genius rests in the identification and use of their own political assets. The development of MITI was a harrowing pro-
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cess, but its special characteristics and the environment in which it works arise from the special interaction of the Japanese state and society. The Japanese built on known strengths: their bureaucracy, their zaibatsu, their banking system, their homogeneous society, and the markets available to them. Such postwar reforms as the elimination of the military from political life, the rationalization of the zaibatsu, the strengthening of the Diet, and the equalization of social classes were all important, but the institutions of the Japanese developmental state are products of Japanese innovation and experience.
This suggests that other nations seeking to emulate Japan's achievements might be better advised to fabricate the institutions of their own developmental states from local materials. It might suggest, for example, that what a country like the United States needs is not what Japan has but, rather, less regulation and more incentives by the government for people to save, invest, work, and compete internationally. The Japanese learned to cooperate effectively with each other as a matter of national survival; the wars and economic miseries of the 1940's compelled them to maintain what were essentially wartime degrees of social and economic mobilization well into the 1960's. Lacking a comparable consensus on goals, the United States might be better advised to build on its own strengths and to unleash the private, competitive impulses of its citizens rather than add still another layer to its
