Despite the law's scope, its 50 articles contain very few concrete rules or stipulations. All details of implementation were left to Imperial ordinances, which the bureaucracy could issue on its own initiative without reference to the Diet. The law, in fact, became a carte blanche for the executive branch to do anything that it and its various clients could agree on; its policies extended not just to industry and the economy but also to education, labor, finance, publishing, and virtually all social activities even remotely related to the war effort.
38
The Diet vigorously debated the mobilization law. Leaders of the new zaibatsu approved it, even though they did not like controls, because it signaled more business for them. The old zaibatsu and independent business leaders raised numerous objections and demanded a say in the ordinances that would implement the law (this they received), but they were quieted during 1938 with assurances that the China Incident would end soon, or they were shouted down by military spokesmen in the Diet chambers. Some economic leaders seemed to imply that a facade of civilian control should be maintained in order to prolong friendly trading relations with the United States and Great Britain, to which the military agreed, and dividends on equity shares continued to be paid until virtually the end of the Pacific War, when the zaibatsu no longer objected to the nationalization of their destroyed factories. These zaibatsu ownership rights turned out to be virtually the only civilian rights that were respected throughout the wartime period.
More important than the mobilization law to an understanding of postwar industrial policy was the work of department four of the CPB, which was responsible for formulating the materials mobilization plans (
*
, abbreviated
*).
39
Despite their being top secret (only during the 1960's were full details about them published), their influence on postwar economic management cannot be overstated. All analysts agree that the experience and methods of the wartime materials mobilization plans reappeared in the Temporary Materials Supply and Demand Control Law (Rinji Busshi Jukyu* Chosei* Ho) of October 1946, which was MCI's basic control law dur-
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ing the occupation, and in the 'foreign currency budgets' of 1950 to 1964, which were MITI's main instruments of control during the high-speed growth era. The plans also reflected the strong influence during the 1930's in Japan of Stalinist economicsparticularly economic analysis in terms of the direct supply of commodities to industry rather than the attempt to reconcile supply and demand through prices and other market forcesand of the Soviet five-year plans as a means of rapid industrialization, regardless of their effects on consumption and welfare.
40
The initial materials mobilization plan, not yet so named, took the form of a report dated November 9, 1937, from the president of the CPB to the prime minister estimating that there was a total of ?470 million in currency reserves to pay for emergency military imports during the last quarter of 1937. The report also offered a budget for spending this amount. With the China Incident continuing to expand, Uemura's Industrial Plans Department set up a General Affairs Unit for Materials Mobilization Plans (Butsudo* Somuhan*) and charged it with designing a similar budget for the calendar year 1938. This was the first true materials mobilization plan. Prepared in two months, the plan took as its basic assumption that there would be an import capability of ?3 billion for the year. It then calculated the military and civilian needs that this amount had to cover and specified the exact quantities of some 96 commodities that it authorized for import. The plan also calculated the supplies of each commodity that would be available from domestic production, from Manchuria and China, and from stockpiles. After approval by the cabinet on January 16, 1938, the plan was transmitted to MCI for implementation, using as a legal basis Yoshino's foreign trade law of September 1937. The CPB itself had no operational authority or capability.
By midyear the planners discovered that they had overestimated foreign exchange by about ?600 million, and on June 23, 1938, they therefore issued a revised plan. Both the first and second plans of 1938 necessitated structural changes within MCI and also incorporated the first steps in the program to convert some industries, forcibly if necessary, to munitions production. This program affected primarily textile industries and medium and small enterprises (discussed in Chapter 5). The plan also led to the so-called link system (a system revived again for the same purposes during the mid-1950's) in which raw materials imports were authorized only for those civilian industries that manufactured goods for export and that earned more foreign exchange than they spent. The link system also caused a reor-
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ganization of the Trade Bureau into vertical departments for each market and commodity.
The 1939 plan was considerably more elaborate than the one for 1938. Calculated on the basis of quarters of the fiscal year rather than the whole calendar year, it covered about four hundred commodities grouped into ten master categories (steel, nonferrous metals, chemicals, and so forth), and it established an eightfold priority list for the distribution of raw materials:
41
A
army munitions
B
navy munitions
C
1
military reserves (C
1A
army and C
1B
navy)
C
2
materials for the expansion of productive capacity
C
3
nonmilitary governmental requirements
C
4
materials for use in Manchuria and China
C
