THE AGE OF UNCERTAINTY

The recent and ubiquitous speculation in the world's media that Japanese society has reached a watershed is based more on wishful thinking than on an understanding of the forces at work in the Japanese body politic. It is a curious phenomenon, indicative of Western apprehensions, that almost every time Japanese developments gain international attention they are accompanied by assertions that the Japanese people are making choices that will change the way they live and work. In reality, the saddest aspect of Japan is that the Japanese people are not in a position to make such choices.

It is true that Japan has entered what can properly be described as an age of uncertainty. The recent fracturing of the Liberal Democratic Party (LDP) and the parliamentary crisis are symptoms of a disorientation without precedent in postwar Japan. International reality has changed for Japan's elite administrators. Its dominant element, the relationship with the United States, has lost the underpinnings that kept it in place for over four decades. With the disappearance of Cold War certainties from American foreign policy, and Japan's emergence as a discomforting economic force, American indulgence toward Japan is shrinking to a point where the basic guarantees that Japan's political elite could count on for four decades have disappeared.

Changes in domestic reality have been less abrupt and are less easily singled out for analysis, but a pervasive sense of unease about Japan's economic future has left its elites disoriented. Although often deceived by their own propaganda, many of Japan's elite know that Japan's ability to export the costs of its postwar strategy of unlimited industrial expansion has been fundamental to that strategy's success. They doubt that Japan can much longer shift such costs as unemployment, environmental degradation and industrial obsolescence to other countries. During the deflation of the "bubble economy" these past three years, the Ministry of Finance has again demonstrated its genius in disproving prophets of Japanese economic doom. But the officials are now confronting forces so enormous, and international hostility to Japan's "torrential exports" has made the future effectiveness of rescue actions so unpredictable, that continued confidence in their ability to control economic outcomes can no longer be taken for granted.

Japan's age of uncertainty reached an important moment on June 18 when two prominent members of the LDP joined non-LDP politicians in a routine no-confidence vote against Prime Minister Kiichi Miyazawa. Four days later 44 LDP members resigned, forming two new parties. Along with the year-and-a-half-old Japan New Party, they have overturned what Japanese political commentators called "the 1955 setup." This political system, crucial to the shaping of postwar Japan, rested on two pillars: the guaranteed incumbency of the LDP, and a Socialist Party that for 38 years was mired in internal squabbles and unrealistic priorities, guaranteed to keep it out of power.

For over a quarter of a century, informed Japanese and foreigners alike have readily expressed doubts about the authenticity of Japanese democracy. A vote in the countryside could be worth up to four times as much as one in the cities. The Supreme Court, although recognizing that this system violated the constitution, has refused to endorse corrective action that might "cause confusion." By the second half of the 1960s the urban electorate had by and large stopped supporting the LDP, and in successive elections switched what were widely understood to be "protest votes" from one minor party to another. The electorate outside the cities has to a large extent been bribed or subtly coerced into keeping the LDP in power. The Diet has hardly ever been used for genuine parliamentary debates on public issues because the socialist-led opposition indulged in utterly ritualistic politics, regular boycotts of Diet proceedings being its major weapon.

The July 18 elections to the House of Representatives have knocked over one pillar of the 1955 setup. The socialists have been punished for betraying the electorate for 38 years through the loss of half their seats. The politicians who now occupy those seats are not expected to follow the socialist example of marginalizing themselves, raising the possibility that the Diet will become less the rubber-stamp outfit than it has been. Japan's one-party system may well be dead.

POLITICIANS WITHOUT POWER

But the one-party aspect of the 1955 setup, on which doubts concerning Japanese democracy have usually centered, has obscured a more fundamental defect that is likely to remain even now that the 1955 setup is defunct. Since the early 1960s Japan's politicians have not played a significant role in determining national policy, with the sole exception, perhaps, of the brilliant and controversial Kakuei Tanaka. Despite periodic efforts by such talented politicians as Yasuhiro Nakasone, there has not been effective political oversight over bureaucratic decision-making. This bureaucratic decision-making has almost exclusively been restricted to administrative matters. A major shift in national priorities-the need for which is often conceded by independent members of the political elite-cannot come from the bureaucracy, because there is no single entity with the mandate to make decisions that are binding on the entire governing apparatus. The single most powerful entity, the Ministry of Finance, is ultimately guided by the course of action its institutional memory indicates will serve it best, which means that it continues to support the unlimited expansion of Japan's productive capacity.

It is unlikely that this arrangement could have continued for as long as it did without the strategic and diplomatic shield provided by the United States. As Japan concentrated solely on unlimited industrial expansion, there was almost no need to cope with a capricious world; no need to develop acrobatic skills in international diplomacy. These unusual conditions fulfilled the vision held by Japan's first important postwar prime minister, Shigeru Yoshida, of how the Japanese political elite could make the best of the unfortunate circumstances of the late 1940s.

In return for American protection, the LDP accommodated the United States in what Washington cared about most until the Berlin Wall collapsed. Security arrangements, giving the Pentagon unconditional use of whatever military bases it wished to maintain in Japan, were safe as long as the conservatives kept the socialists out of power. But the LDP failed the United States in a way that no one in Washington ever anticipated. By abdicating responsibility for the national agenda to the bureaucracy, the LDP deprived the American government (and that of any other country) of an effective means to discuss any major issue requiring Japanese action. It has not been possible for an American president to discuss the future with a representative of Japan whose mandate reaches further than adjusting technicalities. As things stand, no matter how often Bill Clinton talks with the Japanese prime minister, or how cordial their relationship may be, these two cannot even begin to come to grips with what is threatening to rupture their two countries' crucial relationship.

For some time American trade representatives and other emissaries have been attempting to identify "the right people to talk with." And if there are not any individuals who could make a difference, so it is thought, there must be groups with access to "the right buttons." They do not exist. By leaving overall policymaking in the hands of an unelected and self-appointed group of officials, Japan's elected representatives turned over the core functions of government to men of great but limited competence. Since the 1950s, this bureaucracy has understood limitless industrial growth to be the unquestioned primary goal for Japan, a goal to which all other domestic concerns, such as education and general welfare, as well as international relations must remain subservient. Bureaucrats everywhere judge themselves by their efforts to gain prestige or power for their own institutions. Unless changes could conceivably bring further advantage to their own bureaus, bureaucrats will endeavor to work for the status quo. Japanese bureaucrats are no exception, which results in the institutional paralysis with which foreign negotiators have become familiar.

THE PERMANENT GOVERNMENT

The LDP's abdication of political responsibility fits in with previous forms of Japanese governance, and is connected with the major political flaw of twentieth-century Japan: the absence of a center of political accountability. This is fundamentally different from what has frequently been diagnosed as a "leadership problem," rooted in temporary weaknesses of political will on the part of Japan's highest elected officials. It must be understood that Japan's government agencies do not for practical purposes represent a real government--a core of the state entrusted with the right and duty of decision-making on behalf of the national interest, a core that Japanese citizens could get a grip on if they so desired. Japan poses major conceptual challenges to the West. Americans and Europeans, who take for granted that countries have centers of political accountability (as is clear from the frequent exhortations that "Japan should do this" or "Japan should accept that"), cannot easily understand the workings of a political system lacking a core that can explain to foreigners, to its own population and to the political elite itself what it is doing and why.

Japanese ministries come closer to being states unto themselves than any other government institutions in the industrialized world. Besides their responsibilities for administration, they also monopolize the lawmaking capacities and jurisdiction within their own bailiwicks. For all practical purposes they themselves are not subject to the rule of law. There exists no system of informal power in the world so vast as that of Japan. The system has, however, formal supports in laws that are purposely kept extremely vague to allow for the widest possible bureaucratic discretion. The only significant formal curb on the ministries would be the constitution, which is almost ignored by Japan's bureaucracy. This foreign document--bestowed upon Japan by General Douglas MacArthur-contains a number of articles designed to ward off, in one way or another, arbitrary bureaucratic rule, but these are consistently and systematically violated.

The Ministry of Finance is strongest among these semi-independent governing bodies, since the other government agencies depend on its budget bureau, which judges their annual requests. The banking law assumes that the banks will always follow the ministry's widely varying interpretations of the law. As the 1991 financial scandals demonstrated, ministry officials are not held accountable for violating the securities laws through their informal instructions. The ministry engineered a massive transfer of wealth from the household sector to the industrial sector during the "bubble economy" years, but no one thought to protest. Effective means for holding Ministry of Finance bureaucrats accountable do not exist. Japan's main financial and economic newspaper, the Nihon Keizai Shimbun, functions as an amplifier for what ministry officials want players in the Japanese economy to think and believe, preventing it from monitoring ministerial action with critical eyes.

Cabinet ministers are generally not even considered part of the ministries they ostensibly lead. Hence the actual coordination of the Japanese bureaucracy does not take place at cabinet level, and a prime minister's leverage over the entire governing apparatus is virtually nonexistent. To ensure a measure of stability and coordination, and to minimize turf battles, ministries exchange personnel. These bureaucrats on loan double as diplomats and spies, and one of their main tasks is coordinating measures to keep at bay politicians with ambitions to make policy.

The changed circumstances that have ushered in Japan's age of uncertainty demand political adjustments from Japan that the bureaucracy cannot possibly deliver. This is understood by the main figures in the non-LDP ranks whose actions precipitated the recent political upheaval. Two of the new "reformers," now in the Japan Renaissance Party, Ichiro Ozawa and Tsutomo Hata, have for some years made clear that they are eager to apply their considerable political skills to national policymaking. They were protected by Shin Kanemaru, the single most powerful LDP boss, until an internal LDP power struggle one year ago resulted in his removal (with the help of the most recent political scandal in the press). Their loss of a solid political base inside the LDP and failure to get the LDP behind their program for electoral reform gave them an incentive to try their luck at establishing what the three had frequently mentioned as being good for Japan-a two-party system. The third major "reformer," Morihiro Osokawa, deserted the LDP the year before to form his own Japan New Party and has drawn attention with his advocacy of reviewing certain areas of bureaucratic power. The leader of a group of breakaway socialists, Satsuki Eda, also understands that new directions for Japan can only come from politicians.

An unknown number of senior officials in the ministries, as well as prominent retired bureaucrats, also believe in the need for political oversight. Some officials, understanding from personal experience their own ministries' limitations, privately worry that Japan will blunder into catastrophe, as it did in the 1930s, for lack of strong political guidance. But the flaw in Japan's political system is self-perpetuating. In the absence of a center of political accountability these concerned powerholders cannot take preventive action without losing their dignity and creating the impression that they are disloyal to the institutions in which they have made their careers.

A coalition government of reform-minded politicians fully intent on wresting political control from the bureaucracy would face phalanxes of the real powerholders in Japan who are highly skilled in sabotaging projects not to their liking. Drastic interference with bureaucratic personnel appointments would be required. Such steps would probably be followed by an uproar, with the activist politician pilloried among his colleagues and in the media as being un-Japanese for breaking the unwritten rules of Japanese "harmony." Ozawa, who is without a doubt the strongest of the politicians, has already gained a reputation as being too pushy for a Japanese politician. Someone of his caliber who takes a truly courageous stand in the face of bureaucratic opposition becomes very vulnerable, because it is not difficult to launch a scandal that can bring him down. As part of the new coalition parties, an ambitious group of "reformers" might actually assist officialdom in realizing bureaucratic schemes that would have been more difficult to accomplish under the old 1955 setup. It is entirely possible that the upheaval will eventually make the Japanese governmental system even less responsive to international interests and those of the Japanese citizenry. It is conceivable that future coalitions composed of the existing splitters of the LDP, new splitters, what is left of the LDP and the older, minor parties could become indistinguishable from what the LDP has been-a passive and secondary player in Japan's government.

THE SELF-CENSORING PRESS

Admiration for Japan's undoubted economic successes and for its putative supremacy in managerial skills has blinded many Westerners to the profound failures of the Japanese political system. The general assumption, which was again very much in evidence between the lines of most press commentary, assured us that when it really became necessary this political system would respond and repair itself. This may, of course, still happen. But there are good reasons for pessimism. Major obstacles to self-repair are not fully understood in the West, because they are entirely unexpected. But they could provide clues as to what the rest of the world, especially the United States, can do to help salvage what is salvageable of Japanese democracy.

The single biggest impediment to Japanese political reform is probably the Japanese press. It is monolithic, since the five large daily newspapers speak with one voice-their commentary on the issues of the day is almost indistinguishable, and their selection of what to report and what to ignore is virtually identical. The systematic and heavy self-censorship the newspapers engage in is without parallel in the industrialized world. Hence the press directly and decisively determines what others conceive of as political reality, and as such it should be considered Japan's most powerful political--as distinct from administrative-entity.

The vast informal Japanese power structure provides ample opportunity to flay politicians with corruption scandals. Almost any politician can be implicated in such scandals at any time, because gaining political stature in Japan requires raising large sums of money. The easiest means of raising this money stems from the discretionary licensing powers of the bureaucracy. Relatively new or rapidly expanding businesses must protect themselves against arbitrary treatment. Businesses turn to politicians and offer them very lucrative roles as influence brokers. Without ever distinguishing between unethical bribery and generally accepted political funding, the newspapers consistently denigrate the motives and character of politicians, thus helping to keep alive a general sense that Japan's politicians should not be entrusted with more real power.

No newspaper doubts the need for political reform. But their standard preachings on this subject are placed safely in the context of alleged moral deficiencies of politicians and never concern the shortcomings and abuses of unchecked bureaucratic power. Senior Japanese newspaper editors view themselves as public guardians, entrusted to help maintain a disciplined society with a maximum of order and a minimum of conflict. Since politicians cause political disturbance, and cannot hide the fact that they want power--as opposed to bureaucrats, who are thought to be selfless and dedicated servants of the people-editors protect the bureaucrats and wage regular campaigns against politicians. The newspapers are effectively allied with the police, the public prosecutor, the ministries of finance, justice, education and the Keidanren (the umbrella organization of the business bureaucrats, a de facto public organization).

A very difficult aspect of Japanese political reality to fathom is the absence of public opinion. What passes for it is manufactured by the media, especially the five national dailies, and often bears little resemblance to what the Japanese people actually think. They are as capable as people anywhere of discussing a great variety of subjects with indignation and candor, but Japan lacks the institutions to turn these privately expressed opinions into a shared public opinion.

When, prompted by events, a "national debate" emerges concerning fundamental issues, it is immediately filtered by the press to conform to bureaucratic goals, in particular the overriding aim of preserving the status quo. It is therefore not surprising that the burning question in Japan's age of uncertainty, how to accomplish political direction over bureaucratic power, and the fact that this is central to the current parliamentary crisis, are not widely discussed.

Japanese civil society is extremely weak and politically ineffectual. In fact, the press can be said to have supplanted civil society. Genuine labor unions were crushed long ago and have a tradition of serving management. Japan's famous "company loyalty" precludes political activism (which would certainly destroy an employee's career in the company) and has prevented the emergence of a politically significant middle class. Political action and interest groups are not nationally coordinated and are invariably tied to single causes, making them unfit to serve as the foundation for sustained reasoned opposition to the status quo. The judiciary is not independent. With few exceptions, Japanese intellectuals are servants of the bureaucracy, indulging in a type of verbal political opposition that allows them to maintain an image of independence but is harmless because it remains unconnected with political reality.

Attributing Japan's parliamentary crisis to a Japanese public disgusted with political corruption, as the Western press has done, is therefore highly inaccurate. The widespread notion that the upheaval will lead to a shift from Japan's exclusive concern with producer interests to those of consumers is equally ill-conceived.

CAN JAPAN CHANGE?

Japan's true national interest cannot be discussed and served unless politicians gain ascendancy. If, instead, a succession of weak coalitions leads to the further consolidation of unaccountable bureaucratic and business-bureaucratic power, this would not only be tragic for the Japanese people, but highly problematic and perhaps even dangerous for the rest of the world.

As commentators such as R. Taggart Murphy and Christopher Wood have pointed out, endless additions to productive capacity without regard to profitability could create the conditions for global depression.1/4 The gradual transformation of countries belonging to the Association of Southeast Asian Nations into "subcontracted economies" headquartered in Tokyo raises new questions about long-range Japanese security arrangements for the protection of these foreign assets.

Japan is today one of the world's most powerful political entities. Coping with it requires more than three days a year of the president's time and the attention of third- and fourth-rank American bureaucrats. Even though President Clinton has shown some understanding of the problem, there are very few people who understand how to deal with Japan effectively. They will be utterly overwhelmed with the magnitude of the task.

As experience shows, conventional diplomacy can achieve only limited goals in Japan. But the rest of the world does have levers to change Japan, while avoiding punitive sanctions. The greatest leverage comes from the desperate hankering on the part of Japan's elite administrators for acceptance of their country as a full political equal of the world's other major democratic states. The implied message from the American president and other governments should be that this is not possible unless Japan establishes a system of political accountability. An appropriate context in which to send this message is Tokyo's ardent desire to be given permanent membership on the U.N. Security Council. The Security Council veto power should be made conditional on Japan demonstrating a functioning civilian control mechanism over its own security apparatus. The well-known apprehensions of Korea, Russia and the Southeast Asian countries will strengthen America's case in this matter.

Such concern will actually dovetail with latent and deep-seated fears of large segments of the Japanese political elite, notably the economic ministries. They continue to treat Japan's military (by budget allocation standards the third or fourth biggest in the world) as if it hardly existed-partly because they are unsure as to where in the scheme of Japan's informal power system a fully rehabilitated army and navy would come to rest.

A convincing civilian control mechanism over the defense bureaucracy would foster the development of control mechanisms over other powerful entities, particularly the Ministry of Finance and the business-bureaucratic establishment. Large Japanese companies are--in their behavior and incentive structure-effectively bureaucratic entities, not ultimately driven by considerations of profit making.

A well-informed, imaginative approach ready to engage in unconventional "diplomacy" can achieve much vis-à-vis Japan. Washington could start by urging the Japanese people to write their own constitution. The political/intellectual turbulence this would engender in Japan could only have a salutary effect on the growth of Japan's civil society. It would also end any lingering impression of the United States as postwar parole officer--a role Washington no longer cares to play or understands how to play in any case. Some of the "reformist" politicians, notably Ozawa, need no convincing that Japan needs a constitution giving it unambiguous sovereignty and legitimizing its armed forces.

Contrary to fashionable opinion, the way in which the Japanese have organized their sociopolitical system is very much the business of foreigners. Japanese journalists, many of them moved by feelings of guilt about their systematic self-censorship, frequently solicit and print opinions of foreigners on subjects they dare not touch themselves. Newspapers will prominently feature well-known Americans who direct themselves to the Japanese public with sympathy and genuine understanding. Constant reminders that the people of a great nation must wield power through their politicians and cannot leave fundamental questions of their lives undiscussed would have a far greater positive impact than Westerners now imagine.

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