Japan in the 1960s

1. Japan in the 1960s conservative politics economic growth

4. The Occupation • August 1945 - April 1952 • Supreme Commander of the Allied Powers (SCAP) - General Douglas MacArthur • Two main tasks: • demilitarization • democratization

5. Korean War (1950-3) • Economic turning point for Japan: • war supplies to Korea • industrial resurgence • foreign currency • economic reconstruction • 1945 - 1950 growth rate: 9.4% • 1950 - 1955 growth rate: 10.9% • 1952: Japan’s GDP matched prewar high

6. High Growth of 1955-62 • Large investment in heavy industry • Imports of energy and raw materials • Government’s economic goals: • achieve economic self-sufficiency • achieve full employment • improve export competitiveness • keep domestic demand high

7. High Growth of 1963-73 • Government’s plan to “double the national income in ten years” • scheduled 9% annual growth rate • large-scale infrastructure construction • Shinkansen (bullet train) • Olympic Games • port, road, and rails • human infrastructure

8. High Growth of 1963-73 • labor-intensive in decline • agricultural subsidies • textile bankruptcies and “excess capacity” • coal industry in serious decline • capital-intensive on the rise • large firms had 10- and 20-fold growth • electronics and automobile

9. Government response • government responded to some sectors’ decline with reorganization and subsidization • technological improvement and facility modernization under government protection • Ministry of International Trade and Industry • constant and critical role in developing the computer industry

10. The Iron Triangle bureaucrats big business executives LDP politicians

11. High Growth of 1963-73 • Aggressive export strategy • businesses compete with foreign counterparts under government protection • domestic market sealed off from competition • Strict limitations on governmt expenditures • 1965 Japanese exports exceeded imports for the first time in two decades

12. Government policies • Macroeconomic success through internationally competitive firms • reduce the reliance on agriculture and small industry • capital-intensive industries • technically sophisticated products • improve national economic infrastructure • improve human infrastructure

13. Protection of domestic market • U.S. products and capital dominated world markets to an unprecedented extent in 1950s and 1960s • Japan remained virtually unpenetrated by • foreign firms • foreign products • or foreign capital • Bretton Woods system (1949 - 1971)

14. Japan’s Economic Growth

17. Political & economic institutions • Japan compared with other industrialized democracies • economic institutions dramatically different • economic performance was superior • longest dominance by one political party • far greater egalitarianism in political economy • foreign and security policy tied to that of US

18. Golden age of LDP Politics • Liberal Democratic Party • 1963, LDP won 55% of vote and 60% of seats in lower house elections • LDP benefited from • the economy’s stellar performance • internal leadership coherence • fragmentation of political opponents • compensation of economically disadvantaged

20. Evolution of party system • Combination of multiparty system with sustained dominance of one majority party • Chaotic political party system 1946-55 • 2 conservative parties, 2 socialist parties, communist party, and micro-parties • Party merges in 1955 • “One-and-a-Half Party System”

21. Major Political Parties • Liberal Democratic Party (LDP) • conservative catch-all party • single largest party • Japan Socialist Party (JSP) • “Japan Peace Party” • Japan Communist Party (JCP) • anti-emperor, anti-capitalism, anti-military • only party untainted by money politics

22. National Vote Share

23. Suggested Readings • http://www.kantei.go.jp/foreign/index-e.html • Journals in the UM library: • Japan Echo • Japan Quarterly • New books in the UM library: • Japan in Transformation, 1952-2000 • Japan's Emergence As A Global Power