Hide Ishiguro writes: There are two or three things in Jon Halliday’s interesting article on Japan which require comment.
(1) He writes that the efficiency of the Japanese economy ‘depends massively on exploitation’. I have no wish to defend exploitation in Japan or anywhere else, but it may be important to remind your readers how the situation in Japan compares with that in Britain. I make the point because when the Left writes of exploitation in Britain it is going against the widespread view that the workers have ‘never had it so good’, whereas when the Left makes the same criticism of Japan, it is supporting the traditional right-wing view in Europe that it is only economic exploitation and cheap labour which makes Japan competitive. For instance: (a) There is much less concentration in private hands of industrial wealth in Japan than in Britain, and the problem of growing monopoly in Japan has nothing to do with that of concentrated private ownership. For example in the biggest of the Zaibatsu—the Mitsui group, which ranges from banks, shipbuilding and oil, to chemicals, etc—the shares owned by the Mitsui family are negligible, accounting for less than 1 per cent. Even in Matsushita Electric Equipments, the family firm par excellence, Matsushita holds no more than 5 per cent of the shares. (b) Disparity between the earnings of high, and low income groups is not, it would seem, greater in Japan than in Britain. In an average big industry the basic salary of a director would be about three times the wage of an office clerk or skilled worker in his thirties in the same firm; that of a University Professor who is head of a department about twice that of a lecturer of thirty. (There are, of course, enormous privileges in the form of expense accounts for business.) (c) The growth rate of the Japanese economy in the post-war years is surely related to some extent to its level of defence expenditure, which is one of the lowest in the world? In 1965, Japan spent only 1·39 per cent of its gnp on defence (7·9 per cent of the national budget, which in turn was 17·3 per cent of gnp).
(2) Jon Halliday writes that the gap between average productivity and standard of living is the widest of any industrial society except South Africa. (a) Although the standard of living is difficult to measure by statistics, I agree that the ilo data show that the average per capita income in 1965 in Japan is slightly below that of Italy and just below half of that in Britain. The ratio of the average income of a Briton to that of a Japanese is the same as the ratio of the average income of an American to that of a Briton. However as the average productivity of a Japanese worker is also much lower than that of a British worker (the majority of Japanese workers are employed in small or middle-sized industries) it is quite obscure how Jon Halliday obtained the results which he claims. Quite independently of this, how can the ratio of per capita income and per capita productivity—both averages—tell one anything about exploitation without a study of income distribution? (b) The rate of investment in industrial equipment in Japan is extremely high. For example in 1965 Japan spent 29 per cent of its gross income on industrial investment and 50·3 per cent on personal consumption, whereas the corresponding British figures were about 15 per cent and 66 per cent respectively. As a result the increased wealth of industry is not directly converted into higher incomes for shareholders or the managerial classes. (c) Traditionally the various ‘superstructural’ elements in Japanese society are much less incomeor class-bound than they are in many countries, including Britain. Society is more mobile too, despite the fact that personal relations at every station of life in Japan are often stifling and rigid. An industrial director and a small farmer would read the same dailies, a minister and a railway man would have received the same kind of education until at least 15 and often until 18. They would read the same kind of novels, probably play the same sports (except for golf), and have similar hobbies. The managerial classes often live in houses which are tiny and uncomfortable by European standards. When the average Japanese travels abroad, he is taken aback by the discrepancies in the modes of life of rich and poor, not only in other Asian countries. He also sees or thinks he sees more class distinction in most Western countries, including Britain, than in Japan. He thus tends to blind himself to the question whether economic planning centred on heavy industrial investment is necessarily to his own advantage or not, and whether attention to various urgent social problems, which Jon Halliday rightly points out, is not sacrificed to economic growth.
(3) Jon Halliday writes that during the Allied Occupation ‘any Japanese who could speak English could gain a crucial role—a classic example of this was Miyazawa Kiichi—now head of the Economic Agency’. On the contrary, even since the war, Japan is still a country where the ability to speak foreign languages means very little. Miyazawa has the ideal record and qualifications of the typical Japanese bureaucrat and meritocrat—a good degree from the Law Faculty of Tokyo University (the equivalent of a first in Greats from Oxford), and success in the highly competitive higher civil service and foreign office exam, taken while still an undergraduate. He could hardly have got anywhere just by being a useful ‘interpreter’ as Jon Halliday suggests. Japan is a country where without a good degree from a good Japanese University it is practically impossible to get any decent job at all, whether in government, industry, banking, or the academic world. Just as protectionism