ABSTRACT

On 15 October 1995, the New York Times published a scoop on how the Central Intelligence Agency (CIA) had been tapping the phone of the then minister of international trade and industry and future prime minister of Japan, Hashimoto Ryūtarō. The aim was to gather sensitive information on the strategy of the Ministry of International Trade and Industry (MITI) for the forthcoming automobile negotiations between Japan and the US. These spying activities no doubt could be expected to assist the administration of President Bill Clinton (1993-2001) to reduce its US$60-odd billion annual trade deficit with Japan. Forty-five years earlier, in February 1949, the famous Detroit banker, Joseph Dodge, arrived at the headquarters in Tokyo of General Douglas MacArthur, commander of the Supreme Command for the Allied Powers (SCAP), on a mission to kick-start the Japanese economy. His aims were to bring rampant inflation under control, balance the budget and adopt other measures to help the defeated country to recover economically. The post-Occupation years started out with Dodge stating that, ‘Japan can be independent politically but dependent economically’ (LaFeber 1997:323).