Tokyo Underworld (5 page)

To Blakemore, the leading offender was MacArthur, who professed to understand ‘the Asian mind’ but probably saw less of the country in his stay than anyone else in the Occupation, limiting his vista of Japan to a daily shuttle between his office and the US Embassy, where he lived. During a brief stint with the US State Department in Tokyo, the Oklahoma native, who had also been an OSS agent on the Subcontinent during the war, had filed a report on a bordello in Yokohama with 100 hostesses that was illegally servicing a neighboring US military base – a place where soldiers with disciplinary problems and criminal records were confined as they awaited transfer to the States. He described in his account how payoffs were routinely made to the MPs to buy their cooperation so the inmates could leave the base to visit the establishment across the street, as well as how the girls were
recruited, what the VD rate was, and how it was treated. The experience reinforced Blakemore’s personal belief that the Occupation was intrinsically corrupt. When ordered by his supervisor to bury the report because it would reflect badly on MacArthur, who had been boasting grandly of a ‘spiritual revolution’ taking place in Japan (albeit one that evidently required censorship and segregation), he resigned in protest.

What troubled Blakemore more than anything else, however, was meeting the bordello’s Japanese madam, whom he interviewed for three hours in the course of his research. The madam, it was plain to him, was a product of the upper classes. She was a middle-aged woman with a dignified, cultured manner who spoke very elegant, beautiful and polite Japanese – what Blakemore, one of the few American GHQ staffers to speak the language of the people they were supposed to be governing, described as a ‘joy to listen to’. In fact, she had been the daughter of a wealthy family that had lost everything in the war, and now, penniless, she had to resort to prostitution to survive and support her children. When she spoke in English, however, her refined ladylike image disappeared. What came out of her mouth was a horribly foul concoction of obscenities she had learned from talking to GIs. ‘Ottasmadda you,’ she asked Blakemore at one point. ‘You no likee fuckee? You cherry boy?’ If that was an example of MacArthur’s new Japan, Blakemore wanted no part of it.

Ultimately even official US policy was driven, in good part, not by ideology but by financial interest and the profit motive, although that particular facet of Occupation history was not commonly known at the time. Consider the political U-turn SCAP took in 1947, along with its social one. After a year of fevered reform during which SCAP purged some 200,000 people who had held responsible positions during the war – military officers, politicians, government officials and businessmen – while encouraging labor unions to form, Occupation policy was dramatically altered in what was known as the Reverse Course.
The purged were unpurged, union activity restricted, and many other changes repealed.

The Reverse Course was ostensibly prompted by national security concerns – the rise of Communism in China, the onset of the Cold War with the Soviet Union, and subsequent fear of a Communist Japan (a prospect that, however, did not necessarily instill fear in all Japanese). Almost overnight, the new goal of the Occupation became one of making Japan a ‘bulwark against communism’, as opposed to the previous one of creating a ‘showcase of democracy’.

What most people did not know until much later was the role men from Wall Street played in it all, orchestrating, behind the scenes, a major lobbying campaign to revive the former prewar economic structure. Known as the Japan Lobby in some quarters, it was run by a semisecret group of American individuals affiliated with the Rockefellers, the Morgans and other large US multinationals that had substantial prewar business interests in Japan, long-standing close ties to leaders of the
zaibatsu
(financial combines), and, it went without saying, powerful connections in Washington. Its members included Secretary of Defense James V. Forrestal, who was also president of the large investment house Dillon, Read; William H. Draper, undersecretary of the army and future vice president of Dillon, Read; and presidential advisor John J. McCloy, the Rockefeller dynasty’s main lawyer and ‘foreign affairs minister’. These men argued that American interests lay in maintaining a highly concentrated economy in Japan under an industrial elite capable of managing it, who would make Japan a country fully capable of supporting itself, sharing some expenses with Uncle Sam in protecting Asia from the Reds, and also a country that would be attractive to American capital investment.

An early highlight of the Japan Lobby’s campaign was a December 1, 1947,
Newsweek
cover story, ‘Far to the Left of Anything Now Tolerated in America’, which helped bring great pressure on leaders in Washington to change SCAP policy. On the
cover was California Senator William Knowland, a highly vocal defender of free enterprise, who had been critical of a radical
zaibatsu
deconcentration plan before the Diet known as FEC-230, in which hundreds of large companies would be broken up and awarded to the unions. (It was a plan supported by MacArthur, who held the industrial conglomerates partly responsible for the war and who had already ordered the fragmentation of Mitsui Bussan and Mitsubishi Shoji, Japan’s two largest trading firms.)

‘If some of the doctrines set forth in FEC-230 had been proposed by the government of the USSR or even by the Labor Government of Great Britain,’ Knowland remarked, ‘I could have understood it. It was unbelievable to me that such a document could be put forward representing the government of which I am a part.’

The magazine had relied on reports compiled by a longtime Tokyo lawyer to the US multinationals named James Lee Kauffman, who had taught at Tokyo’s Imperial University before the war and whose clients included Standard Oil, which had been selling its wares in Japan since the late 1800s, and General Electric, which had had deep ties to the Mitsui
zaibatsu
since the nineteenth century and had helped electrify Japan. (American companies had held three-quarters of all direct foreign investment in Japan, led by GE’s holdings in the Mitsui-affiliated Tokyo Shibaura Electric, better known as Toshiba.)

Kauffman, in documents first circulated to allies in the Departments of State and Defense, who then funneled them to the news media in Washington, painted a bleak picture of a socialized economy under FEC-230, one in which so many experienced executives would be purged from their jobs that the only people left to run the banks and other corporations would be ‘lowly clerks’:

If you have ever seen an American Indian spending his money shortly after oil has been discovered on his property you will have some idea of how Japanese workers are (already) using (new) labor laws …

You can imagine what would happen in a family of children of ten years or less if they were suddenly told that they could run the house and their own lives as they pleased … Were economic conditions otherwise, I am convinced Japan would be a most attractive prospect for American capital.

The lobby was formally established as the American Council on Japan in 1949, and it brought to bear enough pressure to ensure that its goals were readily achieved. Only nine of the 1200 concerns targeted for possible dissolution under FEC-230 were ever the subject of SCAP action, the old wartime ruling class was effectively restored, and the
zaibatsu
industrial combines allowed to regroup. At the same time, some 20,000 leftists or Communists – the very people the GHQ had been wooing at the start of the Occupation – were put out of commission by the G-2 intelligence wing with the help of several hundred once-purged members of Japan’s infamous
Tokko-keisatsu
, or Thought Police, who had been allowed to return to action, so to speak.

By 1952, all prewar investments in Japan by US companies had been fully recouped, all prewar Japanese bonds held by ACJ-affiliated companies had been repaid with interest, and all property lost or damaged from 1941 until 1945 had been compensated for – meaning that many US corporations ended up making a tidy sum on the war.

The above foreign investors went on to stake out strong positions in the form of joint ventures in key Japanese industries, including petroleum refining, aluminum, electrical machinery, chemicals and glass. They were led by the Rockefeller group, which over the fifty years following the war would be involved in more combined enterprises with Japanese companies than any other multinational. The Tokyo branches of the Chase Manhattan Bank and Bank of America were tapped to become major business financiers in Japan, allowed to extend credit in amounts equaling the Japanese national budget.

All in all, for some parties on both the highest and lowest rungs of the social ladder, the Occupation turned out to be a very profitable exercise. And the entangled web of veiled, mutually beneficial cooperation that underlay the whole process, sometimes bringing together the unlikeliest of bedfellows, was now in place. It would reveal itself often throughout the rest of the century.

The special relationship between the United States and Japan begun during the Occupation entered a new phase with the signing of the Mutual Security Treaty on April 28, 1952, which formally terminated SCAP rule. Officially hailed in Tokyo as ‘fair and generous’, it gave Japan her freedom and stipulated that America provide Japan’s defense. Yet ordinary Japanese, perhaps, found little reason to cheer. Under the terms of the treaty, Japan had been forced to commit herself, reluctantly, to America’s hard anti-Communist stance vis-à-vis the Soviet Union and China and allow the stationing of 120,000 US troops on 150 bases dotting the Japanese isles. The country, in effect, remained occupied, and over the next several years a string of unpleasant occurrences served to remind the people of that fact. In November 1953, a Tokyo pimp drowned after three American soldiers threw him into a central city canal. In a similar incident the following month a Japanese salaryman lost his life. Then, in 1954, it was the
Lucky Dragon
affair, in which a Japanese fishing boat was irradiated accidentally by a US atomic bomb test in the Marshall Islands, causing the eventual demise of the ship’s captain. These outrages were followed by successive episodes in 1957 and 1958, when bored military sentries discharged their weapons and accidentally killed off-base Japanese.

Equally annoying may have been the bombardment of propaganda delivered in Japanese and English by the Voice of America and the activities of the various US intelligence agencies, who maintained a close surveillance over the people they were supposed to be protecting. The VOA had initially reported, for example, that the captain of the ill-fated
Lucky Dragon
died from a ‘liver ailment’ (not atomic radiation as was later confirmed). It also issued other nuggets of disinformation such as the following:

Today, let’s report on war brides. In the past ten years, over 5,000 war brides have gone to the United States. They have all gotten used to a new land and a new environment. They have nice, kind loving husbands and cute children and are spending each day happily.

Sometimes we are asked about racial prejudice against negroes in the U.S. Well, America is a free and democratic country and there is no such thing as discrimination. There’s no difference between black and white. Both lead abundant lives.

Letters of protest sent to the VOA regarding the inaccuracies of broadcasted reports were passed on to CIA offices in the US Embassy, where they were placed in a special file for potential troublemakers, who were then ‘interviewed’ by American intelligence. Other forms of thought control included the US State Department ban on export to Japan of films like John Ford’s
Grapes of Wrath
and
Tobacco Road
, as well as others that dealt with social injustice in America. On the other hand, proceeds from those films the United States did allow to be shown, such as
Roman Holiday, The Greatest Show on Earth
and
Shane
, were funneled to anti-Communist groups in Japan to circumvent yen–dollar conversion restrictions. (Revenue from petroleum sales was used in the same way, as was that from sales of the Japanese-language edition of
Reader’s Digest
.)

That aside, it was business as usual. Most sectors of Japanese industry, back in the hands of prewar owners, were busy churning out, at first, armaments, munitions, equipment, supplies and other military-related products to support the conflict in Korea. Then they moved on to other types of industrial manufacturing, thanks to a well-educated workforce willing to toil twelve to fifteen hours a day and to careful government direction of investment.

As early as 1956, Japan would pass Britain to become the world’s leading shipbuilding nation, led by Mitsubishi Heavy Industries and Ishikawaharimajima. A firm called Sony would already be
making portable transistor radios, and the textile, steel and mining industries would be competing internationally.

Although Tokyo was still a dusty, rubble-strewn city where homeless ex-soldiers vied with street urchins for handouts and graduates of Japan’s esteemed Tokyo University drove cabs (Renault cabs because there were no domestic autos), the economic recovery was especially noticeable during the year-end holiday season, when Japanese business corporations held thank-you banquets for suppliers, clients and workers to reward them for their devotion. Faced with a rare opulent buffet and all the alcohol he could consume for free, the impoverished, malnourished employee (whose average waist size was estimated to be about twenty-four inches) would gorge himself and inevitably wind up getting sick on the way home – which inspired a popular haiku of the time:

Christmas
,

Stars in the heaven

Vomit in the street

In 1952, 1953 and 1954, the list of all income earners, Japanese or foreign, as reported by the National Tax Office, was topped by the aforementioned Blakemore, a self-confessed Japan addict who, after translating the Japanese Civil Code into English, had set up a private commercial law practice on the Ginza, taking on many of the clients of the ACJ’s James Lee Kauffman, who willingly provided the introductions. He represented General Electric, RCA, International Nickel, and Dow Chemical in joint ventures with big Japanese firms. Blakemore hobnobbed with the likes of John Foster Dulles, John D. Rockefeller III (one of the five brothers indirectly controlling the Standard Oil and Chase Manhattan Bank empire and the largest single foreign investor in Japan), Shigeru Yoshida, who was prime minister of Japan from 1948 to 1954, and the Crown Prince.