The Rise of the Japanese Miracle

  By Kevin Brown, May 16th 2008; Revised
  Category: 20th Century



The Rise of the Japanese Miracle



Japan at the end of the Second World War was a defeated nation in ruin. However in the aftermath of defeat and under US led Allied occupation Japan underwent an extensive reconstruction process in which a Democratic framework in Japanese government and politics was put into place, and where Japanese economic might was rekindled more powerful then ever before.  This eventually made Japan into the 2nd most economically powerful nation on Earth in the latter decades of the Cold War.


During the mid to latter stages of the Second World War, Japan was heavily bombed by US air forces and as a result much of its economy and infrastructure was ether damaged or destroyed outright. In addition upon surrender to the Allies in 1945 on the American battleship the USS Missouri, Japan had lost all of its colonies and occupied territories which provided the nation with many resources and helped power the Japanese economy pre-1941 in addition to providing guaranteed use of these resources. Lastly Japan was occupied by US led-Allied forces to complete the Empire of Japan’s surrender to the Allied Powers. The end of World War II also marked the swift downfall of Japan from any role in the new Asia or the World as a whole for that matter for the time being. This all marked the complete political, economic, social and military collapse of the Japanese Empire.

Imperial Japanese Government delegation signing the instrument of surrender aboard the USS Missouri 

General Douglas Macarthur who would be the leading figure in shaping Japan during the US occupation, poses in a photo with Emperor Hirohito after their first meeting.

In the aftermath of the Japanese surrender, Japan it’s self was occupied by US led-Allied forces under the leadership of General Douglas Macarthur who in addition was charged with the sole responsibility of running a Japan under Allied occupation as a military governor. In this capacity the Allied occupation authority sought out to remake Japan in a way that would be demilitarized and democratized to help prevent possible future aggression. Another issue that the Allies were keen on dealing with was perpetrators of war crimes committed by the Japanese during the course of World War II and before, these included among

Japanese War Criminals face justice

notables former Prime Ministers Hideki Tojo and Kuniaki Koiso, Baron Kōki Hirota who was foreign minister, and Generals, Heitarō Kimura, Iwane Matsui, Akira Mutō. All of which were tried and hung with numbers of others receiving the same fate or prison sentences of various lengths in most cases. However the Emperor along with the rest of the Japanese Royal family were excluded from prosecution. Also the occupation authority laid plans to reform the nation in all factors whether they be political, economic, social or military. In terms of political reforms they most notably drafted and instituted a new Japanese Constitution based on American and other Western liberal Democratic ideals which came into effect in 1947, this represented a change from the pre-World War II Constitution which was based on a Prussian model which through a strong executive and weak legislature and was vulnerable to be influenced. Economic reform was also vast and sweeping as General Macarthur and the Allied occupation authority strongly asserted these reforms, this included breaking the up the “Zaibatsu” monopolies and giving more power to the fledgling Japanese labor unions. Social reform came mainly in the form on the 1947 Constitution which guaranteed women and those of all social classes protection from discrimination (Article 14), Along with the freedom of religion (Article 20), In addition to mutual consent in marriage (Article 24), among many other reforms that were introduced, All of these had a profound impact on Japanese society in the years to come. The reform of the way in which the military and the terms in which force is used was also a crucial target of reform by the occupation authority, The Japanese were obligated to renounce any possible employment of aggressive action in war(Article 9), However a military was to be employed by Japan for defensive purposes only. The Allied occupation of Japan had a profound impact on the nation and helped set Japan on its future course in modern world history.


The occupation of Japan ended in 1952 with the signing of the Treat of San Francisco which officially ended Japan’s role in world affairs as an imperial power and also set the final terms for war damages caused by Japan during World War II. With the Allied occupation now officially over the new Japanese government could now concentrate on other issues, However with the Cold War heating up and with the US and it’s allies engaged in the struggle of the Korean War, Japan’s economy with was still saddled with some war debt despite Allied efforts during the occupation, benefited immensely from basing and “special military "precurement” payments. In addition Japanese politicians and economists along with bureaucrats, started to form a post war national policy for Japan intensely focused on economic growth, despite the recession that Japan was now going through with the end of the Korean War and with it American tributes. However due to careful planning, and the use of such newly created governmental agencies like the Ministry of International Trade and Industry and the subservient Japanese Development Bank which then introduced the Fiscal Investment and Loan Plan, which was a gathering of individual and national financial resources with proved extremely successful giving Japan a much stronger financial situation. Due to this the Japanese economy recovered throughout the 1950’s and was in a full blown boom by the time of the 1960s and remained this way going into the 1970’s. The fostering of this continued growth had much to do with the loosening of Japan’s monopoly laws which allowed the rise of Keiretsu which were conglomerate groups, the Keiretsu were in many ways a resemblance of the pre-WWII Zaibatsu. In addition during the 1960’s the Japanese economy became one that was based more and more of export, However this was balanced with strong protectionist measures for industry at home, This was accomplished in a way through the Foreign Exchange Allocation Policy which was put into place under the guidance of Prime Minister Hayato Ikeda. In addition polices were put into place to prevent foreign competitors from dumping prices and therefore keep the international business situation favorable to Japan’s ever expanding exporting industries. A combination of smart and effective planning along with a strong will to compete and to exploit the weaknesses of other nations economically ensured that Japan was well on it’s way to becoming one of the strongest economies in the modern world.


            Prime Minister Hayato Ikeda: whose policies helped shape the beginning of Japan's economic boom.    

A late 1980's Honda Civic: such Japanese made products like motor vehicles flooded foreign markets. This managed to create stiff competition for domestic industry in many countries. This phenomenon was especially prevalent in the US and Western European nations.

By the mid 1980’s Japan was an economic power second only to the United States of America, its industries kept steady while flooding foreign markets with Japanese made products such as automobiles and electronics and it’s financial situation also stable. Japan also during this time also experienced a more assertive political attitude on defense and economics under the Prime Ministership of Yasuhiro

PM Yasuhiro Nakasone, who contributed greatly to sustaining Japan's economic growth in the 1980's, while creating worry and controversy with his endorsements of resurgent Japanese nationalism that began appearing during this time.   

Nakasone who helped contribute to Japan’s continued economic growth with the privatization of a number of state owned corporations, However PM Nakasone was also extremely controversial for his support in reviving Japanese nationalism. In addition during this time Japan was starting to experience some of the geopolitical difficulties of its position including pressure from Washington to make up for its large trade surplus. Also Japan started to experience resentment and suspicion in foreign media and in economic circles over its power in world economics. Other nations in Asia also saw Japan’s economic might as a threat and feared that Japan’s economy may overshadow their own in the region and could quite possibly led to a resurgence of Japanese aggression if left unchecked, this also marked a new point in anti-Japanese sentiment in the rest of Asia. However in 1987 the Tokyo stock market crashed and dramatically slowed down the Japanese economy. This marked more turbulent economic times for the Japanese economic miracle that were to continue into the 1990’s.


In conclusion Japan which was a nation in ruin at the end of the Second World War raised from the ashes of defeat like a phoenix through reform and determination and to succeed economically in what would eventually become of the Japanese miracle. Despite going through a very turbulent time during the 1990’s economically, Japan has entered the 21st Century in what many would judge fair economic shape and with a growing renewed purpose towards world affairs not seen since the beginning of the 20th Century. So at the current moment it is quite unclear from a geopolitical perspective of what path Japan will take in the new Century.







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Wikipedia-Japanese Constitution