CORRUPTION Syndromes of Corruption

Influence Markets 79
paid large bribes to politicians and some bureaucrats. The Yoshida
government fell in the wake of the scandal, but two other consequences
were equally important. Extensive political intervention halted prosecutions,
beginning a pattern of weak enforcement of bribery laws and
large numbers of suspended sentences. The scandal also hastened the
consolidation of feuding conservative parties into the LDP, a move
backed by business leaders wishing to avoid the high cost of influence
seen in the Shipbuilding case. The Kuro Kiri (‘‘Black Mist’’) scandal of
(1966–7) involved not only specific abuses, such as bribes paid by Kyowa
Sugar to LDP politicians for help in obtaining government loans, but also
to the general atmosphere of the Sato Eisaku government: bribery was
said to envelop politics like a black mist. Eventually the term included
bribery in Japan’s major baseball leagues. Shigemasa Seishi, former
Kyowa chairman and former Minister of Agriculture, received large
sums, as did many Socialist and LDP figures. While the opposition and
LDP dissidents used the issue to push for a national election, Sato’s
faction campaigned on the strong economy and won.
Best-known of Japan’s corruption cases was the Lockheed scandal that
began in 1976. Lockheed made payments of around ¥500 million (about
$1.6 million in 1976) to Prime Minister, and longtime LDP faction
leader, Tanaka Kakuei. Tanaka was convicted of corruption in the
1980s, but because of appeals served no jail time; the case effectively
ended with his death in 1993. Another 460 persons were questioned and
seventeen Diet members were named in connection with payments, but
no other charges were filed. In the US Lockheed was the subject of
Congressional hearings that spurred eventual passage of the Foreign
Corrupt Practices Act.
During the 1980s Recruit Cosmos, a real-estate and investment combine,
issued stock to top politicians, bureaucrats, and other VIPs in
advance of the shares’ appearing on the market, frequently offering nointerest
financing via funds diverted from government subsidies. Those
stocks could then be sold for large profits. Political and bureaucratic favors
were given to various Recruit units in return. A major scandal beginning in
1988 eventually revealed that such deals extended to most top political
figures in Japan. In 1991 it was revealed that Kyôwa, a steel-fabrication and
construction firm, made large payments to Abe Fumio, leader of an
important LDP faction and former head of two regional development
agencies. Abe used political contacts, including former Prime Minister
Suzuki, to win permission for Kyôwa to build a golf course (a major realestate
undertaking in Japan). Abe eventually was sentenced to prison.
The Sagawa Kyûbin case of 1991–3 did more than any other to bring
down the LDP in 1993. Sagawa, a trucking and delivery firm seeking