CORRUPTION Syndromes of Corruption

80 Syndromes of Corruption
permission to expand nationally, gave large sums to LDP politicians with
interests in transportation matters. A particularly ominous note was that
payoffs also went to organized crime factions. Kanemaru Shin was dealing
with Sagawa while working to elect Prime Minister Takeshita. Revelations
of his political, business, and organized crime connections both undermined
public trust in the LDP and worsened resentments among younger
and rural candidates who were cut out of the spoils, yet had to compete
with fellow LDP politicians backed by Sagawa money. Kanemaru was also
involved in extensive tax evasion and personal enrichment.
For years it was thought that top bureaucrats – high-status figures in
society as well as within the state – were generally honest. By the end of the
1990s, however, an important official in the Ministry of Health and Welfare
was found to have taken both payments and extensive hospitality from
construction firms. Others in the Bank of Japan and Ministry of Finance
took money in exchange for information on ‘‘surprise’’ regulatory inspections.
In 2000, Nakao Eiichi’s close ties to a Tokyo construction contractor
during his short stint as Minister of Construction (May–November, 1996)
became the subject of an investigation. Wakachiku Construction paid
Nakao over ¥60 million for help in designating the company as a bidder
on public works projects. Wakachiku’s generosity extended to other politicians
including then-current, and former, cabinet members.
Behind the scandals
Blechinger (1999: 57) has described Japan’s party–business links as a
kind of mutual services agreement, with the LDP dealing in access and
business providing contributions. Modified one-party politics (Pempel,
1998) created enough political competition to make it worthwhile for
backers to put up cash to keep the LDP in power, and a near-monopoly
over access that gave factional leaders leverage over donors that no
American politician could begin to exercise. That, together with the
sheer scale of the expenditures and contracts on offer, helps account for
the level and scope of illegality. Such corruption did not prevent a fourdecade
economic miracle; indeed, it fed upon prosperity. But Japanese
Influence Markets have had significant political costs, aggravating the
factional splits that brought the LDP down (temporarily) in 1993 and
perhaps contributing to Japan’s ineffective economic adaptations over
the past fifteen years. Woodall (1996: 3) calls the contrast ‘‘first-rate
economy, third-rate politics.’’
Two layers of formal and informal institutions influenced political and
economic participation in critical ways, setting the stage for the marketing
of bureaucratic influence at very high prices. One is the ‘‘1955 system’’ of