Japan by the Japanese/Chapter 8

The form of a State may be compared to that of a human body. The State as an organization has a skeleton, muscles, and blood like the human machine. As the human body has a skin to protect the inner, more delicate, and vital organs from outside dangers, the State has the army and the navy as protective agencies. The skeleton of a State consists in the Constitution, the foundation of a State, and the laws whereby it is derived, including the criminal, the commercial, and the civil laws and other codes of executive functions and rules. The muscles which cover the skeleton and make it effectual, and the blood which vivifies and preserves the whole, may be called the economic state.

As to the first constituent, the skeleton Japan is already provided with. The Constitution has been issued, and laws and codes have been brought to a certain perfection, and we now possess a complete skeleton of a State. As to the protective covering of that skeleton, we have won the recognition of the world as a first-class Power.

We have, then, at least two things towards the completion of a perfect body—namely, skeleton and flesh. But in the point of muscle and blood, which I term the economic state, it is far from being complete. It does not require much study to find out that, in spite of the satisfactory development of our codes of laws and of our military system, the economic condition of our country is most discouraging. The price of stocks was raised on the day following the announcement of the Anglo-Japanese treaty, but within a week or two they again fell. This is a symptom of the suffering of the nation from lack of healthy blood and muscle, for the seat of the organic function of our State is the change in the value of stock. Thus the condition of the State is very much like that of a human ​body wanting nourishment, and consequently lacking blood-supply. That our economic world should thus remain undeveloped is due to several causes.

The men who assisted the Emperor in the work of the Restoration, thereby forming the ruling class of Japan, are now the peers of the land. They all belong to the class of so-called Bushi. The Bushi were the descendants of the military class, and were accustomed to rule by the power of their bows and arrows rather than by work. They spent the days walking in the streets with their two swords at their sides, and disdained to talk of the rice market, as unbecoming their vocation. As children we were taught and ordered by our parents not to use the counting instrument, but to study the ‘Shisho’ and ‘Gokyo’ (Chinese classics), and to study politics and the art of ruling; and if we had discussed the subject of harvesting we would have been despised by our friends. Though we knew nothing of the way to earn a penny by our labour, to raise a single silk-worm—nothing, in fact, but the Chinese classics and the art of ruling—we kept our spirits high, and felt ourselves proud and above ordinary mortals because of the saying imbued in our people that ‘the best of flowers is the sakura, and the best of men are the Bushi.’ Even hunger could not break down this aloofness. Such men as these have been holding the reign of the land for thirty years, and do not feel the need for economies. They feel no need for earning money, and they will continue to serve our country only in their capacity of rulers.

From the lowest to the highest Governmental officials, earning money has not been contemplated, but the sole desire has been to serve the country. The ruling officials have thought only of giving laws, or of making treaties on equal terms with foreign Powers, and thereby produced our laws and codes adapted from those of Germany and of France. Japan was thought incomplete without the adoption of laws and treaties. Thus the skeleton was acquired and given a perfect shape, but not economic politics.

The most depressing conditions have continued since the beginning of the Meiji era; and the history of the past thirty years convinces us that this condition of affairs is the result of the Samurai holding the power of government. On the other hand, it will also be noticed that those who had more regard for the economic aspect were the peasants and the merchants. These were the classes that were opposed to the Samurai. They had not been allowed to have a voice in politics, and even if they had been, had no ideas, owing to their uneducated condition. Thus they always stood in a difficult relation to the Samurai. There never was, indeed, a merchant who ​dared to think of becoming a Minister of the Treasury; nor a farmer who dared to think of becoming a Minister of Commerce and Agriculture; nor a manufacturer who thought himself fit to become a Minister of Communications. They only thought of the favour of the officials, and wished their descendants to share the profit acquired by the act of subjugating themselves to the Bushi. These were the reasons why Japan developed her laws and military defences without the acquisition of economic politics. This is the record of the past; and now, though the affairs of the world have been brought nearer to us, although treaties have been made and accepted on an equal basis with other great nations, the Anglo-Japanese Alliance accomplished, and Japan included among the great Powers of the earth—though in the point of law or military science we do not fall behind any other Power, I do profoundly regret to say that, in an economical sense, our country falls short in comparison with European and American countries.

In the newspapers and periodicals, and in the development of foreign intercourse, the attention of the world of economy is directed to Asia, and the stage of the commercial play is the Pacific coast, which is becoming the centre of international trade. The small expanse of the Mediterranean, which has been the world’s commercial centre for several hundred years, is now gradually being abandoned. With the opening of the Suez Canal the trade centre moved out towards the Indian Ocean, and now it has reached the Pacific. The international trade on the Pacific is the question of the world to-day. Hence there was a good reason for England to throw off her usual policy of isolation and ally herself with Japan. And I believe that England had no other purpose in this act of hers than that based upon her economic policy. Thus the commerce of the Pacific will be carried on by four countries.

Japan, upon entering among the great Powers of the earth, has found a worthy ally in England, and now I think we are nearly prepared to face the really difficult problem. I mean no other than this, that our laws and military preparations are all made, and yet we cannot stand on an equal footing with other countries in the matter of economical condition. The question of how to create an economic Japan is one that demands solution, for I am convinced that without the solving of this question we cannot elevate our position.

What quality, then, does Japan possess which will enable her to compete with these four countries? We are far behind in point of agricultural products as compared with Russia and the United States, and in point of manufactures and commerce we are surpassed by England and the United States. Standing ​in such a disadvantageous position as we do, we have no great economists, and our economical policy is yet far from being satisfactorily shaped.

I grieve profoundly for the future of our country, and I urgently hope, therefore, that the Japanese will consider this point of view, and spend their energy in pursuance of an industrial and economical policy for the sake of our country. For it is the only way that we of to-day can serve our country. The making of laws has already been done by our predecessors; the perfection of the military defences has been worked out by our military men; and the only thing left to us is to improve Japan economically.

How best to establish this economic policy of our country must be considered. Russia is not an industrial, but an agricultural, country. Her industry and commerce are as yet in their infancy. She has devoted her energy exclusively to her military defences, and, as a result, she is not looked upon as a competitor by the economic countries of Europe. Japan, on the contrary, occupies a small amount of land and has a large population, with but little material out of which to manufacture, hence has to rely upon the material imported from other countries. We have coal, but not sufficient iron, and almost no gold. Hence, in my opinion, Japan must stand as an industrial country. An agricultural policy is not bad. It was satisfactory in the feudal period—that is, for so long as we were not pressed by the approach of the Russians, English, and the Americans from all sides. But the conditions are otherwise to-day. The Pacific is becoming the centre of the struggle, in which we are called to compete with much stronger foes. Japan as an agricultural country cannot stand against Russia, Australia, Canada, or America. Hence we must try other means for the struggle—that is, we must obtain raw materials from them and manufacture them for the Asiatic markets.

As I have said before, our politicians, our soldiers, and our officials in the great work of the Restoration some thirty years ago have theorized much; but those who read closely the history of the Meiji era will see that our statesmen have largely ignored the economical side of our country. We lack the practical view. Our study was the statesmanship of the Gyoshium period, and our heads were filled with the doctrines of the Chinese classics. But to-day we have to struggle in Asia against superior economic foes like England and America, and even such countries as Germany, Italy, and France, with all their theories, are not lacking in practical and economic spirit; and we find a great gulf existing between the ideas of these countries and those of Japan, which are grounded upon the ​teachings of the Chinese classics, and we cannot at present compete with them.

While I was studying in America, Mr. Holmes, now Associate Justice of the United States Supreme Court, told me a story which, I think, aptly demonstrates the difference in the economic point of view between the Western countries and Japan. His story ran as follows: ‘Several hundred years ago there arose in Europe a movement called the Crusades. In these many Sovereigns of Europe took part, or sent their Princes to hold the positions in their place. These crusades were the outcome of a joint resolution of Christendom to preserve Christ’s tomb at Jerusalem from the Mohammedans. They accomplished their purpose. But the matter was not yet settled, as a discussion arose among the Sovereigns of Christendom as to the further protection of the place against the return of the Mohammedans, and also about the repairing of the sacred tomb. The English representatives having by this time returned home, the other Sovereigns of the European continent demanded that the English should help them to settle the difficulty, to which England replied: “You are welcome to Jerusalem; I want the money I can get out of it,” and began to trade with the natives. So England did not shed as much blood in the fight for Jerusalem as the other nations did, but followed up the results of the Crusade by opening commercial transactions. This was the economic spirit of the Englishmen, from whom the Americans have sprung.’

The more I study the politics of the English and the American Governments, the more deeply I am impressed with the truth underlying this story, though the point of view is foreign to Japan. If Japan were a Christian country, and had fought for the cause, they would have—if only for the maintenance of their dignity—to strive to permanently keep the land from its foes. Such is not the case with England. They would bring out their manufactured articles, and return with heavy pockets. However mean this line of action may appear to us, it has proved beneficial, and the English Government is encouraging it by the issue of laws for its foreign and commercial departments.

In regard to the economic policy of Japan, I presume there are many different views, and I also believe that all views should be disclosed for the interests of the country. We will, of course, recognise the views of statesmanship as such; still, all views coming from outside of Governmental offices, whether they come from the politician or the scholar, should be regarded with due consideration, for there can be no politics developed without the practice of politics, and no economics outside of practice.

​When I was in the Cabinet I attempted two reforms—executive and economic; but, unfortunately, before their accomplishment our Ministry had withdrawn from their position.

As the result of the Chino-Japanese War, our Government resources expanded tremendously, so that now we see an increase of from 80,000,000 to 280,000,000 yen. But this fact adds nothing to the muscle and the blood of the country, it gives nothing to the economic development of Japan. In other words, our national resources have not developed correspondingly with our Governmental resources. This condition of affairs cannot be left alone. We must reorganize it, and, therefore, the Government must give its attention to it. The first step to check this overdevelopment of Governmental resources by means of executive reorganization is the practice of economic policy in general.

The second step pursued in economic policy is to gain an accurate knowledge of any existing defects as they actually are, and which require careful attention. I refer here more especially to the matter of the supplementary Budgets submitted by the Cabinet to the Diet. It has become almost habitual for our Cabinets to propose a supplementary Budget as soon as the general estimates pass the Diet. Thus, when I was in the Diet, this supplementary Budget occurred several times in one session of the Diet. This, I think, ought to be stopped, as it tends to disorganize our financial system. I might here call to mind the similar condition which existed in the English Government. My mission was to investigate the affairs of government conducted by these nations, with a view to prepare for the opening of our Diet, and I took the Japanese Constitution to show to and receive comments from the statesmen of Western countries. I had the pleasure of discussing it with several distinguished men of the British Empire, among them being Mr. James Bryce, who is renowned as a scholar of constitutional law and for his work in the Cabinet. His view was somewhat as follows: ‘The Japanese Constitution does not allow the Diet to cut off the amount of the estimate of the Cabinet without the consent of the latter. I believe it is a fine provision. Nevertheless, it should be remembered that there is another point to be guarded against. That is, the question of allowing a member to bring in a Bill to increase the amount of expenditure of the Government. This is provided against in the English Constitution by a rule in the House of Commons, but I fear that the same evil will develop in Japan that arose in England; and although I think this Constitution of your country is a splendid one, I predict that within ten years of its practice your Cabinet and your ​Parliamental members will stand in a difficult position in regard to the question of increasing the expenditure of government by the Diet. This is one point to be guarded against in the adoption of a constitutional Government.’

We have completed many sessions of the Diet, and in consideration of its record in these past years I fear we have been realizing the evil predicted, and the attention of the proper officials should be called to this evil, in view of adopting an economic policy for our country. Also the members of both Houses should make a firm stand in regard to Bills proposed by the officials of a financial nature, so long as there is not caused an obstinate opposition to the Cabinet. For the carrying out of any economic policy these points should be kept constantly in view by the Cabinet and financial officials.

For the third step in the pursuance of an economic policy I would advise a ‘Supply Department’ within the Government, to furnish articles needed by the Government. Though this may not appear to be of great importance, it cannot be said to be trivial in view of the fact that our Government housekeeping is conducted on a basis of something like 280,000,000 yen, and the goods consumed therein amount to an enormous figure. Under the present system there is a Treasury official in each department. At the end of each annual clearing, whatever is not used in purchasing is returned to the department of the Treasury. The officials of each of these departments seem to prefer to dispose of the money to returning it to the Treasury department. Hence has arisen the habit of buying unnecessary articles with the surplus, and laying them in store till age spoils them. The most direct way to prevent this waste is to provide a ‘Supply Department’ in, say, the department of the Treasury, and to obtain from there all the necessities of the Government. And here, I think, economic policy may be practised. The Supply Department would buy all the goods and distribute them among the other departments. We could thus estimate the amount of goods consumed by each department, and make a record of them for reference. By this means it would be easily discovered why one department called for more goods than another, and the reason. On looking into the treasurer’s accounts of the army we found the affairs better conducted. Overseers of the treasury are appointed here, and independent accounts from each office are no longer given. But other departments are not like this, and economy is not at all considered.

In some European countries there is provided a Supply Department to provide its own Governmental goods. The head of the department has constantly in his mind the number of the officials and employés, and the amount of their use of ​articles in each department; and if there be an unusual demand that is considered unreasonable immediate attention is called to it, and if less demand be made than is usual the department is praised because of its economy. A comparison between the articles used by the European and American countries and those used by Japan shows a decided superiority in those used by the former. They use stationery of surprisingly excellent quality. There is no Government that uses such low-priced paper as the Japanese Government does. I would propose, therefore, an immediate establishment of a Supply Department. We might not be able to have a perfect beginning, but it would enable us to practise financial economy, and the department would get its supplies from within our own country.

The fourth step in the economic policy is that the Government supply should be obtained from our own industry so far as possible. This step needs to be strongly urged. I observed several years ago that almost all the Government offices were using imported paper. We can find an almost equally excellent paper in Senji, Oji, Osaka, and elsewhere in Japan as the imported paper, and I wonder why the high-priced foreign manufactured paper is used instead of that of our own country. If we establish the Government Supply Department, and fix the rate for our paper manufactures, we can get the native paper cheaper and better made, and so, in the end, I think, check the importation of foreign papers. It is the economic policy of European countries to use paper of their own manufacture; our Government, on the contrary, relies mostly upon foreign material, and until this step is altered, we cannot hope to improve our economic condition and to properly develop our industries. Here, I think, the effort of our Government is required in encouraging our manufactures. It should try to check importation from abroad by restricting its supply to those of our own country. This might be objected to on the ground that one yen’s worth of the imported article is equal to 1.20 yen in the home article—that is to say, that the foreign-made article is cheaper than ours by 0.20 yen, or, in other words, our people’s taxes are accordingly affected. Hence checking foreign importation is false economy. This may be true for the present; but suppose if, in the course of a few years, we were able to produce articles precisely the same, in every point of excellence, as the foreign, then the argument would lose force, for the imported articles will have to be insured during their long voyage, and pay for storage and other incidental fees, thus giving a much higher price than could possibly be attached to our own manufacture. The following example will illustrate my view: About four ​years ago I was shown a specimen of flannel manufactured by a flannel factory at Osaka. It was white flannel, such as is used for our military and naval uniforms. The flannel for these uniforms was imported from England, and is also used for other forms of clothing. The manufacturer who showed me the sample had a strong desire to improve the quality of the flannel until it would be possible to replace the English make. He repeatedly proposed to our Government to encourage his industry, but the Government would not consider it because the English flannel was both cheaper and better. At length the Government, sorely beset by the earnestness of the man, arranged to purchase the flannel from him, provided the price was made lower and the quality improved. In the course of a few years this was realized, and to-day the Osaka flannel is produced in such excellent and low-priced goods that the English make cannot surpass it. This end could not have been accomplished without the help of the Government—an obvious result of the economic policy.

We often hear that the safety of the country cannot be insured so long as we are not able to manufacture our own military equipment—rifles, cannons, gunpowder, etc.—and yet we take no measures to meet this situation, but rely upon the imported material for the clothing of our soldiers. When we hear similar utterances in Europe and America it means less than it does to us. It means that such things as military instruments, clothing, shoes, and other things are, of course, made by themselves. We can never be independent from a military point of view so long as we are relying upon foreign countries for our army’s clothing and even for rations. And for this reason I advocate the independent supply of military goods as well as of military instruments.

It cannot be expected that this proposal of mine should be followed immediately. It may, nevertheless, be adopted by calling to it the attention of the proper officials. When I say the Government supply should be confined to the products of our own country, I must warn the Government against the improper arrangement of terms. In arranging, for instance, with the flannel manufacturers, we should make a contract for a fixed period—say four years—and a promise should be required of the manufacturers that, after the expiration of a fixed period, they should provide their factories with such necessary machinery, materials, and men as would insure the production of goods of prescribed quality, and that if the goods fell short of the required quality they should be refused. This would inevitably lead to the improvement desired in the course of four or five years.

I might give here another illustration of the merit of my ​proposal. By an invitation of Admiral Rogers, of the U.S. Navy, I was received aboard an American vessel, and after a cruise along the coasts, anchored at the port of Kobe. Two German war-ships were also in port. I was surprised to see the American sailors going freely ashore while the German sailors all remained on their ships, and I asked the Admiral the reason. The explanation was as follows:

The German Government is making an effort to prevent the landing of its sailors as much as possible. As a rule, its sailors are not paid for a week before entering or during a stay in a foreign port; their pay days are always calculated to occur in mid-ocean. In a German vessel there is always provided a cigar store and saloons, so that the men can purchase their own cigars and liquors on board instead of the money being spent on the shores of a foreign country. This regard to detail in the German economic policy is interesting. The Americans, on the other hand, do not pay much attention to the sailors’ accounts, and do not object to their swelling the coffers of another country. But in larger questions, such as the coal-supply for instance, despite the coal abundantly obtainable in Japan, the United States does not rely upon us for its supply. There are established coal-supply stations at Yokohama, at Kobe, and at Nagasaki by the United States Government, and American coal is transported a long distance and stored there for use by her vessels. And, further, all the shoes, clothing, etc., worn by the sailors are made in America. Japan, on the contrary, as has been shown, has, until recently, been using all foreign goods for her army and navy, and I repeat here, that in such a manner we can never hope to improve our economic condition nor encourage industries.

It may be admitted that militarism is unproductive, and that, therefore, it adds nothing to the economy of the country. In Europe and America the unproductiveness of the military is, nevertheless, turned into productiveness by the well-applied economic policy of spending the money which might go abroad, as in the case of Japan, in their own countries. It is indisputable that supporting an army and a navy requires an enormous amount of money, and that this amount has to go somewhere. In Japan there is annually spent several millions for military defence, and what I would propose is to turn this amount into the encouragement of industries as a step towards an economic policy.

Another point necessary to be brought under consideration is that of the appointment of Consuls to foreign countries. Heretofore these appointments, as is seen in the records of foreign intercourse between various countries, have been made ​by the Department of Foreign Affairs. But now it becomes evident that the importance of commercial affairs in a country has begun to be perceived by the Governments of many countries; the attention of statesmen is being paid as much to commerce as to the military defence, and I hear that the selection of these officials is made with a view to the promotion of commerce, and that some of the wideawake nations of the West have placed these officials under the direct instruction of the Department of Commerce of the Treasury instead of under the Department of Foreign Affairs. If we wish to expand our country, economically within and commercially without, we must be acquainted with the affairs of other countries. Our foreign diplomats should be required to report on the progress of commercial and economic affairs, especially to such as are related directly with Japan, of the countries to which they are sent, and not expected merely to perform the function of representative. It is desirable, therefore, that the selection and appointment of Consuls should be made by the Department of Commerce and Agriculture, and that these officials should receive their instructions, if not entirely, at least largely, from that Department. I desire also that those who go abroad for the purpose of observation, whether in an official function or in a private capacity, should study in more detail the aspect of our trade as related to foreign countries. At present our foreign traders are firing in the dark; they only send their goods out, without knowing for what market they are intended. A Japanese manufacturer sends his goods to Yokohama, and knows nothing of its further destination.

Such is never the case in European or American factories. Each load of their intending export has its definitely marked destination, the destination, apparently, being determined by the class of goods. The manufacturers of the West, moreover, seem clearly and constantly acquainted with the conditions of production in the competitive field, so that they can instantly perceive what is required of their goods in order that those goods may not be rejected at their destination. If there is an impending war endangering a foreign market, they at once regulate the production of their factories accordingly, and thereby avoid overproduction and waste. They do not wait for warnings from the Governments, but take care of themselves. Their Chambers of Commerce are always provided with records and information necessary for their prompt and decisive action.

In conclusion I should like to recapitulate what I have already said. Japan is fully developed as far as laws and militarism are concerned. She is fully established as a military Power; but an economic Japan is not yet created, and towards ​the creation of this the combined effort of our Government and of our people is to be directed. Our territory extends in a narrow band from Kamchatka, in the frozen north, to tropical Formosa. This gives us a varied production. Our land, surrounded on all sides by the sea, gives us great facilities of navigation. We have many of the best ports in the world, and are favoured with a temperate climate. Our race is remarkably intelligent, and we fully appreciate its industrious spirit, which is also being recognised by the outside world. We are serious in our search for education, and as for the patriotism and loyalty of the people towards the Emperor, we are not equalled by any other nation.

We possess, then, every qualification necessary for the development of our country into a great nation—namely, the commercial supremacy of the Pacific and of the Asiatic continent. This problem the European nations are most earnestly studying, but among all the competing countries Japan is most advantageously situated. We are so near the region of the impending struggle—the Asiatic continent—that we can reach it in less than twenty-four hours. We do not lack the means to accomplish our purpose, and the attainment of the end depends only upon our diligence and effort.