The Problem with Amakudari
Image Credit: Ian Plumb

The Problem with Amakudari

 
 

Closely related to the gakubatsu I talked about this month over here is the phenomenon of amakudari. Amakudari—meaning descent from heaven—is an institutional practice where senior Japanese bureaucrats are plucked from the civil service and installed in cushy executive positions within the public or private sector. Where gakubatsu perhaps specialize in controlling entry into the bureaucracy, amakudari comes into play when the bureaucrats approach retirement age and must be compensated for all their ‘hard’ work. Try not to snicker.

What might not be as well known is that amakudari isn’t limited to the bureaucracy—amakudari-like processes exist between large firms and small firms, amongst businesses within a keiretsu, amongst banks, and even amongst educational institutions. So although it’s important to acknowledge amakudari's existence, it’s more important to realize the magnitude and stupefying reach of this supercilious practice which has, via collusion with other societal institutions, built itself up into a veritable fortress.

Enjoying this article? Click here to subscribe for full access. Just $5 a month.

Amakudari, in one form at least, was practiced during Imperial Japan, where it incurred little or no scrutiny or oversight. And, because many industries were nationalized at the time, it was likely a simple task to relocate bureaucrats as it would have been an entirely internal government process. After World War II, the General Headquarters of the Allied occupation objected to the practice, although amakudari lived on through the occupation of Japan under the auspices of the National Personnel Authority.

And the practice continues today because as bureaucrats rise up the civic ladder, they compete for fewer and fewer positions of seniority. Some retire early, while others continue to fight for the remaining positions. Those who ultimately lose are then expected to voluntarily retire from the ministry in almost ritualistic fashion, to preserve the absolute seniority of the new senior officials. The bureaucrats who retire from the ministry are awarded a consolation prize of sorts via amakudari, a kind of 'thank you for playing, here is your fat pay cheque.' Some particularly tenacious ex-bureaucrats even hop between several of these positions in a practice sometimes referred to as urakudari, which is similar to amakudari, but not as well known.

While amakudari is frequently noted as a way of ‘compensating’ bureaucrats for their efforts and modest salaries while in the civic service, amakudari's proponents have also defended it as a means of lubricating the machinery of public-private sector relations. By placing former bureaucrats in senior positions, amakudari is able to protect the influence of the ministries while simultaneously providing a more direct line of communication between the ministries and the industries they oversee. Amakudari officials can be used to communicate directly with their former ministries, thereby bypassing bureaucratic red tape and making amakudari officials particularly powerful lobbyists. This is supposed to work both ways as well, as the private firms are supposed to be able to use amakudari officials as a window into the legislative process of the ministries, allowing the private firms to keep abreast of new laws, ordinances, and initiatives.

But as evidenced by the continued exposure of amakudari-related scandals, including those involving the Japan Highway Public Corporation, Narita Airport, the Defence Facilities Administrative Agency, and recently even the Air Self-Defence Force, it’s clear that in practice, amakudari amounts to little more than a network that facilitates bid-rigging and bypassing of competitive bidding procedures, avoidance or outright falsifying of inspection records, and generally a circumvention of traditional expectations of transparency and fair play.

Discussion of amakudari remains especially pertinent today considering how several of TEPCO's own executive positions were filled through the practice. According to the Japan Times, in the past 50 years, 68 ex-bureaucrats have landed senior positions at the nation’s 12 electricity suppliers via amakudari. Out of those 68, five found themselves at TEPCO, drawing criticism for ‘creating cosy, corrupt relations’ and spurring allegations that ‘this has led to slack supervision of the nuclear power industry.’ According to the Associated Press, roughly a quarter of bureaucrats examined at three of Japan's main nuclear regulatory bodies had affiliations with the industry as well. Given the presence of amakudari-officials on both side of the fence—on the regulatory side, and on the industry side—the relationship between industry and regulators looks very cosy indeed.

Initiatives to snuff out amakudari have been numerous, but largely toothless and unsuccessful. In the post-World War II years, amakudari has weathered the many slings and arrows flung against it and has become a more entrenched practice as a result. Thus, the amakudari we have today is comprised of many overlapping and intertwined components and an interplay of legal and political elements such that the whole mess can be likened to a pile of pick-up sticks—a large, terrifically complicated pile of pick-up sticks. Even initiatives spearheaded by the nation's own leaders, including Prime Ministers Junichiro Koizumi, Shinzo Abe, and Yukio Hatoyama have done little to curb amakudari. Shortly before the March 11 earthquake and tsunami, Prime Minister Kan was even confronted with this, a staggering 4,240 cases of amakudari in the year after the Democratic Party of Japan took power.

Few bureaucrats dare to speak out openly against the practice. One that I've found, Moriyo Kimura, from within the Health Ministry, has made some particularly scathing remarks and provided a brief glimpse into the shady mechanisms at play within. No doubt, she has made these comments at risk of becoming ostracized and harassed. But I wholeheartedly commend her for taking these risks. It’s unfortunate that few other bureaucrats—if any—have the gall and fortitude to do so, because change must come from within. The protests of a lonely few will scarcely make a dent in what is such an entrenched and resilient practice.

Newsletter
Sign up for our weekly newsletter
The Diplomat Brief