Following the Meiji Restoration in Japan, which began in 1868, Japan made many social and political changes. The main part of the change began with the end of the Shogunate--a 250-year period of relative peace during which powerful leaders of Samurai clans, primarily the Shokugara, ran the country as, in effect, regents for the emperor.
The Emperor was `restored' to a place in government by these events, and further, the former caste system of Japan was eliminated. The cast system tiers were:
1. Samurai
2. Peasants (or farmers)
3. Artisans
4. Merchants
5. others... not really a caste, but an under-category. The imperial household was placed above the caste system, but everyone else below it.
During the restoration, rapid and massive industrialization became one of the main goals of Japanese rulers, if not the primary goal. Land reforms and taxes on farmers depopulated the countryside and created a large body of unemployed--former farmers and also former farm laborers--to work in new factories, coal mines, and steel mills, among other industrial enterprises.
Workers in industry had few rights, and they lived in squalor, in unsanitary dormitories or cheap housing created by the companies or the interlocking companies for which they worked, the zaibatsu.
Zaibatsus formed from the merchant class, the only class controlling enough capital to do so. Zaibatsus, refers to the interlocking business and banking conglomerates, often family-controlled, that wielded great power with the Japanese government. These interlocking, horizontally structured corporations, at first only two, became silent partners with the militaristic and expansionist wing of the Army and Navy. Ultimately Zaibatsus created the Japanese war machine. The Zaibatsus also encouraged aggressive expansionist policies beginning with their desire for natural resources in Manchuria. War with China, and later war with the Allied Powers, stemmed from the combination of militarism (and the power of the military in government) with the support of the zaibatsus.
Following WWII, the US Occupation began the task of dismantling the zaibatsus. However, The Japanese bureaucracy (through which the US ruled) offered silent resistance. By 1948 US policy changes toward Japan (the beginnings of containment policy) ended the dismantling with some minor changes at the top. These changes were for the most part, cosmetic... the dissolution of the family-controlled holding companies which ran the zaibatsus.
However, these entities have returned, albeit in somewhat different forms. Keiretsu, horizontally or vertically linked subsidiaries, with far-reaching interconnections. A Bank formed the head of each Keiretsu. As a matter of fact, Japanese business law established share cross-holding to discourage foreign investment and to limit competition between the various corporations within the keiretsu. Thus, any one keiretsu has connections to all others through stocks and executive boards.
During Japan's economic "lost decade," mergers occurred among some of the largest banks, a history I won't go into now at this point, plenty of interesting reading along these lines is available.
Recent judicial decisions, particularly the 2010 `Citizens United v. Federal Election Commission,' combined with the slow erosion or slow gutting of The Banking Act of 1933 (Glass-Steagall) and culminating with the 1999 Gramm-Leach-Bliley Act suggest that concentrations of ownership and the inherent risk of corporation welfare versus either individual or state welfare have become a serious issue for the US.
In my next diary, I want to examine the United States as a contrast and comparison to the zaibatsu/keiretsu business model, and to begin examining its effect on politics in the USA. The influence (or even outright control) of the Japanese government and bureaucracy has been proposed by many authors and researchers. These same have made some examinations of US `trusts' and the effect of `trust-busting.'
