The third main trend of which we spoke was the establishment of a
wartime “controlled economy” in Japan. The state took over more and
more control of the economic life of the country. Both army and
businessmen agreed that such control was necessary, but bitterly
disagreed as to how it should be applied. On the whole, the businessmen
managed to keep the most important economic regulations in their own
hands.
The fiercest political struggle during 1938 was waged over the National
Mobilization Bill. Drafted by the Planning Board under army influence,
this measure called for drastic economic conscription. The government
was to have practically unlimited control of social and economic life,
including finance, industry, trade, labor and the press. With respect
to labor, the bill provided for compulsory allocation of workers
to their jobs, prohibited strikes and lockouts, and empowered the
government to fix wages, hours and working conditions.
This bill met with determined opposition in the Diet. Army supporters,
using pressure and intimidation, including terroristic attacks on
Diet members and on party headquarters in Tokyo, pushed it through.
Nevertheless, the opposition did force certain modifications in
the original plan. Premier Konoye pledged that it would be applied
only during a wartime emergency and not invoked in the Sino-Japanese
conflict, which was still referred to in Japan as an “incident.” The
Premier also agreed to appoint a majority of Diet members to the
National Mobilization Council. This Council was to be consulted before
Imperial ordinances applying various sections of the bill were issued.
But on May 5, 1938, despite Konoye’s pledge to the Diet, several of
the main provisions of the bill _were_ applied, and new ordinances
issued since have put many others into effect. Before Premier Konoye’s
resignation in January 1939, a broad series of control measures was
in operation. Foreign exchange was strictly licensed. To make up the
huge war budgets the government had taken over control of capital,
and restricted new investment to a list of so-called “essential”
industries. It also rigidly regulated trade, limiting the export
and import of several hundred commodities. It put the labor control
provisions of the National Mobilization Act into effect. In June 1938
it instituted nation-wide price control for certain commodities, and
has since steadily increased the list of such goods. The Home Ministry
enrolled several thousand “economic police” officers to enforce the
price schedules and other features of the economic program.