Commentary / Japan

Preventing another Moritomo scandal

by Ichiro Asahina

The Moritomo Gakuen scandal — concerning the sale of an 8,770-square-meter government-owned property in Osaka Prefecture for ¥134 million, or a mere 14 percent of its appraisal value, for the construction of a new elementary school for which the first lady, Akie Abe, was an honorary principal — has once again rocked the nation. The issue has been the central topic of deliberation in the Diet, with opposition lawmakers grilling national government officials.

To be honest, I believe it would be better, in terms of the national interest, to discuss more important issues, such as the North Korean problem and work-style reforms to boost labor productivity.

But every day, major newspapers and TV stations repeatedly take up the scandal. In the Diet, many opposition members focus on the issue as they try to drive the government into a corner. As a result, the popular approval ratings of the administration of Prime Minister Shinzo Abe have dramatically declined to less than 40 percent, and they have been exceeded by disapproval ratings in almost all media surveys. It is said that this scandal could be a mortal wound for the Abe administration, which has lasted for more than five years. The Moritomo scandal is no longer a negligible matter.

Many people say the crucial element behind the scandal is Japanese people’s tendency to infer what their bosses are thinking — and act without being given explicit orders — and that the tendency permeates the cultures of most Japanese organizations, including the Finance Ministry, which is at the center of the Moritomo case. In short, they say the truth is that some Finance Ministry officials guessed what their bosses — including the prime minister — were thinking, and offered a steep discount on the land sold to the Moritomo Gakuen school operator.

The Japanese term for such an act — “sontaku” — has become a buzzword even though it was a rather old-fashioned, difficult term until now.

To cope with this sontaku problem, many people say that the Cabinet Bureau of Personnel Affairs, which was created four years ago by the Abe administration to control the personnel matters of senior officials at each ministry, should be abolished as soon as possible.

But this is a ridiculous suggestion. The lack of ability to see the essence of this matter is what leads to such a stupid conclusion. This discussion reminds me of the old expression, “throw the baby out with the bath water.”

Most rational and experienced people recognize the inconvenient truth: It would be almost impossible to eradicate the practice of sontaku within an organization. Sontaku is everywhere — even in private sector companies. For example, at Toshiba, the electronics and machinery giant that almost went bankrupt last year, it was said that many executives read between the lines of what their president or senior executives said and engaged in window-dressing accounting.

Moreover, it is often thought that a team can operate more efficiently if their members tend to guess what their bosses are implying. In other words, sontaku is, in many instances, a useful skill for smoothening relationships among members of a community. Sontaku culture can enhance the integrity of an organization. It is sometimes even mentioned as a positive feature of Japanese companies.

It is true that the abolition of the Cabinet Bureau of Personnel Affairs would change the sontaku culture within the government organization a little bit, but we should not overlook an important function of this bureau. The main reason for its creation was to prevent fierce rivalries among ministries and agencies. The vertical sectionalism within the national government bureaucracy has been so serious that it’s often been difficult for even the prime minister to make a critical decision on a contentious political subject.

For example, even when the prime minister strongly wants Japan to take part in a multilateral free trade agreement supported by the Ministry of Economy, Trade and Industry, the Agriculture, Forestry and Fisheries Ministry would protest and stop it. Since the power to control personnel matters belonged to the minister in charge of each ministry and, in fact, belonged to the ministry’s bureaucrats, it was effectively difficult for even the prime minister to change the senior officials of a ministry.

After the creation of the Cabinet Bureau of Personnel Affairs, the situation drastically changed. As for the top officials of every ministry, the power to control their personnel matters now effectively belongs to the Prime Minister’s Office — although it still nominally rests with the ministers in charge of the ministries. Thanks to this system, the Abe administration can bring together different ministries relevant to each political issue and make decisions on difficult issues, such as postponing the consumption tax hike, which the Finance Ministry would have strongly protested.

What should be done, then, to prevent another Moritomo scandal? Since rooting out the practice of sontaku within the government is not realistic and abolishing the Cabinet Bureau of Personnel Affairs is nonsense, we should use technical solutions.

The essence of this problem is not sontaku but illegal actions facilitated by a “black box” situation inside the government. Actions such as falsifying official documents after they have been approved by relevant officials beggar belief. To prevent these criminal acts, the governments should utilize more technical methods. Making the best use of an electronic approval system would be one solution. In fact, it is said that one of the 15 illegally doctored Moritomo-related documents had been approved through an electronic system, so the falsification was easily discovered.

Using more technical methods to ensure transparency in government procedures would be the best solution to prevent another Moritomo scandal. It is neither a matter of sontaku nor the problem of the Cabinet Bureau of Personnel Affairs.

Ichiro Asahina is CEO of the Tokyo-based think tank Aoyama Shachu Corp.