Chapter 5: KITEN continued

The Lockheed Appeal

For Tanaka, due to his arrest in the Tankan Scandal, 1948 was a bad year. With the Black Mist Scandal, 1967 was also a bad year. Then there was 1974, when Tanaka was forced to resign from the Prime Ministership because of the Bungei Shunju graft exposé, followed by the 1976 Lockheed arrest and the 1983 Lockheed conviction. In 1985 he suffered a stroke. These were six bad years in a brilliant political career that had lasted forty years. Yet 1987 would prove to be the seventh and worst year of all. On July 29, the Tokyo High Court again found Tanaka guilty. He posted a 350-million yen ($3.1 million) bail and immediately filed an appeal with the Supreme Court, but this time around he had very little political clout to fall back on. In a statement read by Naoki Tanaka, Tanaka said of the decision, "I apologize to everyone for causing so much trouble for such a long time and I feel ashamed. But until my innocence is proved, I will work hard for my home prefecture, Niigata, and for the nation." He added that he hoped the Supreme Court would make clear his "innocence."[40]

The Appellate Court's decision came as no surprise to most observers. On November 27, 1985, the Prosecution made public that it had disproved Tanaka's chauffeur's alibi. Tanaka's lawyers had argued that Masanori Kasahara, who had confessed to police and then committed suicide, was in Izu on a pleasure trip and therefore could not have been in Tokyo for the first alleged payoff to Tanaka. As it turned out, the Prosecution produced written evidence that Kasahara was in Tokyo on August 10 for the money-drop and in fact did not go to Izu until August 11. Tanaka's lawyers had tried to be too clever in their concoctions and seriously damaged their credibility with the court.

As was explained in the first Lockheed trial, the prosecution had broken the case down into four basic money routes: the ANA Route, the Marubeni Route, the Kodama Route and the Kenji Osano Route. Both Kodama and Osano had died so their cases were naturally dropped. In May, 1986, the Appellate Court rulings came down on the ANA Route defendants:

May 14 -- Takayuki Sato, former Parliamentary Vice Transport Minister, lost his appeal;
May 16 -- Tomisaburo Hashimoto, former Transport Minister, lost his appeal;
May 28 -- Tokuji Wakasa, ANA Board Chairman, lost his appeal.

In the case of Sato, who remained a Dietman, Judge Yasuo Tokikuni ruled that he knew the money was a bribe, but Sato had had enough punishment by society. He was fined two million yen ($8,888) and his two-year sentence was suspended. Sato accepted the ruling two months later. As for Hashimoto, the judge ruled that he had accepted the bribe, but at age eighty-five he was too old to serve his two-and-a-half years in prison. The sentence was suspended. Hashimoto had accepted a five-million yen bribe ($22,222) so he was fined that exact amount. Wakasa, age seventy-one, was again given three years in prison with a five-year stay of execution. Even though Wakasa had been found guilty of setting up a secret slush fund and then committing perjury to cover it up, Judge Tokikuni felt that he had done so only to benefit his company and not himself. That being the case, he was allowed the five-year stay of execution.

In June of 1986, final statements were made in the Marubeni Route Case. Tanaka's Defense Counsel caused an uproar when they stated that he was the "father of the Japanese people and a patriot." The prosecutors at once interrupted, demanding to know if Tanaka's Counsel was introducing new evidence of truth or just trying to extenuate his crime.[41] The Defense Counsel backed down on the "father" remark and admitted that they were not trying to introduce new evidence of truth. The high court decided to delay a ruling on Marubeni defendants until December 1986 and then pushed the day of judgment into 1987. At first, February 19 was selected, then June 2, and finally July 29. The result was the same as in 1983:

  • Kakuei Tanaka - lost his appeal (four years in prison and a 500-million-yen fine);
  • Toshio Enomoto, Tanaka's former secretary, lost his appeal (one year in prison with a three-year stay of execution);
  • Hiro Hiyama, former board chairmen of Marubeni, lost his appeal (two-and-a-half years in prison with a four-year stay of execution);
  • Toshiharu Okubo, former Marubeni executive director (two years in prison and a four-year stay of execution);
  • Hiroshi Ito, also a former Marubeni executive director, lost his appeal (two years in prison).

Prime Minister Nakasone commented that he would take the verdicts seriously and redouble his efforts to improve ethics in government. The Deputy Prime Minister and former Tanaka lieutenant, Shin Kanemaru, said when he was informed of the appellate decision, "My heart nearly burst with grief." The Governor of Niigata, Takeo Kimi, said the decision was severe but it wouldn't have an impact on prefectural government. Susumu Nikaido, who had been implicated in Lockheed but not indicted, didn't mince his words: "The ruling was wrong from the viewpoint of legal theory. I felt outraged when I heard the same decision as given by the Lower Court. I am sure Mr. Tanaka will be acquitted of the charges by the Supreme Court."[42] Takeshita and his faction chose to respond by offering the press the following anonymous sound-bite: "The former Prime Minister is a man of the past politically."[43] As expected, the opposition parties and the League of Women Voters called for Tanaka's immediate resignation from the Diet. In a poll of university students conducted by the Kyodo News Service, 35 percent of the respondents said that they could not forgive Tanaka, but 22 percent said that they felt sympathy for Tanaka. Said one student from Chuo University, even if Tanaka accepted bribes, it did not matter as long as it was for the sake of national interest.[44]

Nakasone's Successor

The biggest story of 1987 was, "Who would succeed Nakasone and begin the Era of New Leaders?" October 8 was the filing date. On October 7, unable to secure even the fifty votes he needed to get on the ballot, Nikaido withdrew his intended candidacy. The race was between Abe, Takeshita and Miyazawa. Takeshita had the numbers to prevent anyone else from winning and, as in 1984, he led all other politicians in fund-raising. On October 20, he received an official endorsement from Nakasone. The coronation was complete. On October 31, Takeshita was named the president of the LDP at a party convention and on November 6, he was elected Prime Minister. Curiously, in a poll conducted by the Kyodo News Service, 70 percent of the business community preferred Miyazawa to Takeshita. The survey respondents cited a lack of confidence in Takeshita's sense of administrative policies and understanding of foreign affairs.[45]

As his first official act, Takeshita delivered on Nakasone's 1984 pledge to "eliminate Tanaka's influence on government and party affairs." Not that much influence remained. Nonetheless, in naming his Cabinet, Takeshita gave Nikaido nothing and for the first time two Niigata Dietmen, with anti-Tanaka credentials, entered Japan's Cabinet. One was a member of the Takeshita Faction. He was Osamu Takatori and was given the job of Director-General of the Management and Coordination Agency. The other was Takashi Sato, who along with Shin Sakurai had joined the Abe Faction. Sato was given the post of Minister of Agriculture, Forestry and Fisheries. Inasmuch as Takeshita wanted to take revenge against Nikaido and the Tanaka family for their lack of support, he also wanted to show factional unity within his Cabinet:
Faction Takeshita's 1987 Cabinet Nakasone's ex-Cabinet Factional Strength
Takeshita 5 6 120
Miyazawa 4 3 89
Abe 4 3 88
Nakasone 4 4 87
Komoto 2 2 31
Nikaido 0 1 15
Tanaka Neutrals 0 1 6
LDP Independents 1 0 10
Total 20 20 446

Mercifully for Tanaka, his family and his friends, 1987 was drawing to a close. With all that had happened, there were persistent rumors in Niigata that Tanaka would soon retire. Etsuzankai vehemently denied any such thing in their November newsletter. However, Osamu Inaba, Tanaka's long-time nemesis from Niigata's Second District, announced on December 13, that he was retiring from politics. At his press conference he urged Tanaka to come clean on Lockheed and admit that he had received the 500 million yen. Inaba further expressed his belief that if Tanaka would just say he was wrong he would recover quickly from his illness. The year had taken its toll on Tanaka, so much so that he made no appearance at Mejiro on New Year's Day 1988 to receive greetings. It was just as well, because only two hundred people showed up. Of that group, just twenty or so were Dietmen.

The Recruit Scandal

It began as a municipal corruption story. Hideki Komatsu, the Vice Mayor of Kawasaki City, just south of Tokyo, had received shares of stock from a company called Recruit Cosmos. Recruit Cosmos was a subsidiary of Recruit Company, a large publishing firm for job-offer magazines. Recruit was chaired by Hiromasa Ezoe (one of the richest men in Japan). Ezoe was a member of the Tax Council and other advisory panels during Nakasone's tenure as Prime Minister. Hideki Komatsu was not the only politician to have acquired Recruit Cosmos stock, although he was certainly the least famous. Distribution of the stock was as follows:


Prime Minister, Noboru Takeshita -- received 12,000 shares of Recruit Cosmos stock
Ex-Prime Minister, Yasuhiro Nakasone -- 29,000 shares
Finance Minister, Kiichi Miyazawa -- 10,000 shares
LDP Secretary General, Shintaro Abe -- 17,000 shares
Chairman of LDP Policy Affairs and Research Council, Michio Watanabe -- 5,000 shares
Former Minister of Agriculture, Forestry and Fisheries, Mutsuki Kato -- 12,000 shares
Former Chief Cabinet Secretary, Takao Fujinami -- 12,000 shares
Former Deputy Chief Cabinet Secretary, Hideo Watanabe -- 10,000 shares
Former Director General of the Defense Agency, Koichi Kato -- 5,000 shares
Former Education Minister, Yoshiro Mori -- 30,000 shares
LDP member, Bunmei Ibuki -- 30,000 shares
Parliamentary Foreign Vice Minister, Takujiro Hamada -- 20,000 shares
Democratic Socialist Party Chairman, Saburo Tsukamoto -- 5,000 shares
Democratic Socialist Party member, Keishu Tanaka -- 5,000 shares
Japan Socialist Party member, Takumi Ueda -- 5,000 shares
member, Katsuya Ikeda -- 5,000 shares
Kakuei Tanaka

Japanese politicians are free to purchase any amount of stock they wish. The problem with the Recruit Cosmos stock was that the above seventeen politicians, and sixty other politicians and businessmen, received the stock at tremendous discounts, prior to it being offered for public sale. Typically, the the pre-flotation stock was sold for 1,200 yen ($10.50) per share. In fact, in most cases Recruit's financial company (First Finance), loaned the inside traders the cash they needed to purchase the discount shares. The loans were interest free and could be paid back at the debtors' convenience. After Recruit Cosmos was introduced on the public market, it sold for 5,000 yen ($44.) per share. These profits from the sale of Recruit stock were huge and tax free.[46] The fact that they were tax free infuriated the public because at the pinnacle of this scandal the LDP were ramming Japan's first Consumption Tax into law.
As for Vice Mayor Hideki Komatsu, shortly after he received his shares of Recruit Cosmos stock, Ezoe and group were able to get a very desirable piece of commercial property in front of the town railway station. They used that property to build a twenty-story office building. Komatsu suddenly sold his stock for a profit of almost 134.8 million yen ($800,000). The sale raised a few eyebrows. Soon after, Komatsu was fired, and the scandal began to grow exponentially.

It was conspicuous that of all the names on the above list, nine had held Cabinet posts in the Nakasone Government and four were members of the Nakasone Faction (Nakasone, Michio Watanabe, Fujinami and Hideo Watanabe). All fingers pointed at Nakasone, so much so that he was called to defend himself in an Extraordinary Diet session. Perhaps knowing that the country couldn't afford two living ex-Prime Ministers facing prison, he blamed his secretary, maintained his innocence and escaped indictment, but not punishment. The press was less forgiving and dubbed him the "Keeper of the Castle." Other circumstances surrounding the Recruit Scandal forced him to resign from his own faction and the LDP (the practice is called kejime ) on May 31, 1989.

Tanaka's involvement in what was called the Recruit Stock-for-Favors Scandal occurred during the first of two deliveries during the Nakasone administration. The first round of payoffs was in December of 1984 when Tanaka still wielded a great deal of political influence. The second round was in the autumn of 1986 at a time when Tanaka had disappeared from active politics so he would have been of little interest to Ezoe. Tanaka's defense for his conduct in 1984 was the same as Nakasone's. He maintained that his secretary Shigezo Hayasaka, not Tanaka personally, had bought and or received 20,000 shares of Recruit Cosmos stock. It should be noted that Ezoe bought back 10,000 shares from Hayasaka. Tanaka's case was further strengthened by the fact that only four of the big political names caught up in the Recruit Scandal were involved in the 1984 payoff. All the others were caught up in the 1986 payoff, and unlike Tanaka, were still actively ruling Japan which made them more interesting to the public prosecutor. Tanaka, like Nakasone, escaped indictment. The fact that the defense of "the-secretary-did-it" worked was curious given the fact that there was testimony that Ezoe had instructed the early political purchasers to buy the stock under the names of acquaintances so that he would not have to report the transactions to the Finance Ministry.[47]

Takeshita tried everything to keep the lid on this scandal. He and Nakasone immediately blamed their secretaries. Takeshita then assigned his Finance Minister Kiichi Miyazawa to investigate the legal ramifications of the nation's stock-trading laws as they applied to the Recruit Scandal. Miyazawa was promptly caught with his hand in Ezoe's cookie jar and he had no secretary to blame for his 10,000 shares. On December 9, 1988, Miyazawa resigned from his Cabinet post because of his involvement in the Recruit Scandal. Eighteen days later, Takeshita reshuffled his Cabinet, but did not fire Shintaro Abe or Michio Watanabe. On December 27, Takeshita appointed Takashi Hasegawa of the Abe Faction as his new Justice Minister. Four days later, Hasegawa resigned after it was revealed that he had received donations from Recruit Company.

There is little doubt that the political quagmire Takeshita and his Cabinet faced would have been far more severe during the last four months of 1988 had it not been for a bigger news story. All of Japan was gripped by the daily death watch over Emperor Hirohito, Japan's oldest and longest reigning Emperor. Hirohito had taken ill on September 19 and for the next 111 days the media and the nation watched him lose an excruciating fight with duodenal cancer. On January 7, 1989, at 6:33 a.m., the Showa era ended. Hirohito died at age eighty-seven. A little more than three hours later, in a ceremony called Kenji-to Shokei no Gi (Inheritance of the Sacred Sword and Gem Stones), Crown Prince Akihito, age fifty-five, became the 125th Emperor of Japan. He proclaimed his era as Heisei (Achievement of Universal Peace). After a year-long period of official mourning, Akihito would go through the process of a formal coronation. On February 24, the State Funeral of Emperor Showa was held and as is the custom, an amnesty for convicted criminals was carried out by the Prime Minister to honor the Emperor's memory. Takeshita purposely neglected Kakuei Tanaka, under the pretext of public criticism over the Recruit bribery case. In doing so, all bribery cases were excluded from the amnesty decree. Even though Tanaka lost this round he won a different kind of battle. As a member of the Diet, he outlasted his arch rival Takeo Fukuda who announced his retirement on March 8.

It was not until May 29, 1989, that government prosecutors finished their 260-day probe into the Recruit influence-buying scandal. The results were mixed. Only sixteen indictments were leveled. Four of them were summary indictments for violations of the Political Funds Control Law. Those four were the underlings of Abe, Miyazawa and Mutsuki Kato. All four quickly pleaded guilty and paid the 200,000-yen fine (about $1,770). Ezoe had been arrested as had Hisashi Shinto, the former chairman of the behemoth Nippon Telegraph and Telephone Corporation (NTT). Not mentioned in the final summary indictments was Ihei Aoki, Takeshita's secretary and blood relative. On April 11, Takeshita, after numerous denials, finally admitted that he had collected 151 million yen (about $1.3 million) from the Recruit group. That revelation was followed three days later by Shintaro Abe's admission that his wife was being paid a monthly fee as a consultant for Recruit Company. Takeshita's public approval rating reached an historic low of 3.9 percent. On April 25, Takeshita announced that he would step down as Prime Minister after the Diet passed the 1989 budget. The next day, Ihei Aoki committed suicide, thus ending his personal problems with the public prosecutor.

All told, forty-plus politicians and businessmen lost their jobs and one billion yen ($8.9 million) of unlisted shares, donations and other gifts were identified. The four major LDP faction heads were all unindicted, but tainted. On June 2, Takeshita left the office of Prime Minister in disgrace after only 575 days in office. For Tanaka, it was divine retribution; he had lasted 886 days as Prime Minister. Takeshita lacked the leadership talent to hold the office for even one term, despite being born with a silver spoon pedigree and being handed the most powerful political machine created in postwar Japan.
Replacing Takeshita was a very difficult task for the LDP. They needed a leader who was untainted by the Recruit Scandal. The man who could have been Prime Minister was Masayoshi Ito of the Miyazawa Faction. He was serving as Chairman of the LDP Executive Council when, in May, he was first offered the job. Ito was untainted, which explained why he turned down the offer, stating, "It is meaningless if only the book's cover is changed and the contents remain the same." The only way to change the book would be to pass factional leadership on to the next generation. None of the LDP leadership was willing to do that, because this generation of Takeshita, Abe and Miyazawa had been in power for less than two years. Tanaka's generation had held power for almost sixteen years. Sato and Ikeda's generation had lasted twelve years and Yoshida/Hatoyama's had endured thirteen years. Desperate, the LDP leadership even tried to turn back the clock and let Takeo Fukuda be Prime Minister again. Abe and Miyazawa had nobody they could put up for Prime Minister and Takeshita was not willing to step down from his own faction yet. By process of elimination, the new leader had to come from the Nakasone Faction.

Nakasone had three strong lieutenants: Takao Fujinami, Michio Watanabe and Sosuke Uno. Fujinami was the assumed factional successor to Nakasone. After Recruit, his career was over. Watanabe was also involved in the scandal, leaving only Uno. To put Uno in power, Nakasone had to commit kejime, which he did, resigning from his faction and the LDP. As Takeshita retreated into the shadows, sixty-six-year-old Sosuke Uno was elected as the new Prime Minister of Japan. It was the first time in the LDP's thirty-four-year history that a person who did not head his own faction had become LDP President and Prime Minister. Seven days after taking office, Uno was exposed in a sex scandal that became a kind of Geisha-gate. To make matters worse, Uno's Minister of Agriculture, Forestry and Fisheries, Hisao Horinouchi, on July 7, said "Women are useless in the world of politics." The LDP was losing touch and in the July 23 Upper House election, for the first time in the party's history, it lost its majority and thirty seats. After only fifty-three days in office, Uno announced his intention to resign as Prime Minister and take responsibility for the election defeat.

The LDP decided to select their next president by general election of all 404 LDP members and the 47 representatives of the local party chapters. It was good theater, but as usual the factional bosses were calling the shots. The odds-on favorite in an overall election was Ryutaro Hashimoto, a new leader in the Takeshita Faction. He was acting Secretary General of the LDP, but he was also locked in an intra-factional power struggle with another new leader, Ichiro Ozawa. Still another bright star in the faction was Tsutomu Hata. Prior to 1987, both Ozawa and Hata had been fiercely loyal to Tanaka.[48] Kanemaru favored Ozawa over Hashimoto as Takeshita's successor. Neither Takeshita nor his mentor, Shin Kanemaru, were ready to step down and decided not to field a candidate. That made Ozawa happy at the expense of Hashimoto. Kanemaru convinced thirty-member, mini-faction leader Toshio Komoto, who had taken over for Takeo Miki, that he, at age 78, was too old to run.

Komoto put aside his ten-year dream to be Prime Minister and put forth his leading lieutenant, Toshiki Kaifu. Kaifu had the backing of Takeshita, Abe and Yoshio Sakurauchi (the stopgap leader of the Nakasone Faction). On August 9, 1989, the Uno Cabinet officially resigned after just sixty-eight days in office. Only Ishibashi's sixty-five-day Cabinet, in 1956, was shorter. Kaifu became party president and Prime Minister on August 10. His Cabinet was jokingly referred to as "Takeshita's Second." Kaifu, like Komoto, was a protegé of Takeo Miki (who had died just ten months earlier, on November 14, 1988, at age eighty-one) and his ascension was reminiscent of Miki's. Miki had only forty-six members in the faction when he was made interim Prime Minister after Tanaka's resignation. Kaifu came to power with even less clout than that. Because of the Recruit Scandal, the LDP was once again drifting into a shadow advisory system like the one Tanaka had created after Lockheed. This time around, Kanemaru and Takeshita hoped to be the backstage Genro, with Kaifu as a marionette controlled by their 105 factional votes.

Tanaka Retires from Politics

The surprise announcement came on October 14, 1989. Tanaka was now seventy-one years old. It was delivered from the offices of Echigo Kotsu in Nagaoka by Naoki Tanaka, Koichi Honma and the chairman of Etsuzankai, Jinmatsu Kataoka. The statement that was read quoted Tanaka as follows:
"I have determined to put a period to my political life as a member of the House of Representatives at the expiration of this term in office. I express my profound gratitude for the powerful and unstinting support given me by the Etsuzankai and many other people over such a long period of forty-two years.

I expect that my junior politicians will be spurred on to greater efforts for the development of my beloved home province Niigata and for the public peace of our nation. Looking back, I have nothing to regret in my political life."[49]
had one regret, and that was that Tanaka did not name a successor. His failure to do so caused immediate trouble and confusion within the organization. After the announcement, the Etsuzankai Liaison Council and eight Prefectural Assemblymen who belonged to Etsuzankai were summoned to an emergency meeting. Most Etsuzankai members had had no idea that Tanaka was going to retire. They blamed Makiko for that. Since Tanaka's stroke she had made a point of being rude to everyone in Tanaka's political apparatus. Tanaka's family also made it clear that no family member or secretary was going to be promoted by them. Tanaka himself had never liked Fukuda's or Suzuki's practice of handing over their Diet seats to their eldest son's (Yasuo Fukuda and Shunichi Suzuki). Nonetheless, it was standard practice. It would have been logical for Makiko, age forty-five, to take her father's place if for no other reason than to preserve the Third District for Tanaka's grandson, Yuichiro, age nineteen. Together, the leaders of Etsuzankai, on this day decided, though not unanimously, to field a candidate to fill Tanaka's chair in the next election, expected in 1990.

Said Masaru Yamagishi, the seventy-four-year-old chairman of the Nishiyama-Futada branch of Etsuzankai, "Since Tanaka is retiring, we should do so too. Even if our executives choose a new standard-bearer, most members will never follow him."[50] Etsuzankai leadership further agreed that those who had already declared their candidacy before Tanaka's announcement should be excluded from their list of replacements. That decision meant that two of the organization's strongest contenders, Yukio Hoshino (former Mayor of Ojiya) and Masanori Morosato (former Mayor of Tokamachi) lost their chance to become Etsuzankai candidates.

Seventeen days passed before the next Etsuzankai meeting at Echigo Kotsu. Tanaka's constituency was the "pork-barrel showcase" of all Japan. Even with the hard times since Lockheed, Etsuzankai still represented 100,000 votes from 320 branches across the Third District. It was a political machine that annually cost anywhere between 500 million and a billion yen to operate (4.5 to 9 million dollars). The obvious question was how could anyone but Tanaka hold this organization together? Who else had his money-gathering ability, especially if the Tanaka family now diverted their financial resources to Naoki in Fukushima? In just seventeen days, Etsuzankai found itself in a panic. The representative from Minami-Uonuma warned the Liaison Council, "Since no successor for Tanaka has been chosen, other camps have assaulted our turf." The representative from Kariwa added, "If we can't find a new candidate soon we (Etsuzankai) will have to dissolve."[51]

Ransenkai, a two hundred-company Tanaka support group, based in the city of Sanjo, did dissolve just prior to this second emergency meeting of Etsuzankai. One company president simply summed it up by saying, "We are grateful to Mr. Tanaka, but times have changed. Even if a successor is chosen, we will deal with him as an ordinary candidate, nothing more."[52] Finding a candidate and funding were just two of the problems faced by Etsuzankai in the July 1986 election; Tanaka got 40 percent (179,000) of the votes. The second place winner only needed 49,000 votes. In the next election, a minimum of 60,000 votes would be needed to get just one of the Lower House Diet seats, even if Etsuzankai could rally behind a candidate. Over the course of sixteen terms, Tanaka had made it easy for Etsuzankai, whose leadership had aged along side him.

The local media, particularly the newspaper Niigata Nippo, put enormous pressure on Etsuzankai to chart its future. Each day in which they failed to choose a successor, the media ran a story of Tanaka reminiscences followed by a column on the downfall of Etsuzankai. The matter was finalized during the Etsuzankai near month-long Bonenkai (year-end party) at a hot-spring hotel in neighboring Yamagata Prefecture. More than five hundred Etsuzankai members a day streamed into the hotel; 11,113 people gathered in all and it was a record-breaking Bonenkai. On November 12, the Niigata Assemblymen that belonged to Etsuzankai decided to ask Makiko one last time to reconsider. On November 16, they dispatched the Chairman of Etsuzankai, Jinmatsu Kataoka, to Mejiro. Makiko made it clear to him that she would not run. On November 25, the Liaison Council announced its decision. Etsuzankai would not field a candidate to succeed Tanaka in the next election. However, each of the twelve districts was free to support whomever it wished. Etsuzankai had ruled the Third District for forty-two years. After forty-three days of confusion (October 14 to November 25), the organization all but evaporated. (Etsuzankai officially disbanded the following year.) So, who would get Tanaka's votes? That would have to be decided at the polls.

The Post-Tanaka Election of 1990

The voters in Niigata did not have to wait long for a chance to render their opinion. Abe, Miyazawa and a host of other LDP scandal-ridden politicians were anxious for a misogi (purification) election. On January 24, 1990, only three days after the Diet resumed following the New Year's holiday season, Kaifu dissolved the House of Representatives and called for a February 18, general election. The early election was masterminded by Shin Kanemaru and Ichiro Ozawa over the wishes of Kaifu and Takeshita. Both wanted an end-of-the-year election.

It was becoming increasingly clear that Kanemaru, not Takeshita, dominated the Keiseikai (the Takeshita Faction). In this up-coming election it would be he, not Takeshita, who would dole out money to members and give speeches around the country on their behalf. The speculation was that Kanemaru was disappointed in Takeshita for his poor performance as Prime Minister a goal for which they had both worked so hard. In any case, it was all in the family and Kanemaru was the patriarch.

As was stated earlier, Kanemaru's eldest son had married Takeshita's eldest daughter in 1968. In addition, Ozawa's sister-in-law was married to Takeshita's younger brother. The marriage had been arranged by Tanaka. Ozawa's wife, Kazuko, was the daughter of Tadashi Fukuda, who was the president of Fukuda-gumi, the largest construction company in Niigata. Fukuda was a very strong Tanaka supporter.
Beginning in 1990, Kanemaru emerged as the most powerful man in Japan with Ozawa as his most trusted lieutenant. The stage was set for the 39th general election and the issues were political reform (Recruit Scandal), the consumption tax and liberalization of agricultural markets. Again the LDP won a stable majority of 286 seats; a stable majority is usually defined as 271 seats, which is enough to maintain the Lower House Speaker's Post and chairmanship of most of the eighteen standing House committees. Unlike in past elections, the Socialists, led by energetic Takako Doi and her "woman power" appeal, reversed the JSP's fortunes and gained fifty-eight seats. They controlled a formidable 141 seats. The message sent by the electorate was "no change for now," but the LDP was put on notice to reform itself. The LDP victory assured Kaifu that he would be able to remain Prime Minister for the rest of his term which was due to end in October, 1991. Not counting Kakuei Tanaka, all but two of the sixteen Recruit Scandal candidates were returned to office, though most won their seats back with far fewer votes than usual. The post-election factional numbers for both houses looked as follows:

Takeshita/Kanemaru -- 105
Miyazawa -- 85
Abe -- 86
(Michio Watanabe) -- 66
-- 33
Nikaido -- 2

One of the biggest surprises of the February 18 election came out of Fukushima. Naoki Tanaka lost his Diet seat. Only three seats were available in the district and he placed fourth. The belief was that once Kakuei retired, Naoki wasn't much of an insider anymore. He had been the star of the nine-member Nikaido group. The faction Secretary General was Okiharu Yasuoka and he, like Naoki, lost his seat in the election. Three others from the group retired. In the end, the once mighty Mokuyo Club consisted of only two members, Masumi Esaki and Ganri Yamashita. They were both loyal to Tanaka to the bitter end. As for Nikaido, he was welcomed into the Miyazawa Faction as an advisor. The Mokuyo Club, thereafter, withered away. On the advice of Kanemaru, Naoki was assured the support of Keiseikai if he ran again. The biggest loser was the ex-Nakasone Faction, which was reduced by ten Diet seats. The public knew that Nakasone was at the heart of the Recruit Scandal and they made him pay for it.

In the 1983 general election, Tanaka's LDP candidates had placed first in each of Niigata's four political districts. In this election, the top four spots went to the Japan Socialist Party. In the Third District, Kichinosuke Meguro was the name that replaced Kakuei Tanaka on the leaderboard:

1990 Election Results in the Third District of Niigata

First place
-- 94,107 votes -- Kichinosuke Meguro, age 55 -- JSP -- (A new face in the election)
Second place
-- 72,263 votes -- Hideo Watanabe, age 55 -- LDP -- (Incumbent/Ex-Nakasone Faction)
Third place
-- 69,832 votes -- Yukio Hoshino, age 57 -- LDP -- (Takeshita Faction)
Fourth place
-- 66,860 votes -- Shin Sakurai, age 56 -- LDP -- (Incumbent/Abe Faction)
Fifth place
-- 64,468 votes -- Tatsuo Murayama, age 75 -- LDP -- (Incumbent/Miyazawa Faction)
-- 63,178 votes -- Tomio Sakagami, age 63 -- JSP -- (Incumbent)
-- 28,782 votes -- Masanori Morosato, age 53 -- (ex-Nakasone Faction)

The question remained, "Who got the 179,062 Tanaka votes?" The Niigata Nippo and Yoshiaki Kobayashi, an assistant law professor at Keio University, discovered the answer:

37.2% of the Tanaka votes (66,611) went to Meguro and Sakagami of the JSP
of the Tanaka votes (56,405) went to Hoshino of the LDP
of the Tanaka votes (21,667) went to Morosato, an Independent
of the Tanaka votes (12,892) went to Murayama of the LDP
of the Tanaka votes (6,625) went to Watanabe of the LDP
of the Tanaka votes (3,939) went to Sakurai of the LDP
of the votes were classified as in abstention

It also must be noted that more than 1,000 citizens in the Third District voted for Tanaka, despite his retirement. Many of the invalid votes came with messages like "Nobody is as good as Tanaka" and "Many thanks for your kind labor." The JSP won the Tanaka vote lottery in terms of raw numbers, but statistically Hoshino won:

80.8% of Hoshino's 69,832 votes were dependent on Tanaka votes
% of Morosato's 28,782 votes were dependent on Tanaka votes
% of the JSP's (Meguro & Sakagami) 157,285 votes combined were Tanaka votes
% of Murayama's 64,468 votes were dependent on Tanaka votes
% of Watanabe's 72,263 votes were dependent on Tanaka votes
5.9% of Sakurai's 66,860 votes were dependent on Tanaka votes

Yukio Hoshino campaigned under the slogan, "Don't give the seat of Mr. Tanaka to the JSP." He tried very hard to project himself as Tanaka's successor. This was his first campaign for a seat in the Lower House and he needed all the help he could get. Hoshino was a leading figure in Etsuzankai. He was also one of the very few who stood up and publicly defended Tanaka during the Lockheed Scandal.
He was born in a small mountain village a long way from the nearest town of Ojiya in 1932. After primary school he took night classes to get his high school diploma. At age twenty-four, he journeyed to Tokyo and slowly worked his way through Chuo University by taking correspondence courses in law. In 1965, he became a lawyer. After practicing law for ten years, he returned to Ojiya and successfully ran for mayor. He served in that post for fourteen years.

Hoshino wanted Etsuzankai votes. To get them he solicited the support of Shizue Arakawa, the former head of Etsuzankai Women's Association and Shigezo Hayasaka, Tanaka's former Secretary. Arakawa was very effective in delivering women's votes and Hayakawa, in a speech in Ojiya City, said, "Hoshino is the legitimate successor of Tanaka." In exit polls the voters said they liked Hoshino because his hard life resembled Tanaka's. Others felt that he was the last chance to hold Etsuzankai together. Hoshino crowned his victory by maneurvering to get Tanaka's old Diet office. He then joined the Takeshita Faction.
Even though ex-Mayor Masanori Morosato lost, he placed second highest on the Tanaka dependency list. His success in garnering Tanaka votes was due primarily to hard work and to the endorsement he received from Tanaka's old Futada Primary School teacher, Mitsuo Kanai.

The JSP's victory in Tanaka's Third District was solid proof that many of his and Etsuzankai supporters were not diehard believers in the LDP, just believers in Tanaka. Given the constituency loyalties in Japanese politics, it was extraordinary to see 37.2 percent of what had been reliable LDP votes, bolt to the Socialist Party. All told, twenty-six people vied for the thirteen seats available in Niigata's four districts. Ten were incumbents and sixteen were new to the process. When it was over, counting the already established four Upper House Dietmen, Niigata had an all new look, with eleven seats still belonging to the LDP and an unprecedented six seats going to the JSP. Niigata didn't look like Tanaka anymore:

6 seats to the Japan Socialist Party
seats to the Miyazawa Faction
seats to the Takeshita Faction
seats to the Abe Faction
seat to the Watanabe Faction
seat to Independent Tatsuo Ozawa

In this election, Tatsuo Ozawa (no relation to Ichiro Ozawa) of the First District campaigned that he was a "neutral in the ex-Tanaka Faction." It was a wishy-washy stance and the voters dropped him from his usual position of first place to third. There are only three seats available in the First District. In the Second District, Kozo Watanabe was Tanaka's normal front runner. He was forced to resign because of ill health. In his stead he sponsored Saburo Shirasawa. Kozo had betrayed Tanaka for Takeshita in late 1987. This was the voters' chance to get at him. His handpicked replacement lost the election. Also from the Second District was Tanaka's old nemesis, Osamu Inaba. Prior to the election, he retired from office because of age. Yamato Inaba ran in his place and lost the election. In the Fourth District, Osamu Takatori was, up until this election, the top seed. The voters dropped him down to second place. Takatori, like Kozo Watanabe, had betrayed Tanaka for Takeshita.

On February 28, Prime Minister Kaifu formed his Second Cabinet. He tried, under the slogan of "The Right Man for the Right Post," to rid himself of anyone implicated in scandal. Shintaro Abe and Michio Watanabe (who succeeded Nakasone after this election) openly challenged Kaifu. The issue was clear, Kaifu was an interim Prime Minister only. Abe, Miyazawa and Watanabe were the chosen few. Kaifu's only job was to provide a decent interval for the smoke to clear from the Recruit Scandal, after which he would be out and things could get back to normal. Despite a 52-percent popularity rating in the poles (Tanaka held the record at 62 percent), Kaifu was no match for the factional bosses. Once again the Cabinet was formed along factional lines:

Takeshita six Cabinet positions and Secretary General of the LDP (Ichiro Ozawa)
four Cabinet positions and Chairman of Policy Affairs Research Council (Mutsuki Kato)
four Cabinet positions and Chairman of the Executive Council of the LDP
four Cabinet positions and Speaker of the Lower House
(Kaifu's Faction), two Cabinet positions

The Tanaka Memorial Hall

The idea for a Tanaka Memorial Hall was originated in 1983 by then-Mayor of Nishiyama, Isamu Ejiri. Tanaka liked the idea and even had blueprints drawn up by a Tokyo construction company. After Tanaka's stroke, plans for the building were put on hold temporarily. Then, on September 12, 1988, Ejiri announced to the town assembly that he had come to an agreement with the Tanaka family on construction of the Memorial Hall. Tanaka would put up 4 billion yen ($35.6 million) for the Memorial Hall itself and the city would kick in 1.5 billion yen ($13.3 million) to build the parking lot, a small park and community facilities. Ejiri figured that Nishiyama could pull the money out of the special subsidy they got for the Kashiwazaki-Kariwa Nuclear Power Plant. The best part of the city's proposal was that the Tanaka's Memorial Hall would be built on the site of his alma mater, Futada Primary School. The lot had been vacant since 1979 when schools were rezoned. This was to have been one of Ejiri's last acts as Mayor. He retired, after twenty-four years, having lived up to his local nick names. Some called him the "mini-Kakuei," while others referred to him as the "Emperor of Nishiyama." As the Mayor he consistently delivered 80 percent of the local votes to Tanaka. He was replaced by Tadao Komano, but stayed active in this project.

In the spring of 1989, Makiko informed the city that she wanted to establish a foundation in connection with the Memorial Hall. The Tanaka family would endow the foundation with objects of Japanese and foreign art as well as with other historical Tanaka mementos. The city would be entrusted with the care of the property and management of the foundation. The city had no problem with the idea, though some thought that the whole thing was a scheme to avoid inheritance tax after Tanaka's death.

In 1990, momentum toward the building of the Memorial Hall slowed down. The Tanaka family found themselves in an executive power struggle for control of Echigo Kotsu, Naoki Tanaka lost in the 1990 election and the former Mayor, Isamu Ejiri, fell ill. Despite the fact that the city had already purchased land to build a road that would connect the would-be Memorial Hall to the nearby highway, the project unexpectedly collapsed when Mayor Komano could no longer conceal the fact that he had been misappropriating public funds and on Tuesday, July 10, 1990, turned himself in to the police.

By the time that Komano finished his confession, the city of Nishiyama had discovered that they were short 1.5 billion yen ($13.3 million). The money had been loaned secretly over a period of thirteen years to local construction companies who had failed to pay the city back. Kamano told police, "I could not decline Ejiri's request for financing from public funds for the construction company."[53] Ejiri responded by telling reporters that he knew the payments were illegal but he thought the money would be paid back. The president of Shinada Construction Company, Yoshitane Shinada, triggered Komano's downfall on that fateful Tuesday morning when he defaulted on his loan. Shinada had lost the money on bad construction projects, race horses and gambling activities in South Korea. Fifty-six days after Komano's confession, he, ex-mayor Ejiri, both their city accountants, Shinada and another construction company president were arrested by the Niigata Prefectural Police. The man elected as the new mayor of Nishiyama was a sixty-six-year-old Buddhist monk by the name of Giichi Totsugu. Totsugu and his administration were far outside the old Tanaka machine and a Tanaka Memorial Hall was put on hold until at least 1995. The expensive legal battles had only begun. Totsugu and the city said that Ejiri, Komano and their cronies owed the banks the money. The banks maintained that the city of Nishiyama owed them the money. In time, the two groups settled with the town owing 70 percent of the debt and the banks agreeing to pay 30 percent. As for Ejiri and three others, the Niigata District Court sentenced them to four and a half years in prison with no stay of execution. Ejiri should be out just in time to see the Tanaka Memorial Hall under construction.

Mutiny at Echigo Kotsu

Kakuei Tanaka had been the CEO of Echigo Kotsu since he founded it in 1960. He owned 40 percent of the profitable company stock. Jinmatsu Kataoka was the company's President and President of the now defunct Niigata chapter of Etsuzankai. His Vice President was Yasuhiko Kazamatsuri, Tanaka's brother-in-law. Kazamatsuri was also still the Acting President of Tanaka's 100-percent-owned gravel company, Chotetsu Kogyo (see Seijin-Echigo Kotsu-Political Fortress). Since Tanaka's stroke, Makiko and Naoki had taken an active role in Echigo Kotsu's affairs. Both were members of its Board of Directors.

On June 2, 1990, Makiko and Naoki blindsided Kataoka by demanding that he withdraw as President and that Kazamatsuri be promoted into that position. Their rational was that the company needed to improve its management by reshuffling its executives. In truth, Makiko had been systematically removing all of Tanaka's political lieutenants from their family's life. She had not however, informed Kazamatsuri of her plan. Yasuhiko was as surprised as Kataoka by Makiko's sudden power play. Sachiko Kazamatsuri, Tanaka's youngest sister, was also in the dark about the sudden move to make her husband President of Echigo Kotsu. Sachiko, in close contact with the family, had been house-sitting Tanaka's Nishiyama residence for years, keeping the place ready for his infrequent retreats home.

Kazamatsuri respected Kataoka and wanted nothing to do with Makiko's high-handed plot against him. Neither man believed that Makiko was representing Kakuei. To save his position, Kataoka had to move quickly and he had to have Kazamatsuri's help. Fifteen percent of Tanaka's Echigo Kotsu stock was held under the family name; 25.2 percent of the Tanaka's total of 40 percent was held under the corporate name of Chotetsu Kogyo. Kazamatsuri, in defiance of his in-laws, did a very un-Japanese thing he turned over Chotetsu's Echigo Kotsu stock to Echigo by giving the Kataoka camp power of attorney. Kataoka went right to work selling Tanaka's stock in Echigo Kotsu. As the major shareholders of Chotetsu, the Tanaka's were immediately informed. That same day they forced Kazamatsuri to resign; legally registering their action on the next day, June 6. An emergency Board meeting of Chotetsu was called. The Board defied Makiko and renominated Kazamatsuri as President. Makiko again fired Kazamatsuri and re-registered the firing as a legal action.

On June 9, the Board of Directors of Echigo Kotsu met and flatly refused to change the existing corporate structure. Makiko responded, "It is my father's will to change the managerial principles of this company. Kataoka did a lot as Niigata's Chairman of Etsuzankai, but the management of an enterprise should be distinguished from politics. Kataoka is running a one-man business in this company. We were beaten at the Board of Directors as a result of a vote forced by Kataoka, but we are going to take a countermeasure at the general meeting of stockholders."[54] Makiko and camp then proceeded to send a letter to each stockholder stating, "It is a breach of trust that Chotetsu sold its Echigo Kotsu stock."[55] Kataoka fired back with letters of his own, claiming that, "Makiko, without justification, is trying to claim Echigo Kotsu for herself and is abusing the name of Kakuei Tanaka."[56]

The general meeting of stock holders was held on June 28. By that time, Kataoka had sold 1.99 of the 2.55 million shares of Chotetsu's stock in Echigo Kotsu to four Nagaoka firms. Naoki and Makiko had lost big and had little choice but to refrain from exercising what vote they had left. Kataoka had learned his craft from the best, Kakuei Tanaka himself. Makiko was still new to the politics of power. On September 19, Makiko and Naoki foolishly filed a lawsuit in Niigata District Court to get the Chotetsu stock back. On September 25, Kataoka canceled the registration of Kakuei, Makiko and Naoki as Corporate Directors, in effect expelling them from Echigo Kotsu. Makiko and Naoki filed another lawsuit. The whole issue came to a head at the 1991 general meeting of stockholders. Kataoka and Kazamatsuri intended to finish this whole squabble. They put before the stockholders a proposal to sever the Tanaka's with a retirement allowance. Even Hana Tanaka showed up for this vote. The atmosphere was heated with charges and counter-charges. At one point, Makiko, red-faced, yelled out, "I have not resigned my post as Director."[57] In the end, 3.5 million shares cast their votes in Makiko's defense, but 5.8 million shares went the other way.

The Tanaka's were out. The once mighty political fortress of Echigo Kotsu now belonged to others. At a press conference held after the meeting, Naoki said, "Echigo Kotsu without my father-in-law cannot be imagined! It is a serious situation. We reject this retirement allowance."[58] Kataoka, at this same press gathering, said, "To Mr. Tanaka, I apologize for this internal strife. But Echigo Kotsu is a public service enterprise with more than 1,000 employees, so it cannot be permitted for individuals (Makiko) to do anything they like."[59] As for Yasuhiko Kazamatsuri, he was on the winning side of this dispute, but his wife lost. Sachiko, herself estranged from her brother's family, moved out of Tanaka's Nishiyama home and back to Nagaoka. Said Yasuhiko, "It's no wonder why my wife is coming home. The Tanaka family is the Tanaka family and the Kazamatsuri family is the Kazamatsuri family."[60]

True to their word, Makiko and Naoki did not give up. They fought Kataoka for two more years. Finally, on May 16, 1992, Kataoka resigned in the hope of ending the dispute. On June 26, 1992, an ailing Kakuei Tanaka and his wife Hana attended the meeting of stockholders. That meeting soon became a free-for-all and had to be canceled. Another meeting was scheduled for July 28. At this meeting it was announced a reconciliation had been worked out. Yasuhiko Kazamatsuri would be the company President, but Kakuei Tanaka was the Chairman of the Board, with Makiko as Vice President and Naoki as company counselor.
As a postscript to Echigo Kotsu, there was the matter of litigation involving Toyano Lagoon. Tanaka's front organization, Urahama-Kaihatsu, had filed a suit in 1981 asking the court to confirm its ownership of 8.7 hectares (21 acres) of the lagoon. Tanaka felt that he owned 83 hectares (205 acres). In 1989, the court finally ruled that Urahama-Kaihatsu only owned 74.3 hectares (184 acres) and returned the 8.7 hectares to the 125 original owners. Urahama-Kaihatsu appealed, but later, in late 1990, withdrew that appeal. Even though Tanaka lost a part of his lagoon in this case, another suit filed against his front company, Muromachi Sangyo, disputing their ownership of the Shinano Riverbed, ended in Tanaka's favor. The Niigata District Court ruled in 1988 that the plaintiffs had failed to prove that Tanaka had used his political influence, hence the original land sale contracts were valid. Tanaka did not testify in either case. Most of the ownership of the southern half of the Shinano Riverbed was later transfered from Muromachi Sangyo to another Tanaka affiliate, Senshugahara Kogyo. Echigo Kotsu is now housed in the Senshugahara Kogyo building which sits within the southern half of the Shinano Riverbed. The northern part of the riverbed has become a well developed art and culture area for the city of Nagaoka.

[ Chapter 5: KITEN is continued. The next section is 'Getting Rid of Kaifu'. ]


© Steven Hunziker.