Competitive Collaboration in Haute Finance: Japan and the West in the interwar period
Organizer/Chair: Katalin Ferber, Waseda University, SILS
The
1920s, as new historical research shows, not only redefined the meaning
of international, but also encouraged various forms of cooperation
between sovereign states, central banks and private financiers. This
panel offers to provide an exciting and new perspective on Japanese and
Western financial powers, England and the USA, attempted to secure
financial and monetary hegemony in both Europe and in East Asia. As a
‘transitional stage’ of international competition and cooperation, this
period offers a peculiar example to both financial and economic
historians to re-examine the origin of currency colonialism and money
diplomacy. Historians until recently viewed this period both as the
cause of the Second World War and, therefore as an obvious failure of
international efforts to create economic and financial cooperation
among sovereign states. Contrary to this, our panel participants
instead argue that much of the failure of cooperation was in fact, the
result of changing international competition for financial resources.
Thus financial hegemony is considered as a part-and-parcel of
territorial domination in Michael Schiltz’s presentation on the
currency history of the Japanese empire. Simon James Bytheway will shed
light on the changing circumstances of Japanese financial dependency
and discuss various efforts to adjust to the changing financial balance
between the USA and England. Dong Zhaohua analyses how a private money
doctor, Thomas Lamont tried in private garb to synchronize and organize
the American high financial circles’ interests with that of his own
private bank’s neutral lending activities to the Japanese government.
Janis Mimura examines the new evolutionary state of Manchuria, with its
revolutionary institutional setting, offers a new interpretation of the
reformist (technocratic) bureaucrats and their utopian vision on the
modern Japanese empire.
1) Simon James Bytheway, Nihon University
From Lombard Street to Wall Street: financial and monetary cooperation between the USA and Japan
“The United States is too much interested in the development of her own resources to take a really keen permanent interest in international finance” (Paul Einzig, The Fight for Financial Supremacy, London, Macmillan, 1931, p.81).
The transfer of financial power from London to New
York, however incremental or piecemal the process may have been, forced
Japan’s financial and monetary authorities to consider new ‘ways and
means’ of securing their country’s interests. After enjoying an
unprecedented boom during the war, and immediate post-war years; new
global financial realities impelled Japan’s financial leaders to
re-centre their offshore activities from Europe the United States of
America during the 1920s. My presentation aims to clarify the nature of
the Japanese reaction to the changing post-war circumstances, and, in
doing so, explore avenues of cooperation and joint participation in
financial and monetary matters, as they occurred between the Japanese
and American authorities. In particular, the intimate, at times clumsy,
relationship that developed between the leadership of the Bank of Japan
and the Federal Reserve Bank of New York will be explored. All this, of
course against the backdrop of Japanese government lending, as it
relates to the refinancing its earlier war-debts, and maintenance of
its gold reserves; municipal lending, as it relates to the earthquake
reconstruction loans of Yokohama and Tokyo; and company lending as it
relates to electrification (electric power generation) and
railway-building programs. Finally, the success and failure of
financial and monetary cooperation will be addressed and considered.,
particularly in the light of Japan’s growing aggression against China
from 1931, and the coming war between the USA and Japan from 1941.
2) Dong, Zhaohua, Waseda University/Beijing University/ GSPAS
Restoration or Stabilization? Japan and her return to the Gold Standard
As Tsushima Juichi, Japan’s overseas commissioner stressed, “lifting the gold embargo was different from the Western term, which was restoration of the Gold Standard or currency-stabilization” which certainly had a different policy-implication. As this term difference symbolized, for Japan the re-turn to the Gold Standard in the twenties clearly demonstrated the conflict between national and international interests. Stabilization in the twenties thus had quite a different meaning from the late nineteenth century’s one. In my presentation, I elaborate several, often conflicting domestic views on the policy of restoration or the policy of stabilization of the Japanese, gold based currency.
I focus one of the most famous and influential American private banking representative, Thomas Lamont and his activity with Japanese financial bureaucrats, politicians and private business circles. The question I ask how national economic and financial interests were perceived by Japanese financial politicians, and how international changes influenced domestic decisions, including lifting he gold embargo. Both Lamont and Leffingwell, the private bankers of Morgan and Company put together a rather peculiar list of requirements for Japanese financial leaders in order to be a ‘normal country’ I also analyze the tension between the private American bankers’ suggestions and its broader international consequences. Japan. Because of the restoration of the Gold Standard rapidly lost of financial and monetary stability. The price of restoration was immense.
3) Katalin Ferber, Waseda University Discussant: Kobayashi Hideo, Waseda University, Graduate School of Asian and Pacific Studies (GSAPS)